Murlidhar Teckchand Gandhi And 5 ... vs The State Of Maharashtra And 3 Ors
2016 Latest Caselaw 163 Bom

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                 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                    ORDINARY ORIGINAL CIVIL JURISDICTION




                                                                               
                            WRIT PETITION NO. 165     OF 2007




                                                       
            Murlidhar Teckchand Gandhi & Ors.           ..      Petitioners
                  vs.
            State of Maharashtra & Ors.                 ..      Respondents




                                                      
            Mr. Milind Sathe - Senior Advocate with Mr. R. S. Datar i/b. Mr. R.
            D. Mishra for Petitioners.
            Mr. E. P. Bharucha - Special Counsel / Senior Advocate with Mr.
            Milind More - Additional Government Pleader for Respondent Nos.
            1 to 3.




                                              
            Mr. Y. R. Mishra with Mr. P. M. Bhagat for Respondent Nos. 4 to 64.
                                   
                                     CORAM :   S. C. DHARMADHIKARI AND
                                               M. S. SONAK, JJ.

Date of Reserving the Judgment : 11 February 2016. Date of Pronouncing the Judgment : 01 March 2016.

JUDGMENT : (Per : M. S. Sonak, J.)

1] The challenge in this petition is to the acquisition of the

petitioners property bearing CTS No. 165, 165/1 to 51 admeasuring

2668.11 sq. meters, at Village Kanjur, Taluka Kurla, Mumbai (said

property) vide Notification No. DAL/2002/LR-459/SLUM-1 dated 31

May 2006 issued under Section 14 of the Maharashtra Slum Areas

(Improvement, Clearance and Redevelopment) Act, 1971 (Slum

Act).

2] In the years 1976, 1986, the said property was declared as

'slum area' in terms of Section 4 of the Slum Act. However, the

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declarations were set aside by the Slum Tribunal, on certain

grounds, which are not relevant for deciding the issues raised, in

the present petition. The said property was once again declared as

'slum area' by Notification dated 20 August 1997. The petitioners

appeal questioning said declaration was dismissed by the Slum

Tribunal by its order dated 12 December 1997. Thereupon, the

petitioners instituted a writ petition no. 851 of 1998 challenging the

Slum Tribunal's order dated 12 December 1997. On 11 June 1998,

this Court, in the said writ petition, made an ad interim order,

restraining the implementation of or taking of any steps / action in

pursuance of declaration dated 20 August 1997 and the Slum

Tribunal's order dated 12 December 1997. The ad interim order was

confirmed on 15 June 1998, in terms of prayer clause (C) , which

reads thus :

"(C) that this Hon'ble Court pending the hearing and final

disposal of this petition be please to stay the operation of the said Declaration order dated 20/8/1997 which was published in the Government Gazette dated 21/8/97 and the said."

3] On 3 July 1998, the Competent Authority i.e. the respondent

no.3 issued show cause notice under Section 14(1) of the Slum Act

requiring the petitioner to show cause as to why the said property

be not acquired. A notice to the same effect, was also published in

the newspapers on 11 July 1998. The petitioners through their

Advocate, submitted their response, inter alia pointing out that there

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was an interim order dated 15 June 1998 made in writ petition no.

851 of 1998, challenging the declaration of the said property as a

'slum area'. The record indicates that no further steps were taken

in the matter by the respondent no. 3 for almost three years

thereafter and until the dismissal of the petition and vacation of

interim order.

4] The learned Single Judge of this Court, by judgment and

order dated 17 April 2001, dismissed the writ petition no. 851 of

1998 instituted by the petitioners. Further, by judgment and order

dated 31 July 2001, the Division Bench of this Court in appeal no.

413 of 2001, dismissed the petitioners appeal against the judgment

and order dated 17 April 2001. Finally, on 15 July 2002, the Hon'ble

Supreme Court, dismissed the petitioners Special Leave Petition

against the judgment and order dated 31 July 2001. As a result of

all this, the interim order made on 15 June 1998, stood vacated.

5] Upon consideration of the cause shown by the petitioners, the

respondent no. 1 issued Notification dated 31 May 2006 (Impugned

Notification) under Section 14(1) of the Slum Act for acquisition of

the said property. An award was also made by the Deputy Collector

under Section 17 (5) of the Slum Act determining the compensation

payable, in respect of the acquisition on 10 January 2007. The

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petitioners, on 11 January 2007, instituted the present petition

questioning the Impugned Notification as also, all actions, in

pursuance of the same.

6] On 31 January 2007, the Chief Lands Surveyor is stated to

have taken possession of the said property under a panchnama

and by issuance of a possession receipt. On 14 February 2007, the

petitioners instituted appeal no. 2 of 2007 before the Slum Tribunal,

questioning the compensation determined and sought enhanced

rates. However, on 12 March 2007, the petitioners withdrew the

said appeal with liberty to file it afresh.

7] On 23 August 2007, this Court, issued Rule and interim relief

in terms of prayer clause ( c) in the present petition. The impugned

Notification dated 31 May 2006 was accordingly stayed.

8] Mr. Milind Sathe, the learned Senior Advocate for the

petitioners has made the following submissions in support of the

present petition :-

(A) That the very initiation of acquisition proceedings by

issue of show cause notice dated 3 July 1998 under Section

4(1) of the Slum Act, was without jurisdiction, in as much as on

the said date, the Notification dated 20 August 1997 declaring

the said property as 'slum area' was no longer in existence,

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due to the interim order dated 15 June 1998 made by this

Court in writ petition no. 851 of 1998. The existence of a

declaration that the said property is a 'slum area' is a

mandatory predicate, in the absence of which, the power of

acquisition under Section 14(1) of the Slum Act, can never be

exercised. For these reasons, Mr. Sathe urged that the

impugned Notification dated 31 May 2006, made in pursuance

of the show cause notice dated 3 July 1998, is a nullity and is

required to be declared as such;

(B) In the alternate, Mr. Sathe submitted that in the present

case there has been no compliance with the provisions

contained in Sections 5, 11, 12(7) and 13 of the Slum Act prior

to the exercise of powers under Section 14 of the Slum Act.

