Satwaratna Coop Housing Society Ltd vs Bharat Petroleum Corporation Ltd

NON-REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 3185 OF 2022 (Arising out of SPECIAL LEAVE PETITION(CIVIL) NO. 3250 OF 2020)

SATWARATNA CO-OP HOUSING SOCIETY LTD. & ANR. … Appellants

VERSUS

BHARAT PETROLEUM CORPORATION LTD. & ORS. … Respondents

J U D G M E N T

INDIRA BANERJEE J.

Leave granted.

This appeal is against a judgment and order dated 25.04.2019

passed by the Division Bench of the High Court of Judicature at

Bombay, allowing Writ Petition No. 1515 of 2017 filed by the

Respondent No.1-Bharat Petroleum Corporation Limited and quashing

an order passed by the Municipal Commissioner, Municipal

Corporation of Greater Mumbai, granting permission for

redevelopment of a building to M/s. Satwaratna Cooperative Housing

Society Limited being the Appellant No. 1 before us, and

hereinafter referred to as the Appellant-Society, subject to the

conditions specified in the said order.

Signature Not Verified Digitally signed by

Sometime in 1972-73, a residential building consisting of GULSHAN KUMAR ARORA Date: 2022.05.27 09:59:52 IST Reason:

Ground + three floors was constructed on Survey No. 103, Hissa No.

15 bearing CTS No. 35 and 39 at Village Mahul, Taluka Chembur, 2

Mumbai Suburburn District, Mumbai. As the building was over 40

years old and in a dilapidated condition, the Appellant-Society

obtained consent of all its members and appointed the second

appellant, i.e., M/s. Kishraj Developers, hereinafter referred to

as the Appellant-Developer to redevelop the building. A

registered Development Agreement was accordingly executed between

the Appellant-Society and Appellant-Developer.

On or about 9th December, 2014, the Appellant-Developer

approached the Municipal Corporation of Greater Mumbai with a

proposal for redevelopment of the building in question. The

reconstructed building was to comprise a stilt 7 upper floors.

By a communication No. CE/6794/BPES/AM dated 25.06.2015, the

Municipal Corporation of Greater Mumbai disapproved the proposal

as submitted by the Appellant-Developer. The Appellant-Developer

was, however, given permission to reconstruct the building subject

to compliance of the conditions stipulated in the communication.

Upon receipt of the communication, the Appellant-Developer

demolished the existing building. The 12 families who were

members of the Appellant-Society were provided with alternative

accommodation at monthly rent of Rs.18,000/- per month with 10%

increase each year.

On 05.09.2015, after the occupants of the building vacated,

the Municipal Corporation of Greater Mumbai granted commencement

certificate to the Appellant-Developer enabling the Appellant- 3

Developer to commence construction of the building that was being

redeveloped, upto the plinth level.

On 29.10.2015, the respondent No.1, Bharat Petroleum

Corporation Limited, hereinafter referred to as Respondent-BPCL

sent a lawyer’s notice to the Municipal Corporation of Greater

Mumbai, contending that the proposed re-development of the

building in question would jeoparidise the safety of the refinery

of Respondent-BPCL as well as the safety of the inhabitants of the

locality.

In the meanwhile, after grant of commencement certificate, the

Appellant-Developer commenced construction, which was carried out

upto the plinth level. Upon completion of construction upto the

plinth level, the Appellant-Developer through its Architect

approached the Municipal Corporation of Greater Mumbai, inter

alia, seeking grant of completion certificate.

On or about 02.03.2016, an area admeasuring 362.16 sq. meters

being the set back area in respect of the building under

reconstruction was handed over to the Municipal Corporation of

Greater Mumbai for which a receipt was duly granted to the

appellants.

Pursuant to the objection raised by the Respondent No.1-BPCL,

the concerned Executive Engineer of the Municipal Corporation of

Greater Mumbai prepared an exhaustive note pointing out that there

were existing buildings in the vicinity of the refinery of 4

Respondent-BPCL, which were higher than the building under

reconstruction.

In the said note, it was pointed out that the proposed

redeveloped building was to have a height of 23.90 sq. meters.

In other words, it would only be a low rise building. Further

more, the Appellant-Developer had given an undertaking of Police

verification of the prospective buyers of the additional floors to

be constructed in terms of the Development Agreement. The report

apparently contained a list of other buildings of ground+ seven

levels in the vicinity of the refinery of Respondent-BPCL, at an

equal distance from the refinery, supported by photographs.

