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J. Venkatesan

`The construction of buildings for residential purposes in the land would be at the risk of the owners and would be subject to the result of the writ petition pending in the High Court.'

New Delhi , May 11

GIVING major relief to the textile mills in Mumbai, the Supreme Court on Wednesday said that those closed textile mills in Mumbai that were granted commencement certificates for development of land in possession of private owners, could go ahead with the construction after getting requisite sanction from the authorities.

A Bench comprising Mr Justice N. Santosh Hegde and Mr Justice S.B. Sinha passed the orders on a batch of appeals against the Bombay High Court order, staying further development plans of the mills. It also allowed the National Textile Corporation to complete the transactions relating to development of land in its sick textile mills in Mumbai as per the plan approved by the Board for Industrial and Financial Reconstruction.

However, the Bench made it clear that construction of buildings for residential purposes as well as creation of third-party interest in the land would be at the risk of the owners and would be subject to the result of the writ petition pending in the High Court. On a petition from the Bombay Environment Action Group, the High Court, by an interim order on April 1, had restrained Brihanmumbai Municipal Corporation from granting approval to the development plan till details about ownership and schemes were laid before the court for scrutiny and evolved an integrated plan of development.

With over Rs 10,000 crore at stake in these development works, the Bench allowed those mills that have got permission for construction to resume the work. The Bench said, "Any further construction and/or creation of third-party rights by the mill owners will be at their own risk and would be subject to final orders of the High Court."

Further, the judges said, "creation of third-party rights, like selling flats constructed in the mill land to people, would not be construed as an equity in favour of the mill owners. Therefore, before entering into agreement creating third-party interest in the mill land, the owners must advertise the actual position relating to the land in question in two widely circulated dailies - one in English and the other in Marathi."

Regarding those mills whose layout plan for development of the mill land had not been sanctioned, the judges said that they could still apply to the authorities for approval of schemes but on the basis of such approvals could not start construction.

Also if the petitioners succeeded before the High Court then the NTC would have to offer land for greenery purposes in other mills situated in the metropolis to offset the development taking place in the seven mills under the BIFR approved plan.

The PIL in the High Court 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.

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. The Bench asked the High Court to dispose of the writ petition by July 31.

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SC allows Mumbai mills to go ahead with construction — `NTC mill land can be developed as per BIFR plan'

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