Relying mainly upon the decision of this Court in the case of

Ramkali Kushawaha (Kachhi) & Ors. vs. The Deputy

Collector (Enc) & Competent Authority, Kurla-I & Ors.1, Mr.

Sathe submitted that powers of acquisition could never have

been exercised without compliance with the provisions

contained in Sections 5, 11, 12(7) and 13 of the Slum Act,

which, in terms, confers a preferential right upon the land

owner to either improve the slum area or to redevelop the

same;

1 2004 (2) ALL MR 320

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( C) That, in the present case, the said property has not

been declared as 'slum rehabilitation area' under Section 3C

of the Slum Act. Therefore, the respondents, cannot

legitimately claim that Chapters II and III of the Slum Act,

which contain Sections 4 to 10 of the Slum Act, are

inapplicable, when it comes to acquisition of the said property

by resort to the provisions contained in Section 14 of the Slum

Act. Mr. Sathe therefore contended that the impugned

acquisition, in the present case, must fail for non compliance

with the provisions contained in Sections 5, 11, 12(7) and 13

of the Slum Act; and

(D ) Finally, Mr. Sathe contended that acquisition in the

present case was at the instance of the respondent no. 4 -

developer, and therefore same was malafide. In this regard,

reliance was placed upon the decision of the Hon'ble Supreme

Court in the case of Royal Orchid Hotels Limited & Anr. vs. G.

Jayarama Reddy & Ors.2, to submit that power of eminent

domain cannot be over stretched to legitimize a patently illegal

and fraudulent exercise undertaken for depriving the land

owners of their constitutional rights to property with a view to

favour private persons.

    2 (2011) 10 SCC 608



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            9]      Mr. E. P. Bharucha, the learned Senior Advocate appearing

for the respondent nos. 1 to 3 and Mr. Mishra, the learned counsel

for respondent nos. 4 to 64 countered the submissions of Mr. Sathe

by submitting that 'stay order' neither wipes out the existence of the

slum declaration, nor, was the same, in the facts and circumstances

of the present case, a bar to the issuance of a show cause notice to

the petitioners, requiring them to show cause as to why the said

property be not acquired under Section 14 of the Slum Act. Mr.

Bharcuha, pointed out that ultimately the petitions, in which, the stay

order had been made were dismissed and such dismissal was

upheld by the Division Bench as well as the Hon'ble Supreme

Court. In such circumstances, the respondents are entitled to be

placed in the same position in which they were, before, the stay

order was made. In this regard, the learned counsel placed reliance

upon the decision of the Supreme Court in the case of Kanoria

Chemicals and Industries Ltd. & Ors. vs. U. P. State Electricity

Board & Ors.3

10] Mr. Bharucha and Mr. Mishra, further submitted that the

material on record amply bears out that several opportunities were

afforded to the petitioner to take steps to either improve the slum

area or to redevelop the same. However, the petitioners failed to

avail any such opportunities. In these circumstances, it was 3 (1997) 5 SCC 772

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contended that at least the petitioners cannot complain about the

alleged non compliance with the provisions contained in Sections 5,

11, 12(7) and 13 of the Slum Act, in the matter of any preferential

right to either improve or redevelop the slum area. Finally, the

learned counsel for the respondents submitted that the acquisition

is by no means vitiated by any malafides or colourable exercise of

power and therefore, the decisions upon which reliance has been

placed by Mr. Sathe, are inapplicable to the facts and

circumstances of the present case.

11] Rival contentions now fall for determination.

12] In so far as Mr. Sathe's first contention is concerned,

reference, will be appropriate to the provisions contained in Section

14 of the Slum Act, which inter alia provide that where on any

representation from the Competent Authority, it appears to the

State Government that, in order to enable the Authority to execute

any work of improvement or to redevelop any slum area or any

structures in such area, it is necessary that such area, or any land

within adjoining or surrounded by any such area should be

acquired, the State Government may acquire the land by publishing

in the official gazette, a notice to the effect that the State

Government has decided to acquire the land in pursuance of the

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section. Provided that, before publishing such notice, the State

Government or as the case may be, the Competent Authority may

call upon by notice, the owner of, or any other person who, in its or

his opinion may be interested in, such land to show cause in writing

why the land should not be acquired with reasons therefor, to the

Competent Authority within the period specified in the notice, and

the Competent Authority shall, with all reasonable despatch,

forward any objection so submitted together with his report in

respect thereof to the State Government and on considering the

report and the objections, if any, the State Government may pass

such order as it deems fit. Sub Section (1A) of Section 14 provides

that acquisition of land for any purpose mentioned in sub section (1)

of Section 14 shall be deemed to be a public purpose. Sub section

(2) of Section 14 provides that the notice as aforesaid is published

in the official gazette, the land shall, on and from the date of which

the notice is so published vest absolutely in the State Government

free from all encumbrances.

13] In the present case, there is no dispute that the said property

was declared as 'slum area' by notification dated 20 August 1997.

Mr. Sathe however contends that such declaration was 'stayed' by

this Court by its interim order dated 15 June 1998 made in writ

petition no. 851 of 1998. On this basis, Mr. Sathe contends that the

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very initiation of acquisition proceedings under Section 14(1) of the

Slum Act, was clearly ultra vires and therefore, the Impugned

Notification dated 31 May 2006 made by the State Government , in

pursuance of show cause notice dated 3 July 1998, is a nullity and

has no existence in the eyes of law. There are several reasons as to

why this contention of Mr. Sathe cannot be accepted.

