The Bombay High Court recently upheld the tenants’ right to redevelop a dilapidated Kalbadevi building after the landlords failed to take the necessary steps within the statutory time frame. The court quashed a Mhada (Maharashtra Housing and Area Development Authority) order that had granted the landlords permission to submit a redevelopment proposal, effectively empowering the tenants to proceed with the project.
The case involved Kalyan Bhavan, an 80-year-old cessed building in Kalbadevi. In a ruling delivered on November 26, Justices Ajay Gadkari and Kamal Khata allowed a petition by 38 tenants of the building. They set aside Mhada’s July 8, 2023, order, which had instructed the landlords to submit a redevelopment proposal, as well as a July 10 letter of intent (LoI) issued by Mhada, permitting them to undertake the redevelopment. The court also directed Mhada to issue the LoI to the petitioners—the tenants. The case dates back to February 14, when the Bombay High Court had initially ruled that the landlords could apply to Mhada for redevelopment under the amended Section 79A of the Mhada Act. Under this provision, owners are granted the first opportunity to submit a proposal for redevelopment within six months of receiving a notice, provided they have the consent of at least 51% of the building’s occupants or tenants.
However, the landlords failed to meet the six-month deadline, which expired on November 17, 2023. Despite this, Mhada issued a fresh notice to the tenants in December 2023, asking them to submit a redevelopment proposal. Girish Godbole, Senior Advocate for the tenants, argued that Mhada was not informed of the expired deadline when the February 14 order was passed. He explained that the tenants had secured 65% consent for redevelopment and that Mhada’s subsequent reissuance of the order attempted to overstep the court’s earlier ruling. He contended that once the statutory six-month period had lapsed, Mhada could not grant the landlords a fresh opportunity to redevelop the property.
Mhada’s advocate, Akshay Shinde, clarified that the authority had misunderstood the February order and acted in good faith to provide the landlords a new chance. However, the High Court firmly disagreed, stating that the February 14 ruling was unambiguous and did not extend the six-month statutory period. The court noted that if the landlords failed to act within the stipulated time frame, the tenants had the right to take over the redevelopment process. In addition, the court reiterated that while tenants in cessed buildings could reconstruct the building under the provisions of the Development Control and Promotion Regulations (DCPR) 2034, they could not “redevelop” it unless the process involved compliance with the Mhada Act. The ruling emphasized the rights of tenants in this context. The Bombay High Court ruled that the tenants of Kalyan Bhavan have the right to redevelop the building under the relevant regulations. The case marks an important precedent for tenants in cessed buildings who face delays or neglect from landlords in maintaining or redeveloping dilapidated properties.
