Supreme Court Quashes MRCHS Land Allotment, Citing Arbitrary Process and Violation of Procedure​​​On December 12, 2024, the Supreme Court bench of Justice Sudhanshu Dhulia and Justice Ahsanuddin Amanullah set aside the Bombay High Court's judgment. The Court found the allotment of land to the Medinova Regal Co-operative Housing Society (MRCHS) by the Maharashtra Government to be arbitrary, as it had been made without following the proper procedures. The land was initially intended to provide housing for doctors working at Tata Memorial Hospital.

In 2000, MRCHS through their Chief Promoter Dr. C.N. Shenoy, applied to the Maharashtra Chief Minister for a plot in Bandra, citing the housing needs of its members, primarily doctors at Tata Memorial Centre. The society explained that its members, despite living in Maharashtra for over 20 years, did not own houses and faced long commutes to their workplace. In 2003, the Revenue & Forest Department issued a Letter of Intent (LoI) for a different plot, not the one MRCHS had originally applied for. Soon after, MRCHS underwent several changes in its membership, including resignations and substitutions, which led to concerns about the eligibility of the members, particularly regarding income limits and the requirement to include backward-class members. Official recommendations to cancel the LoI were made several times, but the Chief Minister intervened, requesting further scrutiny and providing MRCHS with additional chances to comply. After years of deliberation, in 2008, MRCHS was able to demonstrate that 13 of its 29 members were eligible, and the final Letter of Allotment was issued. The Proposed Vaibhav Cooperative Housing Society Limited (Appellant), who had also applied for the plot, challenged the allotment in the Bombay High Court. The court dismissed the petition, and the appellant subsequently appealed in the Supreme Court.

“The Supreme court observed that, “the entire process of the allotment was biased.

The entire history of how the plot came to be allotted to MRCHS shows nepotism and favouritism for a society which was not even eligible in the first place for this allotment. A perusal of the records shows that not a single member of the society is a doctor at Tata Memorial Hospital. Leave aside a doctor, not one member is an employee of Tata Memorial Hospital, which was the projection earlier and for which the plot was sought to be allotted.”.

The Supreme Court referenced the Land Revenue (Disposal of Government Land) Rules, Maharashtra, 1971, and the Government Regulations of 1999, which set out a detailed procedure for land allotment to cooperative housing societies. According to Clause 11 of the rules, the State Government must provide written reasons when allotting land to a specific society. The Court noted that this procedure was not followed in the case of MRCHS, leading it to conclude that the land allotment process was carried out arbitrarily.

“Clause 11 provides the mechanism by which the public can get to know that government land is available for allotment and can apply for the same. Also, if land is allotted under the discretionary powers of the government, then it is necessary to give reasons in writing as to why such allotment is made in favour of a particular society. Since there has to be transparency in matters of allotment of land by the government, adherence to the above rules and regulations becomes important in the cases of allotment, but unfortunately, all this is completely missing in the present case where allotment was made in favour of MRCHS in total violation of the prescribed procedure.", the court said.

The Court further emphasized the importance of maintaining transparency in the distribution of land by the State, recognizing it as a valuable community resource.

“Land is a precious material resource of the community and therefore the least which is required from the State is transparency in its distribution. In our opinion, therefore there has been a complete arbitrariness in the allotment in favour of MRCHS. As far as the present appellant is concerned, its case for allotment of a plot is a matter which is yet to be decided by the authorities, but the allotment of the plot in favour of MRCHS is not proper, as it is violative of the procedure as well as eligibility criteria.” the court observed.

Thus, the Supreme Court allowed the civil appeal, setting aside the Bombay High Court's order, and quashed the Letter of Allotment dated 10th April, 2008 in favor of MRCHS.

Case Details: Proposed Vaibhav Cooperative Housing Society Limited vs. State of Maharashtra & Ors. Civil Appeal No. 5193 of 2024.

Advocate for the Petitioner: Sr. Adv. Mr. Vinay Navare, AOR Mr. Prashant Shrikant Kenjale, Adv.Mr. Harish Nirbhavane.

Advocate for the Respondent: Sr. Adv. Mr. Sanjay Kharde, AOR Sr. Adv. Mr. Shyam Divan, AOR Mr. Sandeep Sudhakar Deshmukh.