IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

SPECIAL LEAVE PETITION (CIVIL) NO. 33471 OF 2011

Esha Ekta Appartments CHS Ltd. and others … Petitioners

Versus

The Municipal Corporation of Mumbai and another … Respondents

With

SLP(C) No.33601 of 2011

SLP(C) No.33940 of 2011

SLP(C) No.35324 of 2011

SLP(C) No.35402 of 2011

O  R  D  E  R

1. Having failed to convince the trial Court and the High Court to entertain  

their  prayer  for  restraining  respondent  no.  1  –  Municipal  Corporation  of  

Mumbai  (for  short,  ‘the  Corporation’)  from  demolishing  the  buildings  

constructed on Plot  No. 9,  Scheme 58, Worli,  Mumbai,  the petitioners have  

filed these petitions under Article 136 of the Constitution.         

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2. The petitioners are the Cooperative House Building Societies (for short,  

‘the societies’) and their members, who are said to have purchased flats in the  

buildings constructed by the developers on the plot in question.  Their grievance  

is that even though the flats were purchased under a bona fide belief that the  

buildings have been constructed in accordance with law, the trial Court and the  

High Court did not injunct the Corporation from demolishing the same on the  

ground that the latter had taken action in furtherance of the orders passed in  

Writ  Petition Nos. 2040/1999, 2402/1999, 2403/1999, 2904/1999, 2949/1999  

and 1808/2000.  

3. The Corporation leased out the plot in question, of which the total area is  

17907.60 sq. meters to M/s.  Pure Drinks Pvt.  Ltd.  on 17.1.1962 for general  

industrial  use.  After  18  years  and  about  11  months,  the  State  Government  

issued order dated 1.12.1980 under Section 37(2) of the Maharashtra Regional  

and Town Planning Act, 1966 and sanctioned the change of use in respect of  

13049.45 sq.  meters  land from industrial  to  residential.   Between 1980 and  

1982, M/s. Pure Drinks transferred that portion of land to the developers for  

construction  of  residential  buildings.  The  building  plans  submitted  by  the  

developers for construction of 6 buildings comprising of basement, ground and  

5 upper floors were sanctioned by the competent authority on 8.6.1981. The  

amended  building  plans  submitted  by  the  developers  for  construction  of  9  

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buildings with ground and 5 upper floors were also sanctioned by the competent  

authority.   

4. In  1984,  the  developers  submitted  new  building  plans  proposing  

construction of two buildings on stilts with 24 and 16 upper floors respectively,  

additional 6th and 7th floors in building no. 2 and additional 6th floor on a portion  

of building no. 3. The new plans were rejected by the competent authority on  

6.9.1984. Notwithstanding this, the developers continued the construction and  

did not stop their activity despite the stop work notice dated 12.11.1984 issued  

by the Corporation.

5. After  the  purchasers  of  flats  formed  societies,  they  along  with  the  

societies  filed  writ  petitions  for  issue  of  a  direction  to  the  Corporation  to  

provide water connections. During the pendency of those petitions, the Division  

Bench of the High Court took cognizance of the fact that the buildings had been  

constructed  in  violation  of  the  sanctioned  plans  and  passed  order  dated  

11.10.2005 and directed the Additional  Commissioner  of  the Corporation to  

appear in person to explain the reason for not taking action against the illegal  

construction. That order reads as under:

“In all these writ petitions, arguments were heard on behalf of  the parties. None appeared for respondent no.4 in Writ Petition  No.2904-99, for respondent No.4 in Writ Petition No.2403-99,  for respondent Nos.4 and 5 in Writ  Petition No.2402-99,  for  respondent  nos.4  and  5  in  Writ  Petition  No.1808-2000.  Shri  

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N.V.  Patil,  Sub-Engineer  Building  and  Proposal  (City)  was  present in Court to assist the Advocate for the Corporation.

