MUMBAI | NEW DELHI: Supreme Court Tuesday set aside a March 2022 judgment of Bombay HC that had directed BMC to transfer the title of five acres of Century Cotton Textile Mill land at a prime location in Worli to the Aditya Birla Group-controlled Century Textiles and Industries Ltd. The SC order paved the way for BMC to take possession of the land which was given from 1927 for 28 years at a yearly rent of Re 1 though no step was taken to take it back after the lease expired.
The land was allotted for construction of 476 dwelling units and 10 shops for the poor. SC noted the lease was intended under the Bombay Improvement Trust Transfer Act of 1925 for welfare and accommodation of the “poorer classes”. It said the company had in 2009 submitted plans to alter the plot use for commercial purposes while the lease deed intended the property to serve as an “instrument of social betterment by housing those who are economically vulnerable.”
“By seeking to redirect the property towards commercial exploitation”, the company “threatens to erode the very foundation upon which the original agreement stood,” said the SC bench of Justices Vikram Nath and Prasanna B Varale in their judgment. SC had maintained status quo since April 2022 and no conveyance was effected.
The company had in 2007 issued legal notice requiring BMC to execute the conveyance deed to get title and ownership of land in its favour.
Setting aside a 2022 Bombay HC judgment, the Supreme Court held that neither the statutory framework nor terms of the lease deed imposed any obligation on BMC to convey five acres of Century Cotton Textile Mill land to the Aditya Birla Group-controlled Century Textiles and Industries Ltd. The conveyance would make the company the absolute owner of the plot and formalise vesting of the premises in the company’s name.
The company had in 2007 issued notice requiring BMC to execute the conveyance deed. It also approached HC, which allowed its plea in March 2022 and directed BMC to execute the conveyance in eight weeks. The company had claimed the lease conferred a right to conveyance in their favour. The BMC had gone in appeal against the HC decision.
The SC said both the law and lease intended the land “remain dedicated to providing adequate housing to those otherwise struggling to find decent living conditions in a rapidly expanding metropolis. To ignore or circumvent these conditions would nullify the intended social function of the property and transform a carefully crafted scheme of public welfare into a mere instrument of private profit.”
“Such a departure from the intended purpose is not only a breach of the lease conditions but also a subversion of the policy that animated the entire statutory regime. The legislation and the contract work in tandem to ensure that urban improvement aligns with the welfare of weaker segments. When land allocated under a special scheme, particularly one centred on “poorer classes” accommodation, is sought to be commercially exploited, it represents a direct affront to the spirit of the enactment. Rather than addressing housing inadequacies and improving urban life for those in need, the resource would be diverted to profit-making ventures that do nothing to alleviate the conditions of the underserved,” the bench said.
The bench said the company’s conduct amounts to abuse of beneficial legislation such as the Bombay Improvement Trust Transfer Act.
The SC said in essence, the entire arrangement is anchored on a quid pro quo: the property is leased on special terms, with minimal rent and under carefully prescribed conditions, to ensure the less-privileged receive tangible benefits. “When the lessee attempts to convert this arrangement into a vehicle for commercial gain, it repudiates the fundamental bargain. The public trust reposed in the private entity to serve a greater good is thus betrayed. This not only harms the class of beneficiaries whom the legislation and agreement were designed to protect, but also imperils the broader public interest by allowing beneficial legislative frameworks to be distorted and exploited contrary to their genuine purpose,” it said.