14] In the first place, it is to be noted that Section 14(1) of the

Slum Act only requires that the acquisition is in respect of the

property, which is declared as 'slum area' under Section 4 of the

Slum Act. The acquisition, in the present case, has been effected

vide the impugned notification dated 31 May 2006 and the award

made in pursuance thereof. As on the date when the impugned

notification dated 31 May 2006 came to be issued, there is no doubt

that the said property was a 'slum area' under Section 4 of the

Slum Act. By the said date, writ petition no. 851 of 1998 instituted

by the petitioners had already been dismissed and such dismissal

had also attained finality in view of the dismissal of appeal by the

Division Bench and the dismissal of Special Leave Petition by the

Hon'ble Supreme Court. During operation of the interim order, only

a show cause notice was issued to the Petitioners, requiring them to

show cause as to why said property be not acquired by resort to

Section 14 of the Slum Act. In the light of the Petitioners response,

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the concerned Respondents did not take any further steps in the

matter or proceed with the acquisition of the said property under

Section 14 of the Slum Act. It is only after Writ Petition No. 851 of

1998 was finally dismissed and the interim order made therein,

vacated, that steps were taken for acquisition of the said property.

There is really no dispute that the ultimate acquisition of the said

property was effected, when there was no doubt whatsoever as to

the status of the said property being 'slum area' in terms of Section

4 of the Slum Act. Accordingly, there is no jurisdictional infirmity in

the making of Impugned Notification.

15] Secondly, there is a qualitative difference between 'setting

aside' of the slum declaration dated 20 August 1997 and any grant

of 'stay' upon the operation of such declaration. The mere grant of

any 'stay' upon the operation of declaration, does not wipe out the

very existence of such statutory declaration made under Section 4

of the Slum Act. The grant of 'stay', at the highest implies that the

declaration may not be operative from the date of making of the

impugned order. However, this is far cry from suggesting that the

declaration stands wiped out from existence. In case of Shree

Chamundi Mopeds Ltd. Vs. Church of South India Trust Association

CSI CINOD Secretarait, Madras4, the Supreme Court has held that

while considering the effect of an interim order staying the operation 4 (1992) 3 SCC 1

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of the order under challenge, a distinction has to be made between

quashing of the impugned order and stay of operation of an order.

Quashing of an order results in restoration of position as it stood on

the date of the passing of the order, which has been quashed. The

stay of operation of an order does not, however, lead to such a

result. It only means that the order which has been stayed would

not be operative from the date of passing of the stay order and it

does not mean that the said order has been wiped out from

existence. This position has been reiterated by the Supreme Court

in case of Kanoria Chemicals (supra).

16] Thirdly, in the present case, writ petition no. 851 of 1998, in

which, the Petitioners had obtained the interim order, has since

been dismissed and the interim order vacated. In the case of

Amarjeet Singh & Ors. vs. Devi Ratan & Ors. 5, the Hon'ble Apex

Court has held that no litigant can derive any benefit from mere

pendency of case in a court of law, as the interim order always

merges in the final order to be passed in the case and if the writ

petition is ultimately dismissed, the interim orders stand nullified

automatically. A party cannot be allowed to take any advantage of

its own wrongs by getting an interim order and thereafter blame the

Court. The fact that the writ is found, ultimately, devoid of any merit,

shows that a frivolous writ petition had been filed. The maxim actus 5 (2010) 1 SCC 417

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curiae neminem gravabit, which means that the act of the court

shall prejudice no one, becomes applicable in such a case. In such

a fact situation the court is under an obligation to undo the wrong

done to a party by the act of the court. Thus, any undeserved or

unfair advantage gained by a party invoking the jurisdiction of the

court must be neutralised, as the institution of litigation cannot be

permitted to confer any advantage on a suitor from delayed action

by the act of the court.

17] In the case of Kanoria Chemicals (supra), the contention

similar to the one raised by Mr. Sathe came to be rejected. In the

said case, the Uttar Pradesh State Electricity Board (UPSEB) by

Notification dated 21 April 1990 revised electricity rates/tariffs under

Section 49 of the Electricity (Supply) Act, 1948. The Notification,

inter alia, provided for payment of interests in case the bill amount is

not paid within the specified period. In writ petitions questioning the

validity of the Notification, an interim order staying the effect of

Notification dated 21 April 1990 was made by the Allahabad High

Court to operate during pendency of such writ petitions. The writ

petitions were ultimately dismissed on 1 March 1992. Thereupon,

the Petitioner-consumer paid the difference amount between pre-

revised and revised electricity rates, but declined to pay the late

payment surcharge in terms of clause 7(b) of the Notification dated

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21 April 1990, inter alia, on the ground that the entire Notification

dated 21 April 1990, including clause 7(b) thereof, which dealt with

late payment surcharge, had been stayed by the Court, during

pendency of the writ petitions. The UPSEB, however, raised

demands for late payment surcharge and several petitions were

once again filed by the consumers, resisting such demands. The

Allahabad High Court dismissed the petitions and the consumers,

appealed to the Supreme Court. The question before the Supreme

Court, inter alia, revolved around the effect of 'stay order' issued by

the Allahabad High Court during pendency of petitions questioning

the Notification dated 21 April 1990 and clause 7(b) thereof, dealing

with late payment surcharge.

18] The Supreme Court, explained and distinguished its earlier

decision in case of Adoni Ginning Factory Vs. Secretary, A.P.

Electricity Board6, and cautioned against reading the said decision

as having laid down any proposition that the grant of a stay of

Notification revising the electricity charges, has the effect of

relieving the consumers of their obligation to pay late payment

surcharge/interest upon the amount withheld by them, even after,

their petitions are dismissed ultimately. The Supreme Court

observed that holding otherwise, would mean that even though the

electricity board, which was the Respondent in writ petitions

6 (1979) 4 SCC 560

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succeeded therein, is yet deprived of late payment surcharge, which

was due and payable under the Notification. This would be a case

where the Board would suffer prejudice on account of the orders of

the Court and for no fault on the part of the Board. The Board,

would then, succeed in writ petitions and yet loose in the matter of

recovery of late payment surcharge. The Supreme Court, in terms

held that such construction would neither be legal nor equitable.

