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REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 1086  OF 2015

(ARISING OUT OF SLP(C)NO.19426 OF 2012)

  GODREJ & BOYCE MANUFACTURING.CO.LTD.    ………APPELLANT

Vs.

STATE OF MAHARASHTRA & ORS.             ……RESPONDENTS

J U D G M E N T

V.GOPALA GOWDA, J. Leave granted.        

2. The appellant whose land bearing CTS Nos. 31(pt),  

7 (pt), 70 to 78, 80(pt) and 81, measuring 2188 sq.  

mtrs. at Vikhroli were reserved in the Development  

Plan in the year 1991 for acquisition by the Ministry  

of  Railways  for  laying  additional  railway  tracks  

between  “Thane  and  Kurla”,  has  questioned  the  

correctness of the notification  dated 5.8.2008 issued  

by the Urban Development Department of the respondent

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No.  1-State  Government  under  Section  37(1)  of  the  

Maharashtra Regional Town Planning Act (for short “the  

MRTP  Act”)  proposing  the  modification  in  the  

Development Plan deleting the reservation of land in  

question  from  Railway  reservation  and  adding  

reservation for Development Plan Road, before the High  

Court of Bombay questioning the power of the State  

Government regarding the proposed modification in the  Development  Plan  after  the  period  of  10  years  

specified  under  Section  127  of  the  MRTP  Act,  was  

expired and the State Government has failed to take  

steps for acquisition of the land involved in these  

proceedings  reserved  for  the  purpose  of  laying  

additional railway tracks between “Thane and Kurla”,  

which was not interfered with by the High Court by  

recording  its  reasons  in  the  impugned  order  dated  

12.12.2011, passed in the Writ Petition No. 2274 of  

2011, is under challenge in these proceedings, urging  

various legal contentions.

3. The brief facts of the case are as under:-

In the year 1991, appellant’s land in question  

were reserved under the Sanctioned Development Plan of

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Greater  Mumbai  for  acquisition  of  respondent  No.2  

herein  –  Union  of  India,  Ministry  of  Railways  for  

laying down additional Railway tracks between “Thane  

and Kurla”.

No steps were taken by the concerned authorities  

despite passing of 10 years period as contemplated  

under  Section  127  of  the  MRTP  Act  to  acquire  the  

reserved  land  of  the  appellant.  The  appellant  has  

issued the purchase notice under the said Section on  

04.09.2002  to  the  respondent  No.2  -  Ministry  of  

Railways stating that if, the Ministry of Railways is  

in  need of  the land  in question,  the same  may be  

acquired by them, and if the same is not required, a  

clarification to that effect may be issued.

4. After issuance of the said notice, the period of 6  

months as prescribed under Section 127 of the MRTP  

Act, was expired on 3.3.2003, thus, the reservation of  

the land in question was deemed to be released.  

5. Having got no reply from respondent No. 2, the  

appellant  again  wrote  a  letter  dated  2.10.2004  to  

respondent No.1 for de-reservation of the land if the  

same is not required by them.

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6. On 1.11.2004, the respondent No. 2 - Ministry of  

Railways informed the Urban Development Department of  

State that there was no proposal for acquisition of  

reserved land for railway development works in the  

Railways in the near future.

7. The  appellant,  on  5.1.2005,  wrote  to  the  Urban  

Development  Department  of  the  State  Government  

requesting for suitable steps in view of clarification  

letter dated 1.11.2004 issued by respondent No. 2 and  

requested it for expediting the process of deleting  

the reservation of the land in question.

8. The  Urban  Development  Department  of  the  State  

Government has issued the notification on 24.5.2006  

under Section 37(1) of the MRTP Act, proposing the  

modification  to  the  Development  Plan  by  deleting  

“Railway reservation” and adding “Reservation for DP  

Road”.  The  land  which  was  reserved  earlier  in  the  

Development Plan for railway line, the period of 10  

years and 6 months after issuing notice was lapsed,  

now proposed to be reserved for Development Plan Road.  

The same was followed by another notification issued  

by the State Government under Section 37(1) of the

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MRTP Act dated 5.8.2008 for modification of the land  

deleting from the Railway reservation and reserving  

the same for Development Plan Road.

9. Being  aggrieved  by  the  said  notification  dated  

5.8.2008 proposing the modification of reservation of  

the  land  in  question  from  the  Railway  line  to  

Development Plan Road, the appellant approached the  

High Court by filing Writ Petition No. 2274 of 2011  

challenging the correctness of the said notification  

by placing strong reliance upon Section 127 of the  

MRTP Act, contending that the proposed modification by  

the Urban Development Department is impermissible in  

law as the State Government has no power to do so.

