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IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.10933  OF 2013 (Arising out of SLP(C) No.14202 of 2012)

Oswal Agro Mills Ltd. ... Appellant

versus

Hindustan Petroleum Corporation Ltd. and others ... Respondents

With

CIVIL APPEAL NO. 10934  OF 2013 (Arising out of SLP(C) No.30858 of 2012)

J U D G M E N T

G.S. SINGHVI, J.

1. Leave granted.

2. These  appeals  are directed against  order  dated 12.4.2012 by which the  

Division Bench of the Bombay High Court allowed the writ  petition filed by  

respondent No.1-Hindustan Petroleum Corporation Ltd. (HPCL) and quashed the  

sanction accorded by the competent authority of the Municipal Corporation of  

Greater  Mumbai  (for  short,  ‘the  Corporation’)  for  change  of  user  and  

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construction of residential and commercial complex on land bearing CTS Nos.  

381 and 381/1 to 22, Village Anik, Taluk Chembur, MSD, Mumbai and directed  

the Municipal Commissioner to reconsider the application made by Oswal Agro  

Mills  Ltd.  (hereinafter  described  as  “the  appellant”)  keeping  in  view  the  

objections raised by the Police Department, Ministry of Petroleum, Ministry of  

Environment  and  Intelligence  Bureau  and  the  Security  Control  Regulations  

issued by the State of Maharashtra under Section 37 (1AA) of the Maharashtra  

Regional and Town Planning Act, 1966 (for short, ‘the 1966 Act’).

3. The appellant purchased the land in question from Union Carbide Ltd. in  

1989 with the permission of the State Government.  In the development plan of  

the area, the land was shown as included in Special Industrial Zone (I-3 Zone). In  

2005, respondent No.1 acquired land bearing CTS Nos. 382 and  382/1 to 66 of  

Village  Anik,  which  is  located  at  a  distance  of  430-450  meters  from  the  

appellant’s land from Ahmedabad Printing and Calico Mills Company Ltd. for  

construction of storage tanks.

4. On  17.3.2006,  the  appellant  made  an  application  to  the  Industries  

Department  of  the  State  Government  for  change  of  land  use.  The  State  

Government  informed  the  appellant  that  the  Industries  Department  can  give  

NOC for industrial purpose keeping in view the locational policy, which did not  

contain any provision for change of land use and that change of user was within  

the jurisdiction of the Planning Authority.

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5. The  appellant  also  made  an  application  to  the  Maharashtra  Pollution  

Control Board (MPCB) for grant of environmental clearance. Thereupon, MPCB  

issued notice dated 19.6.2006 and invited objections against the proposed grant  

of  environmental  clearance  to  the  appellant’s  project.  Respondent  No.1  filed  

objections dated 11.7.2006 and pleaded that permission sought by the appellant  

should be rejected because its refinery was very close to the appellant’s land and  

construction of building would be a security threat to the large tanks proposed to  

be installed for storage of crude oil and finished petroleum products on the plot  

purchased from Calico Mills Company Ltd. Another plea taken by respondent  

No.1 was that there were several major industrial units in the industrial zone and  

setting up residential or commercial complex in that zone next to the refineries  

was risky and hazardous and was not in public interest. Respondent No.1 sent  

similar  communication  dated  17.7.2006  to  the  Corporation.   The  latter  sent  

communication dated 26.10.2006 to the Under Secretary, Urban Development  

Department informing him about the objections raised by respondent No.1 and  

pointed out that proposal of the appellant cannot be withheld under the existing  

rules and regulations because issues of safety and security were not within its  

jurisdiction.  The Corporation also suggested that a strip of land could be left  

around the  premises  as  buffer  for  additional  safety  of  the  installation  of  the  

refinery and surveillance could be kept by installing CCTV cameras, etc. The  

Labour Commissioner, to whom a copy of application dated 17.3.2006 had been  

forwarded, sent communication dated 18.11.2006 to the Corporation that he had  

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no objection to the issue of NOC to the appellant. He also mentioned that dues of  

workers had already been paid.

6. After  one year and one month of  the submission of  application by the  

appellant,  the  Corporation  addressed  letter  dated  21.4.2007  to  the  Under  

Secretary, Urban Development Department seeking his advice on the objections  

raised by respondent No.1. In that letter it was mentioned that colony of HPCL  

officers  was  situated  on  North-East  side  of  the  appellant’s  plot,  residential  

quarters  of  Maharashtra  State  Electricity  Board were  abutting the  plot  and a  

number of Slum Rehabilitation Schemes were in place around the disputed plot.  

7. While the appellant’s application was pending, respondent No.1 addressed  

letters dated 26.10.2007 and 3.6.2008 to the State Government raising objections  

against  the  proposal  of  M/s.  Metal  Box  Ltd.  and  M/s.  Apar  Industries  to  

construct residential and commercial complex on plots adjacent to its refinery. In  

reply,  the  Corporation  sent  letter  dated  22.7.2008  to  the  Chief  Manager  of  

respondent  No.1  for  issue  of  NOC  for  construction  of  tenements  meant  for  

project affected persons under the Slum Re-development Scheme under Clause  

33(10) of Development Control Regulations (for short, “DC Regulations”) .

8. By  letter  dated  25.7.2008,  the  Corporation  informed  the  Director  of  

Refineries, HPCL that Slum Rehabilitation Authority had approved the plan on  

the Metal Box plot and letter dated 26.10.2007 sent by respondent No.1 has been  

forwarded to the Executive Engineer (SRA).  

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9. Vide letter  dated 21.10.2008,  the Ministry  of  Environment  and Forests  

(MoEF)  granted  environmental  clearance  to  the  proposed  construction  of  

commercial buildings consisting of Wings A, B, C and D (G+7), office building  

(S+8), amenity building (G+2) and S1-S8 buildings (G+7) on the appellant’s plot  

under category 8 (b) of EIA notification 2006 subject to  strict compliance of  

specific and general conditions contained in the letter.  

10. In the meanwhile,  Bharat  Petroleum Corporation Limited (BPCL) filed  

Writ Petition No.1891/2007 against the State of Maharashtra and others. BPCL  

also  applied  for  an  interim  injunction  against  the  construction  of  residential  

building. One of the grounds taken by BPCL was that Development Plan had  

been altered ignoring the  threat  perception to  its  refinery.  By an order  dated  

11.12.2008, the Division Bench of the High Court declined the prayer for interim  

injunction by recording the following reasons:

“2. The land which is  the subject  matter  of  dispute  belonged to  Mafatlal Group. Mafatlal’s entered into M.O.U. with Petitioner No. 1  to sell the land for housing of the Petitioner’s staff and workers by  agreement dated 23.5.1982. On 25.1.1990, an order came to be passed  under  the  Urban  Land  Ceiling  Regulation  Act,  1976  granting  exemption to the land for development for housing the staff of the  Petitioner No. 1. In the D.P. Plan notified in the year 1992, it  was  shown as reserved for housing of the staff of the Petitioner. As the  Petitioner did not show interest, Mafatlal entered into an agreement  with Eversmile who proposed to the Petitioner to purchase the flats  which  they  would  construct,  which  proposal  however  was  not  accepted.

The  Petitioner  thereafter  sought  to  acquire  the  land  and  this  was  informed  by  communication  dated  4.8.1992  by  the  Petitioner  to  Respondent No. 1. The land was not acquired by the Petitioner though  

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the persons who had acquired interest  in the land were willing for  acquisition. One of the reasons appears to be that the Petitioners did  not want to pay for the land which was to be kept open.  

3.  On  17.7.1999,  a  corrigendum  was  issued  to  the  exemption  Notification under Urban Land Ceiling Act and the land consisting  part-A was tobe developed as per the policy of S.R.A. and the land  occupied  at  Part-B  was  to  be  developed  as  per  order  of  the  Government.

The  Petitioner  was  also  in  touch  with  NEERI  who  in  their  communication dated 19.1.2000 noted that the construction of housing  complex for 2000 buildings was in full swing. They had raised some  objections from the environment point  of view. The Petitioner also  approached  the  Intelligence  Bureau.  By  letter  dated  5.7.2000,  the  Intelligence Bureau informed that considering the threats and as the  land belonged to private persons, it should be purchased along with  the existing structure.

The Petitioner in a communication dated 4.12.2006 addressed to the  Secretary, Ministry of Environment and Forest, Government of India  pointed out that the construction activities were going on since 1999- 2000 but  the work was stopped because  of  CRZ violation and the  construction activities are likely to be resumed.

4. The main contention urged on behalf of the Petitioners has been  that while making alterations in the D.P. Plan, the threat perception to  the  refinery  of  the  Petitioners  ought  to  have  been  taken  into  consideration and that due notice was not given to them. In the instant  case,  as  may be noted,  the plan as notified in  the year  1992 itself  showed that  the  land was  reserved  for  housing  of  the  staff  of  the  Petitioner. This has now been changed for S.R.A. and other purposes  which are  residential.  Therefore,  the land since  the year  1992 was  reserved for residence. The Petitioner in the year 1992 did not raise  any objection to the land which was reserved for residence and on the  contrary  they  wanted  the  land  for  housing  their  staff.  The  correspondence  further  indicates  that  the construction activities  has  commented from the year 1999-2000, though for some time in view of  C.R.Z. violation that could not be proceeded with.

