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Rajhan Narendra Raut vs The State of Maharashtra Urban Development Department

Civil Appeal · 2022 INSC 863Decided 25 Aug 2022
Civil Appeal No. 4639 of 2012
N.V. Ramana · Hima Kohli

Background

The appellants owned land in Pune reserved for a park under the city's 1987 Development Plan. Under Section 126 of the Maharashtra Regional Town Planning Act, they surrendered the land to the Pune Municipal Corporation in exchange for a Transferable Development Right (TDR), a certificate letting them build elsewhere, initially fixed at 100% Floor Space Index (FSI) based on the State's own Advocate General's legal opinion, and they paid the Corporation money for site work and handed over possession in 2004. A year later, the State reversed course, slashing the TDR to just 4% FSI on the ground that the land was in a "Hill Top/Hill Slope" zone, and the Bombay High Court upheld this cancellation.

Decision Breakdown

The Supreme Court found the State's reversal unjustified. It had accepted and acted on its own Advocate General's opinion (that the surrounding residential zoning should determine the TDR rate), and never went back to get a fresh legal opinion or otherwise properly justify overturning it, even though the appellants had already surrendered their land and paid money in reliance on the earlier decision. Noting the matter had dragged on for 18 years with the State and the Municipal Corporation repeatedly blaming each other and even changing their story about what use the land was put to, the Court set aside the High Court's judgment. Rather than simply restoring the original 100% FSI TDR (which the respondents said would strain city infrastructure given intervening construction), the Court ordered the Corporation to return the land to the appellants within four weeks for residential use, and directed the State/Corporation to pay compensation of Rs. 1 crore per year (from 2004) for the loss caused by the prolonged deprivation, to be completed within three months.

Lesson Learnt

A citizen who parts with property in reliance on a government body's own considered legal opinion and formal decision is entitled to have that reliance honoured; authorities cannot arbitrarily reverse a settled benefit years later without a proper, reasoned basis, and courts can fashion practical remedies (return of property plus compensation) when the original relief is no longer feasible.

Official source (sci.gov.in)View Judgment (PDF)

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