# GODREJ & BOYCE MANUFACTURING CO.LTD. "' v. STATE OF MAHARASHTRA & ORS

- **Citation:** [2009] 1 S.C.R. 1016
- **Court:** Supreme Court of India
- **Decided:** 2009-02-06
- **Case number:** Civil Appeal No.17 46 of 2007
- **Bench:** Markandey Katju, Aftab Alam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/godrej-boyce-manufacturing-co-ltd-v-state-of-maharashtra-ors-25363
- **Pages:** 29

## Headnote

Maharashtra Regional and Town Planning Act, 19661
Development Control Regulations for Greater Bombay, 1991:
c
Sections 2, 22A, 29, 31, 37, 126, 15413, 32, 34, 35, 62,
Paragraph 6 of Appendix VII - Voluntary surrender of lands
- Roads constructed by the owners before surrendering the
lands -
Claim for Floor Space Index or Transferable
D Development Rights for the whole of the surface area of the
roads - Municipal Corporation limiting it to 15% of the area
relying on a circular - Held: Such changes could be made
only by making suitable amendments in the law and not by
an executive circular - It is highly debatable if certain public
E utilities can be introduced through a circular within the
meaning of the Act or the Regulations - Surrender of the
lands in terms of clause (b) of section 126(1) of the Act cannot
be subjected to any further conditions than those provided for
in the statutory provisions - It is open to the Legislature to add
to the conditions provided for in the statute - But not to be
~ .
F left in the hands of the executive to impose conditions.
'
The appellants and the writ petitioners had their plots
of land shown in the Development Plan as reserved for
roads. They voluntarily surrendered their lands. In
G addition, they constructed on their respective pieces of
land the Development Plan roads at their own cost and
as per the specifications stipulated in the relevant rules.
There is no dispute between the parties in regard to the
Floor Space Index or Transferable Development Rights
H
1016
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1017
STATE OF MAHARASHTRA & ORS.
granted to them for the surrendered pieces of land. But A
the parties are in serious controversy over the extent of
Floor Space Index or Transferable Development Rights
for the roads constructed on the surrendered lands at the
owners' cost. The landowners claim that for constructing
the roads they are entitled to Floor Space Index or
B
Transferable Development Rights for the whole of the
surface area of the roads. The municipal authorities
would, however, grant them additional Transferable
. Development Rights only to the extent of 15% of the road
area. The stand of the municipal authorities is based on c
a circular dated April 9, 1996 issued by the Muni<:ipal
Commissioner, Municipal Corporation of Greater Bombay.
The circular envisages a graded scheme for grant of
Additional Development Rights for construction of
amenities by the landowner, e.g., in case of amenities like D
"'
general hospital, municipal primary school etc. it allows
FSI equal to the built up area of the structure but in case
of DP road only 15% of the area of the road surface.
On behalf of the landowners it is argued that the
contents of the circular are no more than executive
E
instructions and can not supersede or override the
provisions of the Regulations which are legislative in
nature; in any event the circular would only operate
,__)..
prospectively and have no bearing on the cases in hand
since it was issued after the appellants and the petitioners
F
had surrendered their plots of lands after constructing
roads on those lands as required by the authorities. On
behalf of the State and the municipal authorities, it is
contended that the law provides for grant of additional
Floor Space Index or Transferable Development Rights
G
commensurate to the value of the amenity constructed
--.It
by the landowner and the meaning of paragraph 6 of
Appendix VII to the Regulations will be clear by reading
it along with the other provisions of the Regulations and
the parent Act; and that the circular dated April 9, 1996
H
1018
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A would appear to be merely clarificatory and fully apply to
the claims of the appellants and the petitioners.
Allowing the appeals and the writ petitions, the Court
HELD:1.1. The regulation fixes the measure of
B equivalence by using the words "equivalent to the area
of construction/development done on the surrendered
land". 'Area' of c

## Text

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(2009] 1 S.C.R. 1016
A
GODREJ & BOYCE MANUFACTURING CO.LTD.
"'
v.
STATE OF MAHARASHTRA & ORS.
(Civil Appeal No.17 46 of 2007)
B
FEBRUARY 6, 2009
[MARKANDEY KATJU AND AFTAB ALAM, JJ.]
Maharashtra Regional and Town Planning Act, 19661
Development Control Regulations for Greater Bombay, 1991:
c
Sections 2, 22A, 29, 31, 37, 126, 15413, 32, 34, 35, 62,
Paragraph 6 of Appendix VII - Voluntary surrender of lands
- Roads constructed by the owners before surrendering the
lands -
Claim for Floor Space Index or Transferable
D Development Rights for the whole of the surface area of the
roads - Municipal Corporation limiting it to 15% of the area
relying on a circular - Held: Such changes could be made
only by making suitable amendments in the law and not by
an executive circular - It is highly debatable if certain public
E utilities can be introduced through a circular within the
meaning of the Act or the Regulations - Surrender of the
lands in terms of clause (b) of section 126(1) of the Act cannot
be subjected to any further conditions than those provided for
in the statutory provisions - It is open to the Legislature to add
to the conditions provided for in the statute - But not to be
~ .
