Bombay High Court Refers Dispute Between CIDCO and State Government to State for Clarification on Land Allotment Cancellations

Court’s Decision:
The Bombay High Court directed the State Government to clarify the purport of its communication to CIDCO dated August 1, 2018, concerning the cancellation of land allotments to the petitioner. The decision regarding the cancellation of the allotment and further proceedings was put on hold until the State Government’s final decision.

Facts of the Case:
The petitioner, M/s. Trishul Construction Co., had been allotted three plots of land in Ghansoli, Navi Mumbai, by CIDCO through a tender process in 2007. Despite paying the first installment of the lease premium, the petitioner was unable to pay the second installment due to economic downturns in 2008. CIDCO initially granted extensions, but the petitioner continued to face delays in payment.

In 2018, the State Government instructed CIDCO to act in a financially beneficial manner, proposing to regularize the allotment by condoning delays and recovering the second installment along with late fees. However, CIDCO decided to cancel the allotment and forfeited the earnest money deposit and part of the lease premium in January 2024.

Issues:
Whether the communication from the State Government in August 2018, instructing CIDCO to regularize the allotments, was a directive under Section 154 of the Maharashtra Regional and Town Planning (MRTP) Act.
Whether CIDCO was justified in canceling the allotment despite the State’s communication.

Petitioner’s Arguments:
The petitioner argued that CIDCO was bound by the State Government’s directives to regularize the allotments and extend time for payment.
It was further contended that the cancellation violated Section 154 of the MRTP Act, which mandates that directions from the State Government must be followed by planning authorities.

Respondent’s Arguments (CIDCO):
CIDCO maintained that the 2018 communication from the State Government was not a binding directive under Section 154 of the MRTP Act but was merely an opinion under Regulation 15 of the 1975 Land Regulations.

Court’s Analysis:
The Court examined the communication from the State Government and concluded that it was indeed a directive under Section 154 of the MRTP Act, making it binding on CIDCO. The Court emphasized that any disputes between a planning authority and the State must be resolved by the State, and its decision would be final.

The Court found that there were conflicting interpretations of the State’s communication between CIDCO and the State Government, and thus referred the matter back to the State Government for clarification.

Conclusion:
The Court ordered the State Government to clarify the nature of its instructions to CIDCO within two months. Until then, CIDCO’s decision to cancel the allotments and retender the plots would remain in abeyance. The final decision of the State would determine the fate of the allotments.