Jyoti Builders vs. Chief Executive Officer, Slum Rehabilitation Authority & Ors.
Background
The dispute concerned a plot of land in Malad, Mumbai that had been declared a slum in 1987 and was reserved in Mumbai's Development Plan as a Recreational Ground (RG). Over roughly three decades the land passed through multiple owners and developers, including the appellant, Jyoti Builders, which had implemented a slum rehabilitation scheme on an adjoining larger property that included this plot, rehousing 34 slum dwellers whose hutments stood on it. In 2015, the CEO of the SRA had passed a detailed (and unchallenged) order holding that the plot was liable to be compulsorily acquired under Section 14 of the Slum Act for the benefit of the slum scheme, with the owner to be paid compensation. Despite this, in 2022 the plot's owner (respondent No. 5) sold it directly to a private developer (respondent No. 4, Alchemi Developers), and the appellant's requests to actually implement the 2015 acquisition order and to get its Occupation Certificate went unheeded, leading it to seek a writ of mandamus, which the Bombay High Court declined.
Decision Breakdown
The Supreme Court held that the State Government's power to acquire slum land under Section 14 read with Section 3D(c)(i) of the Slum Act is subject to any preferential right of the original owner to redevelop the land themselves, so the appellant could not compel the State to acquire the plot via mandamus as a matter of right. However, since the appellant had already generated and used the equivalent FSI (floor space index) for the rehabilitation component covering the slum dwellers on this very plot and had completed its sale-component construction, the Court held it had effectively already been compensated for the land through that FSI benefit, and was entitled to receive its Occupation Certificate for the completed sale building upon handing over a demarcated "Dark Green Portion" reserved as Recreational Ground. Crucially, the Court directed that the private developer who had purchased the plot (Alchemi Developers) and its successors must never construct anything on it: the land must remain solely a Recreational Ground, as originally reserved in the Development Plan, since the plot was never actually part of any sanctioned construction scheme.
Lesson Learnt
Land reserved for public purposes such as a Recreational Ground cannot be diverted to private construction merely because it changes private hands, or because a slum-redevelopment scheme once touched the surrounding area: a builder who has already been compensated through development rights elsewhere cannot demand compulsory acquisition of adjoining reserved land as an entitlement, and courts will actively enforce a public-purpose land reservation against a subsequent private purchaser.