F left in the hands of the executive to impose conditions.
'
The appellants and the writ petitioners had their plots
of land shown in the Development Plan as reserved for
roads. They voluntarily surrendered their lands. In
G addition, they constructed on their respective pieces of
land the Development Plan roads at their own cost and
as per the specifications stipulated in the relevant rules.
There is no dispute between the parties in regard to the
Floor Space Index or Transferable Development Rights
H
1016
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1017
STATE OF MAHARASHTRA & ORS.
granted to them for the surrendered pieces of land. But A
the parties are in serious controversy over the extent of
Floor Space Index or Transferable Development Rights
for the roads constructed on the surrendered lands at the
owners' cost. The landowners claim that for constructing
the roads they are entitled to Floor Space Index or
B
Transferable Development Rights for the whole of the
surface area of the roads. The municipal authorities
would, however, grant them additional Transferable
. Development Rights only to the extent of 15% of the road
area. The stand of the municipal authorities is based on c
a circular dated April 9, 1996 issued by the Muni<:ipal
Commissioner, Municipal Corporation of Greater Bombay.
The circular envisages a graded scheme for grant of
Additional Development Rights for construction of
amenities by the landowner, e.g., in case of amenities like D
"'
general hospital, municipal primary school etc. it allows
FSI equal to the built up area of the structure but in case
of DP road only 15% of the area of the road surface.
On behalf of the landowners it is argued that the
contents of the circular are no more than executive
E
instructions and can not supersede or override the
provisions of the Regulations which are legislative in
nature; in any event the circular would only operate
,__)..
prospectively and have no bearing on the cases in hand
since it was issued after the appellants and the petitioners
F
had surrendered their plots of lands after constructing
roads on those lands as required by the authorities. On
behalf of the State and the municipal authorities, it is
contended that the law provides for grant of additional
Floor Space Index or Transferable Development Rights
G
commensurate to the value of the amenity constructed
--.It
by the landowner and the meaning of paragraph 6 of
Appendix VII to the Regulations will be clear by reading
it along with the other provisions of the Regulations and
the parent Act; and that the circular dated April 9, 1996
H
1018
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A would appear to be merely clarificatory and fully apply to
the claims of the appellants and the petitioners.
Allowing the appeals and the writ petitions, the Court
HELD:1.1. The regulation fixes the measure of
B equivalence by using the words "equivalent to the area
of construction/development done on the surrendered
land". 'Area' of construction/development having being
fixed as the measure of equivalence it is no longer open
to contend that any other basis such as value may be
C used for determining equivalence. [Para 43) [1041-H]
1.2. The rationale behind trying to make value of the
development/construction rather than its area as the
basis to recompense the land owner and for granting the
0 additional FSI or TOR is appreciated, but that is not the
law as it stands and the value of the development/
construction can only be made the basis for granting
additional FSI or TOR by making suitable amendments in
the law and not by an executive circular. [Para 44) [1042E A-BJ
2. In regard to the circular there is something else
too that is quite curious. This aspect of the matter was
not argued before this Court and it is not relevant for the
present, nevertheless this Court would like to point it out
F as it may help the concerned authorities in future. It is to
be noted that both section 126 (1 )(b) of the Act and
paragraph 6 of Appendix VII to the Regulations provide
for additional FSI or TOR for construction or development
of 'amenity' which term is defined both in the Act and the
G Regulations. But in the circular dated April 9, 1996 100%
FSI (built up area) is reserved for public utilities none of
which is expressly mentioned in the definition of amenity
in clause 3(7) of the Regulations. Furthermore 'Municipal
Transport Garage', 'Fire Station', 'Auditorium', 'Electric
H Crematorium', 'Municipal Workshop', 'Town Duty Office'
..
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1019
STATE OF MAHARASHTRA & ORS.
and 'Office Building' are not even co't(ered by the A
definition of ·amenity' under section 2 (2) of the Act. It is
highly debatable if those public utilities can be
introduced through the circular as ·amenities' within the
meaning of the Act or the Regulations. [Para 45] [1042C-~
8
Pune Municipal Corporation and Anr. V. Promoters and
Builders Association & Anr. (2004) 10 SCC 796, referred to.