5. Further from the material before us, it is clear that in the vicinity of  the  Petitioner’s  project,  there  are  other  constructions  which  are  existing  including  residential  buildings.  Eversmile  has  commenced  construction  of  buildings  under  .S.R.A.  project.  The  Petitioners  

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allowed the said construction to come up by maintaining silence for  long  period  of  time.  They  have  neither  purchased  the  land  nor  acquired it. Considering the fact that there are already other buildings  and as the respondent  developers have commenced construction by  spending large amount of money, in our opinion, the contention of the  Petitioners that on account of "security risk" the respondent should be  restrained at the interim stage from constructing on the land on facts  here cannot be granted. The delay must be held against the Petitioners,  as  also  the  fact  that  since  1992,  the  land  has  been  reserved  for  housing. Though we have granted rule that by itself cannot result in  granting interim relief, which must be considered on the basis of well  known principles of grant of interim relief.

6. On behalf of the Respondents, their counsel had sought to argue  that the Petition itself ought not be be admitted and had relied on a  large number of judgements including the judgment of this court in  the case of BEST Workers Union Vs. State of Maharashtra 20085 All  M.R. 848. Considering the contentions advanced based on the D.C.  Regulations which though were also under consideration in the case of  BEST  Workers  Union  (supra),  we  have  admitted  the  Petition.  However, as noted earlier the gross delay and the fact that Respondent  Builders have invested large amounts on the project which is being  constructed under the S.R.A. Project, would be a relevant fact not to  exercise discretion in favour of the Petitioner.”

11. After grant of environmental clearance, respondent No.1 sent letters dated  

14.1.2009  and  23.2.2009  to  Deputy  Director,  Town  Planning  reiterating  its  

objection to the construction of buildings by the appellant.  On 27.2.2009, the  

State Government issued notice in the light of the recommendation made by Upa  

Lokayukta  to  prepare  Security  Control  Rules  and  accepted  the  report  of  the  

Expert Committee for framing Special Regulations for safety of the buildings  

from terrorist attack, the requirement for electrical and electronic system, fire,  

etc.  Thereafter,  the  State  Government  issued  instructions  vide  letter  dated  

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21.3.2009  addressed  to  the  Municipal  Commissioner  for  implementing  the  

Security Regulations.  

12. In view of the communications sent by the State Government, respondent  

No.1 sent letter dated 5.5.2009 to the Chief Secretary to highlight the security  

threat  to  its  refinery  due  to  the  SRA  Scheme  and  requested  that  56  SRA  

buildings be acquired for housing police personnel as has been done in the case  

of SRA buildings constructed near the BPCL refinery.

13. By  an  order  dated  1.9.2009,  the  Municipal  Commissioner  accorded  

sanction for change of user of the appellant’s plot in the light of Regulation 57(4)

(c) of the DC Regulations subject to the requirement of obtaining NOCs from  

different authorities.  After about two months, appellant submitted proposal for  

amalgamation / sub-division of the plot. The Corporation considered the proposal  

and  approved  the  same  vide  letter  dated  10.6.2010  subject  to  the  additional  

conditions  including the  one  that  amenity  space  shall  be  handed over  to  the  

Corporation. On 11.11.2010, the Corporation issued Intimation of Disapproval to  

the  appellant  and  on  28.12.2010,  the  Corporation  granted  permission  to  the  

appellant for handling, storage, transportation and disposal of waste generated  

due  to  construction  of  building.  Subsequently,  the  Corporation  vide  its  letter  

dated 7.1.2011 issued NOC to the appellant regarding fire protection and fire  

fighting  requirements  in  respect  of  the  proposed  construction  of  high  rise  

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residential  building  No.9.  The  Corporation  also  granted  commencement  

certificate to the appellant.

14. In the meeting held on 5.2.2011 under the Chairmanship of the Principal  

Secretary,  Home  Department,  representatives  of  respondent  No.1  and  BPCL  

protested against the permission granted for construction by the appellant and  

others  on  the  property  adjacent  to  the  refinery  of  HPCL  and  pleaded  that  

construction activity should be immediately halted.  It was also suggested that a  

distance of 500 metres as buffer zone was required to be maintained.  Thereafter,  

the Principal Secretary asked the representatives of respondent No.1 and BPCL  

to  make  necessary  representation  to  the  Brihanmumbai  Mahanagar  Palika  to  

maintain the distance. The Principal Secretary also directed the representative of  

respondent No.1 to inform the Urban Development Department within 15 days  

whether the company was willing to take possession of a portion of 500 metres  

from the neighboring property for buffer zone and plant trees, etc. so that the  

State  Government  could  take  an  appropriate  decision.  The  same  was  also  

conveyed to respondent No.1 vide letter dated 15.2.2011.

15. Having failed to convince the State Government and the Corporation to  

stop construction of buildings on the land purchased by the appellant, respondent  

No.1  filed  Writ  Petition  No.1973/2011  for  quashing  all  approvals  and  

permissions granted to the appellant and for restraining the official respondents  

from  granting  further  permissions  or  approvals  or  renewing  the  approvals  /  

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permissions  already granted.  Respondent  No.1 heavily  relied upon the report  

prepared by the  Intelligence  Bureau  highlighting  the  threat  perception  to  the  

refinery  and  its  installations.  Respondent  No.1  also  challenged  validity  of  

Regulation 57(4)(c) of the DC Regulations in terms of which the Commissioner  

of the Corporation can permit any open land in special industrial zone to be used  

for any of the permissible users in residential zone.

16. The  appellant,  the  Principal  Secretary,  Urban  Development  and  the  

Deputy  Director,  Town  Planning,  BMC  filed  affidavits  to  oppose  the  writ  

petition. In the affidavit filed on behalf of the MPCB, it was pleaded that the  

clearance was granted after due consideration of the record in the light of the  

clearance  granted  by  the  Ministry  of  Environment  and  Forests  (MoEF),  

Government of India. Secretary, Department of Environment, Maharashtra also  

referred  to  the  recommendations  of  the  State  Level  Environment  Impact  

Assessment  Authority and claimed that in view of the clearance accorded by  

several  agencies,  permission  sought  by  the  appellant  was  granted.  Labour  

Commissioner  filed an  affidavit  stating  that  he  was only concerned with  the  

payment of dues of the workers and in the report submitted by him it was made  

clear that the dues of workers have already been paid. The Additional Director,  

MoEF filed affidavit  to the effect  that  State Expert  Appraisal  Committee has  

accorded  environmental  clearance  in  terms  of  EIA  Notification  2011.  In  a  

separate affidavit, Principal Secretary, Home Department pointed out that HPCL  

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refinery was Category ‘A’ vital installation and had been declared as prohibited  

area under the Official Secrets Act. The Principal Secretary also submitted that  

construction of high rise building on the plot in question will be a threat to the  

installation of respondent No.1. In an additional affidavit filed on behalf of the  

appellant, its Senior Vice-President Dr. Seema Garg averred that large number of  

buildings have already been constructed in the vicinity of the plot purchased by  

respondent No.1.   Paragraphs 9 to 18 of the affidavit of Dr. Seema Garg which  

have bearing on the decision of these appeals read as under:

“9. I say that Development Control Regulations 1991 (Regulation 29)  provides  that  in  case  of  change  of  user  from  Industrial  to  Residential/Commercial  zone,  the  Corporation  can  insist  for  maintaining distance of 52 metres between the proposed development  and the obnoxious or hazardous industries. I say that plans provide for  a safe distance of far more than 52 metres between the boundary wall  of  the  said  land  and  the  boundary  wall  of  the  petitioner's  existing  refinery.

10.  I  submit  that  the apprehensions  sought  to  be  expressed  by the  Petitioners in the Petition to the effect that the proximity of the said  land to the Petitioners' refinery causes an environmental and security  threat is misplaced and unwarranted. This would be apparent if the  neighborhood  of  the  Petitioners'  refinery  is  considered.  The  Petitioners' refinery is surrounded by dense human habitation i.e. more  than 350,000 occupants  & a  floating  population  of  approx 50,000.  This has been stated by the Asst. Engr. (DP) ES of the BMC in the  affidavit filed in Writ Petition No. 1891 of 2007. The affidavit of the  Assistant Engineering (D.P.) E.S. Mumbai filed in Writ Petition No.  1891 of 2007 by BPCL was to the effect that:

“…population in the locality is estimated to be 3.5 lakhs.  In addition, there is estimated to be floating population of  approximately  50,000 persons  comprising  of  employees  and visitors.  It  is pertinent that touching the refinery of  Hindustan Petroleum Corporation Ltd.,  7,500 flats  have  been constructed with more than 7,500 persons residing  

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there. The situation has not caused any breach of or threat  to the security of Hindustan Petroleum's refinery."

