Bombay High Court: A petition was filed by Cosmos Constructions (petitioner) seeking to quash a condition styled as Condition 1 as a reservation for a contentious MHADA housing site imposed by the Thane Municipal Corporation relating to a building development permission on a tract of land that belongs to the Petitioner. A division bench of G S Patel and Kamal Khata, JJ., quashed and sets aside the condition imposed and directed the Petitioner to submit building proposal after considering the land use as MHADA Housing Site ‘A’ in respect of plots of land.
D Dahyabhai & Co purchased 16 annas of an undivided share in a tract of land known as Manpada Estates at Chitalsar, Manpada, Thane. The total land in question was 433-acres and the purchased land was known as surplus vacant land. On 6-02-1987 by a special allotment order, the State of Maharashtra allotted 88,971 sq mts out of the total surplus land to Maharashtra Housing and Area Development Authority (“MHADA”) and the possession was handed over to MHADA. After series of litigation, of the total land, 40% was retention land in the hands of D Dahyabhai & Co. and the remaining 60% was in MHADA’s possession. This is the background with which D Dahyabhai & Co entered into a development agreement on 28-05-2005 with the present petitioner, Cosmos Constructions, a partnership firm.
Cosmos took development rights and submitted a building proposal for an area and TMC granted development permission for two buildings. Meanwhile, Cosmos submitted proposals for certain additional areas not covered earlier known as contentious area in the present case. The proposals covered an area that was supposedly earmarked as reserved for “MHADA Housing Site-A” but the land was in possession of D Dahyabhai & Co. This proposal was rejected by TMC and Cosmos preferred an appeal under Section 47 challenging this rejection. A writ petition was filed challenging the rejection of its appeal and the original rejection of the development proposal. It also sought a declaration that the land reservation for the MHADA housing site did not survive because the land had been formally re-allotted to D Dahyabhai & Co without any objection from MHADA which stands disposed noting that based on previous litigations, there could not be any further impediment to considering its proposals for the development of the balance plot that was in its possession. D Dahyabhai & Co and Cosmos assailed this order before the Supreme Court but was rejected.
A development proposal for a “Cosmos Lounge” was sanctioned, the modalities of which required various NOC’s from MHADA to be passed time and again among other conditions. As the conditions were met time and again, TMC once again objected to the building proposal, now claiming that it required an NOC from the Forest Department, an NOC from the Urban Land Ceiling Department, a consent letter from flat holders as per the Unified Development Control and Promotion Regulations (“UDCPR”) and saying that certain lands were in use by MHADA. There was partial compliance by the petitioner for the requirements except for the consideration of the land being “in use by MHADA”. This forms Condition No. 1 which is assailed in the present Writ Petition.
Counsel for petitioner submitted that the initial site was enormous, 433 acres or more and what has been left to the Petitioner is a fraction, although it is substantial, of 35,610 sq mts. A very large amount has gone to MHADA. Nobody has complained about that possession being given to MHADA. If the attempt now is to reduce even further the Petitioner’s land, then it must be clearly shown that there is an existing and ongoing reservation. This cannot be done by some convoluted process of implication or conjecture, but it must be shown as such, i.e., as a continuing reservation on a finally sanctioned Development Plan or on the modification that has been sanctioned under the MRTP Act. If this is not done, the principles of Wednesbury unreasonableness and the doctrine of proportionality will necessarily apply.
The Court noted that in Associated Provincial Picture Houses Ltd. v. Wednesbury Corporation, [1948] 1 KB 223, Lord Greene said:
“… It is true that discretion must be exercised reasonably. Now what does that mean? Lawyers familiar with the phraseology used in relation to exercise of statutory discretions often use the word ‘unreasonable’ in a rather comprehensive sense. It has frequently been used and is frequently used as a general description of the things that must not be done. For instance, a person entrusted with a discretion must, so to speak, direct himself properly in law. He must call his own attention to the matters which he is bound to consider. He must exclude from his consideration matters which are irrelevant to what he has to consider. If he does not obey those rules, he may truly be said, and often is said, to be acting ‘unreasonably’. Similarly, there may be something so absurd that no sensible person could even dream that it lay within the powers of the authority. … In another, it is taking into consideration extraneous matters.
“it must be proved to be unreasonable in the sense that the court considers it a decision that no reasonable body can. It is not what the court considers unreasonable.”
Placing reliance on Council of Civil Service Unions v. Minister for the Civil Service, [1984] 3 WLR 1174, (CCSU) wherein the Court held “It applies to a decision which is so outrageous in its defiance of logic or accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it.”
Placing further reliance on All India Railway Recruitment Board v. K Shyam Kumar, (2010) 6 SCC 614, wherein the Court observed that
“To arrive at a decision on “reasonableness” the Court has to find out if the administrator has left out relevant factors or taken into account irrelevant factors. The decision of the administrator must have been within the four corners of the law, and not one which no sensible person could have reasonably arrived at, having regard to the above principles, and must have been a bona fide one.”
In All India Railway Recruitment Board (supra), the Supreme Court noted
“Wednesbury principle applies to a decision which is so reprehensible in its defiance of logic or of accepted moral or ethical standards that no sensible person who had applied his mind to the issue to be decided could have arrived at it. Proportionality as a legal test is capable of being more precise and fastidious than a reasonableness test as well as requiring a more intrusive review of a decision made by a public authority which requires the courts to “assess the balance or equation” struck by the decisionmaker. Proportionality test in some jurisdictions is also described as the “least injurious means” or “minimal impairment” test to safeguard the fundamental rights of citizens and to ensure a fair balance between individual rights and public interest. Suffice it to say that there has been an overlapping of all these tests in its content and structure, it is difficult to compartmentalise or lay down a straitjacket formula and to say that Wednesbury has met with its death knell is too tall a statement.”
“Proportionality requires the court to judge whether action taken was really needed as well as whether it was within the range of courses of action which could reasonably be followed. Proportionality is more concerned with the aims and intention of the decision-maker and whether the decision-maker has achieved more or less the correct balance or equilibrium. The court entrusted with the task of judicial review has to examine whether decision taken by the authority is proportionate i.e. well balanced and harmonious, to this extent the court may indulge in a merit review and if the court finds that the decision is proportionate, it seldom interferes with the decision taken and if it finds that the decision is disproportionate i.e. if the court feels that it is not well balanced or harmonious and does not stand to reason it may tend to interfere.”
“Proportionality works on the assumption that administrative action ought not to go beyond what is necessary to achieve its desired results (in everyday terms, that you should not use a sledgehammer to crack a nut) and in contrast to irrationality is often understood to bring the courts much closer to reviewing the merits of a decision.”
Thus, the Court held that the two doctrines are not antithetical, both may be applied and invoked separately and both together in the facts of this case. The petitioner has made out a sufficient case for grant of relief and therefore, the Court directed the respondent to forthwith approve the revised Building Proposal submitted by the Petitioner vide Development Proposal in respect of land situated at Village Chitalsar, Manpada, Thane without insisting for submission of Development Proposal after considering land use as MHADA Housing Site ‘A’ as mentioned in condition no 1 of impugned communication/letter dated 12-07-2022.
[Cosmos Constructions v Municipal Corporation of the City of Thane, 2023 SCC OnLine Bom 1858, decided on 31-08-2023]
Advocates who appeared in this case :
Ms Druti Datar, i/b Rajesh Datar, Advocates for petitioner
Mr Ajit Ram Pitale, with Ameya Abhay Pitale and Siddharth Pitale, Advocates for respondent