3. The conditions, that is to say, the mutual rights and
obligations subject to which the land owner may offer to C
surrender the designated plot of land to municipal
authority and the latter may accept the offer are
enumerated in detail in the statutory provisions. Beyond
those conditions there can be no negotiations for
surrender of the land, particularly in derogation to the o
land owner's statutory rights. Having regard to the nature
of the law the submission advanced on behalf of the
municipal authority would lead to palpably unjust and
inequitable results. The land owner whose land is
designated in the development plan as reserved for any
E
of the purposes enumerated in section 22 of the Act or
for any of the amenities as defined under section 2(2) of
the Act or regulation 2(7) of the Regulations is not left with
many options and he does not have the same bargaining
position as the municipal authority. Therefore, surrender
F
of the land in terms of clause (b) of section 126(1) of the
Act cannot be subjected to any further conditions than
those already provided for in the statutory provisions. It
is of course open to the legislature to add to the
conditions provided for in the statute (or for that matter G
to do away with certain conditions that might be in
existence). But it certainly can not be left in the hands of
the executive to impose conditions in addition to those
in the statutes for accepting the offer to surrender the
designated land. [Para 47] [1043-F-H; 1044-A-B]
H
1020
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A
4. Mr. Shah, the constituted attorney of the appellants
might have been present in the meeting and he might or
might not have voted for the graded scheme for grant of
additional TOR but that would not authorise the municipal
authorities to override or supersede the statutory
8 provisions by issuing circulars in the nature of executive
instructions. [Para 48) [1044-E]
c
5. The stand of municipal authorities is contrary to
the law as it stands today and the view taken by High
Court is unsustainable. [Para 49) [1044-F]
Case Law Reference:
(2004) 1 o sec 796
referred to
Para 27
CIVIL AP PELLA TE JURISDICTION : Civil Appeal No.17 46
D of 2007.
E
From the Judgment/Order dated 18.10.2005 of the
Division Bench of the Bombay High Court on Writ Petition No.
323 of 2000.
WITH
Civil Appeal Nos.1591-1592 of 2007, W.P. (C) No.190
of 2007, Civil Appeal No. 2045 of 2007.
F
Ashok Desai, Milind Sathe, Mahendra Ghelani, Chedda
and Jay Savla for the Appellant.
G
Shekhar Naphade, Pallav Shishodia, Arun Pednekar,
Sanjay V.Kharde, Asha Goplan Nair, Siddhartha Chaudhary,
Bhargava V. Desai and D.N. Mishra for the Respondent.
The Judgment of the Court was delivered by
AFTAB ALAM, J. 1. Maharashtra town planning law has
evolved, with a view to promote planned development and decongest the highly congested areas, the imaginative concept
H
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1021
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
-;
of making, under certain circumstances, the development
A
potential of a plot of land separable from the land itself and
further letting the development rights to be transferable by the
land owner. The provisions made for the development rights that
arise from a piece of land and yet acquire a separate and
independent existence with the added flexibility of being
B
transferable come very useful in case of plots of land shown in
the Development Plan as reserved for some public purpose or
..
amenity that prohibits their owners from developing those plots
by making any other kind of construction. In such circumstances
it is open to the landowner to surrender the plot of land free of c
cost (and free from all encumbrances) to the municipal
authorities who may acquire the land by granting to the
landowner Floor Space Index or Transferable Development
· Rights against the area of the surrendered land. The law further
provides for additional Floor Space Index or Transferable
D
..
Development Rights against the development or construction
of amenities (for which the plot is shown reserved in the plan)
by the owner at his own cost.
2. The appellants and the petitioners in this batch of
appeals and writ petition had their plots of land shown in the
E
Development Plan as reserved for roads. They voluntarily
surrendered their lands. In addition, they constructed on their
respective pieces of land the Development Plan roads at their
'~ '
own cost and as per the specifications stipulated in the relevant
rules. There is no dispute between the parties in regard to the
F
Floor Space Index or Transferable Development Rights granted
to them for the surrendered pieces of land. But the parties are
in serious controversy over the extent of Floor Space Index or
Transferable Development Rights for the roads constructed on
the surrendered lands at the owners' cost. The landowners
G
claim that for constructing the roads they are entitled to Floor
Space Index or Transferable Development Rights for the whole
of the surface area of the roads. In support of their claim they
rely upon paragraph 6 of Appendix VII to the Development
Control Regulations for Greater Bombay, 1991 that provides
H
1022
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A for, ' ... a further DR in the form of FSI equivalent to the area of
the construction/development done by him (landowner) ...... '.