2.  In  the  course  of  the  argument,  it  was  revealed  by  the  Advocate  for  the  Corporation  on  taking  instructions  that  original licence for construction was granted in favour of four  persons  viz.  Shri  Manjit  Singh  Madanjit  Singh,  Power  of  Attorney Holder of S. Karanjit Singh, Chief Executive Officer  of  Pure  Drink  Pvt.  Ltd.,  Shri  Ishwarsingh  Chawla  of  PSD  Construction Pvt. Ltd.,  Shri D.K.Gupta of D.Y. Builders Pvt.  Ltd.  and  Abdula  Yusuf  Patel.  Pursuant  to  the  illegality  in  construction  having  been  found,  notices  were  issued  under  Section 53-1 of the M.R.T.P. Act on 20th February, 2002 to all  the  four  persons  mentioned  above.  Thereafter,  sanction  was  granted for prosecution of all the four persons and decision in  that  regard  was  taken  on  19th  May,  2003  by  the  Executive  Engineer  (Building  Proposal),  CT/1  of  the  Corporation.  Meanwhile,  the  panchanama  of  the  illegal  construction  was  carried out on 13th November, 2002. Besides, the prosecution  was launched against builder, developer and all the occupants  of the building and they were convicted on admission of guilt  and sentenced by way of imposition of fine from Rs.600/- to  Rs.2000/-  imposed  by  the  Magistrate.  Apart  from the  above  actions, no other action has been taken by the Corporation in  relation to the illegal construction. The affidavit-in-reply filed  on  behalf  of  the  Corporation  before  issuance  of  rule  in  the  petition by Shri Kurmi Deonath Sitaram, Executive Engineer,  DP(City)(I) discloses that initial approval was granted for six  wings consisting of ground plus five upper floors and it  was  issued on 9th June, 1981 and Commencement Certificate was  granted  on  10th  June,  1981.  The  amendment  plans  were  approved for nine wings of ground plus five upper floors on  2nd  February,  1983.  Thereafter,  amendment  plans  proposing  stilt  plus  twenty-four  floors and stilt  plus sixteen floors with  additional sixth and seventh floor to building nos.2 and 4 and  additional  sixth  floor  for  the  part  of  building  no.3  were  submitted but they were refused on 6th September, 1984. In spite  of  that,  the  constructive  activities  continued  and  the  work  beyond the approved  plans was carried out, and therefore Stop  Work notice was issued under Section 353-A of the MMC Act  on 12th November, 1984. However, the work continued. Again  

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new architect submitted further plan with a fresh notice under  Section 337. The same was rejected by the Corporation.

3. The affidavit also discloses the various illegalities committed  in  the  course  of  construction  of  the  buildings  which  include  construction of additional floors without approval, increase in  the height of the building and carrying of construction beyond  the permissible limits of FSI, apart from other illegalities. The  affidavit, however, does not disclose as to what action, if any,  for prohibiting the developer and the owner from proceeding  with  the construction,  was taken as wall  as  what  action was  taken after illegal construction having been carried out, apart  from launching prosecution and issuance of notices. Even in the  course  of  the  argument,  learned  Advocate  appearing  for  the  Corporation  could  not  satisfy  us  about  any  concrete  action  having been taken by the Corporation for stoppage of illegal  construction or demolition of illegal construction. In fact,  the  arguments in the matter were heard partly on 27th September  and again yesterday and as well as today. On the very first day  of the argument, it was orally informed by the learned Advocate  for the Corporation that he would ensure the presence of the  officer of the Corporation to assist him in order to enable him to  give correct detail information in the matter. In spite the officer  being  present,  we  are  not  able  to  get  the  detail  information  regarding the action taken by the Corporation as also the detail  description of the illegalities committed by the builder and any  other persons on his behalf in the matter. It is to be noted that  undisputedly the records disclose some illegalities in the matter  of construction carried out since the year 1984 onwards. In spite  of affidavit having been filed in the year 2000, the Corporation  has  not  explained  the  reason  for  failure  on  its  part  to  take  appropriate  action  against  the  illegal  construction  and  even  today.  Apart  from  being  assisted  by  the  officer  of  the  Corporation,  the  Advocate  appearing  for  the  Corporation  is  unable to disclose the reason for the same. We find it necessary  to  issue notice  to  the  Additional  Commissioner  to  appear  in  person before us on Friday i.e. 14th October, 2005 at 11.00 a.m.  to explain the same along with all records in the matter, as it is  informed  by  the  Advocate  for  the  Corporation  that  Commissioner is out of India.

