Municipal Corporation's Failure To Initiate Acquisition Proceedings Validates Purchase Notice: Bombay HC Upholds Land De-Reservation

The Division Bench of Justice Sunil B. Shukre and Justice Rajesh S. Patil stated that,

“Under Section 127 of the MRTP Act, a land owner gets a right of de-reservation of his land by application of deeming fiction if he issues a notice calling upon the Planning Authority or the Development Authority or the Appropriate Authority to purchase the land in terms of the provisions of Section 126 of the MRTP Act and the Planning Authority or the Development Authority or the Appropriate Authority fails to take steps for acquisition of the land in question within the period prescribed in Section 127 of the MRTP Act, presently the period prescribed is of two years and in case of the purchase notice in question involved in this petition, this period was of one year. In such a case, owner of the land gets right of seeking declaration about de-reservation of his land by deeming fiction.”

The only issue involved in this petition was whether the Purchase Notice issued by the petitioners, under Section 127(1) of the Maharashtra Regional and Town Planning Act, 1966, of 16th September 2013 was valid or not. The incidental question arising from the main question was that if purchase notice is considered to be valid, would it lead to deemed de-reservation of the land in question in view of the provisions made in Section 127 of the Maharashtra Regional and Town Planning Act, 1966, (“MRTP Act”, for short), or would it be affected by the sanction of revised development plan subsequent to issuance of the purchase notice.

Advocate Prathamesh Bhargude appeared for the Petitioners, Advocate M.P. Thakur, AGP appeared for Respondents 1,2 and Advocate R.S. Khadapkar appeared for Respondents 3-5.

As per the argument presented by the counsel representing the petitioners, they asserted that the Purchase Notice issued on September 16, 2013, even though it was issued after the draft revised development plan was published on March 28, 2013, is still considered valid. According to their stance, since the respondent-Municipal Corporation failed to initiate the land acquisition process within the stipulated one-year period, the land in question became de-reserved through a deeming fiction mechanism.

On the contrary, the counsel representing the respondent-Municipal Corporation counterargued that because the Purchase Notice was issued subsequent to the publication of the draft revised development plan, it can be inferred that the Municipal Corporation still intended to maintain the original public purpose associated with the land. Consequently, they contended that the petitioners did not acquire an unequivocal right of de-reservation through the application of deeming fiction.

The Court clarified that the issuance of the notice is subject to the condition that at least ten years should have been passed since the final regional plan or final development plan came into effect. The provision specifically references the final plans, not draft plans. Therefore, the context of Section 127 only concerns the final plans that are in force. The Court noted that a revised plan in this context referred to a sanctioned or final revised plan, not a draft revised plan.

The case of Balkrishna Jagannath Lad, 2015(5) Mh.L.J. 899 highlighted that once a reservation lapses according to Section 127, the subsequent creation of a revised development plan doesn't automatically revive the reservation.

In the case of Santu Sukhdeo Jaibhave, 2022 SCC OnLine Bom 5273 it was established that the validity of a deemed lapsing of reservation can only be assessed concerning a final revised development plan, not a draft version. The same stance was supported by the Apex Court's dismissal of a petition for Special Leave to Appeal.

Ultimately, the Court concluded that the petitioners have an unequivocal right to seek the benefits of deemed lapsing of reservation over their land. This arises from the issuance of a purchase notice following the expiration of the ten-year period from the first final development plan. Since the Municipal Corporation failed to initiate acquisition proceedings within one year of receiving the notice, the land's de-reservation is deemed.

“In the present case, an indefeasible right has accrued to the petitioners to seek benefit of deemed lapsing of reservation over the land in question for the reason that the purchase notice was issued by them after expiry of the period of ten years from the first final development plan and before the draft revised plan came to be sanctioned and that even though period of one year had expired after receipt of the purchase notice by the respondent-Municipal Corporation, admittedly, no steps for acquisition of the land in question have been initiated by the Municipal Corporation. In other words, the purchase notice issued by the petitioners is valid and it has led to deemed de-reservation of the land in question.”

The Court referred to previous cases, including the fact-specific Ranjan Manubhai Doctor case, 2005(1) Mh.L.J. 718 to emphasize that the current case's context differed.

In conclusion, the petition was allowed, and the land's de-reservation was upheld, in line with the petitioners' claims. The Court issued relevant writs and directions in accordance with the petitioners' requests.

Cause Title: Babanrao Dattu & Ors. V. State of Maharashtra & Ors.

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