The municipal authorities would, however, grant them additional
Transferable Development Rights only to the extent of 15% of
the road area. The stand of the municipal authorities is based
B on a circular dated April 9, 1996 issued by the Municipal
Commissioner, Municipal Corporation of Greater Bombay. The
circular envisages a graded scheme for grant of Additional
Development Rights for construction of amenities by the
t
landowner, e.g., in case of amenities like general hospital,
c municipal primary school etc. it allows FSI equal to the built up
I
area of the structure but in case of DP road only 15% of the
.,
area of the road surface. On behalf of the landowners it is
argued that the contents of the circular are no more than
executive instructions and can not supersede or override the
D provisions of the Regulations which are legislative in nature; in
any event the circular would only operate prospectively and have
.,.
no bearing on the cases in hand since it was issued after the
appellants and the petitioners had surrendered their plots of
lands after constructing roads on those lands as required by
E the authorities. The argument is sought to be repelled on behalf
of the state and the municipal authorities by taking the position
that the law provides for grant of additional Floor Space Index
or Transferable Development Rights commensurate to the
value of the amenity constructed by the landowner and the
F
meaning of paragraph 6 of Appendix VII to the Regulations will
~
be clear by reading it along with the other provisions of the
Regulations and the parent Act. Seen thus the circular dated
April 9, 1996 would appear to be merely clarificatory and fully
apply to the claims of the appellants and the petitioners. On
behalf of the Municipal Corporation the claims of the appellants
G and the petitioners are also resisted on certain grounds of facts
that we shall consider in due course.
3. This is the parameter of the dispute between the
parties.
H
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1023
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
4. At this point it will be useful to refer to some of the
A
provisions of the Maharashtra Regional and Town Planning Act,
1966 (the Act) and the Development Control Regulations for
Greater Bombay, 1991 (the Regulations).
5. Section 2 of the Act contains the definitions. SubB
section (2) defines "Amenity" very widely to cover vastly different
public utilities from hospitals, secondary schools and colleges
"'
to roads, streets and open spaces etc.. Section 2 (2) of the
Act is as under:
"(2) "amenity" means roads, streets, open spaces, parks c
recreational grounds, play grounds, sports complex,
parade grounds, gardens, markets, parking lots, primary
and secondary schools and colleges and polytechnics,
clinics, dispensaries and hospitals, water supply, electricity
supply, street lighting, sewerage, drainage, public works
D
and includes other utilities, services and conveniences;"
6. Sub-section 7 defines 'Developmerit' and sub-section
9A defines 'Development Right' as follows:
"9A. "Development Right" means right ta carry out
E
development or to develop the land or building or both and
shall include the transferable development right in the
form of right to utilise the Floor Space Index of land
""
).
utilizable either on the remainder of the land partially
reserved for a public purpose or elsewhere, as the final
F
Development Control Regulations in this behalf provide;
(italics supplied)"
Sub-section 9 defines 'Development Plan' to mean a plan for
G
the development or re-development of the area within the
.......
jurisdiction of a Planning Authority and includes revision of a
Development Plan and proposals of special planning authority
for the development of land within its jurisdiction.
?.Sub-section 13A defines 'Floor Space Index' as follows:
H
1024
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A
"13 A. "Floor Space Index" means the quotient or the ratio
of the combined gross floor area to the total area of the
plot, viz.:
Floor Space Index = Total covered area of all floor
B
Plot area;"
8. Sub-section 15 defines 'Local Authority' and expressly
mentions, amongst others, the Bombay Municipal Corporation
....
constituted under the Bombay Municipal Corporation Act.
c
9. Sub-section 19 defines 'Planning Authority' to mean a
Local Authority apart from certain other bodies.
10. Sub-section 23 to 26 define 'Region', Regional Board',
'Regional Plan' and 'Regional Planning Committee'
respectively;
D
11. Sub-section 27 defines 'Regulation' to mean a
regulation made under Section 159 of the Act and includes
zoning, special development control regulation and other
regulations made as part of Regional Plan, Development Plan
E or town planning scheme.
12. Chapter II of the Act contains the provisions relating
to Regional Plan under sections 3 to 20. In this group of cases,
however, we are concerned with the Regulations forming part
.~ -
F
of a Development Plan which is dealt with under sections 21
to 42 in Chapter Ill of the Act. Section 21 obliges every Planning
Authority to prepare a draft Development Plan for the area
within its jurisdiction subject to the provisions of the Act and in
accordance with the provisions of a Regional Plan, where there
is such a plan. Section 22 deals with the contents of the
G 'Development Plan'. It mandates that the Development Plans
would generally indicate the manner in which the use of land in
......
the area of the Planning Authority is to be regulated and the
development of land therein is to be carried out. Further, the
Development Plan would provide for, in particular the proposals
H for allocating the use of land for purposes, such as residential,
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1025
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.)
industrial, commercial, agricultural, and recreational. It would
A
also contain proposals for designation of lands for many
different kinds of public purposes enumerated in clauses (b)
to (I) of the section. As per clause (m) of the section the
Development Plan would also provide for the provisions for
grant of permission for controlling and regulating the use and
B
development of land within the jurisdiction of a local authority
and the matters connected therewith.