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4.  The  Registrar  General  is  required  to  fax the  copy of  this  order to the Corporation apart from the fact that of the same is  being noted by the Advocate for the Corporation. At the request  of the learned Advocate for the Corporation, Registrar need not  send  copy  of  this  order  by  fax  as  learned  Advocate  for  the  Corporation undertakes to the Court that he through the officer  present  in  Court  will  assure  intimation  of  this  order  to  the  Additional  Commissioner  and  consequently,  his  presence  before the Court on 14th October, 2005 at 11.00 a.m.”

6. The Commissioner of the Corporation appeared before the High Court on  

14.10.2005  and  gave  an  assurance  that  necessary  steps  would  be  taken  in  

accordance with law within a period of two months in relation to the illegal  

constructions. Thereafter,  the Corporation issued notices dated 19.11.2005 to  

respondent  no.  2,  the societies  and their  members  under Section 351 of  the  

Mumbai Municipal Corporation Act, 1888 (for short, ‘the 1888 Act’) requiring  

them to show cause as to why the unauthorized constructions may not be pulled  

down and the buildings be brought in tune with the sanctioned plans. In the  

notices it was also stipulated that if the noticees fail to show sufficient cause,  

then the Corporation will pull down the illegal construction and also take action  

under Section 475A of the 1888 Act. The societies and their members sent reply  

dated 28.11.2005 through their advocate and pleaded that they were in no way  

responsible  for  the  unauthorized  constructions.  Deputy  Chief  Engineer,  

Building Proposals (City) did not accept the reply sent by the advocate of the  

societies and their members and passed orders dated 3.12.2005 and 8.12.2005  

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and directed the petitioners to remove the illegal constructions.  Thereupon, the  

petitioners filed Long Cause Suits for declaring notices dated 19.11.2005 and  

orders  dated  3/8.12.2005  to  be  illegal.   They  further  prayed  for  grant  of  

permanent  injunction  restraining  the  Corporation,  its  servants,  agents  and  

representatives  from  taking  any  action  demolishing  the  buildings.  The  

petitioners also filed notices of motion for grant of temporary injunction. On  

17.12.2005, the trial Court passed ad-interim orders and directed the parties to  

maintain status quo in respect of the suit structures.

7. In  the  detailed  written  statement  filed  on  behalf  of  the  Corporation,  

several objections were taken to the maintainability of the suits. On merits, it  

was pleaded that the buildings were constructed in violation of the sanctioned  

plans and the developers did not stop the construction activity despite stop work  

notice. It was further pleaded that action taken under Section 351 of the 1888  

Act was legal and justified because the buildings had been constructed in gross  

violation of the sanctioned plans. It was then averred that those who purchased  

the flats knowing fully well that the buildings were being/had been constructed  

in  violation  of  the sanctioned plans  are  not  entitled to complain against  the  

action  taken  by  the  Corporation  for  removal  of  the  illegal/unauthorized  

constructions.

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8. After hearing the counsel for the parties,  the trial  Court passed orders  

dated 23.3.2010 and rejected the petitioners’ prayer for temporary injunction.  

For the sake of reference paragraphs 36 to 39 of the order passed in the case of  

the petitioners, who have filed SLP(C) No. 33471 of 2011 are extracted below:  

“36. In so far as claim of the plaintiffs that they are bona fide  purchasers  of  their  respective  flats  and they  were  not  aware  about illegal  construction raised by the building/Developer is  concerned, it is submitted by both the counsels of the defendant  no. 2 that the fact of illegal construction itself mentioned in the  agreement  in  between  the  plaintiffs  and  developers.  In  this  respect while perusing the agreement produced by the plaintiffs  on record revising plans for putting up multi-storied building  submitted to the Corporation and for sanction. It means on that  day it was made known to the purchaser the revised plan has  been  submitted.  In  short  on  that  date  the  upper  floor  construction was not sanctioned by the Corporation.  

