Supreme Court Upholds Church Trust's Preferential Right in Slum Land Acquisition

The Supreme Court of India, presided over by Justice Surya Kant and Justice Ujjal Bhuyan, has delivered a significant judgment in a landmark case involving the Basilica of Our Lady of the Mount (Church Trust) and Saldanha Real Estate Pvt. Ltd. The dispute centered around land at CTS No. B-960, Bandra, Mumbai, which the Church Trust has owned for decades.

A portion of this land, long occupied by shacks, was declared a slum area in 1978. Over the years, the slum dwellers formed Shri Kadeshwari CHS Ltd. and entered into a redevelopment agreement with Saldanha Real Estate Pvt. Ltd. The Church Trust, however, had its own plans for a comprehensive redevelopment project that included the disputed land.

In 2021, when the Church Trust submitted its redevelopment proposal to the Slum Rehabilitation Authority (SRA), it was rejected on technical grounds. Saldanha Real Estate, which had already lodged its proposal, continued with the acquisition proceedings. The Bombay High Court, however, overturned the acquisition, recognizing the Church Trust's preferential right to redevelop the land. This led to an appeal by Saldanha Real Estate and other appellants to the Supreme Court.

Court Proceedings

The appellants, including Saldanha Real Estate Pvt. Ltd., Shri Kadeshwari CHS Ltd., and the SRA, argued that the Church Trust's redevelopment proposal was defective, late, and not in the proper format. They further claimed that the 2018 Amendment to the Slum Areas Act reversed the burden of action, requiring landowners to act within 120 days of a slum declaration. They also contended that the Trust's decades of inactivity justified the acquisition.

In response, the Church Trust asserted that its right to redevelop the land was not waived and that it had submitted its proposal in time. The Trust alleged that the SRA had colluded with Saldanha Real Estate, rejecting the Trust's proposal on technical grounds while accepting similar proposals from Saldanha. The Trust also argued that the acquisition was driven by malafide intentions, allowing Saldanha to exploit the land at undervalued rates.

Court’s Reasoning

The Supreme Court, in its judgment, referred to several precedents, including the Tarabai Nagar Co-Op. Housing Society case, which addressed the right of landowners to redevelop slum rehabilitation sites. The Court held that the 2018 Amendment did not weaken the preferential right of landowners; instead, it strengthened it by incorporating owners into the statutory framework. The Court noted that no valid notice was issued to the Church Trust, thereby preserving its preferential right.

The Court also found evidence of collusion between Saldanha Real Estate, Shri Kadeshwari CHS Ltd., and the SRA. The rejection of the Church Trust's proposal on technical grounds while accepting similar proposals from Saldanha indicated bias and malafide intentions. As a result, the Supreme Court upheld the decision of the Bombay High Court, declaring a significant portion of the acquisition illegal and tainted with malafide intentions.

The Court ordered that the Church Trust be given 120 days to present a proper redevelopment scheme, and the SRA and the State were mandated to process and accommodate this scheme within 60 days of its filing. The rights of the slum dwellers were to be protected in accordance with the existing undertakings with the Trust.

Conclusion

This decision by the Supreme Court reaffirms the priority rights of landowners in slum redevelopment projects, protecting them against opportunistic and collusive tendencies in the real estate industry. It ensures that the rights of landowners and the needs of slum dwellers are balanced, promoting fair and just urban development in Mumbai.