13. Section 22A enumerates what is meant by modification
of a substantial nature in the Development Plan. Sections 23
C
to 31 lay down the procedure for making Development Plan,
including Development Control Regulations by the Planning
Authority after inviting objections and submitting draft plans to
the State Government. Section 31 empowers the State
Government to sanction the draft Development Plan submitted
by the Planning Authority. Section 37 deals with modification
D
of final Development Plan. Chapter VII of the Act deals with
Land Acquisition and section 125 provides that any land
required, reserved or designated in a Regional Plan,
De.velopment Plan or Town Planning Scheme for a public
purpose or purposes including plans for any area of
E
comprehensive development or for any new town would be
deemed to be land needed for a public purpose within the
meaning of Land Acquisition Act, 1894. Section 126 lays
down three modes for acquisition of land required for public
purposes specified in the plans. The provisions of this section
F
are important for the cases in hand and are reproduced below
in so far as relevant for the present:
"126. (1) When after the publication of a draft Regional
Plan, a Development or any other plan or town planning
G
scheme, any land is required or reserved for any of the
public purposes specified in any plan or scheme under this
Act at any time the Planning Authority, Development
Authority, or as the case may be, any Appropriate Authority
may, except as otherwise provided in Section 113A
H
.
.
1026
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A
acquire the land,-
B
c
D
E
F
G
H
{a) by agreement by paying an amount agreed to, or
(b) in lieu of any such amount, by granting the /and-owner
or the lessee, subject, however, to the lessee paying the
lessor or depositing with the Planning Authority,
Development Authority or Appropriate Authority, as the
case may be, for payment to the lessor, an amount
equivalent to the value of the lessor's interest to be
determined by any of the said Authorities concerned on
the basis of the principles laid down in the Land
Acquisition Act, 1894 Floor Space Index (FSI) or
Transferable Development Rights (TOR) against the
area of land surrendered free of cost and free from all
encumbrances, and also further additional Floor Space
Index or Transferable Development Rights against the
development or construction of the amenity on the
surrendered land at his cost, as the Final
Development Control Regulations prepared in this
behalf provide, or
(emphasis added)
(c) by making an application to the State Government for
acquiring such land under the Land Acquisition Act, 1894,
and the land (together with the amenity, if any, so
developed or constructed) so acquired by agreement or
by grant of Floor Space Index or additional Floor Space
Index, or Transferable Development Rights under this
sections or under the Land Acquisition Act, 1894, as the
case may be, shall vest absolutely free from all
encumbrances in the Planning Authority, Development
Authority, or as the case may be, any Appropriate
Authority,
(2) to (4) ....
14. Section 154 of the Act obliges every Regional Board,
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1027
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
Planning Authority and Development Authority to carry out such
A
directions or instructions as may be issued from time to time
by the State Government for the efficient administration of this
Act. Section 158 contains the rule making powers and
authorizes the State Government to make rules to carry out all
or any of the purposes of the Act. Section 159 provides that
B
any Regional Board, Planning Authority or Development
Authority may with the previous approval of the State
~
Government make regulations consistent with the Act and the
rules made thereunder.
15. The Municipal Corporation of Greater Bombay which c
is a Planning Authority under section 2( 19) of the Act prepared
a revised Development Plan and on April 30, 1985 submitted
the Revised Draft Building bye-laws and Development Control
Rules to the State Government as required under section 30(1)
D
+
of the Act. The Development Control Rules, after being
subjected to the procedure prescribed by law finally received
the sanction of the State Government on March 25, 1991 and
came into force from that date under the name, 'The
Development Control Regulations for Greater Bombay'.
E
16. Before proceeding to examine the relevant provisions
of the Regulations it may be noted that on the date on which
the Regulations came into force certain amendments were
introduced in the Act as well. Some of the amendments made
. J.
in the Act with effect from March 25, 1991 include the definition
F
of 'Amenity' in its present form that was substituted for the
original definition of the term and the insertion of the definition
of 'Development Right' as sub-section (9A) of section 2.