37. Not only this it is appeared from the letter of Jayant Chitnis,  Architect  who  specifically  mentioned  in  his  letter  that  he  already addressed a letter dated 5.1.1990 and informed to the  concerned developer about the show cause notice issued by the  Corporation about the construction of upper floors which were  not sanctioned. This letter also addressed to the said society by  the said Architect.  It  means the Architect  made aware to the  societies as well as the Developer when show cause notice has  been issued by the Corporation when Corporation noticed the  construction of illegal upper floors. From this fact it is clear that  even on the date of purchase the respective flat owners were  aware that the construction of upper floors which is mentioned  in the 351 notice were illegal  and unauthorized.  Till  then by  adopting the risk of demolition they have purchased the same.

38. From the documentary evidence as well as direction given  by the Hon’ble High Court in the abovesaid writ petitions it is  clear  that  on  the  buildings  of  the  plaintiffs  there  are  certain  illegal constructions of upper floors as mentioned in the notice  

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under Section 351. Therefore, at this prima-facie stage plaintiffs  have not made out any case to protect their illegal construction.

39. Not only this as per the direction of the Hon’ble High Court  the MMC has issued notices and after receiving the reply from  the respective societies, the AMC passed order of demolition of  such illegal upper floors. Prima facie in the order I found no  illegalities  carried  out  by  the  AMC  in  passing  the  same.  Considering all the documents and submissions I found no any  three  cardinal  principles  available  with  the  plaintiffs  for  granting  ad-interim  injunction.  Therefore,  I  answer  above  points in the negative. Hence, I proceed to pass the following  order.

ORDER

1) Notices of Motion No. 4807/2005 is hereby dismissed.

2) Cost in cause.

3) Notices  of  Motion  No.  4807/2005  is  disposed  of  accordingly.”

9. The appeals filed by the petitioners were dismissed by the learned Single  

Judge  of  the  High  Court  who,  after  examining  the  documents  filed  by  the  

parties, agreed with the trial Court that the constructions made in violation of  

the sanctioned building plans were illegal and the Corporation did not commit  

any error by ordering demolition of the unauthorized portions of the buildings.  

The reasons assigned by the High Court for negating the petitioners challenge  

to  the  order  of  the  trial  Court  are  contained  in  paragraphs  12  to  15  of  the  

impugned  which are extracted below:

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“12.  It  may  be  mentioned  that  for  immovable  properties  authorized  construction  can  be  shown  only  by  documentary  evidence. No party can contend orally that the construction is  authorized without showing documentary evidence.  In a case  such as this, where flats have been constructed in the building  and have been sold under agreements to flat  purchasers  in a  proposed co-operative society under the provisions of MOFA,  the documentary evidence must be present to the mind of the  flat  purchasers  upon  taking  inspection  of  the  plans  and  specifications statutorily required to be shown and inspected.  Consequently  in  such a  case  the  only  documentary  evidence  would be expected to be with the flat purchasers who, under the  specific  statutory  mandate,  would  require  to  inspect  the  title  contained in the sanctioned plan and the specifications. If that is  shown in reply to the notice, of course, the notice would not  proceed. That essential document which would be only to the  knowledge  of  the  party  receiving  the  notice  and  the  party  purchasing the flat would have to be shown by that party alone  and not by the MMC just because the party orders or directs the  MMC to produce the plans which never were.  

13. The fact that the flat purchasers purchased flats which are  shown  not  to  have  been  specifically  under  sanctioned  plans  shows that they are not bonafide purchasers. The fact that the  regularization application has been made itself shows that the  admitted position that the structure was illegal which required  regularization.  No  party  can  apply  for  regularization  of  a  regular structure. Consequently it is self-contradictory to state  that the structure is authorized and yet apply for regularization.

14.  In  fact  a  preposterous  argument  is  that  the  lease  of  the  lessees is not terminated by the MMC who is the lessor and the  lessees have malafide sought to complain and get the impugned  notice enforced.

15. It is gratifying to note that the learned Judge has passed a  legal order upon seeing a blatant defiance of law and the legal  procedure  throwing  to  the  winds  all  legal  requirements  and  mandates of construction under the supervision of the planning  authority  obviously  upon the conviction and expectation  that  such  extensive  construction,  however  illegal,  would  not  be  demolished.”

