Have issued notices to HDIL for termination of 24 slum rehabilitation contracts, SRA tells Bombay HC

The slum rehabilitation authority (SRA) on Tuesday informed the Bombay high court (HC) that it has issued show-cause notices to Housing Development and Infrastructure

The slum rehabilitation authority (SRA) on Tuesday informed the Bombay high court (HC) that it has issued show-cause notices to Housing Development and Infrastructure Limited (HDIL) for termination of contracts of 24 redevelopment projects in the city.

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Advocate general Ashutosh Kumbhakoni, who represented SRA, informed the bench of justice SC Dharmadhikari and justice Riaz Chagla that the realty group, whose promoters are facing criminal charges in the Punjab and Maharashtra Cooperative (PMC) Bank fraud case, has not completed the project beyond 1 or 2%. He added that HDIL was not in a position to complete the slum rehabilitation projects and therefore SRA issued show-cause notices for contract termination. SRA will terminate the contracts awarded to HDIL, if the realty firm fails to justify the delay in the implementation of the slum redevelopment schemes.

He was responding to a petition filed by 32 residents of Bharat Nagar in Bandra (East), where a major slum rehabilitation project had been undertaken by HDIL. The petitioners said they were declared eligible for rehabilitation under the scheme and had vacated their respective structures between 2006 and 2008. Though initially HDIL would pay them the transit rent, the real estate firm later stopped paying the amount to the petitioners. The residents further contended that the SRA officials did not take any action HDIL despite repeated complaints, reminders and representations since April 2018.

The slum dwellers have primarily sought directions from the court for the expeditious completion of the project and allotment of permanent accommodation to them. As an interim measure, the petitioners have sought a direction to SRA to either provide the residents with alternative accommodation till the competition of the project or pay them the transit rent of ₹17,500 per month, with a 10℅ increase in the amount annually.

During the course of the hearing on the petition, the court was also informed that the proceedings under the Insolvency and Bankruptcy Code had been initiated against HDIL and an Insolvency Resolution Professional has been appointed by the National Company Law Tribunal.

The bench expressed doubts over the proceedings with regards to the slum rehabilitation projects, primarily in view of the fact that the land on which the projects are being implemented are public properties. The bench said the developer gets the right to exploit the property commercially only after completing the construction of rehabilitation tenements.

Kumbhakoni agreed with the observation, stating that for at least now, the property cannot be said to be an asset of the developer.

The court has now posted the petition for further hearing on February 11.