However, in view of the objection of Respondent-BPCL, a stop work

notice was recommended, on condition that Respondent-BPCL would be

liable for legal proceedings, damages, claims for compensation and

the like.

On 05.04.2016, the Municipal Commissioner issued a stop work

notice directing the appellants to stop redevelopment work of the

building in question. It is alleged that the appellants were not

provided with a copy of the complaint made by the Respondent-BPCL.

They were also denied completion certificate to continue

construction.

In the circumstances, the Appellants filed a writ petition in

the Bombay High Court being Writ Petition No. 1418 of 2016. By a

judgment and order dated 23.02.2017, the Bombay High Court 5

disposed of the said writ petition No. 1418 of 2016 by directing

the Municipal Corporation of Greater Mumbai to take an appropriate

decision having regard to the materials on record and to pass a

brief reasoned order on the issues raised by the respective

parties.

Thereafter, on 28.02.2017, the appellants submitted their

representation placing reliance on the note dated 11.03.2016

prepared by the concerned Executive Engineer of the Municipal

Corporation of Greater Mumbai. On 20.03.2017, the Respondent

No.1- BPCL submitted a detailed representation putting forward its

claims before the Municipal Commissioner after which on

21.03.2017, the Appellant-Developer made a further representation

to the Commissioner, inter alia, assuring the Municipal

Commissioner that requisite precautions would be taken by the

Appellant-Developer while selling the additional flats to

prospective buyers, to address the apprehensions/concerns of

Respondent-BPCL.

The Municipal Commissioner of the Municipal Corporation of

Greater Mumbai held formal hearings on 22.03.2017 and 27.03.2017

and thereafter passed a reasoned order dated 16.05.2017 granting

permission to the Appellants to continue with the construction

subject to the conditions stipulated in the said order.

The Respondent-BPCL filed the writ petition Writ being

Petition No. 1515 of 2017 in the Bombay High Court challenging the 6

order of the Municipal Commissioner. On 12.09.2017, the Bombay

High Court directed that status quo as on that date be maintained.

In the meanwhile, pursuant to the order dated 16.05.2017

passed by the Commissioner, Municipal Corporation of Greater

Mumbai, the Appellant-Developer had recommenced the construction.

In view of the order of status quo the work of reconstruction had

to be haulted. By the impugned judgment and order, the High Court

has allowed the writ petition and quashed the order dated

16.05.2017 of the Municipal Commissioner of the Municipal

Corporation of Greater Mumbai.

The High Court meticulously recorded the submissions made on

behalf of Respondent-BPCL, took note the nature of the activities

of the refinery of Respondent-BPCL and observed that the Municipal

Commissioner had downplayed and virtually ignored the security

concerns expressed by the Respondent-BPCL. The High Court

observed :

“47. For one, the concern is founded on two critical aspects. First is safety. Now, natural calamities come uninvited. On such occasions, it is the normal and ordinary expectation of the general public and those caught in and are victims of calamities, that rescue operations are commenced forthwith. The response, therefore, ought to be almost immediate. The teams and squads in-charge of emergent relief and rescue measures ought to reach the site within minutes and not hours. If the construction and development in the vicinity of the refinery is not regulated, restricted and controlled, then, a natural calamity can never be tackled properly if not averted altogether. When bureaus in charge of climate and weather can now foresee a cyclone, heavy to very heavy rainfall causing floods, mudslides, landslides, etc. then, adequate safety measures have to be taken by making suitable advance arrangements. Huge amount of machinery and manpower has to be deployed even before the calamity strikes and it must be totally geared up, prepared so as to minimise the loss to life and property. A refinery is not comparable with any other 7

establishment. Its existence meets and satisfies the Nation’s fuel requirement. Given its prominence, a refinery has to be protected and safeguarded in a manner excelling every other building. It has to be equipped form within and must receive total outside suppoort so as to meet a natural and man-made calamity and disaster. A refinery catching fire means enormous loss to the public exchequer. The operations in such establishment go on round the clock (24x7) They would be at a standstill if a major fire, explosion, accident, etc. occurs. The Commissioner appears to be wholly oblivious to all this. It never strikes him that it is the Municipal Corporation which stopped the construction when above concerns were expressed, then, how can the Municipal Corporation be justified in taking a U-turn now ought to have entered his mind. Far from it, even though there was nothing on record to arrive at a conclusion that all concerns of the petitioner are no longer subsisting, the Municipal Corporation has in the impugned order gone back and allowed resumption of construction. This is wholly inexplicable and the approach is wholly perfunctory.

