HC strikes down SRA’s acquisition of NESCO land for slum rehab

HC observed that SRA had taken over the land in 2016 without giving NESCO a chance to propose a redevelopment scheme

MUMBAI: The Bombay high court on Tuesday set aside the acquisition of land owned by NESCO Limited in Goregaon (East) for a slum rehabilitation project, holding that the state and Slum Rehabilitation Authority (SRA) had acted without following due process under the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971.

Mumbai, India - September 03, 2021: Bombay High Court at Fort, in Mumbai, India, on Friday, September 03, 2021. (Photo by Anshuman Poyrekar/Hindustan Times) (Anshuman Poyrekar/HT PHOTO)

The division bench of Justices G S Kulkarni and Aarti A Sathe ruled that the authorities had failed to recognise the “preferential right” of the landowner to undertake redevelopment of their own land, a right protected under Article 300A of the Constitution. Stating that the acquisition process was initiated without giving NESCO an opportunity to propose a redevelopment scheme, the court noted that the state and SRA had “discarded the legal rights of a private landlord” and had invoked the draconian powers of Section 14 of the Slum Act “mechanically and at the behest of unscrupulous elements”.

The case began in April 2016 when the SRA issued a notification to acquire two adjoining plots owned by NESCO at Ram Nagar, Goregaon (East), which had been occupied by slum dwellers. NESCO challenged the acquisition on the ground that the land was private property and that, under the law, it should have been granted the first opportunity to redevelop it. It contended that the show cause notices preceding the acquisition were never properly served, that hearings were denied, and also objected to the SRA’s meagre compensation of ₹12 lakh.

The judges strongly rebuked the SRA and state officials, citing Supreme Court observations that highlighted “bureaucratic misuse” and “collusion with private developers”. They observed that acquisition of private land under the Slum Act was being misapplied for private benefit.

“Such powers can never be exercised at the behest of unscrupulous elements and discarding the legal rights of private landlords,” the court warned, echoing concerns raised by higher courts over misuse of slum redevelopment laws in Mumbai.

Allowing NESCO’s petition, the Court quashed the 2016 acquisition notification, the 2017 award granting compensation, and subsequent notices issued by the authorities.