HC orders developer to pay transit rent regardless of financial condition

Mumbai court directs developer to pay transit rent to evicted slum dwellers despite financial constraints, criticizes inaction of authorities.

MUMBAI: The Bombay high court on Wednesday directed a developer company to pay transit rent to evicted slum dwellers in the city, regardless of its financial situation. The directive came on a petition filed by some of the slum dwellers.

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Transit rent, also called as rehabilitation allowance, is paid by the developer to the owner/occupant, who suffers hardship due to dispossession by the developer.

In 2013, the petitioners were evicted from their homes to facilitate a slum redevelopment scheme. According to the Letter of Intent (LOI) issued to the developer (respondent no. 3), it was their responsibility to pay the petitioners’ monthly transit accommodation rent. However, the developer stopped these payments around 2015-2016, citing financial constraints. Despite disputing the exact timeline, the developer did not deny owing arrears.

In their ruling, justice MS Sonak and justice Kamal Khata underscored the developer’s obligation to continue paying transit rent until permanent alternate accommodation is provided. “The petitioners cannot be made to run from pillar to post to recover their dues after having vacated their premises in 2013,” the court stated.

The court criticised the developer for pleading financial incapacity while refusing to relinquish the project. Similarly, the lender and government authorities were censured for their inaction. “From all this, we find that none of the respondents are serious about solving the Petitioners’ most genuine problem,” the judges noted.

The court ordered the developer to deposit all arrears of transit accommodation rent in court by July 24, 2024. Additionally, the Slum Rehabilitation Authority (SRA) and the state government were given two weeks to decide on pending proposals from the developer and the lender. An affidavit detailing these decisions must be filed by July 10, 2024.

In a strong admonition, the court warned, “If, for any reason, the developer wishes to avoid compliance, then we direct the managing director of the third respondent (developer) Company to personally remain present in this court and file an affidavit disclosing all the assets of the third respondent company.”

The matter is scheduled for further hearing on July 31, 2024.