Bombay High Court: Pressing on the distress caused to residents due to developers, the Division Bench of G.S. Patel and Neela Gokhale, JJ. refused to hear Nishcon Realty and also cancelled the NOC to its cohorts, while directing Maharashtra Housing and Area Development Authority (‘MHADA') to proceed for appointment of another developer.
In the Order dated 7-08-2023, the Court directed Nishcon Realty along with its cohorts to bring 50% of amount of the arrears that was due as transit rent and had rejected the then application for Rs 1 crore by 11-08-2023 and the rest later. However, nothing was deposited by them. In addition, the Court had restricted the proceedings initiated by MHADA under Section 91(A) and clarified that the same was a temporary order till 11-08-2023 only for testing bona fides of Nishcon Realty.
Since there was no deposit, the Court reprimanded Nishcon Realty for ‘persistently defaulting developers who are in debt to the tenants in vast amounts' and refused to hear any submissions on their behalf.
The Court highlighted the developers' failure to abide by their commitments under the NOC. It further cancelled the NOC to Nishcon Realty's cohorts, Parekh Consultancy and an eponymous LLP and directed MHADA to issue a formal letter of cancellation in this regard and also restricted MHADA from giving a chance of hearing to those entities.
The Court ordered all these entities to entirely remove themselves from the site by 14-08-2023, including all the personnel, security guards, equipment, machinery, etc. and instructed MHADA to ensure the said directions were complied with. It further kept it open for MHADA to proceed as per law for appointment of another developer.
The Court required the amount recoverable by all the petitioners to be certified by MHADA, whether in proceedings ongoing before MHADA or any fresh proceedings that might be required to be instituted. The Court again cited the failure to deposit amount acknowledged by the entities and allowed the finally certified amount due by MHADA to be executable, as specified by MHADA only. The Court strictly required the entities to pay the same amount within 30 days of such order issued by MHADA, after expiry of which, the amount would carry further interest @6% per annum until payment or realization.
The Court agitatedly expressed that “We simply fail to see how residents of this city, many of them senior citizens, can be treated like this and then be expected to spend all their time, energy and money pursuing litigations to recover what is legitimately theirs and what was promised to them. For too long now they have been put to untold suffering, prejudice and hardship. We do not accept that developers have a right to default. Equally, we do not accept that developers can simply be allowed to escape the consequences of their defaults and to abandon projects like this with no obligations or liabilities. It is about time that a message went out to every developer that if a developer takes on a development project in the city, the developer assumes a significant responsibility and the financial element or aspect of it is not one that will be overlooked or ignored. It is one that this Court will ensure is entirely fulfilled.”
The Court noted that the older buildings were brought down in 2016-17, and that there was nothing on the old Parvati building site. Further, the benefit which the residents were entitled to through the said project had been abandoned for 7 years.
[Sushila Gordhandas Parikh v. State of Maharashtra, Writ Petition (L) No. 20423 of 2023, Order dated 11-08-2023]
Advocates who appeared in this case :
For Petitioners: Advocate Mayur Khandeparkar, Advocate Rishika Harish, Advocate Prashant S Goyal, Advocate Aniruddha A Sapre, Advocate Manish Gala, Advocate Nilesh Gala, Advocate Ankit Shah
For Applicants: Advocate Mangesh Sawant, Advocate Arun Panickar
For Respondents: Advocate Akshay Shinde, Senior Advocate Ashish Kamat, Advocate Aseem Naphade, Advocate Chirag Sarawagi, Advocate Riya Thakkar, Advocate Tushar Goradia, Advocate Santosh Pathak, Advocate Purva Naik, Advocate Nilesh Modi, Advocate Kshitij Kadam, Advocate Karl Tamboly, Advocate Akshay Doctor, Advocate Deepesh Yadav, Advocate Sairuchita Chowdhary, Advocate Manisha Jagtap, Assistant Government Pleader SB Gore, Advocate Shyam Kapadia, Advocate Prachi Joshi, Advocate Shushank Chavan, Advocate Priya Pakhare, Advocate M Chopra