Another very important amendment made in the Act was the
insertion of clause (b) in section 126(1) of the Act. Before March
G
25, 1991, section 126 of the Act provided for Acquisition of
Land only by two means, one by payment of an amount agreed
upon by the parties and the other by following the procedure
under the Land Acquisition Act, 1894. The introduction of
clause (b) in section 126(1) provided for a third mode for land
H
1028
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A acquisition that is based on the concept of Transferable
Development Rights against the area of land surrendered free
of cost and free from all encumbrances and a further Additional
Floor Space Index or Transferable Development Rights against
the development or constructions of the amenity on the
B surrendered land by the land owner (or the lessee) at his own
cost. On behalf of the appellants and the petitioners it is argued
that apart from section 2(9A) and clause (b) of section 126 (1 ),
there is no other provision in the Act dealing with the concept
of Transferable Development Rights and those two provisions
c were introduced in the Act on the same day the Regulations
came into force in order to give effect to the concept of
Transferable Development Rights evolved in the Regulations.
17. Coming back to the provisions of the Development
D
Control Regulations for Greater Bombay, regulation 2(2)
provides that any terms and expressions not defined in the
Regulations shall have the same meaning as in the Act or the
Bombay Municipal Corporation Act, 1888 and the rules and
bye-laws framed thereunder, as the case may be, unless the
context otherwise required. Regulation 3 contains the
E definitions and clause (7) defines 'amenity' as under:
"Amenity means roads, streets, open spaces, parks
recreational grounds, play grounds, gardens, water supply,
electric supply, street lighting, sewerage, drainage, public
works and other utilities, services and conveniences".
). .
F
18. It is to be noted here that the definition of 'amenity'
under the Regulations is much restricted than the one given
under the Act and under the Regulations 'sport complex, parade
G
grounds, gardens, markets, parking lots, primary and
secondary schools and colleges and polytechnics, clinics,
dispensaries and hospitals' are not expressly included in the
definition of amenity.
19. 'Road' indeed is common to the definitions both under
H the Act and the Regulations and in clause (76) of regulation 3
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1029
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
it is defined in the widest possible terms.
A
Regulation 3 (42) defines Floor Space Index as follows:-
"(42) Floor space index (FSI)" means the quotient of the
ratio of the combined gross floor area of all floors,
B
excepting areas specifically exempted under these
Regulations to the total area of the plot, viz.:
Total covered area on all floors
Floor Space Index (FSI) -
c
Plot area"
20. Regulation 32 deals with Floor Space Indices and
Tenement Density and provides for different Floor Space Indices
for different areas in Greater Bombay. Regulation 33 provides
for Additional Floor Space Index that may be allowed to certain
D
categories. Regulation 34 contains the concept of Transferable
Development Rights and it reads as follows:-
"34. Transfer of Development Rights. -
In certain
circumstances, the development potential of a plot of land
E
may be separated from the land itself and may be made
available to the owner of the land in the form of
Transferable Development (TOR). These Rights may be
made available and be subject to the Regulations in
~
Appendix VII hereto".
F
21. Regulation 35 provides for the method of computation
of Floor Space Index.
22. Regulation 62 empowers the State Government to
interpret the Regulations in the event of any dispute between
G
the Municipal Corporation and an aggrieved party. Regulation
63 empowers the Commissioner to delegate functions which
he is empowered to discharge to other subordinate officers.
Regulation 64 provides for discretionary power of the
Commissioner which can be exercised in the event of any
H
1030
SUPREME COURT REPORTS
(2009) 1 S.C.R.
A hardship.
23. Appendix VII, referred to in regulation 34, lays down
the manner for the grant of Transferable Development Rights
to owners/ developers and the conditions for the grant of such
B rights. The claim of the appellants and the petitioners are fully
based on the provisions of Appendix VII, hence, those
provisions, in so far as relevant for the present, are reproduced
below:
"APPENDIX VII
c
(Regulation 34)
Regulations for the grant of Transferable Development
Rights (TDRs) to owners/developers and conditions for
grant of such Rights
D
1.
The owner (or lessee) of a plot of land which is
reserved for a public purpose in the development
+
plan and for additional amenities deemed to be
reservations provided in accordance with these
E
Regulations, excepting in the case of an existing or
retention user or any required compulsory or
recreational open space, shall be eligible for the
award of Transferable Development Rights (TDRs)
in the form of Floor Space Index (FSI) to the extent
and on the conditions set out below. Such award
F
will entitle the owner of the land to FSI in the form
of a Development Rights Certificate (DRC) which
he may use himself or transfer to any other person.
2.
Subject to the Regulation 1 above, where a plot of
G
land is reserved for any purpose specified in
section 22 of Maharashtra Regional and Town
Planning Act, 1966, the owner will be eligible for
Development Rights (DR's) to the extent stipulated
in Regulations 5 and 6 in this Appendix had the
H
land been not so reserved, after the said land is
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1031
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
surrendered free of cost as stipulated in Regulation
A
5 in this Appendix, and after completion of the
development or construction as in Regulation in this
Appendix if he undertakes the same.
3.