11. Moreover there are a number of multistoried/high rise buildings  which  are  situated  much  closer  to  the  Petitioners  refinery.  The  distance between the boundary wall of the Petitioners refinery and the  said  land  is  approx  470  mtrs.  Moreover  as  stated  earlier  the  Respondent No.20's actual construction site is an additional 400-500  mtrs away from its plot boundary: i.e. the aggregate distance from the  Refinery wall to the said buildings is 800-900 mtrs. As compared to  this,  there  are  multistoried  buildings  and  even a  high rise  situated  much  closer  to  the  Petitioners  refinery.  Some  of  such  buildings/habitations which surround the Petitioners' refinery are set  out hereunder:

On the South: At   the   distance   of zero metres /i.e.  almost  adjoining  the  refinery  there  exist  a  Gavanpada  village  with  a  population of about 7000 people.

On the East: a)   At the distance of 18.53 metres, there exist slums;  namely  Paryag  Nagar  and  Prakash  Nagar  with  a  population  of  approximately 5000 people.

b) At  the distance  of  about 125 mtrs., situated on raised ground/a hill, is the residential high  rise  tower  of  14  storey  constructed  on  the  Metal  Box  plot.  This  building is almost complete and ready for occupation.  

On the North: a)   At the distance of 30 to 130 mtrs. there are more  than 50 multi storey buildings constructed for Slum Rehabilitation by  RNA SRA Scheme and Videocon SRA Scheme consisting more than  6000 housing units and hundreds of shops.

  b) At  the distance  of  50  mtrs.  there  exists  Vishnunagar  Slum  having  a  population  approximately of 10,000 people.

  c) At  the distance  of  approx.  400  metres,  there  exists  Bharat  Nagar  slum  having  a  population of approx. 20000 people.

On the West: Across  the  road  and  opposite the main Gate of Refinery are the shops and hutments with a  population of about 200 people.

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Hereto annexed and marked Exhibit "A" is the satellite map showing  the location of the Petitioners refinery and its surroundings. Some of  those developments have taken place as recently as 2009-2010. Also,  annexed  hereto  as  Exhibits  "B-1"  to  "B-13"  are  some  of  the  photographs  clearly  showing  the  extent  of  residential  development  and the surroundings of the Petitioners' refinery.

12. The Petitioners after making initial objections in 2007, have not  filed  any  proceedings  to  stop  or  obstruct  the  construction  and  completion of the SRA High Rise project constructed on the land of  Metal  Box  which  is  at  the  distance  of  only  125  mtrs.  from  the  Petitioners' refinery.

13.  I  say  that  that  on  the  Northern  side  touching the  boundary  of  Respondent No.20's land which is notified as Residential Zone, there  is the MSEB Colony, buildings constructed for MHADA and various  SRA Projects.  Even  the  Petitioners'  own residential  colony  falling  within the Residential zone is situated only a few metres away from  the Boundary wall of Respondent No.20's land. Not only that, Bharat  Nagar and New Bharat Nagar residential areas having population of  approximately 20,000 people is also in the vicinity.

14. I say and submit near the refinery of the Petitioners, there is a  refinery of Bharat Petroleum Corporation Limited (BPCL). I say that  just  opposite  to  their  refinery,  the  area  as  sanctioned  under  the  Development Plan was shown for residential use. As a matter of fact,  BPCL  itself  required  the  area  near  the  refinery  to  house  their  workmen and staff quarters. I therefore, say and submit that statutory  authorities  while  finalizing  the  Development  Plan  had  taken  all  required steps to safeguard the hazardous industries by providing for  maintaining safe distance under the DCR. I say that the said area has  now have been developed with construction of multi storey buildings.  I  say  that  the  Plans  annexed  hereto  clearly  show  the  nature  of  constructions  surrounding  the  BPCL  refinery  also.  Not  only  that  monorail  route  is  passing just  outside  the boundary wall  of  BPCL  refinery and a railway station is also built which is having direct line  of site vision into refinery. I say that Exhibits "C-1 to C-3" are some  of  the  photographs  clearly  and  unequivocally  show  that  there  are  number of buildings already constructed near the refinery of BPCL  and  also  the  monorail  track.  I  therefore,  say  and  submit  that  the  Petitioners carrying on similar activities as that of BPCL cannot allege  the environment or the security concerns more particularly when all  the authorities have sanctioned the project of Respondent No.20.

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15. I say that despite repeated requests, the Petitioners have not shared  with Respondent No.20 the alleged report of Intelligence Bureau with  regard to the Security concerns. I say that in absence of such report  the Petitioners are unable to deal with the same. I submit that unless,  the Petitioners disclose the IB report, this Hon'ble Court should not  take  cognizance  of  the  alleged  extracts  relied  on  /referred  to.  I  however say that the issue regarding the proposed construction posing  a  security  risk  to  the  Refinery  (being  within  its  line  of  sight)  is  misconceived  and  untenable.  I  say  that  the  Petitioners'  property  is  enclosed on all sides by a boundary wall. Adjoining the boundary wall  there is a public road, which is used by the public at all times of the  day and night. Heavy vehicular traffic is also a constant phenomenon  on the said road. The said road does not have any security checks or  any persons patrolling it. I say that in order to enable any person a  direct line of site vision into refinery areas, one does not require to  climb multistoried buildings, as the refinery/storage tanks are clearly  visible & in the line of sight of a pedestrian walking along the road or  any occupant of a vehicle using the said road had a clear line of sight  to the Petitioners storage tanks. The Petitioners have also not raised  any security issue in respect of the buildings/multi storeyed buildings  built on almost three sides of the refinery at a distance ranging from  50 mtrs  to 300 mtrs.  In these circumstances  the Petitioners  cannot  contend that construction being carried out by these Respondents at a  distance of 800 to 900 mtrs constitutes a security risk and is required  to be stopped. Hereto annexed and marked Exhibit "D" is the satellite  image  of  the  Petitioners  refinery  along  with  photographs  of  the  residential colonies, SRA projects, commercial establishments, slums  around the same as also the developments opposite BPCL refinery.

16. I say that the Petitioners are merely apprehending that use of fire  crackers by residents would pose constant  hazard and threat  to the  refinery. The Petitioners have rather ignored the fact that the proposed  development of Respondent No.20 shall  be at the distance of more  than 800 mtrs.

17. I say that as the project on the said property is covered by the  Notification  issued  under  the  Environment  Protection  Act,  1986.  Accordingly,  the  Environment  Impact  Assessment  (EIA)  was  necessary  to  be  obtained  from MoEF,  and  Respondent  No.20  had  applied for the said sanction for the said project. I say that the said  process of EIA also requires a public hearing. I say that Petitioners  participated  in  the  public  hearing  conducted  by  the  Maharashtra  Pollution Control Board.

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18. The petitioners have acquired land admeasuring 2,30,407.40 sq.  metres  bearing  CTS  No.382,  382/1  to  22  belonging  to  one  Ahmedabad Printing and Calico Mills Co. Ltd. A part of this land falls  between the exiting refinery of the Petitioners and the said land of  Respondent No.20. Considering this area, which is as on date an open  area  there  is  a  distance  of  more  than  500  metres  between  the  Petitioners' existing refinery and the said land. It is not open to the  Petitioners to now carry on construction of additional/new storage on  the said Calico and thereafter  contend that safety distances are not  being maintained. The Petitioners are seeking to render the Petitioners  buildable land sterile without acquiring and paying for the same.”

(reproduced from the SLP paper book.)

The details of the buildings existing in the vicinity of the refineries of  

respondent No.1 and BPCL, to which reference has been made in the  

affidavit of Dr. Seema Garg, are given hereunder in the form of the  

following table:

Location  from the  Refinery  

Distance from the  Refinery

Name of  building/habitation  

Population  

South 0 metres; i.e., almost  adjoining the refinery  

Gavanapada Village 7000

East a) 18.53 metres Slums of Paryag Nagar  and Prakash Nagar

5000

b) 125 metres On a raised ground-  residential high rise  tower of 14 storey on  the Metal Box plot

Almost  complete  and ready  for  occupation

North a) 30-130 metres More than 50 multi  storied constructed  under the SRA scheme

6000  housing  units and  hundreds of  shops

b) 50 metres Vishnunagar Slum 10,000 c) 400 metres Bharat Nagar Slum 20,000

West Across the road and  opposite the main  gate of the refinery  

Shops and hutments 200  

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17. The  Division  Bench  of  the  High  Court  allowed  the  writ  petition  and  

quashed the permission accorded by the Corporation and other authorities for  

conversion of the appellant’s land from Special Industrial Zone (I-3) to Local  

Commercial  Zone  (C-1)  under  Regulation  No.  57(4)(c)  of  DC  Regulations,  

approval  granted  for  amalgamation  /  sub-division  of  the  plot  and  sanction  

accorded to amended building plans for construction of residential buildings. The  

High Court also quashed NOC issued by MPCB and environmental clearance  

granted by MoEF and directed the Municipal Commissioner to re-consider the  

applications made by respondent No.1 for change of land use and for sanction of  

plan  and  decide  the  same  afresh  after  considering  the  objections  raised  by  

various Departments and the provisions of Security Control Regulations.