19] The Supreme Court, in paragraph '11' of Kanoria Chemicals

(supra) has observed thus:

11. The learned counsel for the appellants in the appeals before us rely upon the portions underlined in the above passage as a decision supporting their contention that where the operation of government order is stayed, no surcharge can be demanded upon the amount withheld. We find it

difficult to agree. In our respectful opinion, the underlined portions do not constitute the decision of the court. They

merely refer to the fact that the Board itself did not make a demand for surcharge amount in respect of the period covered by the stay under its own understanding of the effect of the stay order granted by the High Court and that it was

justified in its opinion. The demand was, the Court pointed out, in respect of the period covered by the order of injunction granted by this Court. This Court held expressly that the grant of an injunction does not relieve the consumers of their obligation to pay the charges at the enhanced rates and,

therefore, the demand for surcharge/interest for such period is not illegal. The portions underlined cannot be understood as laying down the proposition that in respect of the period covered by the stay, no demand can be made. No such proposition can be deduced from the said passage for the reason that the liability for the said (sic period) was not at all in issue in the said decision. Unless put in issue and pronounced upon, it cannot be said that there was a decision on the said issue. There was no lis between the parties with respect to the period covered by the stay order of the High Court. If so, it cannot be said that any decision was rendered

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by this Court on the said issue or aspect, as it may be called.

We, therefore, agree with the High Court that Adoni Ginning 1

cannot be read as laying down the proposition that the grant of stay of a notification revising the electricity charges has the effect of relieving the consumers/petitioners of their obligation

to pay late payment surcharge/interest on the amount withheld by them even when their writ petitions are dismissed ultimately. Holding otherwise would mean that even though the Electricity Board, who was the respondent in the writ

petitions succeeded therein, is yet deprived of the late payment surcharge which is due to it under the tariff rules/regulations. It would be a case where the Board suffers prejudice on account of the orders of the court and for no fault of its. It succeeds in the writ petition and yet loses. The

consumer files the writ petition, obtains stay of operation of the notification revising the rates and fails in his attack upon

the validity of the notification and yet he is relieved of the obligation to pay the late payment surcharge for the period of stay, which he is liable to pay according to the statutory terms

and conditions of supply -- which terms and conditions indeed form part of the contract of supply entered into by him with the Board. We do not think that any such unfair and inequitable proposition can be sustained in law. No such proposition flows from Adoni Ginning1. It is a matter of

common knowledge that several petitioners (their counsel)

word the stay petition differently. One petitioner may ask for injunction, another may ask for stay of demand notice, the third one may ask for stay of collection of the amount demanded and the fourth one may ask for the stay of the very

notification. Such distinctions are bound to occur where a large number of writ petitions are filed challenging the same notification. The interim orders made by the Court may also vary in their phraseology in such a situation. Take this very case: While the consumers had asked for stay of operation of the government order revising the rates, those very

consumers asked for an injunction when they came to the Supreme Court. Furthermore, as pointed out rightly by the High Court, the orders of stay granted by the High Court in writ petitions questioning the validity of the Notification dated 21-4-1990 were not uniform. In the case of writ petition filed by the Eastern U.P. Chamber of Commerce and Industry, Allahabad, the operation of the notification was stayed while in the case of the writ petition filed by the Employers' Association of Northern India, it was directed that "effect shall not be given to the Notification dated 21st April, 1990 as against the petitioner", while clarifying at the same time that

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"in the event of failure of the writ petition, the petitioner shall deposit with the relevant authority within a period of one month from the date of dismissal of the writ petition the

difference between the amount of electricity dues to be paid hereinafter by the petitioners under our orders and the sum

which may be calculated on the basis of the impugned notification". The words "sum which may be calculated on the basis of the impugned notification" in the later order clearly mean and include the late payment surcharge as well. The

acceptance of the appellants' argument would thus bring about a discrimination between a petitioner and a petitioner just because of the variation of the language employed by the court while granting the interim order though in substance and in all relevant aspects, they are similarly situated. It is

equally well settled that an order of stay granted pending disposal of a writ petition/suit or other proceeding, comes to

an end with the dismissal of the substantive proceeding and that it is the duty of the court in such a case to put the parties in the same position they would have been but for the interim

orders of the court. Any other view would result in the act or order of the court prejudicing a party (Board in this case) for no fault of its and would also mean rewarding a writ petitioner in spite of his failure. We do not think that any such unjust consequence can be countenanced by the courts. As a

matter of fact, the contention of the consumers herein, extended logically should mean that even the enhanced rates

are also not payable for the period covered by the order of stay because the operation of the very notification revising/enhancing the tariff rates was stayed. Mercifully, no such argument was urged by the appellants. It is

ununderstandable how the enhanced rates can be said to be payable but not the late payment surcharge thereon, when both the enhancement and the late payment surcharge are provided by the same notification -- the operation of which was stayed.

(emphasis supplied)

20] In the case of Indian Council for Enviro-Legal Action vs. Union

of India & Ors.7, the Hon'ble Apex Court has held that it is bounden

duty and obligation of the court to neutralise any unjust enrichment

and undeserved gain made by any party by invoking the jurisdiction

7 (2011) 8 SCC 161

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of the court. When a party applies and gets a stay or injunction

from the court, it is always at the risk and responsibility of the party

applying. An order of stay cannot be presumed to be conferment of

additional right upon the litigating party. The stay granted by the

court does not confer a right upon a party and it is granted always

subject to the final result of the matter in the court and at the risk

and costs of the party obtaining the stay. After the dismissal of the

lis, the party concerned is relegated to the position which existed

prior to the filing of the petition in the court which had granted the

stay. Any leniency would seriously affect the credibility of the judicial

system. Unscrupulous litigants must be prevented from taking

undue advantage by invoking jurisdiction of the court. No litigant

can derive benefit from the mere pendency of a case in a court of

law. Litigation should not be permitted to turn into a fruitful industry

so that the unscrupulous litigants are encouraged to invoke the

jurisdiction of the court.