Development Rights (DRs) will be granted to an
B
owner or a lessee only for reserved lands which are
retainable/non-retainable under the Urban Land
+
(Ceiling and Regulations) Act, 1976, and in respect
of all other reserved lands to which the provisions
of the aforesaid Act do not apply, and on production c
of a certificate to this effect from the Competent
Authority under that Act before a Development Right
is granted. In the case of non-retainable lands, the
grant of Development Rights shall be to such extent
and subject to such conditions as Government may
D
specify. Development Rights (DRs) are available
only in cases where development of a reservation
has not been implemented i.e. TDRs will be
available only for prospective development of
reservations.
E
4.
Development Rights Certificates (DRCs) will be
issued by the Commissioner himself. They will
state, in figures and in words, the FSI credit in
square meters of the built-up area to which the
..
owner or lessee of the said reserved plot is entitled,
F
the place and user zone in which the DRs are
earned and the areas in which such credit may be
utilized.
5.
The built-up area for the purpose of FSI credit in the
form of a DRC shall be equal to the gross area of G
the reserved plot to be surrendered and will
~~
proportionately increase or decrease according to
the permissible FSI of the zone where from the
TOR has originated.
H
1032
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A
6.
When an owner or lessee also develops or
constructs the amenity on the surrendered plot at
his cost subject to such stipulations as may be
prescribed by the Commissioner or the appropriate
authority, as the case may be and to their
B
satisfaction and hands over the said developed/
constructed amenity to the Commissioner/
appropriate authority, free of cost, he may be
granted by the Commissioner a further DR in the
form of FSI equivalent to the area of the
c
construction/development done by him utilization
of which etc. will be subject to the Regulations
contained in this Appendix.
(emphasis added)
D
7.
A DRC will be issued only on the satisfactory
compliance with the conditions prescribed in this
Appendix.
8.
to 19 .....
"
E
24. In light of the provisions of the Act and the Regulations
the case of the appellants and the petitioners is plain and
simple. Mr. Ashok Desai learned Senior Counsel appearing on
behalf of the appellants submitted that the law clearly envisaged
grant of FSI or TOR under two separate heads, one, for the land
-1,
F and the other for the construction of the amenity for which the
land is designated in the Development Plan, at the cost of the
owner. Section 2(9A) defined 'Development Right' to incluge
the transferable development right and section 126(1) (b)
provided for the grant of FSI or TOR against the area of land
G surrendered free of cost and further additional FSI or TOR
against the development or construction of the amenity on the
surrendered land at the owner's cost as the final Development
)---
Control Regulation should provide. Mr. Desai further submitted
that the extent of FSI or TOR for the land would be equal to the
H gross area of the surrendered plot and the extent of FSI or TOR
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1033
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
'"1"
for construction of the amenity for which the land was
A
designated in the final Development Plan would be equivalent
to the area of construction/development made on the land.
Regulation 34 made provisions for transferability of
development rights and Appendix VII referred to in regulation
34 provided for the extent of FSI or ORT admissible under the
B
two heads. Paragraph 5 of Appendix VII that related to the
-~
surrender of the land provided for FSI credit in the form of a
development right certificate 'equal to the gross area of the
reserved plot'. Paragraph 6 of the Appendix VII that dealt with
the additional DR for construction of the amenity for which the c
surrendered plot was designated in the Development Plan at
the owner's cost provided for a further DR in the form of FSI
'equivalent to the area of the construction/ development' made
on the surrendered land. Mr. Desai contended that paragraph
6 of Appendix VII used the words 'equivalent to the area of
construction/development' which was capable of only one
D
meaning, that is to say, the additional DR would be the same
in area as the amenity constructed/developed on the
surrendered land. Mr. Desai further pointed out that no
provision of Appendix VII, much less paragraph 6 of the
E
Appendix made any distinction between the different amenities
as defined under the Act or the Regulations and there was not
the slightest hint or suggestion for grant of additional TOR on
a variable and sliding scale for construction/development of
,!-
different kinds of amenities on the surrendered land. Learned
counsel submitted that the additional TOR permissible under
F
--
the statutory Regulations could not be reduced or curtailed on
the basis of the circular issued by the Municipal Commissioner.
25. Here it would be appropriate to take a look at the
circular dated April 9, 1996 issued under the hand of the
G
Municipal Commissioner, Municipal Corporation of Greater
~...;,
Bombay. It deals with the grant of additional development rights
in lieu of construction of amenities as per the provisions of
-f
regulation 34 read with paragraph 6 of Appendix VII of the
'
Regulations. It was apparently issued on the basis of the
H
........
1034
SUPREME COURT REPORTS
[2009] 1 S.C.R.