18. One of the grounds which found favour with the High Court was that the  

Corporation is duty bound to ensure that large human habitation does not grow  

around the refinery, which comes within the definition of hazardous industries.  

The other ground accepted by the High Court was that while sanctioning change  

of land use and building plans, the Corporation did not pay due attention to the  

issue of security of the refinery and health of people likely to reside in the newly  

constructed buildings.  The High Court also held that even in the absence of  

specific  provision in  DC Regulations,  the  Municipal  Commissioner  was  duty  

bound to keep in mind the larger public interest, i.e., health of the people living  

in  the  vicinity  before  granting  permission  for  construction  of  residential  and  

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commercial  complex.  The  High  Court  accepted  the  affidavit  filed  by  the  

Assistant  Commissioner  of  Police  that  the  proposed  construction would  pose  

serious threat to the refineries of respondent No.1 and BPCL and held that such  

construction  cannot  be  allowed.   The  High  Court  rejected  the  appellant’s  

contention that the restriction proposed to be imposed in the name of security  

threat amounted to violation of its property rights. The High Court referred to the  

incidents like Bhopal gas tragedy, terrorist attack in Mumbai and the reports of  

the  Intelligence  Bureau  and the  Ministry  of  Home Affairs  and  held  that  the  

Municipal  Commissioner  had  approved  change  of  user  and  sanctioned  the  

building plan without applying mind to various issues.

19. R.D.  Dhanuka,  J.,  who  authored  the  main  judgment  recorded  the  

arguments of the learned counsel in 35 pages.  He rejected the objection raised  

on behalf of the appellant that the writ petition was not maintainable because  

respondent No.1 had not approached the Court with clean hands. The learned  

Judge then referred to  several  judicial  precedents  on the interpretation of  the  

1966 Act  and held:

“In our opinion even these above-referred provisions clearly provides  that  even  if  the  relaxation  in  respect  of  the  dimensions  in  case  of  hardship, can be granted by the Municipal Commissioner, Municipal  Commissioner  is  prohibited  from granting  such  relaxations  if  such  relaxation affects health, safety, fire safety, structural safety and public  safety of the inhabitants of the building and the neighbourhood. In our  view, the Learned Counsel for HPCL is right in his submission that  this  prohibition  against  the  Municipal  Commissioner  in  relaxing  certain conditions  even in  case  of  hardship,  if  it  affects  the  public  

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safety, health etc. should be read in the powers of Commissioner under  Regulation 16(a) (b) and (n). We are of the opinion that the issue of  security and health aspect, which is for members of the public at large  and is in pubic interest and therefore, by not considering the security  and  health  aspect  or  refusing  to  consider  such  aspects  while  sanctioning  the  plan  or  while  permitting  change  of  user,  is  totally  illegal  and  contrary  to  Regulations  16(a)  (b)  (n)  read  with  section  64(b) of the D.C. Regulations.

From  the  perusal  of  the  aforesaid  judgments  and  applying  the  principles thereof to the facts of this case, we are of the opinion that  the learned counsel for Oswal as well as Municipal Corporation are  not right in their submission that the security aspect should not have  been  considered  at  all  by  the  Municipal  Commissioner  while  sanctioning the plan for development or while permitting change of  user under any of the provisions of the D.C. Regulations or Mumbai  Municipal Corporation Act or Maharashtra Regional Town Planning  Act. We are of the opinion that it is not only the power but also duty of  the Municipal Commissioner to consider the security aspect in public  interest before granting permission to development any land as well as  permitting  change  of  user  from  one  zone  to  another  zone.  Under  Regulation 16(a), (b), (n) read with Regulation 64(b) read with section  46  of  the  M.R.T.P.  Act.  We  are,  therefore,  unable  to  accept  the  submission of the learned counsel for Oswal as well as B.M.C. that  there was no enabling provisions under the present D.C. Regulations  or any other provisions to consider security and health aspect before  sanctioning  the  plan  or  before  permitting  change  of  user  by  the  Municipal Commissioner.”

The learned Judge then referred to the judgment of the Division Bench of the  

High Court in an un-reported judgment titled TCI Industries Limited v.  The  

Municipal Corporation of Greater Bombay and others and held:   

“The  principal  argument  of  the  petitioner  was  that none  of  the  authorities  have  considered  Intelligence  Bureau report  categorically  pointing  out  that  any  planning  to construct  high  rise  residential  buildings  at  the  site  of demolished  factory  of  M/s.  Oswal  Agro  Mills  Limited,  Anik, Chembur  (Near  HPCL  Refinery)  would  be  detrimental  to  the

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security/safety  of  the  vital  installation  and  that  the  Mumbai terrorist  attack  in  November,  2008  had  exposed  vast coastline  of  Mumbai  to  danger  through  the  sea  due  to  which oil  installations  have  become  more  vulnerable  to  threat  from inimical  forces  and  such  installations  and  other  public  places were  likely  to  be  targeted.  Inspite  of  petitioner  bringing  these facts  to  the  notice  in  the  public  meeting  held,  strongly objecting  to  the  permissions  if  any  being  granted  to  Oswal for  development,  none  of  the  authorities  have  even  bothered to  look  into  the  security  aspect  while  granting  the  approval  to Oswal and have taken very casual approach in the matter. The learned  counsel  for  the  HPCL  as  well  as  learned  counsel  appearing  for  Government of India invited our attention to the instructions given by  the Government of India, Ministry of Home Affairs to their advocate  appearing in this matter requesting its advocate to appraise this Court  of the view of the Ministry of Home Affairs about the security aspect.  Even  in  the  said  letters,  it  is  made  clear  that  vital  installations  including  located  near  the  coastline  are  vulnerable  to  threats  from  inimical  forces  in  view  of  the  prevailing  security  situation.  It  is  recorded that the construction of building at the site of Oswal cause  security hazard to vital installations in HPCL Refinery. The Ministry  of Home Affairs have also addressed separate letter and has advised to  the State Government of Maharashtra requesting to review the matter  of permissions and clearance granted to Oswal for change of user and  construction  of  such  high  rise  construction  in  view  of  the  safety  reasons involved. We have also perused the affidavit in reply filed by  Mr. Didarsingh, Assistant Commissioner of Police, stating that as per  police  record,  HPCL is  "A"  category  vital  installation  in  terms  of  National importance and has been declared as prohibited area in the  Official  Secret  Act,  1923.  It  is  further  stated  that  the  high  rise  buildings, if permitted on the Oswal Mills land may enable direct line  of  sight  vision  into  not  only  HPCL Refinery  area  but  also  BPCL  Refinery area which is also close to Oswal Agro Mills Ltd. towards  south direction. It is further stated that any upper floors of complex on  Oswal land if permitted may provide an ideal launching pad for any  external subject to be directed or targeted at the said refinery storage  tank  which  may  contain  highly  inflammable  substances  like  LPG,  Naptha,  Crude oil  etc.  The Police department  have placed reliance  upon the threat assessment as per the report of the inspection of the  Industrial Security carried out by the Intelligence Bureau, Government  of India in the said affidavit. However, the learned counsel appearing  for  Oswal  submitted  that  the  so  called  assessment  of  Intelligence  Bureau  regarding  security  threat  to  refinery  of  petitioner  is  of  no  

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significance as  according to  him,  the ministry of  Environment  had  granted approval to the project of Oswal much after the said report of  Intelligence Bureau and while granting such approval the Ministry of  Environment had considered all aspects including the security aspect.  On  the  other  hand,  the  learned  counsel  appearing  for  the  HPCL  strongly  canvassed  that  this  court  is  not  an  expert  in  the  issue  of  security aspect. The serious threats of life and security perceived by  the Intelligence Bureau can not be brushed aside by the authorities as  well as by this Court. Oswal has not alleged any malafides on the part  of  Petitioners  in  raising  issue  of  security  or  health  or  in  placing  reliance  upon  Intelligence  Bureau  Report  or  has  not  made  such  allegations against Intelligence Bureau. Oswal has also not produced  any other report from expert showing different position.”