21] In case of Ram Krishna Verma vs. State of U.P.8, the Hon'ble

Supreme Court examined the issue while placing reliance upon its

earlier judgment in Grindlays Bank Limited v. ITO-AIR 1980 SC 656

and held that no person can suffer from the act of the Court and in

case an interim order has been passed and the petitioner takes

advantage thereof, and ultimately the petition stands dismissed, the

8 (1992) 2 SCC 620

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interest of justice requires that any undeserved or unfair advantage

gained by a party invoking the jurisdiction of the Court must be

neutralized. A similar view has been reiterated by this Court in

Mahadeo S. Shelke v. Pune Municipal Corpn.- (1995) 3 SCC 33.

22] In case of South Eastern Coalfields Ltd. Vs. State of M.P. 9, the

Hon'ble Supreme Court examined this issue in detail and held that

no one shall suffer by an act of the Court. The factor attracting the

applicability of restitution is not the act of the Court being wrongful

or a mistake or error committed by the court; the test is whether an

act of the party persuading the Court to pass an order held at the

end as not sustainable, has resulted in one party gaining an

advantage it would not have otherwise earned, or the other party

suffering an impoverishment which it would not have suffered but

for the order of the Court and the act of such party. There is nothing

wrong in the parties demanding to be placed in the same position in

which they would have been had the Court not intervened by its

interim order, when at the end of the proceedings, the Court

pronounces its judicial verdict which does not match with and

countenance its own interim verdict. The injury, if any, caused by

the act of the Court shall be undone and the gain which the party

would have earned unless it was interdicted by the order of the

Court would be restored to or conferred on the party by suitably

9 (2003) 8 SCC 648

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commanding the party liable to do so. Any opinion to the contrary

would lead to unjust if not disastrous consequences.

23] In the aforesaid decision of South Eastern Coalfields Ltd.

(supra), the Hon'ble Supreme Court at paragraph 28 observed thus:

"28. .....Litigation may turn into a fruitful industry. Though litigation is not gambling yet there is an element of chance in every litigation. Unscrupulous litigants may feel encouraged to approach the courts, persuading the Court to pass

interlocutory orders favourable to them by making out a prima facie case when the issues are yet to be heard and determined on merits on merits and if the concept of

restitution is excluded from application to interim orders, then the litigant would stand to gain by swallowing the benefits yielding out of the interim order even though the battle has

been lost at the end. This cannot be countenanced. We are, therefore, of the opinion that the successful party finally held entitled to a relief assessable in terms of money at the end of the litigation, is entitled to be compensated......"

24] The aforesaid judgments are passed on the application legal

maxim sublato fundamento, cadit opus, which means in case a

foundation is removed, the superstructure falls.

25] In case of Badrinath v. State of T.N.10, the Hon'ble Supreme

Court has held that it is settled legal proposition that the forum of

writ court cannot be used for the purpose of giving interim relief as

the only and the final relief to any litigant. It is not permissible for a

party to file a writ petition, obtain certain orders during the pendency

of the petition and withdraw the same without getting proper

10 (2000) 8 SCC 395

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adjudication of the issue involved therein and insist that the benefits

of the interim orders or consequential orders passed in pursuance

of the interim order passed by the writ court would continue. The

benefit of the interim relief automatically gets withdrawn/neutralized

on withdrawal of the said petition. In such a case concept of

restitution becomes applicable otherwise the party would continue

to get benefit of the interim order even after loosing the case in the

court. The court should also pass order expressly neutralizing the

effect of all consequential orders passed in pursuance of the interim

order passed by the court. Such express directions may be

necessary to check the rising trend among the litigants to secure

the relief as an interim measure and then avoid adjudication on

merits. (Vide Abhimanyoo Ram v. State of U.P.- (2008) 17 SCC

73)).

26] In this petition, we are not required to apply the above noted

principles strictly. We rest our conclusion only on the broad principle

that an interim order of stay in the present case does not wipe out

the declaration of the subject property as slum. If that is the legal

position then, the Petitioner derives no benefit or advantage from

the same.

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            27]     In the fact situation with which we are concerned, to permit

the Petitioners to build any argument on the basis of interim order

dated 15 June 1998 in writ petition no. 851 of 1998, would virtually

amount to permitting the Petitioners to take undue advantage of the

interim order obtained by them, even though, the writ petition in

which the same was obtained has been ultimately dismissed. As

observed in the case of Kanoria Chemicals (supra) and several

other decisions referred to above, this would be neither permissible,

nor equitable. The Respondents, who have succeeded in Writ

Petition No. 851 of 1998, cannot, despite such success, have their

acquisition voided, merely because show cause notice dated 3 July

1998, requiring the Petitioners to show cause as to why the said

property be not acquired, was issued when the interim order dated

15 June 1998 staying the operation of 20 August 1997 declaring the

said property as 'slum area' was in operation. Admittedly, in the

present case, by the time the Impugned Notification dated 31 May

2006 was issued, there was no controversy whatsoever, that the

said property was "slum area" in terms of Section 4 of the Slum Act.

There is accordingly, no legal infirmity in the issuance of Impugned

Notification dated 31 May 2006.