48. Secondly, the security of the refinery is of paramount consideration. That must prevail over a commercial or private business enterprise. The refinery under continued threat of the nature highlighted above means risk to human life, threat, to the economy and loss of reputation of the State as a whole.

The world at large will ridicule us if a prime refinery in Mumbai is destroyed by terrorists and subversive activities of a handful. One can only imagine the magnitude of the financial and economic loss in the event such activities stall or obstruct production of petroleum products.

49. The decision making should not be influenced by any other expect the above yardsticks and parameters. The above is not the manner in which these matters have to be decided. In the first instance, this Court itself would have gone into the concerns expressed by the petitioner and equally considered the versions of respondent Nos. 3 and 5. However, it gave an opportunity to the Municipal Corporation to have a second look particularly because it had earlier issued a stop-work notice. There is not a word as to why a stop-work notice was issued in the year 2016 despite all permissions and approvals in place. If the Municipal Corporation found substance in the complaint of the petitioner and its genuine concerns leading to the issuance of stop-work notice, then, we do not understand the turn around. This turn around is virtually fatal. If such high level officials and particularly, drawn from Indian Administrative Service and working as Municipal Commissioners take a pedantic view in a matter of national importance and concerning public safety, then, we are compelled to hold that their approach overlooks the very object and purpose of a planning legislation.” 8

There can be no doubt, as observed by the High Court, that

natural calamities come uninvited. There are possibilities of

cyclones, heavy rainfalls, floods, mudslides, landslides and the

like. However, the connection between reconstruction of a

dilapidated building that had been in existence and the

possibility of natural calamities is difficult to perceive.

There can also be no doubt that a refinery is not to be

compared with other establishments. A refinery has to be

protected. However, when there is no law which provides for a

buffer zone between a refinery and other constructions, it was

rather harsh to comment that the Commissioner had been wholly

oblivious to the security and safety concerns of the Respondent-

BPCL, more so when the Municipal Commissioner had given direction

for round the clock security, police verification of prospective

flat buyers, etc.

It is rather surprising that the High Court should have taken

exception in the impugned judgment and order to the fact that the

Municipal Commissioner had issued a stop work order but later

passed the impugned order. The High Court remarked :-

“49. ********** There is not a word as to why a stop-work notice was issued in the year 2016 despite all permissions and approvals in place. If the Municipal Corporation found substance in the complaint of the petitioner and its genuine concerns leading to the issuance of stop-work notice, then, we do not understand the turn around. This turn around is virtually fatal. If such high level officials and particularly, drawn from Indian Administrative Service and working as Municipal Commissioners take a pedantic view in a matter of national importance and concerning public safety, then, we are compelled to hold that 9

their approach overlooks the very object and purpose of a planning legislation.”

The High Court appears to have overlooked the note of the

Executive Engineer concerned and the advice to issue a stop work

order at the risk of the Respondent-BPCL of the costs and

consequences of the stop work order. It is patently obvious that

the stop work order was a temporary measure pending further

consideration of the objection raised by the Respondent-BPCL to

the reconstruction of the building. If anyone were to be

aggrieved by the stop work order, it was really the appellants

and/or the flat owners temporarily shifted elsewhere, and not any

one else.

There can be no doubt that the security of the refinery is of

paramount consideration. However, in the absence of any law which

provides for a buffer zone between a refinery and a residential

building as observed hereinabove, the owner of land cannot be

prevented from the right to utilize the land effectively including

the right to carry out redevelopment and/or reconstruction in

accordance with law and the Rules and Regulations with regard to

the construction of buildings.