10. The  High  Court  vide  its  order  dated  12.12.2011  

dismissed the writ petition by holding that the action  

of the State Government is only proposed modification  

and therefore, the writ petition cannot be entertained  

at  this  stage.  However,  the  High  Court  has  given  

liberty to the appellant to raise objections before  

the  Urban  Development  Department  of  the  State  

Government  regarding  the  proposed  modification.  

Further,  it  is  observed  by  the  High  Court  in  the

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impugned  order  that  the  impugned  notification  was  

issued  in  the  month  of  August,  2008,  whereas  the  

appellant  has  filed  the  petition  in  the  month  of  

August, 2009. In the absence of explanation by the  

appellant for filing a petition about one year after  

the issuance of impugned notification, therefore, the  

writ petition was also rejected on this ground. Hence,  

the  civil  appeal  is  filed  by  the  appellant  urging  

various grounds.

11.  Mr.  Shyam  Divan,  the  learned  senior  counsel  

appearing on behalf of the appellant placed strong  

reliance upon the provision of Section 127 of the MRTP  

Act, in support of his legal contention that the land  

of the appellant involved in this case was reserved  

for the Development Plan by the State Government for  

acquisition by the Ministry of Railways for laying  

additional Railway tracks between “Thane and Kurla”,  

which period of 10 years was expired long back and  

therefore,  the  proposed  action  to  de-reserve  and  

modify  the  same  for  the  abovesaid  purpose  is  not  

permissible in law.

12. It  was  further  contended  by  the  learned  senior

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counsel that in view of the law laid down in Prakash  

R. Gupta  v. Lonavala Municipal Council and Ors.1 the  

land should have been acquired within 10 years from  

the date of sanctioned development plan. No proceeding  

for acquisition of the reserved land was commenced by  

the State Government and Railway department within the  

said period under Section 127 of the MRTP Act. The  

land involved in these proceedings having not been  

acquired by the respondents within stipulated time of  

10 years, the reservation of the land for the purpose  

of railway under the provision of Section 127 of the  

MRTP  Act  has  lapsed  long  back  and  hence  the  same  

stands  released  from  reservation  in  favour  of  the  

appellant.  

13. The learned senior counsel also contended that the  

High Court should have seen that once the right of the  

appellant  under  Section  127  of  the  MRTP  Act,  is  

accrued  in  favour  of  the  appellant,  any  proposed  

modification of the plan in exercise of power by the  

State Government under Section 37 of the MRTP Act,  

should not be allowed  to render the right of the  1

 (2009) 1 SCC 514

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appellant under Section 127 of the MRTP Act as otiose.

14.  On  the  contrary,  Mr.  R.P.  Bhatt,  the  learned  

senior counsel on behalf of the respondents sought to  

justify the impugned notification contending that the  

Stat Government is empowered to modify the Development  

Plan by deleting the earlier purpose for which the  

land was reserved, and can be modified for Development  

Plan Road. The said action is only proposed one and  

therefore, the appellant cannot have any grievance at  

this stage and can raise objections to the impugned  

notification  before  the  State  Government,  the  same  

will be examined it and take appropriate decision in  

the matter. Therefore, he submits that the impugned  

order is not vitiated either on account of erroneous  

reasoning or error in law and the same need not be  

interfered  with  by  this  Court  in  exercise  of  its  

appellate jurisdiction in this appeal.

15.  Having heard the learned senior counsel on behalf  

of  both  the  parties  and  with  reference  to  the  

abovesaid rival factual and legal contentions, we have  

carefully  examined  the  same  keeping  in  view  the  

undisputed  facts  involved  in  this  case.  It  is  an

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undisputed fact that the respondent No. 1 has reserved  

the land in question for the Development Plan under  

the provisions of Section 127 of the MRTP Act for the  

acquisition  of  the  land  in  favour  of  Ministry  of  

Railways for laying additional railway track between  

“Thane and Kurla”. It would be apposite to extract  

Section 127 of the MRTP Act for better appreciation of  

the claim of the parties, which deals with lapsing of  

reservation:-

“127. Lapsing of reservations-If any land  reserved, allotted or designated for any  purpose specified in any plan under this  Act is not acquired by agreement within  ten years from the date on which a final  Regional plan, or final Development plan  comes into force or if proceedings for  the acquisition of such land under this  Act or under the Land Acquisition Act,  1894,  are  not  commenced  within  such  period,  the  owner  or  any  person  interested in the land may serve notice  on  the  Planning  Authority,  Development  Authority  or  as  the  case  may  be,  Appropriate Authority to that effect; and  if within six months from the date of the  service of such notice, the land is not  acquired  or  no  steps  as  aforesaid  are  commenced  for  its  acquisition,  the  reservation,  allotment  or  designation  shall  be  deemed  to  have  lapsed,  and  thereupon the land shall be deemed to be  released from such reservation, allotment  or designation and shall become available  to  the  owner  for  the  purpose  of  development as otherwise, permissible in

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the  case  of  adjacent  land  under  the  relevant plan.”