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10. Before  proceeding  further,  we deem it  appropriate  to  mention  that  in  

January 2002, Corporation had decided to demolish the buildings constructed in  

violation of the sanctioned plans.  On coming to know of this, the flat buyers  

made applications through their architect for regularization of the buildings and  

gave  out  that  they  were  prepared  to  pay  concessional  penalty.   Their  

applications were rejected by the Corporation.  The appeals filed against the  

orders  of  the  Corporation  were  dismissed  by  the  State  Government  and the  

petitioners have challenged both the orders by filing separate writ petitions.   

11. Dr. Abhishek Manu Singhvi,  Shri  Mukul Rohatgi,  Shri  Shyam Divan,  

Senior Advocates and Shri Santosh Paul and Shri Abhimanyu Bhandari, learned  

counsel for the petitioners argued that the impugned order is liable to be set  

aside  because  if  the  disputed  constructions  are  demolished,  the  suits  will  

become infructuous and the members of the societies and their  families will  

suffer  irreparable  loss  inasmuch  as  they  will  become roofless.  Dr.  Singhvi,  

placed before the Court satellite  map of the site and argued that if  the total  

constructed area is measured with reference to the area of the plot which was  

leased out by the Corporation to M/s. Pure Drinks Pvt. Ltd., the construction  

made by the developers cannot be said to be excessive and the trial Court and  

the  High  Court  committed  serious  error  in  recording  a  finding  that  the  

construction of buildings with 24 and 16 floors is illegal. Learned counsel then  

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referred  to  the  agreements  entered  into  between  the  flat  buyers  and  the  

developers to show that the former had purchased the flats under a bona fide  

belief that the developers will be able to persuade the Corporation to sanction  

the revised building plans and they should not be made to suffer on account of  

the wrong, if any, committed by the developers. Learned counsel also pointed  

out that the writ petitions filed by the petitioners for issue of a mandamus to the  

Corporation  to  regularize  the  illegal/unauthorized  construction  are  pending  

before the High Court and submitted that till the disposal of those petitions the  

Corporation  should  not  be  allowed  to  demolish  the  buildings  or  the  

constructions which are said to have been made in violation of the sanctioned  

plans.  In support  of  this  submission,  Shri  Mukul Rohatgi  placed before this  

Court  xerox  copies  of  the  order  sheets  of  Writ  Petition  No.  6550 of  2010.  

Learned counsel for the petitioners lastly submitted that the Court may consider  

the  desirability  of  transferring  the  writ  petitions  filed  by  the  petitioners  for  

regularization of the construction to this Court so that the issue of regularization  

may be finally decided and 200 families which are residing in the flats allegedly  

constructed in violation of the sanctioned plan may not be rendered homeless.

12. Shri  Pallav  Shishodia,  learned  senior  counsel  appearing  for  the  

Corporation argued that the action taken under Section 351 of the 1888 Act is  

perfectly  legal  because  the  buildings  in  question  were  constructed  despite  

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rejection  of  the  revised  building  plans  and  the  issue  of  stop  work  notice.  

Learned  senior  counsel  emphasized  that  the  Corporation  had  taken  belated  

action  for  removing the illegal  construction in  the  light  of  the  observations  

made by the Division Bench of the High Court on 11.10.2005 and, therefore,  

notices dated 19.11.2005 and orders dated 3/8.12.2005 cannot be faulted.

13. Shri Harish N. Salve, learned senior counsel appearing for respondent no.  

2 argued that total area of Plot No. 9 cannot be taken into consideration for the  

purpose of deciding whether the buildings have been constructed in violation of  

the sanctioned plan because the State Government had allowed change on land  

use only in respect of 13049.45 sq. meters. Learned senior counsel submitted  

that the members of the societies who purchased the flats knowing fully well  

that  the  buildings  had been constructed  in  violation  of  the  sanctioned plans  

cannot claim any equity or complain against the action taken by the Corporation  

for demolition of the illegal/unauthorized structures.  

14. We have considered the respective submissions and carefully scrutinized  

the record. The scope of the appellate Court’s power to interfere with an interim  

order passed by the Court of first instance has been considered by this Court in  

several cases. In Wander Ltd. v. Antox India (P) Ltd 1990 Supp SCC 727, the  

Court  was called upon to consider  the correctness  of  an order  of  injunction  

passed by the Division Bench of the High Court which had reversed the order  

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of the learned Single Judge declining the respondent’s prayer for interim relief.  