The High Court took note of the provisions of the Maharashtra

Regional Town Planning Act, 1966, hereinafter referred to as the

‘MRTP Act’ and in particular, Chapter III thereof, titled

“Development Plan”. Unfortunately, the MRTP Act does not contain

any specific provision which prohibits or even restricts the 10

construction of a building in the vicinity of a refinery. The

Development Control Regulations for Greater Mumbai, framed under

Section 22 clause(m) of the MRTP Act, requires measures of safety

and public interest to be taken into consideration. There cannot

be any question of haphazard constructions or control free

development. However, in the impugned judgment and order there is

no specific finding of contravention by the Appellants of any

particular statutory provision or of any particular Rule or

Regulation in redevelopment of the building in question. The High

Court further observed as hereunder :-

“53. xxxxxxx That the factories, industries and installations dealing with inflammable and obnoxious substances and products by themselves present a threat to the life of the people residing in buildings within their proximity. If the people residing there are likely to face serious health issues on account of emission of gases and toxic substances, leakages and accidents in these installations, then all the more, the stand of the Municipal Corporation, when it agreed to resettle and rehabilitate the project affected persons to a locality other than Mahul and the present departure therefrom cannot be reconciled. We have witnessed a totally opposite approach in this matter. The Municipal Corporation is aware of such installations going by the nature in residing within close vicinity of such installations going by the natu5re of the activities in such installations. They are hazardous to health and in the case of a mishap would result in death or loss of limbs. If instances of leakages and accidents occur frequently and poisonous gases are released day in and day out from such installations, then, it would not be possible to save human lives or to retrieve persons caught in such accidents. Some of them may be employees of the refinery. They have to be rescued and brought out, For that, a, huge emergency plan has to be drawn up and implemented. The areas have to be evacuated so that emergency vehicles can reach such installations in record time. If these vehicles do not reach and the necessary manpower is not able to access the sites of such installations expeditiously and quickly, then, precious human lives would be lost. Therefore, there is not only a threat perception of the nature presented by Mr. Singh, but existence of vital installations like a refinery by itself enhances the possibility of danger and harm to the people. The nature of the activities in refineries and like installations cannot be wished away, ignored or brushed aside so lightly and casually as has been done in the present 11

case. Nobody can assure or guarantee that despite strict security and safety measures, no accidents will occur in future. None can guarantee that there will be no explosion or no leakage. When there are number of hazardous industries in Mumbai Sururban, Thane and Palghar Districts, and the accidents in such industries have resulted in loss of precious human lives and destruction of property, then all the more, we are unable to sustain the approach of the Municipal Corporation and the Municipal Commissioner. For instance, every factory manufacturing hazardous goods and products has witnessed at least one fire and explosion, it comes uninformed and unpredicted and at odd hours. Thereafter, we have seen a rush to the site and emergency vehicles have to be brought from all over so as to commence the rescue operations. There is a salvage operation also to be carried out. All this requires areas within the vicinity of such industries to be kept open from human occupation. If human beings reside very freely in these localities, then, they may also be victims. The construction activity cannot be controlled, but if not checked at the right moment, increases the harm and danger assuming that such checks do not necessarily guarantee and ensure safety of the occupants. The occupants face a continued risk to their life and to their property. That is not minimised by passage of time. Rather, by passage of time, it increases. The population expansion and it pressure is bound to result in more serious accidents or incidents of the nature described above. Pertinently, in the impugned order, the Municipal Commissioner does not conclude that the concerns of the petitioner are imaginary and not real. There is a reason for stressing on safety, security issues repeatedly. The petitioner has not been held guilty of exaggerating them. To then not take cognizance of such issues and matters by holding that there is no law setting a regime like creation of a buffer zone is to neglect and gloss over the same. There is no prohibition in law to be wise enough and to do everything to avoid a disaster and catastrophe.

54. We have not seen any attention paid by the Municipal Commissioner to the above aspects. Equally, we have not seen in the impugned order, the Commissioner taking into consideration the apprehensions expressed by the petitioner.

The petitioner points out as to how the vital installations are targets of terrorists and the activities of this nature are carried out throughout the world. Such installations are regular targets. To paralyse the economy and to block the regular supply of petroleum products that regularly the refineries are attacked. Merely because after 26th November, 2008, no terrorist attack or bomb blast has taken place in the city of Mumbai does not mean that there will no recurrence of the same in future. In fact, because of the high alert and strict vigil that such attacks are averted. Moreever, sustained efforts in improving the standards of safety and security would not necessarily guarantee that in future, there will be no attacks mounted on all vital installations in the city of Mumbai. In fact, the recent developments denote that on several occasions and particularly when there are such 12

incidents in the neighbouring countries, an alert is sounded, cautioning all concerned, by the Intelligence Agencies in India. They alert everybody, including parties like the petitioner and request them to take additional protective and safety measures. They place the installations like the petitioner in high risk zone. Additional forces are deployed and we see their presence round the clock. In fact, the concerns expressed by the petitioner have not been addressed by the authorities. We cannot be unmindful of the fact that despite high level meetings convened, no comprehensive policy measures are taken. It is left to the petitioner to upgrade its safety measures. It is left to the petitioner to then deploy additional security officials. It is only left to the petitioner then to strengthen its boundaries and compound walls. However, this is an individual endeavor. A comprehensive action plan has to be put in place. That is not only by the planning authority and Ministry, but, equally by the Central Government and Central Industrial Security Forces and agencies like the same. They have to sit together and draw up a contingency and security plan. We hope and trust that it would be done expeditiously.”

