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Properties worth Rs 25k crore in Mumbai illegal: HC

March 25, 2008 11:33 IST

The Bombay High Court on Monday held that developments on more than 1,000 acres of land in the suburbs of Mumbai is illegal and said that those are on the declared forest land. 

According to estimates, nearly 125,000 flats will be affected by the court's decision. Market sources have pegged the value of these properties at around Rs 25,000 crore (Rs 250 billion). Both the existing developments and on going real estate projects are going to be impacted by the court move.

Developers such as Godrej Properties, Lodha Group, Runwal Group, Oberoi Constructions among others are expected to be impacted by the court move. The developers are expected to move the Supreme Court against the verdict.

In 2002, an NGO, Bombay Environmental Action Group, had moved the HC to protect the forest lands encroached by the builders.

In 2006, the state government had issued notices to developers, mostly in Ghatkoper, Bhandup, Mulund, Thane and Kandivali, terming the developments on the declared forest land as illegal.

Subsequently, a bunch of developers went to court stating that both the Bombay Municipal Corporation and Thane Municipal Corporation in their town plans had shown the said developments as either residential or commercial developments.

Commenting on the developments, a Mumbai-based builder said: "Developers take due diligence before any construction. Both 1967 and 1991 town plans have not said that these are forest lands. It is not the fault of the developers."

However, an executive of a global property consultant said that municipalities in Mumbai area did not have proper mapping facilities.

"There is a lack of information and ignorance on the part of planners. While municipal administration is a state subject, forests is a central subject. This is causing the problems," he said.

Former Member of Parliament Kirit Somaiya, who had joined the petition on behalf of Mulund Resident Association, demanded that "the government must immediately bring the amendment bill to Maharashtra Private Forest Conservation Act and protect the interests of thousands of residents, who will be suffering for no mistake of theirs".

"The government should regularise all the structures for whose construction permission is given by the civic authorities," he added

Somaiya claimed 125,000 flats, covering areas from Vikhroli to Mulund in the eastern suburbs and in Western suburbs Borivali and areas between Kandivali and Arey colony at Goregaon, Wagle Estate and Ghodbunder road in Thane, which houses one million people will be affected by the court decision.

The properties worth Rs 25,000 crore have become worthless and owners of nearly one third of these properties still owe substantial amount to financial institutes, he added.

Ray of hope

There is a ray of hope for the apartment owners and builders. After the court verdict, Maharashtra Forest Minister Babanrao Pachpute said government  will soon bring a policy to regularise these houses by remaining in the ambit  of court judgement.

The government can regularise the constructions by asking developers to pay the fine for deforestation under the act, claimed a senior forest department official.

BS Reporter in Mumbai