16.  It  is  also  an  undisputed  fact  that  after  10  

years, notice dated 4.9.2002 served by the appellant  

under Section 127 of the MRTP Act upon the respondent  

No.1 stating that if, the reserved land was needed for  

the notified purpose, Railway department may acquire  

the same by adopting acquisition proceedings, but if  

the same is not acquired, the clarification to that  

effect be issued. Thereafter, on 3.3.2003 the period  

of  6  months  as  prescribed  under  the  provision  of  

Section 127 of the MRTP Act, after issuance of the  

above  notice  by  the  appellant  and  served  on  the  

respondent No.1, was also lapsed long back. Therefore,  

the reservation of the land in favour of the Railway  

was  deemed  to  be  released  under  the  above  said  

provision  of  the  MRTP  Act.  The  respondent  No.  2-

Ministry of Railways informed the Urban Development  

Department  of  the  State  Government  on  1.11.2004  

stating that there was no proposal for acquisition of  

the  land  in  the  Railways  in  the  near  future,  is  

evident from the undisputed fact of the correspondence

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made between the Ministry of Railways and the Urban  

Development Department of the State Government, which  

would clearly go to show that the land reserved even  

after 10 years and on expiry of service of notice of 6  

months there was no intention on the part of the State  

Government  to  acquire  the  reserved  land  for  the  

purpose reserved in favour of the Railways department  

to form the Railway tracks between “Thane and Kurla”.  

In that view of the matter, the land reserved for the  

purpose under Section 127 of the MRTP Act, is lapsed  

and the appellant is entitled for developing the land  

as  it  likes.  The  State  Government  instead  of  

clarifying to the notice issued by the appellant, has  

proceeded  further  to  initiate  proceedings  under  

Section 37 of the MRTP Act, proposing the modification  

in  the  Development  Plan  by  deleting  Railway  

reservation  and  adding  reservation  for  Development  

Plan Road. Section 37(1) of the MRTP Act, which deals  

with  modification  of  Final  Development  Plan  reads  

thus:-  

“37.Modification  of  final  Development  Plan -  (1) Where a modification of any  part of or any proposal made in, a final  Development  Plan  is  of  such  a  nature

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that it will not change the character of  such  Development  Plan,  the  Planning  Authority may, or when so directed by  the State Government shall, within sixty  days from the date of such direction,  publish a notice in the Official Gazette  and  in  such  other  manner  as  may  be  determined by it inviting objections and  suggestions from any person with respect  to the proposed modification not later  than one month from the date of such  notice;  and shall also serve notice on  all  persons  affected  by  the  proposed  modification and after giving a hearing  to any such persons, submit the proposed  modification (with amendments, if any),  to the State Government for sanction. 1A) If the Planning Authority fails to  issue  the  notice  as  directed  by  the  State Government, the State Government,  shall  issue  the  notice  and  thereupon,  the provisions of sub-section (1) shall  apply as they apply in relation to a  notice  to  be  published  by  a  Planning  Authority.”

By a careful reading of the provisions of Sections 127  

and 37(1) of the MRTP Act, which are extracted as  

above  abundantly  make  it  clear  that  the  State  

Government is not empowered to delete the reservation  

of the land involved in this case from Railway use and  

to modify the same for Development Plan Road in the  

Development Plan after expiry of 10 years and 6 months  

notice period was over as the appellant has acquired  

the valuable statutory right upon the land and the

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reservation of the same for the proposed formation of  

Railway  track  was  lapsed  long  back.  Further  the  

respondent No. 2 vide its letter dated 1.11.2004 has  

stated that there is no proposal for acquisition of  

land for the purpose of which it was reserved.  

  Section  127  of  the  MRTP  Act,  which  fell  for  

consideration before the three Judge Bench of this  

Court in the case of  Shrirampur Municipal Council,  

Shrirampur  v.  Satyabhamabai Bhimaji Dawkher & Ors.2  

wherein  the  contention  of  the  appellant  that  the  

majority judgment in the case of Girnar Traders (2) v.  

State of Maharashtra3  need to be considered by larger  

Bench  as  the  same  is  contrary  to  Section  127  and  

Municipal  Corpn.  Of  Greater  Bombay  v.  Hakimwadi  

Tenants’ Asson.4 case, was rejected. The Court opined  

that the same is not contrary to Section 127 of the  

MRTP Act and further held that there is no conflict  

between  the  judgments  of  the  two-Judge  Bench  in  

Hakimwadi  Tenants’  Asson.  (supra) and  the  majority  

judgment in Girnar Traders (2) (supra) case.  Further,  

2   (2013) 5 SCC 627 3  (2007) 7 SCC 555 4  (1988) Supp SCC 55

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the  three  Judge  Bench  judgment  in  Shrirampur  

Municipal Council, Shrirampur (supra) at paras 45 and  

46  supported  the observation of Constitution Bench  

in  Girnar Traders (3)  v. State of Maharashtra5 case  

relating to Section 127 of the MRTP Act, which read  

thus:-  

“45. In  our  view,  the  observations  contained  in  para  133  of  Girnar  Traders  (3)  unequivocally  support  the  majority  judgment  in  Girnar  Traders (2).