28] Mr. Sathe's second and third contentions are interconnected

and therefore, are disposed of together. There is no dispute in the

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present case that there was no Notification as contemplated by

Section 3-C of Slum Act issued by the Chief Executive officer of the

Slum Rehabilitation Authority. Therefore, Mr. Sathe may be right in

his submission that the provisions of specified Chapters of the Slum

Act, as modified in terms of Section 3-D of the Slum Act might not

apply to the said property. Section 3-B of the Slum Act empowers

the State Government or the Slum Rehabilitation Authority (SRA)

concerned with the previous sanction of the State Government, to

prepare a general Slum Rehabilitation Scheme for areas specified

under sub-section (1) of Section 3-A for Rehabilitation of slums and

hutment colonies in such area. The said property, in the present

case, is undoubtedly, a property situated in the area specified under

Section 3-A of the Slum Act and further, even a general Slum

Rehabilitation Scheme, as contemplated by Section 3-B of the Slum

Act is in place. However, Section 3-D of the Slum Act provides that

on publication of Slum Rehabilitation Scheme under sub-section (1)

of Section 3-B, the provisions of other Chapters of Slum Act shall

apply to any area declared as the slum rehabilitation area, subject

to certain modifications. Since, the said property has not been

declared as 'Slum Rehabilitation Area' , Mr. Sathe is right in his

contention that the provisions of other Chapters of Slum Act, will

apply to the said property, in their original and not modified form.

The question which therefore arises for determination is whether

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the compliance with the provisions contained in Sections, 5, 11, 12

(7) and 13 of the Slum Act is necessary prior to exercise of powers

of acquisition under Section 14 of the Slum Act and further, whether

in the facts and circumstances of the present case, there has been

any such compliance.

29] Mr. Sathe, has placed reliance upon the decision of the

learned Single Judge of this court in case of Ramkali Kushawaha

(supra), to contend that the powers of acquisition under Section 14

of the Slum Act, can never be exercised without prior compliance

with the provisions contained in Sections 5, 11, 12 (7) and 13 of the

Slum Act, which, in terms, confer a preferential right upon the land

owner to either improve the slum area or to redevelop the same

himself. Mr. Sathe pointed out that the decision in case of Ramkali

Kushawaha (Kachhi) (supra), was confirmed in Appeal No. 324 of

2004 decided on 14 February 2011 and even, the Special Leave

Petition against the same was dismissed on 27 July 2012.

30] Upon careful consideration of the decision in the case of

Ramkali Kushawaha (supra), we are not sure if the same is indeed

an authority for the proposition which Mr. Sathe has canvassed.

However, even if we proceed on the basis that Ramkali Kushawa

(supra) is an authority for the proposition that a landowner has any

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preferential right to either improve or redevelop the slum area,

before the powers of acquisition under Section 14 of the Slum Act

can be put into motion, in the facts and circumstances of the

present case, we are satisfied that there is overwhelming material,

which establishes that the Petitioners in the present case were

offered more than ample opportunities for either improving the slum

area or to redevelop the same, before the Impugned Notification

dated 31 May 2006 under Section 14 of the Slum Act came to be

issued. There is accordingly, no legal infirmity in the Impugned

Notification dated 31 May 2006.

31] In the aforesaid regard, reference is first required to be made

to the provisions contained in Section 4 of the Slum Act, which

empowers the competent authority to declare any property or area

as 'slum area', where it is satisfied that such area is source of

danger to the health, safety or convenience of the public of that

area or of its neighbourhood, by reason of the area having

inadequate or no basic amenities, or being insanitary, squalid,

overcrowded or otherwise. Such power can also be exercised

where the buildings in any area, used or intended to be used for

human habitation are in any respect, unfit for human habitation, or

by reasons of dilapidation, overcrowding, faulty arrangement and

design of such buildings, narrowness or faulty arrangement of

streets, lack of ventilation, light of sanitation facilities or any

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combination of these factors, detrimental to the health, safety or

convenience of the public of that area. Before, declaring any area

as 'slum area', the competent authority, is also required to have

regard to the condition of the buildings, repairs, stability, freedom for

damp, natural light and air provision for water-supply , provision for

drainage and sanitary convenience, facilities for the disposal of

waste water and such other parameters set out in Section 4(2) of

the Slum Act.

32] The Section 5 of the Slum Act empowers the competent

authority, to call upon the owner or mortgagees of the property in

slum areas, which are capable of being improved to submit their

objections and suggestions, in the matter of executing of works of

improvements by the competent authority. Section 11 of the Slum

Act, empowers the competent authority to declare slum area as

'slum clearance area' and thereafter make a clearance order under

Section 12 of the Slum Act. Section 13 of the Slum Act, empowers

the competent authority to itself redevelop the clearance area, if the

authority is satisfied that it is necessary in the public interests to do

so. This has to be preceded by reasonable opportunity to the

owner. In the present case, as noted earlier, there is ample material

on record, which suggests that the Petitioners were afforded more

than ample opportunities to undertake execution of works for

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improvement as also redevelopment of the said property, before the

exercise of powers of acquisition under Section 14(1) of the Slum

Act. Therefore, even if we are to proceed on the basis that the

landowner is required to be called upon to execute works of

improvement or be offered opportunity to redevelop the slum areas,

before such slum areas can be acquired by resort to the provisions

contained in Section 14 of the Slum Act, in the facts and

circumstances of the present case, there is ample material on

record to establish that such opportunities were time and again

offered to the Petitioners, who have failed to avail the same. In such

circumstances, the Petitioners, can hardly complain regards alleged

non-compliance with the provisions contained in Sections 5, 11,

12(7) and 13 of the Slum Act.

