Sixty seven years after the Brihanmumbai Municipal Corporation (BMC) acquired a land without paying for it, the Bombay High Court set aside an order that directed the civic body to pay less than 1/10th of the plot’s actual market value.
A single Bench of Justice R.D. Dhanuka was hearing a plea filed by Kekobad Doongriwalla challenging the a decision passed by a retired judge that the BMC had to pay just ₹16 lakh to the owner for acquiring the land.
On November 16, 1951, the BMC acquired the land measuring 12 gunthas or 1,113.2 square metres for 14 annas in Thane. The plot belonged to Dinshaw Doongriwalla, the grandfather of the petitioner. The BMC bought the land to construct a pipeline on Tansa lake. Mr. Kekobad said that the BMC was erroneously shown to own a larger part of the property. This mistake was realised in 1974 and the civic body was asked to make the correction. In 1981, a survey was carried out in the presence of a BMC official and Mr. Kekobad was confirmed to have ownership of the property.
However, Mr. Kekobad claimed that sometime before 1985, the BMC illegally commenced construction of an office building on the property. He then moved the court seeking the BMC to vacate the land and hand over possession of the property. In 1992, the civil judge directed the BMC to do so and restrained them from encroaching or trespassing on the property. However, the BMC appealed against the order before the Additional District Judge in Thane.
In 1996, the BMC approached Mr. Kekobad and said they are willing to acquire the property at the market value and an amount of ₹36,24,000 was agreed upon. The Deputy Hydraulic Engineer of the BMC sought papers of the sale from Mr. Kekobad to know the basis of the valuation report. Mr. Kekobad refused to produce the documents and said he was not required to do so.
The BMC then filed a first appeal in court, which was dismissed in 1998. The BMC was directed to demolish the existing construction and hand over possession of the land to Mr. Kekobad. In 1999, the BMC came up with the figure of ₹16,65,830 for gaining possession of the land. However, Mr. Kekobad said he was not aware of it.
In 2015, V.P. Tipnis, a retired judge, determined the market value of the land to be ₹ 16,65,830 with the interest of rate of 12% per annum from 1996 to 2015. Mr. Tipnis said Mr. Kekobad would also be entitled to interest on ₹59,63,671.40 at the rate of 12% per annum from the date of the award till the date of realisation.
Advocate Birendra Saraf, appearing for the petitioners, brought to the notice of High Court that Mr. Tipnis had determined the market rate of the property accoring to 1996 values when it had to be calculated as per 2014 values. Justice Dhanuka said, “The arbitrator should have considered ₹5,199 as the price per sq.ft in 2014. The entire basis of awarding the compensation is totally absurd and shows patent illegality.” The court said, “The arbitrator has determined the market value of the land to be ₹ 16,65,830 without any evidence and recording any reason.” The court then decided to set aside the award passed by the arbitrator.
