Bombay Dyeing [Get Quote] Chairman Nusli Wadia and K Raheja Corp's C L Raheja may opt for an out-of-court pact to settle a dispute on the development of 200 acres of prime land in Malad, in the western suburbs of Mumbai, said sources close to the development.

In February this year, Wadia had moved the Bombay High Court against K Raheja Corp's Chandru Raheja and his sons, Ravi and Neel, as well as nephews, Rahul and Ashish, for violating the agreement between him and the Rahejas on developing the Malad land. Wadia had demanded damages worth Rs 350 crore.

The land houses some of Mumbai's prominent landmarks, including Inorbit Mall, Hypercity and Mindspace, among others.

"Both the parties are talking about an out-of-court settlement, but it may take some time before they reach an amicable agreement as huge stakes are involved in the case," said sources close to the development.

When contacted, a Wadia group spokesperson said: "We do not comment on speculation," while a K Raheja Corp official could not be contacted despite many calls and messages.

According to sources, though June 25 was the scheduled date for hearing in the high court, the case was not heard.

The land was owned by the late Eduljee Framroze Dinshaw and Wadia is the sole administrator. The Dinshaw estate is to be paid 12 per cent of the revenues generated from lease or sale of the property to genuine third parties.

It was alleged that K Raheja Corp had sold or leased the land at low cost to their own sister concerns and shell companies created for the purposes of purchase of these properties.

Wadia terminated the agreement (dated January 2, 1995) with Ivory Properties and Hotels, owned by the Rahejas, with effect from February 1, 2008, and two powers of attorney on the same date executed by Wadia in favour of Ravi C Raheja and Neel C Raheja, Wadia's advocates said in a public notice in February this year.

Wadia has alleged that nearly ten properties have been illegally built by the Rahejas, inlcuding Hypercity, Inorbit Mall, Infinity Towers and Intelnet, on the Malad land and asked the court to order Rahejas to demolish the structures.

He has also asked the court to stop all further renewals of shop leases and any further creation of third-party rights.

In May this year, Wadia also moved the Bombay High Court against C L Raheja's brother G L Raheja and his relatives, demanding Rs 1,370 crore for allegedly violating a similar agreement between him and the GL Raheja group for developing nearly 478 acres in Malad.

Wadia demanded that Rahejas demolish the buildings, inlcuding Palm Spring Centre and Unique Commercial Complex, among others, built on 478 acres, and demanded damages.

Wadia mentioned the names of G L Raheja, Sandeep G Raheja, Sonali G Raheja and Ferrani Hotels, belonging to the GL Raheja Group, as the main defendants, a public notice released in the newspapers showed. The case is still pending in the Bombay High Court.

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