33] In the present case, the competent authority upon record of

satisfaction that the said property indeed complied with the

parameters requisite for its being declared as a 'slum area', made

the statutory declaration under Section 4 of the Slum Act on 20

August 1997. The Petitioners' appeal against the same was

dismissed by the Slum Tribunal on 12 December 1997. The

Petitioners' writ petition no. 851 of 1998 was dismissed by the

learned Single Judge of this Court on 17 April 2001. The appeal

against the same was dismissed by the Division Bench on 31 July

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2001. Finally, even the Supreme Court, dismissed the Petitioners'

special leave petition on 15 July 2002. From all this, it is quite clear

that the Petitioners, who claim to be owners of the said property,

had permitted the said property and the structures therein to

deteriorate to such an extent that the competent authority, had no

realistic option, other than to declare the said property as a slum

area under Section 4 of the said Act. The material on record

indicates that from time to time opportunities were afforded to the

Petitioners to improve the conditions in the said property or even to

undertake redevelopment therein, but the Petitioners availed

neither.

34] The Slum Tribunal, in its judgment and order dated 12

December 1997, whilst dismissing the Petitioners' appeal no. 87 of

1997, questioning slum declaration dated 20 August 1997 has

recorded findings that the said property comprised about six chawls

having about 339 occupants. The structures, the rooms and the

roofs in particular were decayed and in dilapidated conditions.

There is reference to about eight W.Cs., out of which almost five

were rendered unusable. Two W.Cs. had no doors and three were

over flooded with human excreta. There were no septic tanks and

the waste was drained in open nallaha, which itself, was over

flowing with filth and constituted health hazard. The entire area

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emitted foul smell and pollution was writ large. The internal roads

were narrow and not properly maintained. There were no street

lights. The height of the structures, denied its occupants natural

light. In short, there were no basic amenities, the conditions were

insanitary, squalid, overcrowded. There was no proper ventilation,

there was foul smell and pollution, the conditions constituted

serious health hazards and the area was unfit for human habitation.

Despite all this, the Slum Tribunal has recorded that the

tenants/occupants of the structures had expressed willingness to

having the said property redeveloped by the Petitioners themselves

and had even assured cooperation for such purpose. The Slum

Tribunal, went to the extent of itself granting the Petitioners

opportunity to take appropriate steps to develop the property under

the Slum Rehabilitation Schemes before any action is taken to

acquire the said property by resort to the provisions contained in

Section 14 of the Slum Act. The observations in paragraphs 22 and

the operative portion of the judgment and order dated 12 December

1997, made by the Slum Tribunal, would bear out this position. They

read thus :

22. However, to give chance to the Appellant landlord to take appropriate steps to develop the property one one or other scheme . I therefore, hereby permit the Appellant to take steps to develop the said plot No. 165, 165/1 to 51 of Village Kanjur by adopting any steps towards development of the plot within 3 months from the date of order, failing which, the competent authority should take steps to initiate proceedings under sec.14(c) of the said Slum Act and permit

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the occupiers of the Co-op. Housing Society, i.e., Mata Vaishnodevi Co-op. Housing Society, to develop the said plot in accordance with the schemes to which they are bound.

23. In the premises, I therefore, pass the following order:

" Declaration of slum of property bearing C.T.S. No.

165/65- 1 to 51 declared as Slum by Notification No. ENC/DCK/I/WS/168/SR-200 OF 1997 dated 20.8.1997 published in the Maharashtra Government Gazette on 21.8.1997 is hereby confirmed.

Ad-interim stay granted is hereby vacated. Appellant be permitted to adopt any of the Scheme for re-development within a period of there months from to date of order, failing which the Competent Authority should adopt proceedings under

Sec. 14(1) of the Maharashtra Slum Area (I.C. & R.) Act, 1971 and thereafter, hand over the plot for

development to Mata Vaishnodevi Co-op. Housing Society to develop the said plot in accordance with law.

However, I propose no order as to cost.

Appeal dismissed.

(emphasis supplied)

35] Similarly, even in the writ petition no. 851 of 1998 instituted by

the Petitioners questioning, inter alia, the aforesaid judgment and

order dated 12 December 1997 made by the Slum Tribunal, a Court

Commissioner was appointed to inspect the said property and make

a report about the condition of the said property, particularly with

regard to the amenities like W.C.s, water supply, electricity

connection etc. The Commissioner, has made his report, which

more or less, is in consonance with the reports taken into

consideration by the Slum Tribunal in its judgment and order dated

12 December 1997.

     skc                                                                      judgment 165-07.doc




            36]      The learned Single Judge of this Court, by judgment and

order dated 17 April 2001, has upheld the judgment and order dated

12 December 1997 made by the Slum Tribunal and consequently,

the declaration dated 20 August 1997. The learned Single Judge of

this Court has noted that there was due compliance with principles

of natural justice and fair play before the slum declaration dated 20

August 1997 was made. Besides, there is record that on two

occasions earlier, there were attempts to declare the said property

as 'slum area'

under Section 4 of the Slum Act. However, the

attempts were frustrated on some technical grounds. The learned

Single Judge has observed that from the defects pointed out, it was

quite clear that there was absolutely no improvement of any nature

undertaken by the Petitioners to improve the condition of the said

property and the structures therein, so as to render the same

habitable. The learned Single Judge specifically rejected the

Petitioners' contention that there were no specific notices issued to

the Petitioners to remedy the defects or the conditions by observing

that on two occasions earlier, the show cause notices had been

issued to the Petitioners; reports were prepared in presence of the

Petitioners ; accordingly, there was no necessity of sending them

special notice to make good the defects. The learned Single Judge

has observed that the Petitioners never made any efforts to provide

basic human needs for reasonable habitable condition and despite

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being made fully aware of the conditions and they did not set right

the defects and the conditions. The learned Single Judge, in this

context, has observed that "he had more than ample opportunity to

take every necessary steps to provide for basic amenities to avoid

third time the action by the authorities". With all such observations,

the Petitioners' writ petition no. 851 of 1998 was dismissed.

