Bombay High Court Decision on Slum Development Fraud
In a significant legal development, the Bombay High Court has dismissed a series of pleas filed by developers, including L&T Asian Realty Project LLP and an entity linked to the Adani group, in a case concerning alleged fraud in slum development. The case citation is L&T Asian Realty Project LLP & Ors v. State of Maharashtra & Ors. The ruling was delivered by Justice Gauri Godse, who imposed a penalty of ₹2 lakh on each of the developers for what was deemed an “unnecessary attempt” to delay the proceedings.
Pleadings and Allegations
The pleas were submitted by L&T Asian Realty Project LLP, L&T Realty Limited, Shiv Infra Vision Pvt Ltd, the Chief Executive Officer of the Slum Rehabilitation Authority (SRA), and Portsmouth Buildcon Pvt Ltd, a company associated with the Adani group. These entities sought to have the lawsuit, filed by KS Chamankar Enterprises and its partner, dismissed under Order 7 Rule 11 of the Code of Civil Procedure. The plaintiffs, KS Chamankar Enterprises, alleged fraud, conspiracy, and wrongful removal as developers of a slum project in Mumbai.
Details of the Case
Chamankar Enterprises had originally been appointed to develop three slum societies. They assert that they had completed a composite rehabilitation building before being suddenly replaced by Shiv Infra Vision, as per SRA’s instructions. Chamankar contested this change in the High Court, alleging that certain blacklisted developers, including entities linked to L&T and Portsmouth Buildcon, colluded with SRA officials to orchestrate their removal and take over the project.
Court’s Analysis and Ruling
Justice Godse, in her ruling, noted that the suit presented a clear cause of action and involved issues that required trial. The defenses raised by the developers, such as the absence of a cause of action, issues of limitation, and the requirement for pre‑institution mediation under Section 12A of the Commercial Courts Act, were deemed insufficient to justify dismissing the case at this stage. The judge emphasized that the defenses involved mixed questions of law and fact, which should be addressed during the trial.
The judge criticized the developers for pressing technical objections and consuming significant court time, contrary to the intent of the Commercial Courts Act, which aims for speedy resolution of commercial disputes. Consequently, each of the four entities involved was ordered to pay ₹2 lakh to the plaintiff within two weeks, totaling ₹8 lakh in penalties.
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Legal Representation
The legal teams involved included Advocates Rohan Savant, Ish Jain, Vinayak Siraskar, Duj Jain, Soham Bhagwat, Agam Mehta, and Aman Saraf, briefed by Kiran Jain & Co., representing KS Chamankar. Advocate Aparna D Vhatkar appeared for the Additional Chief Secretary and Chairman. Advocates Yashesh Kamdar, Brian Noronha, and Amisha Upadhyay from India Law LLP represented the L&T entities. Senior Advocate Simil Purohit, with Advocates Shrikant Seegarla and Shraddha Achliya, represented Shiv Infra Vision and its associates. Senior Advocate Pravin Samdani, along with Advocates Aditya Shiralkar, Disha Shetty, and Jyoti Tated from Wadia Gandhy and Co., appeared for Portsmouth Buildcon. Advocates Mayur Khandeparkar, Jagdish G Aradwad (Reddy), and Abhijit Patil represented the SRA, while Additional General Pleader Himanshu Takke appeared for the State.