A decision arrived at in a meeting held on June 17, 1994 in which
representatives of various bodies were present and in which
after considering the various aspects such as cost of
construction of amenity, category of reservation etc. a scheme
was formulated for grant of additional development right in lieu
B of various constructed amenities on a graded basis. The
circular provides that 100% FSI (Built up area) would be
granted for the following buildable reservations:
[a] Municipal Transport Garage [b] General Hospital
c
[c] Fire Station
[d] Auditorium
[e] Electrical Crematorium
[ij
Municipal Workshop
[g] Municipal Primary School [h]
Municipal Retail Market
D
[i] Town Duty Office DJ
Office Building"
E
F
G
Paragraph Ill of the circular deals with construction of DP roads
etc. with which we are directly concerned in this group of cases,
and in so far as relevant for the present, provides as under.
"3. CONSTRUCTION OF DP ROADS, WIDENING OF
EXISTING ROADS ETC."
[i] Additional Development Right equivalent to 15% area
of DP Road constructed by the Owner of the land as per
the Municipal specifications which includes provisions of
SWDs, footpaths, Central verge, dividers, providing street
lights, laying water mains and sewer lines etc. shall be
considered."
ii to viii] ....
26. Later on, it appears, it came to the notice of the
municipal authorities and the State Government that the matter
was taken to the Court where the circular dated April 9, 1996
H was challenged and claim was made for additional
,._
~~ I
I
i
GODREJ & BOYCE MANUFACTURING CO.LTD. v.
1035
STATE OF MAHARASHTRA & ORS. [AFTAB ALAM, J.]
"1
Development Right equal to the area of the road constructed
A
on the surrendered plot of land. The extent of the additional
Development Right for construction of DP roads was then
increased from 15% to 25% of the area of the road by circular
dated April 5, 2003, the relevant parts of which are as follows:
"Under the circumstances, the quantum of addl. TOR for
B
construction of roads/setback lands to be granted to
owners/developer of DP Roads/setback lands is being
enhanced from 15% to 25% for all prospective cases
which are not covered under litigation"
c
And
""
"In cases where owners have filed writ petition which is
...
pending in the Court, the additional TOR will be granted
as per the orders of the Court. However in case these
D
owners are agreeable to accept 25% additional TOR, the
same can be considered after withdrawal of the Writ
Petition filed by them in the Court"
27. Mr. Desai submitted that in Pune Municipal
E
Corporation and Anr. V. Promoters and Builders Association
& Anr. (2004) 10 SCC 796 this Court held that the Development
Control Rules framed under the Maharashtra Regional and
Town Planning Act, 1966 had statutory force. On the other hand
,1
the circulars issued by the Municipal Commissioner were
simply executive instructions. The circulars, therefore, could not
F
override or supersede the provisions of the Regulations. He
further submitted that the municipal authorities too were fully
aware and conscious of this legal position and had accordingly
requested the State Government vide letter dated July 19, 1997
to suitably modify paragraph 6 of Appendix VII of the
G
Regulations. Mr. Desai further submitted that the circular dated
~-·
April 9, 1996 on the basis of which the appellant was being
denied additional FSI or TOR equal in area to the road
constructed on the surrendered plot was issued subsequent to
the surrender of the land after construction of the road on it. In
H
1036
SUPREME COURT REPORTS
(2009] 1 S.C.R.
A any event, therefore, the circular would not affect the appellant's
right as it would operate only prospectively and not
retrospectively.
28. Mr. Naphade, learned Senior Counsel appearing for
8 the State of Maharashtra, countered the claim of the appellants
and the petitioners by submitting that the circulars simply made
clear the position that was implicit in the statutory provisions
and would be clearly discernable on reading paragraph 6 of
Appendix VII to the Regulations along with other relevant
provisions. Apart from clarifying the statutory position, by
C introducing a graded scheme for grant of additional FSI or TOR
the circular eliminated the possibility of any discriminatory or
arbitrary action on the part of the authority competent to issue
the development right certificate. The submission of Mr.
Naphade is based on the premise that the law contemplated
0 grant of further additional TOR commensurate to the value of
the amenity constructed/developed on the surrendered land.
Learned counsel pointed out that the definition of amenity
covered vastly different public utilities like a school building or
a road or even an open space. He further submitted that though
E both a single storied school building and a road built on plots
of land equal in area may have more or less the same carpet
area, the cost of construction of the school building will be much
higher than the road. Hence, the grant of additional TOR for
construction of all the different kinds of amenities equal to the
F area of the construction would be illogical, unreasonable and
discriminatory. Further, in case the graded system was not
followed it would be left in the hands of authority competent to
issue the development right certificate to give additional FSI
or TOR on a subjective basis. The circular, by introducing a
G graded scheme eliminated the subjective element and closed
any possibility of arbitrary and discriminatory action on the part
of the authority.