MUNCIPAL CORPORATION OF GREATER MUMBAI v. MAHENDRA BUILDERS AND 10 ORS.
Upholding Interim Injunction: Municipal Corporation Restrained from Dispossessing Settled Possessor Without Due Process, Lease Assignment Dispute.
Court: Bombay High Court
Citation: 2025:BHC-OS:22943-DB
Decision Date: 01-12-2025
List of Laws
The Societies Registration Act, 1860; The Bombay Public Trusts Act, 1950; Mumbai Municipal Corporation Act, 1888; Transfer of Property Act; Constitution of India; Code of Civil Procedure, 1908
Case Brief
- Facts: The Municipal Corporation of Greater Mumbai (MCGM) appealed against an order that restrained them from interfering with Mahendra Builders' possession of a property (Plot A1) except through due process of law. The property was originally leased by the Improvement Trust of Bombay to Lallubhai Dharamchand in 1901 for 99 years. The lease was assigned to Bikaji Taraporwala, who constructed a building. After Taraporwala's demise, the lease was surrendered to MCGM, which then granted two leases for the unexpired period to Taraporwala's executors. The executors later assigned the suit plot to the Parsi Panchayat Trust in 1966. In 1974, the Parsi Panchayat agreed to sell the building and assign the leasehold rights to Mahendra Builders. The Charity Commissioner granted permission for the sale in 1975. Although MCGM issued licenses for the transfer in 1986, the assignment deed was not executed immediately due to pending Charity Commissioner proceedings. The 99-year lease expired in 2000. In 2003, a registered deed of assignment was submitted, but MCGM then claimed the assignment was void due to the lease's expiry and took possession by affixing a notice and conducting a Panchanama.
- Procedural Posture: Mahendra Builders filed a suit seeking a declaration of their continued possession and a restraint on MCGM's actions. The Single Judge granted an ad-interim order in favor of Mahendra Builders, which was challenged by the MCGM in this appeal. A connected appeal was also filed by the Empire Building Occupants Welfare Association. The Supreme Court had previously condoned a delay in instituting the appeal and requested simultaneous hearing of both appeals.
- Issue: Did the Single Judge err in granting an interim injunction restraining the MCGM from dispossessing Mahendra Builders from the suit property, considering the expiry of the lease and the subsequent assignment of rights? Specifically, was the Single Judge's order perverse or did it appropriately consider the principles of prima facie case, balance of convenience, and irreparable injury?
- Holding: No, the Single Judge did not err. The High Court dismissed the appeals, upholding the interim injunction against the MCGM.
- Reasoning: The Court found no perversity in the Single Judge's order. The Single Judge had correctly considered the triple tests for granting an interim injunction. Mahendra Builders had established a prima facie case of settled possession for over 25 years, supported by documents and MCGM's prior conduct. The balance of convenience favored granting the injunction, as dispossessing Mahendra Builders without due process would cause irreparable harm not compensable by monetary damages. The Court emphasized that the MCGM, even with a superior title, could not take the law into its own hands and must follow due process. The injunction merely restrained MCGM from taking possession through arbitrary means like affixing notices, and did not prevent them from pursuing legal remedies. The Court also noted that the issue of whether the Parsi Panchayat could assign rights after the lease expiry was a mixed question of law and fact, and that MCGM's own conduct suggested they initially recognized the assignment.