Construction rights: Maharashtra govt makes U-turn on mill land directive

Documents show that the department had, on April 23, made use of section 154(1) of the MRTP Act for issuing directives to the municipality which had raised objections to implement the proposed modification with immediate effect, pending the legal process of hearing public suggestions and objections. The MRTP section grants the state government powers to issue directives to local bodies for “implementing or bringing into effect central and state government programmes or project or for efficient administration of the Act, or in larger public interest.”

In 2011, the Bombay High Court had ruled that it cannot be used for bypassing public suggestions and objections while proposing modification in the DC rule. On Friday evening, Principal Secretary (Urban Development) Dr Nitin Kareer confirmed that the government had cancelled the earlier directive, staying the implementation of the modification, which will now be a part of the ‘excluded portion’ of the new development plan, on which public suggestions have already been invited.

On November 11, 2016, the Fadnavis government had hiked the FSI/TDR for those who surrendered land areas for the reservation free of any encroachments. In the island city where the mill lands are situated and where real estate prices command a premium, the hike was substantial, from 1.33 times the area of the surrendered land to 2.5 times.

Wary of public criticism, the government had ruled that the enhanced benefit will only be applied prospectively. In other words, it was not extended for cases of earlier land acquisition or developments where “compensation in the form of FSI/TDR or any other means had been paid partly or fully.” The April 23 modification diluted this rider, permitting the benefit to accrue even retrospectively.

It proposed that for mill land projects, developers who have already been given compensation in part or fully for surrendering such land areas in the past, would still be entitled to the heightened benefit, provided their construction project is yet to be issued an occupation certification and it has not utilised the entire FSI permissible. Documents show that both the civic building proposals department and the UD had questioned the modification initially, with officials from both sides contending that the “compensation of the surrendered land area had no linkage to the status of construction.”

“The benefit is meant to be provided as a compensation for the surrendered land. How can it be linked to the construction stage? It is like when two parties are negotiating a land deal, the moment a token amount is paid, the deal value is considered to be locked,” said a senior official, requesting anonymity. The approved new development plan only grants compensation upto 1 time of the surrendered land area for textile mill redevelopments. Directives under section 154 (1) of the MRTP had ensured that the modification was implemented forthwith.

Most mill redevelopments have already availed the FSI benefit against surrender of RG under the old provision, confirmed officials. With large areas surrendered, the modification will allow ongoing luxury constructions on mills land to reap major construction bonus,  sources claim. Before Friday’s order, records show that acting on the state’s directive, the municipality has already approved proposals to grant additional construction area in two projects – one implemented by Indiabulls Infraestate Limited and another by Shreeniwas Cotton Mills Limited – both in Lower Parel. Records also show that the centre-owned National Textile Corporation, which has handed over 66,000 sq m worth RG to the civic body, would gain the most if the modification goes ahead.

Documents show that when the proposal was first taken up for consideration in November, 2017, both the municipality and the UD had opposed it. Chief Engineer (Development Plan) Sanjay Darade, on November 7, 2017, wrote to the government, “The TDR/FSI benefit had been granted at the time of hand over of the reservation as per the prevailing regulation. The enhanced benefit cannot be given unless DC rules are modified.” The same month, the UD claimed in a report submitted to the CMO, that the “compensation of land under reservation was in no way impacted by whether the project has occupation permission or not. It wasn’t right to link the two.”

On February 2, 2018, the department justified the proposed modification on grounds of impediments being faced by mill developers due to tough riders. “The civic body has mandated advance handover of the reservation. But (in most cases), the full commencement certificate is yet to be issued and balance FSI remains. It seems appropriate to extend the enhanced incentive,” stated the note. Kareer had been on leave when the second note was issued and UD’s charge had been assigned to Additional Chief Secretary (Housing) Sanjay Kumar. When The Indian Express contacted Kumar, he said he does not recollect the proposal. The department’s joint secretary JD Landge hasn’t signed the file either.

On Thursday, Kareer said, “When the file first came to me in December, the department had pointed out certain issues which remained to be discussed. Subsequently, the department’s viewpoint has been that in mill land cases, advanced possession of reservations is taken and the full FSI is yet to be consumed. I’m not aware of the file being processed or approved since I was on leave around the time.”