Financial Daily from THE HINDU group of publications
Thursday, May 05, 2005
Financial Daily from THE HINDU group of publications Thursday, May 05, 2005 |
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Textiles Corporate - Courts/Legal Issues HC verdict on land development: SC reserves orders on Mumbai textile mill owners' plea J. Venkatesan
New Delhi , May 4 THE Supreme Court on Wednesday reserved orders on a batch of appeals against a Bombay High Court interim order restraining the Brihanmumbai Municipal Corporation (BMC) from granting permission to textile mill owners to develop the land with the defunct mills. A Bench of Mr Justice N. Santosh Hegde and Mr Justice S.B. Sinha reserved orders after hearing arguments from the Solicitor-General, Mr G.E. Vahanvati, on behalf of the Maharashtra Government, and senior counsel Mr Soli Sorabjee, Mr Arun Jaitley, Mr K. Parasaran, Mr T.S. Andhyarujina, Mr Gopal Subramaniam and others on behalf of the mill owners and builders. Counsel for mills said over Rs 10,000 crore of investment by them was at stake. The Maharashtra Government, Bombay Dyeing, National Textile Mills, Ruby Mills, Hindoostan Mills and Morarjee Mills, Mafatlal Industries and Rashtriya Mill Mazdoor Sangh filed the appeals against the High Court order dated April 1. The High Court had directed mill owners to clarify whether they received any clearance from the BMC and the State Government to develop their mill land. The interim stay was given by the court on a public interest litigation (PIL) filed by the Bombay Environmental Action Group that had challenged a 2001 modification to Rule 58 of the Development Control Regulations that permitted mill owners to retain most of their land. The total land area of the defunct mills is around 600 acres, located mostly in Central Mumbai and carries a very high price tag. Assailing this order, counsel appearing for the mill owners brought to the notice of the apex court that over Rs 10,000 crore would be at stake if the impugned order was not stayed. They submitted that the mills concerned had gone ahead with the plans to develop the land in their possession by paying off the dues to the workers running into thousands of crores of rupees and also taken loans from financial institutions to construct residential and commercial complexes as per the guidelines approved by the Maharashtra Government. Mr Vahanvati submitted that the Bombay Action Group, on whose petition the High Court had passed the interim order, had approached the Court after four years of operation of a scheme and that the interim order of the High Court was unwarranted. Appearing for the petitioners before the High Court, senior counsel Mr Iqbal Chhagla contended that the High Court had done nothing wrong by saying further construction activity would not be permitted by the BMC or the State. After hearing the arguments, the Judges reserved orders saying that a balance should be struck between the lung space being sought by the environmental group and the financial constraints faced by the mill owners.
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