MUMBAI: The Bombay High Court has rejected a builder’s motion to prevent a Wadala society from replacing him in the redevelopment of 46 buildings with 900 tenants. Justice Sandeep Marne dismissed the challenge by Pioneer Constructions against Sahakar Nagar CHS, stating that while the builder was appointed in 2013 for the redevelopment, the tenants could not be expected to wait indefinitely.
The High Court highlighted that the interests of the housing members “are far more significant” than those of the developer. This ruling came in response to the builder’s petition, which expressed concern that the society would contract with a new developer due to delays in the project.
Pioneer pursued a commercial arbitration petition after the society convened a general body meeting on January 10, where they resolved to appoint Sugee Avenue Pvt Ltd. They also scheduled another special general meeting on April 23 to finalize the draft of the new development agreement. The builder sought an immediate stay on this resolution. The society previously obtained the necessary approvals before signing another development agreement with Pioneer on June 22, 2015.
The High Court did not grant interim relief but appointed a sole arbitrator to address disputes stemming from the development agreement dated June 22, 2015, as modified by a new agreement on April 22, 2016. During the hearing, the builder’s senior counsel, Dinyar Madon, argued that a 2016 resolution required the society to secure 70% individual consent before the builder could pursue municipal approvals. Madon also noted the absence of a termination clause in the agreements and cited other reasons for the delays, including changes in DCR regulations, litigation among members, and the Covid-19 pandemic. In contrast, the society’s counsel, Chaitanya Chavan, asserted that the delays were unacceptable and the society acted properly in seeking a new builder, alleging that the petitioner had “done virtually nothing” in 13 years apart from an expenditure of Rs 1 crore towards an Earnest Money Deposit, leaving tenants in dire circumstances.
Justice Marne stated that granting interim relief to the petitioner would result in “indefinite delays” for the project, jeopardizing the lives of the 826 residents currently living in buildings erected in 1957. He emphasized that these members have been awaiting safer, larger, and better homes for the past 13 years and can no longer continue to wait.