In making the observations the High Court completely lost

sight of the fact that a building was already in existence.

The residents have been vacated for construction of a new stronger

and better building. Only a few additional floors were being

added, which did not contravene any Rules or Regulation.

In our considered opinion, the High Court patently erred in

arriving at its effective finding that permission for

reconstruction could even be refused in the absence of any law,

rule or regulation demarcating a buffer zone around a refinery.

Regulation 16 of the DC Regulations of 1991 pertaining to the

construction of buildings is extracted hereinbelow for

convenience:-

“16. Requirements of sites – No land shall be used as a site for the construction of buildings -

13 (a) if the Commissioner considers that the site is insanitary or that it is dangerous to construct a building on it or no water supply is likely to be available within a reasonable period of time.

(b)-(d) * * *

(e) If the use of the said site is for a purpose which in the Commissioner’s opinion may be a source of danger to the health and safety of the inhabitants of the neighborhood.

(f)-(m) * * *

(n) if the proposed development is likely to involve damage to or have deleterious impact on or is against urban aesthetics or environment or ecology and/or on historical/architectural/aesthetical buildings and precincts or is not in the public interest.”

The said Rule provides that if the Commissioner considers that

the site is insanitary or it is dangerous to construct a building

on it or water supply would not be available within a reasonable

period of time, the land is not to be used as a site for

construction of building. The Commissioner may also prevent

the use of land as a site for construction, if the use of the said

site is for a purpose which might in the Commissioner’s opinion be

a source of danger to the health and safety of the inhabitants of

the neighbourhood. To cite an example land may not be used for a

purpose which is likely to cause environmental pollution.

Permission to construct may be refused on land which is not fit

for construction, such as swampy or low lying land. The

Commissioner might even disallow the use of land for construction

of buildings if the proposed construction is likely to cause

damage or have deleterious impact on or is against urban

aesthetics or endanger environment or ecology and/or

historical/architectural/aesthetical buildings and precincts or is

not in the public interest. It is for the Commissioner to take a 14

call taking into account relevant factors. It is not for the High

court, exercising jurisdiction under Article 226 of the

Constitution of India to sit in appeal over the decision taken by

the Municipal Commissioner.

In exercise of jurisdiction under Article 226 of the

Constitution of India, the High Court is only to examine whether

the Municipal Commissioner acted within the limits of his

jurisdiction and examine whether there was any such legal

infirmity in the decision making process which vitiated the

decision.

In this case, the High Court has in effect and substance sat

in appeal over the decision of the Municipal Commissioner. The

Municipal Commissioner took note of the existence of buildings in

the vicinity and the existence of higher buildings at a lesser

distance from the refinery. The Municipal Commissioner rightly

took note of the fact that the building was being redeveloped. It

was not a case of new construction.

At the cost of repetition, it is reiterated that in the

absence of any law, Rules or Regulations which prohibited the

construction of a seven storeyed building at the site in question,

the descretion of the Municipal Commissioner was not liable to be

interfered with.

The impugned judgment and order passed by the High Court of

Judicature at Bombay cannot be sustained.

15

The appeal is accordingly allowed and the impugned judgment

and order is set aside.

To show the bona-fides of the Appellants, Mr. Rishi Malhotra,

learned counsel appearing on behalf of the appellants, has on

behalf of his clients even made an offer to sell the additional

floors in the building to the Respondent-BPCL or to any other

Government Organization willing to purchase the same, subject to

payment of the market value. The Appellants may issue

advertisements for sale of the additional flats indicating that

preference would be given to the Respondent-Corporation and to

Government/Public Sector Undertakings. In the event, the

Respondent-BPCL or any other Government or public sector

undertaking makes an offer to purchase the additional flats at the

market value, the additional flats shall be sold to them, subject

to the requisite formalities.

………………………………………………………,J.

(Indira Banerjee)

………………………………………………………,J.

(A.S. Bopanna)

New Delhi;

April 26, 2022.