46. As  a  sequel  to  the  above  discussion,  we  hold  that  the  majority  judgment  in  Girnar  Traders (2) lays down correct law  and  does  not  require  reconsideration  by  a  larger  Bench…”

From the above, it is clear that the majority view in  

Girnar Traders (2)  (supra) is held to be good law.  

Therefore, the case of Girnar Traders (2) (supra) is  

binding  precedent  under  Article  141  of  the  

Constitution of India upon the respondent No.1. The  

relevant paragraph 133 from  Girnar Traders (3)   is  

5  (2011) 3 SCC 1

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extracted hereunder :-

“133. However, in terms of Section  127 of the MRTP Act, if any land  reserved,  allotted  or  designated  for  any  purpose  specified  is  not  acquired  by  agreement  within  10  years from the date on which final  regional plan or final development  plan  comes  into  force  or  if  a  declaration  under  sub-section  (2)  or (4) of Section 126 of the MRTP  Act  is  not  published  in  the  Official  Gazette  within  such  period,  the  owner  or  any  person  interested  in  the  land  may  serve  notice upon such authority to that  effect and if within 12 months from  the date of service of such notice,  the  land  is  not  acquired  or  no  steps, as aforesaid, are commenced  for  its  acquisition,  the  reservation,  allotment  or  designation shall be deemed to have  lapsed  and  the  land  would  become  available  to  the  owner  for  the  purposes  of  development.  The  defaults,  their  consequences  and  even  exceptions  thereto  have  been  specifically  stated  in  the  State  Act. For a period of 11 years, the  land would remain under reservation  or designation, as the case may be,  in terms of Section 127 of the MRTP  Act (10 years + notice period).”

In view of the above said statement of law declared by  

this  Court  in  the  cases  referred  to  supra,  after

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adverting to the judgment of majority view in Girnar  

Traders (2)  case (supra) is accepted in  Shrirampur  

Municipal Council, Shrirampur (supra), wherein it is  

held that the  Girnar Traders (2)(supra) case is not  

conflicting with the  Hakimwadi Tenants’ Asson.  case  

(supra), the statement of law laid down in the above  

referred  cases  are  aptly  applicable  to  the  fact  

situation.  Therefore,  we  have  to  hold  that  the  

impugned  notification  is  bad  in  law  and  liable  to  

quashed. The High Court has not examined the impugned  

notification from the view point of Section 127 of the  

MRTP  Act  and  interpretation   of  the  above  said  

provision  made  in  the  case  of  Girnar  Traders  (2)  

(supra), therefore, giving liberty to the appellant by  

the  High  Court  to  file  objections  to  the  proposed  

notification is futile exercise  on the part of the  

appellant for the reason that the State Government,  

once the purpose the land was reserved has not been  

utilized for that purpose and a valid statutory right  

is acquired by the land owner/interested person after  

expiry of 10 years from the date of reservation made  

in the Development Plan and 6 months notice period is

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also expired, the State Government has not commenced  

the proceedings to acquire the land by following the  

procedure as provided under Sections 4 and 6 of the  

repealed Land Acquisition Act, 1894. Therefore, the  

land  which  was  reserved  for  the  above  purpose  is  

lapsed and it enures to the benefit of the appellant  

herein.  Therefore,  it  is  not  open  for  the  State  

Government  to  issue  the  impugned  notification  

proposing to modify the Development Plan from deleting  

for  the  purpose  of  Railways  and  adding  to  the  

Development Plan for the formation of Development Plan  

Road after lapse of 10 years and expiry of 6 months  

notice served upon the State Government.

17. In view of above, the order passed by the High  

Court as well as the impugned notification issued by  

the State Government are vitiated in law and liable to  

be set aside and quashed and we order accordingly.

18.  The appeal is allowed. The impugned order is set  

aside  and  consequently  Rule  issued.  The  impugned  

notification dated 5.8.2008 is also quashed as the

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period of 10 years from the date of reservation in the  

Development Plan and 6 months notice served by the  

appellant on the respondent No. 1 is also over, the  

reservation of the land is lapsed. No costs.

                                            ……………………………………………………………J.     [V. GOPALA GOWDA]

                         …………………………………………………………J.     [R. BANUMATHI]

New Delhi, January 21,2015