37] The Petitioners, carried the matter in Appeal No. 413 of 2001,

which was dismissed by the Division Bench of this Court on 31 July

2001. Before the Division Bench, the Petitioners had specifically

questioned the Slum Tribunal's order dated 12 December 1997, by

which, it had inter alia, permitted the authorities to take action

under only Section 14 of the Slum Act for acquisition of the said

property, in case, the Petitioners fail to avail the offer to rectify the

condition or redevelopment the said property. Even the Division

Bench, made enquiries with the learned counsel appearing for the

Petitioners, as to whether the Petitioners were prepared to

undertake redevelopment and if so, to submit proposals in that

regard. The Division Bench has however, noted that the Petitioners

had no scheme ready and were unable to furnish any proposals. In

this regard, reference is necessary to the observation in paragraph

'6' of the judgment and order of the Division Bench made on 31 July

2001 :

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6. The learned Advocate for the appellants next submitted that the Tribunal has exceeded its jurisdiction while passing the final order dated 12.12.97. He submitted

that there could have been no order passed under Section 14(1) of the Maharashtra Slum Areas (I.C. & R.) Act, 1971

without notice to the appellants, We find that there is no substance in this submission. It is based on wrong reading of the order. The Tribunal has confirmed the declaration of slum but permitted the appellants to adopt any fo the

schemes for redevelopment within a period of three months from the date of order. In case the appellants fail, then it was stated that the Competent Authority should adopt the proceedings under Section 14(1) of the said Act and thereafter hand over the plot for development to Mata

Vaishnodevi Co-op. Housing Society to develop the said plot in accordance with law. Therefore, proceedings are to

be adopted on failure of the appellants and thereafter plot is to be handed over to the Co-operative Society of the tenants. It is not an order under Section 14(1). When we

made enquiry, the learned counsel for the appellants stated that there is no such scheme ready with the appellants even today giving details how the redevelopment would be carried out, plan of an architect and the amount required for the same.

(emphasis supplied)

38] From the aforesaid, including in particular portion to which

emphasis is supplied, it is quite clear that the Petitioners were

afforded more than ample opportunities to either rectify the

conditions at the site or to themselves carry out redevelopment

under the SRA scheme, but the Petitioners were unprepared to do

so. In a light of such overwhelming material on record, the

Petitioners, can hardly complain about any lack of opportunity to

execute works of improvement or to carry out redevelopment in the

said property themselves. Time and again, the Petitioners were

issued show cause notices as to why said area be not declared as

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'slum area' . Time and again, opportunities were granted to the

Petitioners to execute works of improvement. Time and again,

opportunity was granted to the Petitioners to undertake

redevelopment as per the available SRA scheme. The Slum

Tribunal, specifically offered the Petitioners such opportunity and

deferred action under Section 14 of the Slum Act, only in the event,

the Petitioners fail to avail of such offer. Similar opportunities was

also offered at the stage of disposal of Petitioners' appeal by the

Division Bench. All this was prior to the acquisition of the said

property by resort to the provisions contained in Section 14 of the

Slum Act. In the facts and circumstances as borne out from the

record therefore, the Petitioners are not justified in contending that

the Impugned Notification dated 31 May 2006 is in excess of

jurisdiction or legally infirm for any alleged non-compliance with the

provisions contained in Sections 5, 11, 12 (7) and 13 of the Slum

Act.

39] Insofar as Mr.Sathe's contention based on malafides is

concerned, it is to be noted that there are hardly any pleadings on

this aspect in the petition. It is settled position is law that vague and

casual allegations suggesting that a particular action was taken with

an ulterior motive cannot be accepted without proper pleadings and

sufficient proof. A bald assertion, in the course of arguments that the

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acquisition was made to favour some party, is hardly sufficient even

to investigate into the allegation of malafides. In the absence of

proper pleadings and proper material in support thereof, it is not

possible to embark upon a roving enquiry into the matter. The

allegation of malafides are normally, easy to make rather than make

out. Further, even the burden of proving malafides is upon the

person making the allegations and such burden, is generally quite

heavy. Neither express nor implied malice can be inferred or

assumed in such matters. In case of Gulam Mustafa Vs. State of

Maharahstra 11, the Supreme Court, speaking through Krishna Iyer,

J. , in the context of allegation of malafides has observed that "it is

the last refuge of a losing litigant".

40] The fact situation in case of Royal Orchid Hotels Limited

(supra) offers no parallel to the fact situation in the present case.

There are neither any pleadings nor is there any material in support

of the contentions that the acquisition is vitiated by the malafides or

that the entire exercise was fraudulent or was undertaken to deprive

the Petitioners of their constitutional rights to the property. As

noticed earlier, from time to time opportunities were granted to the

Petitioners to execute works of improvement in or upon the said

property or to undertake redevelopment as per the SRA Schemes. It

is only after the Petitioners failed to opt for either, statutory powers

under Section 14 of the Slum Act came to be exercised.

    11 (1976) 1 SCC 800



     skc                                                                      judgment 165-07.doc

Accordingly, there is no merit in the vague and unsubstantiated

allegations of malafides.

41] For all the aforesaid reasons, this petition is dismissed. Rule

is discharged. Interim orders stand vacated. There shall however,

be no order as to costs.

                    [M. S. SONAK, J.]               [S.C. DHARMADHIKARI, J.]




                                             
            42]     At this stage Mr. Datar appearing for the Petitioners prays that
                                   

there is an interim order operating in this Petition which should be

continued for a further period of three months so as to enable the

Petitioners to consider the position and if necessary, approach the

higher Court.

43] This request is opposed by the counsel appearing for other

side, particularly those awaiting fruits of some development and

rehabilitation.

44] Having found that the statutory prescription is of publication in

the official gazette a notice within the meaning of sub-section (1) of

section 14 and from such publication, the vesting and absolutely in

the State free from all encumbrances takes place. If that publication

has taken place, we do not think that the request of Mr. Datar can

be accepted. The request is refused.

                    [M. S. SONAK, J.]               [S.C. DHARMADHIKARI, J.]