The Bombay High Court recently held that a developer can redevelop a damaged building even if 51 to 70 percent of tenants agree to the reconstruction.
A division bench of Justice Girish Kulkarni and Justice RN Laddha stated that according to the Development Control and Promotions Regulation – 2034 (DCPR-2034), there is no need to get the approval of all tenants in the building for such renovation.
“The requirement of 100% consent of tenants entering into a PAAA with the landlord/owner would not be applicable in respect of such any proposal when the DCPR 2034 itself mandates consent of 51% to 70% respectively of the occupants/ tenants,” the bench stated.
As a result, the bench overturned the Municipal Corporation of Greater Mumbai (MCGM) decision, which required the petitioner-developer (Raj Ahuja) to get the approval of all tenants for the redevelopment of a building in Goregaon.
The civic council, the bench noted, had instructed the developer to get 100% tenant approval for the renovation, known as the commencement certificate (CC).
The developer stated that applying such a condition would simply jeopardize the developers’ rights and interests. It held that obtaining 100% tenant approval is not always practicable, and hence such a precondition was arbitrary.
MCGM, on the other hand, contended that the pre-condition was enforced solely to protect the rights of all tenants.
The bench referred to the MCGM’s guidelines for classifying private and municipal buildings to be in the ‘C-1’ category (dangerous, unsafe), as well as the DCPR-2034.
It was said that if 51% to 70% of the tenants agree to take permanent alternate accommodation (PAA) provided by the owner or landlord, this would sufficient and empower the developer to acquire a CC.
“Therefore, in our clear opinion, it was arbitrary for the MCGM to seek from the petitioners, approval of 100% of the tenants, and in its absence withhold the CC to be given to the petitioners on the basis of a few residents refusing to accept residential tenements,” the bench held.
The division bench opined that once the majority of the occupants agree to vacate the building and/or accept the PAA offered by the owner, by protecting their occupancy rights as they existed at the time the building was demolished, it cannot be heard from the minority of such tenants, for whatever reason, that they are not willing to settle in this regard.