20. P.B. Majmudar, J., who agreed with R.D. Dhanuka, J. referred to Section  

37  of  the  1966  Act  which  contains  the  procedure  for  modification  of  final  

development plan, Clause 57 of the D.C. Regulations and observed:

“4. It  is  required  to  be  noted  that  in  the  instant  case,  after  due  application of mind, the area in question was placed under 13 Zone,  considering the fact that it is surrounded by industries which include  hazardous  industry  like  the  refinery.  It  is  not  in  dispute  that  the  refinery  in  question  is  considered  as  a  hazardous  industry.  In  an  industrial  zone,  commercial-cum-residential  activities  are  not  permitted.   Respondent No. 20 after purchasing the property decided  to  use  the  said  property  for  its  commercial  benefits.   The  Commissioner who is empowered to consider such request for change  of Zone is required to apply his mind in an appropriate manner. The  concerned  Commissioner  at  the  relevant  time,  for  the  reasons  best  known to him, failed to take into consideration various aspects such as  hazardous activity being carried out by the Refinery as high fumes are  going in the sky, refinery which is prone to security threats, etc. simply  because one may apply for conversion from one zone to another and  simply  because  the  Commissioner  is  empowered  to  grant  such  permission, he is not required to grant such conversion mechanically.  The  Commissioner  is  required  to  take  into  consideration  various  aspects  such  as  security  threats,  fire,  safety,  health,  etc.   While  considering  such  aspects,  one  cannot  lose  sight  of  as  to  what  had  happened in Bhopal few years back. It is required to be noted that the  

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Commissioner is not having unfettered and uncontrolled powers, while  taking such decision.  Once these powers are there, it is required to be  exercised sparingly by application of proper mind while taking into  consideration various other aspects in the matter.  In a given case, for  the purpose  of  residential  quarters  of  the employees of  a  particular  industry  or  for  providing  food  facilities,  permission  to  carry  out  commercial-cum-residential activities can be granted but it should not  mean  that  large  scale  commercial  activities  by  putting  high  rise  buildings  for  the  purpose  of  residence  also  can  be  permitted  in  a  mechanical manner.  In my view, while permitted the developer to put  high rise buildings, the Commissioner was required to apply his mind  in  an  appropriate  manner  instead  of  deciding  the  question  in  a  mechanical  manner.   It  is  the  duty  of  the  authority  to  see  that  by  permitting  conversion  from  industrial  zone  to  commercial-cum- residential  zone,  it  may  not  result  into  health  hazards  or  security  threats. On going through the voluminous records and photographs, it  cannot be denied that the area is surrounded by a large scale refinery  and large fumes are also going in the sky. When the question relates to  the  town  planning,  those  who  are  in  the  charge  of  town  planning  should see to it that after 50 or 60 years, the future generations may  not  curse  those  who  were  in  charge  of  planning  as  the  planning  authority is required to consider the future needs and interest of the  future generation also. It is not out of place to mention at this stage  that before independence when Baroda State was in existence, its ruler  Sayajirao Gaekwad, who was a great visionary, never permitted any  industries within the city limits as, according to him, if the industrial  activities are permitted near the residential area, it is bound to affect  the health, safety and security aspects.  The said aspect was considered  by the said Ruler more than 70 years ago.  In the instant case, since the  area  is  surrounded  by  industries  and  is  in  an  industrial  zone,  the  authorities are required to consider as to whether it  will  create any  nuisance  to  the  people  who  are  permitted  to  reside,  if  high  rise  buildings are constructed near such industries.  The planning authority  in  its  wisdom is  required  to  consider  this  aspect  in  an  appropriate  manner.  The Commissioner was required to consider even the aspect  of  security  threat  as  it  is  pointed  out  that  so  far  as  refinery  is  concerned, there is also a security threat. In my view, therefore, the  Commissioner was required to consider the matter appropriately and  should  not  decide  the  matter  mechanically  simply  on  the  basis  of  discussions  during  the  meeting  with  the  officers  of  the  Petitioner  Company.”    

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The learned Judge further observed that the concerned authority did not  

apply  mind  while  sanctioning  change  of  land  use  of  the  plot  owned  by  the  

appellant.

21. We have heard S/Shri Dushyant A. Dave, Rakesh Tiku, Shekhar Naphade  

and Pallav Shishodia, Senior Advocates appearing for the appellants and S/Shri  

Harish  N.  Salve  and  Rakesh  Dwivedi,  Senior  Advocates  appearing  for  the  

respondents and carefully scrutinized the records.

22. Although learned counsel for the parties raised several contentions, I do  

not consider it necessary to deal with the same because the High Court has not  

considered the issues of security and possible adverse impact on the health of  

those who may occupy the buildings to be constructed by the appellant due to  

existence of the refineries and industries in the area in a correct perspective. A  

reading of additional affidavit dated 12.12.2011 filed by Dr. Seema Garg, Senior  

Vice-President of the appellant and photographs annexed with it shows that large  

number of multi-storied buildings have been constructed near the refineries of  

respondent  No.1  and  BPCL  and  over  3,50,000  persons  are  living  in  those  

buildings.    The  photographs  marked  ‘Exhibit  D’  clearly  demonstrate  the  

existence of several buildings in the vicinity of the refineries of respondent No.1  

and  BPCL.    These  include  the  colony  of  the  officers  and  employees  of  

respondent No.1 which is at a distance of 30 meters from BPCL refinery.  The  

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photographs further show that Mono Rail is being constructed at a distance of 18  

meters from BPCL refinery.  

23. The averments contained in the affidavit of Dr. Seema Garg on the issue of  

existence of multi-storeyed buildings in the vicinity of the refinery of respondent  

No.1 and BPCL remained substantially uncontroverted, but the Division Bench  

of the High Court virtually ignored the same and allowed the writ petition of  

respondent  No.1  by  relying  upon  the  report  of  Intelligence  Bureau  and  the  

affidavit  filed  by  the  Assistant  Commissioner  of  Police,   a  reading  whereof  

shows that  the report  as  well  as  the affidavit  are not  based on any scientific  

study. It is extremely difficult, if not impossible, to visualise any security threat  

from the buildings being constructed by the appellant when no such threat  is  

perceived from the buildings already constructed in the close vicinity of the two  

refineries. Gavanpada Village having a population of 7,000 is just adjacent to the  

refinery.  On  East  and  North,  several  buildings  have  been  constructed  at  a  

distance of 18.53 meters to 130 meters. Lakhs of people are residing in these  

buildings.   Respondent  No.1  did  not  get  any  scientific  study  conducted  by  

experts to find out the effect of gases emanating from the refineries and other  

industrial units operating in the area on the health of the people occupying the  

building. Not only this, the said respondent did not explain as to how the security  

persons who may occupy some of the buildings already constructed will not be  

affected by the pollution caused due to operation of the refineries and industries.  

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This being the position,  the bald assertions made on behalf of respondent No.1,  

the  report  of  the  Intelligence  Bureau  and  affidavit  filed  by  the  Assistant  

Commissioner of Police on the issues of security threat and public health could  

not have been relied upon for recording a finding that the buildings proposed to  

be constructed by the appellant would pose security threat and adversely affect  

the health of the prospective occupants of the buildings.

24. The  omission  on  the  part  of  respondent  No.1  to  challenge  the  

sanction/permission accorded by the Corporation and other public authorities for  

construction  of  other  residential  buildings  is  inexplicable.   If  the  buildings  

proposed to be constructed by the appellant at a distance of 800 meters from the  

refinery are considered future security threat to the establishment of respondent  

No.1, the buildings already constructed in the close vicinity of the refinery etc.  

would certainly pose greater security threat.  The solution found by the State and  

its functionaries as also the officers of the Corporation, i.e., use of upper floors of  

the  buildings  for  housing  the  members  of  Police  force  and  other  security  

agencies  can  equally  be  applied to  the case  of  the  appellant  and there  is  no  

rational reason to discriminate the appellant vis-à-vis others, who have already  

constructed  the  buildings.   Similarly,  the  plea  of  respondent  No.1  that  the  

operation of refineries would adversely affect the health of the occupants of the  

buildings proposed to be constructed by the appellant will be equally relevant for  

the occupants of the buildings already constructed.  Respondent No.1 has not  

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placed  any  report  of  the  experts  to  prove  that  the  residents  of  the  buildings  

already  constructed  have  become  prone  to  various  kinds  of  diseases  and,  

therefore,  it  is  opposing  the  construction  of  new  buildings  which  may  be  

occupied by the members of public.  Therefore, this objection cannot be pressed  

into service for restraining the appellant from constructing the buildings.

25. On the premise aforesaid, the appeals are allowed, the impugned order is  

set  aside  and the  matter  is  remitted  to  the  High Court  for  deciding the  writ  

petition of respondent No.1 afresh after considering the material produced by the  

parties on the issues of security threat and possible danger to the health of the  

occupants of the buildings already constructed and those who may occupy the  

buildings to be constructed by the appellant. The High Court shall decide the writ  

petition afresh uninfluenced by the observations and findings contained in the  

order of the High Court and this judgment.  The parties may, if so advised, file  

additional affidavits and documents within six weeks from today.

26. Since  the  construction  of  buildings  by  the  appellant  had  been  halted  

pursuant to the interim order passed by this Court, the High Court is requested to  

decide the writ petition afresh as early as possible but latest within a period of  

four months from the date of receipt of copy of this order in the Registry of the  

High Court.

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27. The Registry is directed to send a copy of this judgment to the Registrar  

General of the Bombay High Court who shall place the same before the Chief  

Justice for appropriate order.

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

New Delhi;        December 10, 2013.

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REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.10933 OF 2013 (@ out of  SPECIAL LEAVE PETITION (CIVIL) NO.14202/2012)

Oswal Agro Mills Ltd. …    Appellants

            Versus

Hindustan Petroleum Corporation Ltd. & Ors. …    Respondents

With CIVIL APPEAL NO.10934 OF 2013

(@ out of  SPECIAL LEAVE PETITION (CIVIL) NO.30858/2012)

Municipal Corporation of Greater Mumbai …    Appellants

            Versus

Hindustan Petroleum Corporation Ltd. & Ors. …    Respondents

J  U  D  G  E  M  E  N  T

H.L. Gokhale J.

