The Bombay High Court said that the situation across the city is 'now so dire' and that it would be necessary for the government to step in with “drastic steps to curb errant builders in default of their obligations" while undertaking redevelopment projects, which also include transit rent payment to tenants who vacated their premises for new permanent accommodations.
Rights of residents are primary: Bombay HC
A division bench of Justices Gautam Patel and Neela Gokhale, on August 7, observed, “We will not sit by and allow residents of this city to be treated as a necessary evil, an irritant or a nuisance in developers’ pursuit of profits or their worship of Mammon.’’
While batting for the rights of the tenants, the bench noted, “The rights of genuine and eligible residents are primary. The developers’ rights are distinctly secondary and will remain subordinated to the rights of such residents.”
Petition hearing: Sushila Parikh and 64 others
The HC was hearing a petition by one Sushila Parikh and 64 others seeking payment of transit rent which the developers have defaulted on. The judges remarked that the situation in the petition is 'by now a familiar story of distress', where several dozen individual residents, some of them senior citizens, are subjected to 'enormous hardship' in the course of what was supposed to be a quick redevelopment of a cessed building.
Joint venture & disputes
Initially, Parekh Constructions was appointed for redevelopment purpose. It then entered into a joint venture with Nishcon Realty Private Limited and they apparently formed Parekh Constructions LLP. Later, the two entities had disputes.
There are two adjoining properties. One is owned by one Darshana and the other is the property of the Trust. On the plot owned by Darshana there was a building, Parvati Building, that was pulled down in 2011 and the tenants have been paid transit rent for a long time. The structure on the Trust’s plot still stands. Nishcon Realty, on a rough calculation accepted before the bench that it is in arrears of transit rent since 2020 amounting to a little over Rs 7 crore.
The court directed that it expects the first 50% of the amount – Rs 3.5 crore as per Nishcon's calculation – to be brought in by Friday, August 11. It said, “How Nishcon Realty arranges its affairs with Parekh Constructions is not our concern, but we make it clear that this is a direction against Nishcon Realty, Parekh Constructions, their LLP, jointly and severally.”
MHADA to cancel NOC
The bench clarified that if the developer fails to bring in Rs3.5 crore by Friday, it will direct “MHADA to immediately cancel the NOC of the only Developer it has on record namely Parekh Constructions”. The HC has kept the petition for hearing on August 11.
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