Supreme Court order to free private forest land in Mumbai for real estate projects

The new ruling will make way for more than 100 real estate projects and bring relief to nearly 500,000 residents whose properties were listed as encroachments

Several real estate projects, many of which were stuck half-way, will be free for development with Thursday’s Supreme Court order on private forest land setting aside an earlier Bombay high court ruling.

The new ruling will not just open up hundreds of acres of private forest land in suburban Mumbai for development, making way for more than 100 real estate projects to be developed, but will also bring relief to nearly 500,000 residents whose properties were listed as encroachments.

Large Mumbai developers such as Oberoi Realty Ltd and Runwal Group, whose projects have been stuck for the past few years, can go ahead and launch and sell their projects now.

“I am deeply disappointed by today’s Supreme Court order,” said Debi Goenka, an environmental activist and managing trustee of the Conservation Act Trust, a non-profit organization.

In 2002, the Bombay Environmental Action Group (BEAG), a non-profit organization, filed a public interest litigation (PIL) in the Bombay high court on the issue of encroachment of private forest land in Maharashtra, which include more than 1,000 acres of land in and around Mumbai.

The high court in 2005 asked the state government to issue a list of encroachments on private forest land and give details of action taken by the government on such encroachments.

Once the land started being notified as forest land, resident groups formed the Hillside Resident Welfare Association (HRWA) and filed a counter PIL in 2006, though the high court upheld the state government’s contention that these residents were encroachers.

Most of these projects have been stuck since 2006, when the BrihanMumbai Municipal Corporation (BMC) issued stop-work notices.

Oberoi Realty’s project in suburban Mulund, which has been stuck over this issue, should be free to launch now, said analysts.

The 3.2 million sq. ft project is expected to fetch around Rs.4,000 crore of revenue for the realty firm, said Adhidev Charttopadhay, analyst, HDFC Securities Ltd.

Vikas Oberoi, chairman of Oberoi Realty, declined to comment, citing the so-called silent period ahead of the announcement of company earnings this weekend.

Runwal Group’s project in Mulund that has also been stuck for the past few years, can be built and completed now.

While it’s a relief, the projects will require fresh environmental clearances now, according to Sandeep Runwal, director of the Runwal Group.

Another realty firm, Aristo Realty Developers Ltd, had partially started construction on a large project in the same suburb, after which it was stalled.

Though interim relief was granted in 2010, under which residents and builders could pay a compounding fee to regularize their properties, not many took the risk with the status of the land being uncertain.

“Today’s judgement has come as a great relief to around five lakh people living in and around Mumbai and 15 lakh more persons from other parts of the state,” said Prakash Paddikal, president of HRWA.

“In fact, it accepts our contention that we were never encroachers on forest land, we were living in flats whose building plans were approved the Municipal Corporation of Greater Mumbai (MCGM) and to whom MCGM has given occupation certificate,” Paddikal added.