Mumbai: The Bombay High Court on Thursday quashed a penalty of Rs. 432 cr imposed by the Mumbai Metropolitan Region Development Authority (MMRDA) on Reliance Industries and Raghuleela Builders , terming it as "ex-facie unreasonable, unjustified, discriminatory, without jurisdiction and in violation of fundamental rights guaranteed under the Constitution of India."
The court set aside the 2014 MMRDA orders for the alleged delay in construction of a building called "One BKC" at Bandra Kurla Complex, Mumbai. The building was to be developed within four years as a commercial building with car park.
One BKC is a 1.5 million square feet (sq.ft) swanky office complex in BKC, and has tenants such as Facebook, Amazon, Bank of America, Cisco, among others.
A division bench of Justice Ranjit More and Justice Bharati Dangre allowed the writ petitions filed by Reliance and Raghuleela Builders challenging the said 2014 orders.
The firms had told the court that the RIL was allotted a 30,000-sq-mt plot in November 2007 for the construction of a building within a span of four years. However, it took more than three years to start the construction as several permissions are required from various authorities.
Later, in 2012, an additional land of 67,000 sq mts was allotted by the MMRDA for further construction. However, the MMRDA rejected after it was asked by the companies to extend the deadline from 2011.
A single-member committee comprising of retired Supreme Court judge was also constituted by the state body to examine the further extension of deadlines, after which it was recommended to extend all four-year deadlines by three more years. Following which, MMRDA extended deadlines of all projects that were allotted after August 26, 2015 by two years.
The division bench said that there was no justification for MMRDA’s cut-off date to extend the deadline, and the 2015 resolution appeared to be arbitrary, discriminatory and without any basis or justification.
“The said set of circumstances are prevailing for the construction being carried out under the leases executed prior to 26th August 2015. Therefore, not extending this benefit of this extension of time from 4 years to 6 years to the prior leases in respect of other plots in the BKC, is completely arbitrary, discriminatory, capricious and violative of Article 14 of the Constitution of India,” the order read.
“The MMRDA has sought to treat equals as unequal. The lessees of plots are being discriminated on the basis of their date of execution of their leases. The lessees who are placed in similar circumstances prevailing for construction in Bandra Kurla area are entitled to equal treatment guaranteed under Article 14 of the Constitution of India," it read.
The Court found sufficient merit in petitioners’ claims and thus the writ petition was allowed.
“The impugned demand of penalty in the form of premium and interest thereon is untenable, without jurisdiction and non-est. The same are thus quashed and set aside as void ab initio," it read.
Also Read: Investments to accelerate development and curb slowdown