We have gone through the judgment prepared by our  

Learned Brother G. S. Singhvi, J. wherefrom we have benefited.  

Yet with great respect, we are unable to persuade ourselves to  

agree therewith for the reasons which we record herein below.

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2. Both these appeals seek to challenge the judgment  

and  order  dated  12.4.2012  rendered  by  a  Division  Bench  of  

Bombay High Court allowing Writ Petition No.1973 of 2011 filed  

by  respondent  No.1  in  these  appeals.   For  the  sake  of  

convenience, we will refer to the facts as disclosed in the appeal  

filed by Oswal Agro Mills Ltd. (‘Oswal’ for short).  The dispute in  

this  matter  is  essentially  with  respect  to  the  proposed  

construction of the residential-cum-commercial complex of the  

appellant  herein,  which  is  permitted  by  the  Municipal  

Corporation of Greater Mumbai to come up in the vicinity of the  

Refinery  run  by  the  first  respondent  Hindustan  Petroleum  

Corporation Ltd. (‘HPCL’ for short) at Mahul, Chembur, Mumbai.  

The refinery is situated on B.D Patil Marg, Mahul, on a property  

comprising of various CTS Numbers. Apart from the refinery, the  

first respondent has about 117 storage tanks on this property  

which  store,  at  any  given  point  of  time,  oil  and  petroleum  

products of over 118883860 KL.  The proposed construction is  

to  come up on  the  adjoining  property  of  Oswal  bearing  CTS  

No.381, 381/1 to 21 of Village Anik, in ‘M’ Ward at R.C. Marg,  

Chembur,  Mumbai.  The  project  involves  construction  of  four  

commercial buildings, one office building, one amenity building,  

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and eight more buildings for residential purposes, consisting of  

about  3000  flats.   The  principal  contention  of  the  first  

respondent is two-fold viz. that from the point of view of the  

safety and security of the refinery, and of the occupants who  

will be residing in this housing complex, as well as their health,  

this  development  ought  not  to  be  permitted.   It  is  their  

submission that such a construction would be contrary to law,  

apart  from  being  potentially  dangerous  and,  therefore,  

undesirable on both these counts.

3. The refinery of the first respondent was set up in this  

area way back in year 1952 on an area of about 416 acres.  The  

refinery of BPCL is opposite the refinery of the first respondent.  

The  factory  of  Rashtriya  Chemicals  and  Fertilizers  is  in  the  

vicinity.   Bhaba  Atomic  Research  Centre  at  Trombay  is  also  

close by.  When all these vital installations were set up, there  

was hardly any population in this area, and in any case there  

were  no  tall  buildings.   The  only  nearby  locality  which  was  

occupied  was  a  village  by  name  Gavanpada.   All  these  

installations were set up in this area principally because it was  

sparsely populated and it is far away from the main island city  

of Mumbai.

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4. This  area  was  designated  as  the  Special  Industrial  

Zone,  and the  commercial-cum-residential  activities  were  not  

permitted  therein.   The appellant  was owning the concerned  

property since about 1989, and its factory thereon, but it moved  

for  the construction of  a  residential-cum-commercial  complex  

therein, only in the year 2006. The requisite change of user has  

been permitted by the Municipal  Corporation and hence,  this  

litigation between the parties.

5. As  can  be  seen  from the  synopsis  of  the  SLP  No.  

14202 of 2012 filed by the appellant,  it  specifically states as  

follows:-

“The petitioners’  said plot is  located approximately 500 mtrs   north of the boundary wall of the HPCL Refinery.  The building   moreover being constructed by them is a further 470 mtrs to   the  north  of  the Petitioners’  plot  boundary i.e.  at  about  970   mtrs (almost 1 kilometer away) from wall.”

6. The appellant  has contended that  at  the most,  the  

first respondent is seeking a buffer zone of 500 meters along its  

refinery,  and  they  also  referred  to  the  construction  of  some  

other buildings which have come up and are coming up in the  

vicinity.  The proposal of the appellant is to construct buildings  

of 7 to 8 storeys,  and it  is  their  submission that when other  

similar constructions are permitted in the vicinity, there is no  

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reason  why  their  construction  should  be  objected.  The  first  

respondent has, however, pointed out in their affidavit before  

the High Court that whatever may be the initial proposal of the  

appellant,  some  of  these  buildings  would  be  going  upto  24  

floors.  As against that, the appellant has tried to explain this  

high-rise  construction on the basis  of  utilization of  F.S.I.,  but  

they  have  not  denied  the  existence  of  such  a  subsequent  

proposal.   In  this  behalf,  it  is  to  be  noted  that  the  first  

respondent has objected to all the similar constructions in the  

vicinity all throughout.

7. As stated above, the first respondent objected at all  

stages when it came to know about the proposed development  

of the appellant. Firstly, when the public notice was issued on  

19.6.2006 for environmental public hearing, the first respondent  

lodged their objection by letter dated 11.7.2006.  They pointed  

out  that  a  residential-cum-commercial  complex  next  to  

oil/petroleum refinery was inherently not environment friendly.  

It has been their submission that the operation of the refinery  

and ancillary  installations,  including  storage facilities,  release  

Volatile  Organic  Compounds  into  the  atmosphere,  some  of  

which  are  carcinogenic,  particularly  at  the  height  of  funnel  

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chimney.  It was also pointed that a construction overlooking  

the  refinery  was not  desirable  from the point  of  view of  the  

safety and security of the refinery.  When the first respondent  

learnt about the other development projects such as those on  

the  Metal  Box Co.’s  plot  and on  that  of  Apar  Ltd.,  they had  

protested by their letters dated 26.10.2007 and 3.6.2008 to the  

Chief  Secretary  of  the  State  of  Maharashtra.   By  their  

subsequent  letter  dated  26.8.2008  to  the  Additional  Chief  

Secretary,  they  lodged  their  objections  once  again.  The  first  

respondent  by  their  letter  dated  15.10.2010  requested  the  

Municipal Corporation to intervene and stop the construction of  

residential/commercial  complex  of  the  appellant  near  their  

refinery.   However,  the  Municipal  Corporation  by  their  letter  

dated  28.10.2010  informed  the  first  respondent  that  the  

development  around  the  refineries  was  being  carried  out  by  

Oswal in accordance with the Development Control Regulations  

(DCR) for Greater Mumbai, 1991 framed under the Maharashtra  

Regional and Town Planning Act, 1906 (‘MRTP Act’ for short),  

and  legally  the  development  could  not  be  stopped  by  the  

Corporation.  

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8. Ultimately,  when  the  first  respondent  learnt  that  

permission had been granted to the appellant for conversion of  

the  land  from  industrial  to  residential-cum-commercial  

purposes,  the  first  respondent  filed  the  earlier  referred  Writ  

Petition in the Bombay High Court bearing No.1973 of 2011. The  

prayers in the Writ Petition were to set aside the approvals and  

permissions  granted  by  various  statutory  authorities,  and  

particularly  the  approvals  and  permissions  granted  for  the  

development purpose and for the change of user as disclosed  

from exhibits  Q to  Z to  the  Writ  Petition.   Prayer  (b)  of  the  

petition was that the permission to develop the residential-cum-

commercial  complex on the said plot be set aside.  The Writ  

Petition  having  been  allowed,  these  two  appeals  have  been  

filed.  Mr. Dushyant Dave, learned senior counsel has appeared  

for the appellant Oswal, Mr. Harish Salve, learned senior counsel  

has appeared for HPCL, Mr.  Shekhar Naphade, learned senior  

counsel has appeared for the Municipal Corporation of Greater  

Mumbai, and Mr. Sanjay Kharde, learned counsel has appeared  

for the State of Maharashtra.  

9. The principal  submission on behalf  of  the appellant  

Oswal  was  that  they  had  been  granted  the  change  of  user  

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(conversion from industrial zone to residential/commercial zone)  

by  the  municipal  corporation,  under  its  permission  dated  

1.9.2009, on this parcel of land (exhibited at Annexure P-23 to  

the Writ Petition). Since, this permission was as per DCR 57(4)

(c),  which  allows  such  a  change  of  user  with  the  previous  

approval  of  the  Municipal  Commissioner,  it  should  not  be  

interfered  with.   This  change  of  user  was  defended  by  the  

Municipal Corporation also through the affidavit of the Assistant  

Engineer,  Development  Plan,  ‘M’  Ward,  dated  19.11.2011.  It  

was  stated  in  paragraphs  4  (c)  and (d)  of  this  affidavit  that  

various  complaints  had  been  received  from  HPCL/BPCL  

concerning the issue of security, and a reference was therefore  

made to the Urban Development Department of the State of  

Maharashtra,  vide  letters  dated  26.10.2006  and  21.4.2007.  