This Court set aside the order of the Division Bench and made the following  

observations:

“In such appeals, the appellate court will not interfere with the  exercise of discretion of the court of first instance and substitute  its own discretion except where the discretion has been shown  to have been exercised arbitrarily, or capriciously or perversely  or  where  the  court  had ignored the  settled  principles  of  law  regulating  grant  or  refusal  of  interlocutory  injunctions.  An  appeal against exercise of discretion is said to be an appeal on  principle.  Appellate  court  will  not  reassess  the  material  and  seek to reach a conclusion different from the one reached by the  court  below if  the one reached by that  court  was reasonably  possible on the material.  The appellate court would normally  not  be justified  in  interfering  with  the  exercise  of  discretion  under appeal solely on the ground that if it had considered the  matter  at  the  trial  stage  it  would  have  come  to  a  contrary  conclusion.  If  the  discretion  has  been  exercised  by  the  trial  court  reasonably  and  in  a  judicial  manner  the  fact  that  the  appellate  court  would  have  taken  a  different  view  may  not  justify interference with the trial court's exercise of discretion.”

15. In Skyline Education Institute (India) Pvt. Ltd. v. S.L. Vaswani (2010) 2  

SCC 142, the 3-Judge Bench considered a somewhat similar question in the  

context of the refusal of the trial Court and the High Court to pass an order of  

temporary injunction, referred to the judgments in Wander Ltd. v. Antox India  

(P)  Ltd  (supra),  N.R.  Dongre  v.  Whirlpool  Corpn.  (1996)  5  SCC  714  and  

observed:

“The ratio of the abovenoted judgments is that once the court of  first instance exercises its discretion to grant or refuse to grant  

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relief of temporary injunction and the said exercise of discretion  is  based  upon objective  consideration  of  the  material  placed  before  the  court  and  is  supported  by  cogent  reasons,  the  appellate court will be loath to interfere simply because on a de  novo consideration of the matter it is possible for the appellate  court to form a different opinion on the issues of prima facie  case, balance of convenience, irreparable injury and equity.”

16. In these cases, the trial Court and the High Court have, after threadbare  

analysis  of  the  pleadings  of  the  parties  and  the  documents  filed  by  them  

concurrently held that the buildings in question were constructed in violation of  

the sanctioned plans and that the flat buyers do not have the locus to complain  

against  the action taken by the Corporation under Section 351 of 1888 Act.  

Both,  the trial  Court  and the High Court  have assigned detailed reasons for  

declining the petitioners’ prayer for temporary injunction and we do not find  

any valid ground or justification to take a different view in the matter.  

17. The submission of Dr. Abhishek Manu Singhvi that the constructed area  

should  be  measured  with  reference  to  the  total  area  of  the  plot  cannot  be  

accepted  for  the  simple  reason  that  the  State  Government  had  sanctioned  

change of land use only in respect of 13049.45 sq. meters.

18. In view of the above, we may have dismissed the special leave petitions  

and  allowed  the  Corporation  to  take  action  in  furtherance  of  notices  dated  

19.11.2005 and orders dated 3/8.12.2005, but keeping in view the fact that the  

flat buyers and their families are residing in the buildings in question for the last  

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more than one decade, we feel that it will be in the interest of justice that the  

issue relating to the petitioners’ plea for regularization should be considered by  

this Court at the earliest so that they may finally know their fate.   

19. We, therefore, direct the petitioners to furnish the particulars of the writ  

petitions filed for regularization of the construction which are pending before  

the High Court. The needful be done within a period of two weeks from today.  

Within this period of two weeks, the petitioners shall also furnish the particulars  

and details  of  the  developers  from whom the members  of  the  societies  had  

purchased the flats.  List the cases on 16th March, 2012 (Friday).   

20. If the petitioners fail to comply the aforesaid directions, the special leave  

petitions shall stand automatically dismissed.

……………..…………………….………….J.   (G.S. SINGHVI)

 ……………..…………………….………….J. New Delhi;                       (SUDHANSU JYOTI MUKHOPADHAYA) February 29, 2012.

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