MUMBAI: The Bombay High Court on Thursday observed that Mhada made an “utterly fantastic’’ demand of 24% interest on ‘arrears’ of ground rent on a land in Oshiwara as a condition for conveyance and also sought ground rent in advance till 2026.
The HC remarked, “We understand Mhada’s anxiety to eliminate all possible uncertainties especially at the time of such serious climate change because nobody knows whether by 2026 this city as we now know will even exist or whether Mhada’s jurisdiction will have been literally eroded.’’Justices Gautam Patel and Kamal Khata on the bench, added, “But that cannot justify a demand of this kind.’’
Mhada counsel P G Lad then on instructions from its officials, withdrew the demand, but sought liberty to issue a fresh one, this time strictly following the law.
A resolution of Aug 26 2021 claimed ground rent in advance from 2021 to 2026 and GST apparently in “arrears” from 2021 to 2026.
The society comprises members who are owners of shops on the premises in Jogeshwari (West). The amount it sought was over Rs 18 crore, said the flabbergasted society — Oshiwara Link Plaza Commercial Premises Cooperative Society Ltd,. It had moved the HC to challenge the demand which Mhada had made as a precondition to convey the commercial building in favour of society.
The Society through senior counsel Anil Singh sought directions to Mhada to execute a lease agreement of the land in its favour and also a conveyance deed for the buildings on it.
The high court directed Mhada to execute conveyance of building and lease of land within three weeks to the Society.
The HC said liberty sought to come up with a fresh legally valid demand was “reasonable’’ but added, “we trust that his officers will keep these observations in mind’’
The HC was concerned at the notice which last year claimed alleged premium and ground rent going back in time to June 6, 1996. with no details of ground rent paid and how the premium could be calculated retrospectively in time.
“The interest component itself to the society is nearly Rs. 12.5 crore. We take it that if Mhada believes that it is entitled to charge interest at 24% per annum, then it must also be willing to pay interest at 24% pa and we would be very interested to know if it will accept deposits at this rate of interest,’’ said the HC in its order.
The HC said Anil Singh fairly said that execution of lease of conveyance deed will not be used against Mhada should there be a revised demand. The HC said any revised demand cannot be delayed inordinately and should be made in ten weeks and once made cannot use it not to execute the lease deed.