However,  no  clarification  as  sought  was  received  from  the  

Government, and hence in view of the order of the Municipal  

Commissioner  dated  24.8.2009,  the  conversion  from  Special  

Industrial  Zone  (I-3)  to  Commercial  Zone  (C-1)  was  granted.  

That was on an undertaking from Oswal, that if the Government  

issues an adverse clarification,  that will  have to be complied  

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with,  and  also  on  an  indemnity,  as  against  any  legal  

consequences arising out of any action initiated by HPCL.  

10. Various submissions were advanced on behalf of the  

first respondent, though the principal ones from amongst them  

were as follows:-

(i)  Firstly, it was submitted that the permission for conversion  

of  the  land  from  industrial  to  residential-cum-commercial  

purpose  was  granted  even  prior  to  the  public  hearing  in  

pursuance  to  the  notice  issued by  the  Maharashtra  Pollution  

Control Board.  Besides, the conversion from Special Industrial  

Zone  (I-3  Zone)  to  Local  Commercial  Zone  (C-1)  under  

regulation  57  (4)  (c)  of  the  DCR  1991  required  a  certain  

procedure to be followed which had not been followed, and it  

could not be without considering the objections of  Respondent  

No 1.   

(ii) Secondly, the likely health hazards for the occupants were  

not considered at all, as pointed out earlier.

(iii) Last  but  not  the  least,  they  emphasised  the  security  

aspect.   In  paragraph  28  of  the  Writ  Petition,  the  first  

respondent specifically relied upon the inspection carried out by  

the Intelligence Bureau of Government of India in the refinery  

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on  10.1.2011.   The  report  stated  in  paragraph  3  thereof  as  

follows:-

“3. Threat Assessment The Mumbai  terrorist  attack  of  November  26,  2008 has   

exposed our vast coastline to danger through the sea due to   which oil installations have become more vulnerable to threat   from inimical forces.  This was revealed during interrogation of   various arrested militants in the country over last few years. David Coleman Headly disclosed during his interrogation that   during  his  nine  visits  to  India  (2006-09),  he  has  identified  a   large number  of  sensitive  establishments  including  economic   targets like Mumbai  Stock Exchange,  World  Trade Tower,  Oil   Installations, BARC Mumbai, etc. Several  multi  storied  buildings  (57)  constructed  under  SRA   scheme  near  the  HPCL  Refinery,  presently  not  allotted  to   anybody due to security concerns, if allotted to persons other   than security agencies, may be misutilised to cause damage to   the Refinery. Any planning to construct high rise residential buildings at the   site of demolished factory of M/s Oswal Agro mills Ltd., Anik,   Chembur  (Near  HPCL  Refinery)  would  be  detrimental  to  the   security/safety of the vital installation.” (emphasis added)  

11. It is relevant to note that on the security aspect, the  

first respondent referred to their letter dated 13.4.2011 to the  

then Chief Secretary, Government of Maharashtra, wherein they  

drew his attention to the recent incident of fire at Indian Oil  

Depot  at  Jaipur  resulting  into  loss  of  life  and  damage  to  

property.   They relied upon the letter dated 1.3.2012 by the  

Deputy Secretary, Ministry of Home Affairs, Government of India  

which specifically stated in Paragraph (2) (ii) as follows:-

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“ii) With specific reference to the construction of within building   at the site of demolished factory of M/s Oswal Agro Mills Ltd.,   Anik Village Chembur near HPCL refinery, they pose a security   hazard  to  the  above  vital  installation  in  HPCL  refinery.   Accordingly, MHA has already issued an advisory in this regard   to  the  State  Government  of  Maharashtra  vide  letter  No  VI   23014/448/2011-VS  dated  16.1.2012  (copy  enclosed).   As   regard  the  possibility  of  such  construction  being  used  by   security agencies, the matter, needs to be examined in depth in   consultation with all concerned.” Lastly,  they  relied  upon  the  affidavit  of  the  Assistant  

Commissioner of Police of Trombay filed in the Writ Petition. In  

paragraph 3, he has specifically stated that any upper floors in  

the complex on Oswal land, if permitted, may provide an ideal  

launching pad for any external object to be directed or targeted  

at  the  said  refinery  storage  tanks  which  may  contain  highly  

inflammable substances like LPG, Naphtha and Crude Oil.

12. The Division Bench of the High Court considered all  

these aspects,  and by a very detailed judgment came to the  

conclusion that such a construction could not be permitted as it  

would be hazardous to health, and would also create a threat to  

the security of the refinery.  It came to the conclusion that the  

development permission in favour of Oswal was granted without  

any application of mind, and without considering the security  

aspect.  All these considerations led the High Court to allow the  

Writ  Petition.   In  paragraph 60 (a)  of  its  judgment,  the High  

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Court  set  aside all  the  orders/permissions which were issued  

from 2006 onwards, and which were annexed at exhibits Q to Z  

to  the  Writ  Petition.  The  High  Court,  thereafter,  specifically  

directed in paragraphs 60 (b) and (c) as follows:-

b)  The  Municipal  Commissioner  is  directed  to  reconsider  the   application  made  by  Oswal  for  change  of  user  and  also   application for sanction of plan after considering the objections   of  the  Petitioners,  Police  Department,  Ministry  of  Petroleum,   Ministry of Environment and Intelligence Bureau Report referred   by HPCL and also Security Control Regulations issued by State   of  Maharashtra,  issued  under  Section  37  (1AA)  of  the   Maharashtra Regional and Town Planning Act, 1996 and after   hearing  the  parties  concerned,  pass  the  fresh  order  after   considering the views expressed by us and in accordance with   law within a period of eight weeks from today. c) Ministry of Environment is also directed to reconsider their   decision while considering the permission applied for by Oswal   after considering the views expressed by us and after hearing   all  the  concerned  parties  including  HPCL  and  should  pass  a   fresh order within a period of eight weeks in accordance with   law.”

13. (i) Our Learned Brother Singhvi, J. appears to have been  

persuaded to accept the submissions of the appellant in view of  

the affidavit of Dr. Seema Garg, Vice President of the appellant.  

The affidavit points out that on the southern side of the refinery,  

the Gavanapada Village is located with a population of about  

7000 people. We must, however, note that this is an old village  

establishment and one cannot do away with it.  It is stated that  

on the eastern side there is a slum at a distance of about 18.53  

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meters.  On the northern side, there are two slums at Vishnu  

Nagar and Bharat Nagar,  and on the western side,  there are  

some shops and hutments.  In our view, HPCL cannot be held  

responsible for these structures.  We must, in any case, note  

that  they  are  all  structures  of  an  insignificant  height.   On  

eastern side, there is a high-rise tower of 14 storeys which is  

almost  completed,  but  yet  not  occupied,  but  which  had  all  

throughout been objected to by HPCL.  On the northern side,  

there are more than 50 multi-storey buildings constructed in the  

Slum Rehabilitation Scheme which also are not occupied.  We  

must, however, note that because of the resistance of the first  

respondent,  the  upper  floors  of  these  buildings  are  to  be  

allotted to the Police department.  

(ii) The affidavit of Dr. Seema Garg has emphasized all  

these aspects which have been quoted in the order prepared by  

our  Learned  Brother,  but  he  has  not  considered  the  above  

explanation  of  HPCL  in  that  behalf.    It  has  been  stated  in  

paragraph 22 of his judgment that the High Court has allowed  

the  Writ  Petition  by  relying  upon  the  report  of  Intelligence  

Bureau  and  the  affidavit  of  the  Assistant  Commissioner  of  

Police, but according to him they are not based on any scientific  

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study  or  expert  analysis.   In  our  view,  the  statement  in  the  

affidavit of the Assistant Commissioner of Police as well as the  

extracts  from the report  of  the Intelligence Bureau are quite  

cogent. The view of the Police Commissioner is reinforced by  

the Central Home Ministry on the background of the terrorist  

attack in the city on 26.11.2008.  It has also been mentioned in  

paragraph 23 of  his  judgment  that  some other  buildings  are  

coming up at a distance of about 800 meters from the refinery.  

As stated above that all throughout these developments have  

been objected to by HPCL.  Therefore, HPCL cannot be faulted  

for  such  constructions  which  are  permitted  by  the  Municipal  

Corporation.  Besides, merely because such constructions have  

been permitted so far, that does not justify any more high-rise  

constructions coming up in the vicinity.  We are aware of the  

serious accidents which took place at the IOCL refinery at Jaipur,  

and  also  at  the  Union  Carbide  Factory,  Bhopal.   Any  such  

accident  would  cause  serious  loss  of  life  and  property,  and  

would be hazardous to the occupants of these constructions.  

14. What  is  most  relevant  to  note  is  that  when  the  

refinery of the first respondent came up in the year 1952, and  

the  other  earlier  referred  vital  installations  of  national  

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importance also  came up in  the nearby area,  the population  

over there was sparse, and that is why these installations were  

permitted  to  be  set  up  at  locations  in  the  Mahul  area  of  

Chembur far away from the Island city of Mumbai.  Now the city  

has  grown-up,  as also  the suburbs,  and people are trying to  

occupy  the  vacant  spaces  wherever  available.  The  Municipal  

Corporation  and  the  State  of  Maharashtra  ought  to  have  

checked and stopped these constructions, particularly the high-

rise  ones in  the vicinity  of  these installations,  but  they have  

failed in  doing the same.   It  cannot,  however,  justify  further  

dereliction  of  their  responsibilities.   Merely  because  some  

constructions have been permitted at some distance from the  

refinery  of  the  first  respondent,  does  not  mean  that  further  

high-rise constructions should be permitted to come up nearby.  

Two wrongs do not make one right.  

15. Having dealt with the appeal filed by Oswal, we may  

now deal with the appeal filed by the Municipal Corporation.  In  

this  behalf,  we  must  say  at  the  outset,  that  we  are  rather  

surprised that the Municipal Corporation has also chosen to file  

an appeal against the order of the High Court.  This is on the  

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background that  Oswal  had given  an  Indemnity  Bond to  the  

Municipal Commissioner dated 7.1.2011 which reads as follows:-

“INDEMNITY BOND To, The Municipal Commissioner,  M.C.G.M. Municipal Office, Mahapalika Marg, Mumbai Hon’ble Sir, Sub: Request to allow the users permission in Local Commercial   Zone (C-1) on the land bearing CTS No.  381,  381/1 to 21 of   Village Anik, in ‘M’ Ward at R.C. Marg, Chembur, Mumbai. M/s Oswal Agro Mills Ltd. Ref: File No. CHE/683/DPES I, the undersigned Shri Mahesh Rawal, Authorised Signatory of   M/s  Oswal  Agro  Mills  Ltd,  of  the  above  mentioned  property   whose office situated at Sea Building, Off Carter Road, Behind   Cafe  Coffee  Day,  Opposite  Chandni  Building,  Bandra  (W)   Mumbai-400 052, hereby undertake to indemnify MCGM of any  legal  consequences  arising  out  of  HPCL  or  any  other   organization/person  moves  any  court  of  law  restraining   development on the land under reference. This Indemnity Bond is binding to me, to my heirs, executors,   assignees,  assigns and to  everybody derives  title  through or   under me. Dated this 7th day of January, 2011 Yours faithfully Oswal Agro Mills Ltd.”

In view of this Indemnity Bond, the Municipal Corporation had  

no reason to file any appeal against the order of the High Court,  

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and  we  disapprove  of  the  same.   We  refrain  from  saying  

anything more.

16. (i) It was contended on behalf of Oswal, as well as on  

behalf of the Municipal Corporation, that the Corporation is not  

required to go into the security aspect and the environmental  

clearance as a pre-requisite before any such proposal is cleared.  

It was submitted that this was outside its jurisdiction.  In this  

behalf, we may refer to the relevant portion of DCR No.16 which  

falls in Part II of the DC Regulation of 1991 containing ‘General  

planning requirements, Land uses and manner of development’.  

The relevant portion reads as follows:-

“16. Requirements of Sites No land shall be used as a site for the construction of buildings- (a) if the Commissioner considers that the site is insanitary or  that it is dangerous to construct a building on it or no  water supply is likely to be available within a reasonable period   of time; (b) …… (c) ….. (d) ….. (e) if the use of the said site is for a purpose which in   the Commissioner’s opinion may be a source of danger  to  the  health  and  safety  of  the  inhabitants  of  the  neighbourhood; (f) ….. (g) ….. (h) ….. (i) ….. (j) ….. (k) ….. (l) …..

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(m) ….. (n) if the proposed development is likely to involve damage to   or have deleterious impact on or is against urban aesthetics or   environment  or  ecology  and/or  on  historical/architectural/   aesthetical  buildings  and  precincts  or  is  not  in  the public  interest.”

Even DCR No.64 which gives the ‘Discretionary powers’ to the  

Commissioner,  does  not  permit  him  under  sub-clause  (b)  

thereof to grant relaxation which will affect safety, fire safety  

and  public  safety  of  the  inhabitants  of  the  building  and  the  

neighbourhood.  Thus, this power is coupled with the duty to  

give paramount importance to safety. These provisions cast an  

obligation  on  the  Municipal  Commissioner  to  take  into  

consideration the objections in this behalf. (ii) DCR  57  (4)  

(c)  was  relied  upon  by  the  appellant  and  the  Municipal  

Corporation in defence of the change of user.  We are conscious  

that  this  DCR contains  a  non-obstante  clause,  but  all  that  it  

states is that ‘notwithstanding anything contained above’ (i.e.  

earlier in the DCRs), such a change of user may be permitted.  

Thus, it is an enabling provision, though it does not mean that  

the power therein is to be exercised disregarding the objections  

that are raised.  The power under DCR 57 (4) (c) could not be  

exercised  as  a  stand  alone  power,  when  specific  objections  

relatable to DCR 16 had been raised.  MRTP Act being an act to  

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provide for  planned development,  the provisions of the DCRs  

will  have  to  be  read  purposively  and  harmoniously,  and  not  

disjunctively. The appellants had relied upon paragraphs 41 and  

42 of the judgment of this Court in  Bombay Dyeing & MFG  

Co.  Ltd.  Vs.  Bombay  Environmental  Action  Group  and  

Ors. reported in  2006 (3) SCC 434.  However, all that these  

paragraphs state is that DCR 57 (4) (c) is pari materia with DCR  

56 (3) (c), which is on the General Industrial Zone (I-2 Zone).  

However, the judgment does not lead us anywhere further on  

the issue in hand.  As against that, we must note that this Court  

has held that the wide amplitude of a non-obstante clause must  

be kept confined to the legislative policy, and it can be given  

effect to, to the extent Parliament intended and not beyond the  

same (See  Para  36  of  ICICI  Bank Vs.  Sidco  Leather  Ltd.  

2006 (10) SCC 452).  HPCL had lodged their objections, and  

the Municipal  authorities were required to consider the same  

but  they  have  not.   Rather,  they  refused  to  consider  these  

objections on a totally erroneous reading of the DCRs as can be  

seen from their earlier referred letter dated 28.10.2010. Where  

human habitation is permitted in proximity of hazardous plants,  

there is an immediate, as well as long term, danger of exposure  

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to health hazards.  The planning authority cannot ignore these  

aspects. The public interest cannot be sacrificed at the altar of  

commercial  interests.  The  submissions  of  the  Municipal  

Corporation  and  Oswal  are  clearly  contrary  to  the  above  

regulations, and are therefore rejected.      

(iii) Oswal and the Municipal Corporation had contended  

that  the  Writ  Petition  was  belated.   With  reference  to  this  

submission, we must note that the I.O.D was issued to Oswal on  

11.11.2010,  and the  Commencement  Certificate  (to  start  the  

construction upto the stilt) was issued on 11.11.2011. The Writ  

Petition filed on 16.9.2011 could not therefore be said to have  

been filed belatedly.  

17. Our Brother  Singhvi,  J.  has apart  from allowing the  

appeal and setting aside the order, directed the High Court to  

re-hear the matter after considering the material produced by  

the parties on the issue of security threat and possible danger  

to  the  health  of  the  occupants  of  the  buildings  already  

constructed  and  that  of  the  prospective  occupants  of  the  

appellant’s buildings.  As stated above, in our view the security  

threat is clearly placed on record, as also the possible danger to  

the health of the occupants of the buildings already constructed  

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and to be constructed as well.  The order of the High Court has  

set aside all the approvals in favour of Oswal.  It has taken care  

of  some  of  these  issues  when  it  directed  the  Municipal  

Commissioner  to  reconsider  the  application  made  by  Oswal  

after considering (a) the objections of the Police Department,  

Ministry of Petroleum, Ministry of Environment and Intelligence  

Bureau report, and also the Security Control Regulations framed  

by  the  State  of  Maharashtra.   (b)  The  High  Court  has  also  

directed that  the Municipal  Commissioner  will  pass the order  

after  hearing  the  parties  and  after  considering  the  views  

expressed by the High Court and in accordance with law.   In  

addition,  we  further  direct  the  Municipal  Commissioner  to  

consider  the  issue  of  possible  danger  to  the  health  of  the  

occupants of the buildings already constructed, and those to be  

constructed by the appellants, as desired by Singhvi, J..  He has  

referred to the statement in the affidavit of Vice-President of the  

appellant that HPCL is seeking to make the property of Oswal  

sterile and unbuildable without acquiring the same.  The parties  

can certainly utilise the time now available for appropriate and  

fruitful negotiations in this behalf.  And, in any case, Oswal can  

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certainly use the land for an agro-industry or any permissible  

industry.

18. This being the position, we cannot find any fault with  

the  impugned judgment  and order  of  the  High  Court,  and it  

need  not  be  set  aside.  On  the  contrary,  these  two  appeals  

deserve  to  be  dismissed.   Accordingly,  we  pass  an  order  

dismissing these two appeals. The parties will  bear their own  

costs.

………………….…………………J. [ H.L. Gokhale ]

      ……………….………………………J. [ Ranjana Prakash Desai ]

New Delhi Dated: December 10, 2013

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