Page 1 IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.10933 OF 2013

(Arising out of SLP(C) No.14202 of 2012)

Oswal Agro Mills Ltd. ... Appellant

versus

Hindustan Petroleum Corporation Ltd. and others... Respondents

With

CIVIL APPEAL NO. 10934 OF 2013

(Arising out of SLP(C) No.30858 of 2012)

J U D G M E N T

G.S. SINGHVI, J.

1.Leave granted.

2.These appeals are directed against order dated 12.4.2012 by which the

Division Bench of the Bombay High Court allowed the writ petition filed by

respondent No.1-Hindustan Petroleum Corporation Ltd. (HPCL) and quashed the

sanction accorded by the competent authority of the Municipal Corporation of

Greater Mumbai (for short, ‘the Corporation’) for change of user and

1

Page 2 construction of residential and commercial complex on land bearing CTS Nos.

381 and 381/1 to 22, Village Anik, Taluk Chembur, MSD, Mumbai and directed

the Municipal Commissioner to reconsider the application made by Oswal Agro

Mills Ltd. (hereinafter described as “the appellant”) keeping in view the

objections raised by the Police Department, Ministry of Petroleum, Ministry of

Environment and Intelligence Bureau and the Security Control Regulations

issued by the State of Maharashtra under Section 37 (1AA) of the Maharashtra

Regional and Town Planning Act, 1966 (for short, ‘the 1966 Act’).

3.The appellant purchased the land in question from Union Carbide Ltd. in

1989 with the permission of the State Government. In the development plan of

the area, the land was shown as included in Special Industrial Zone (I-3 Zone). In

2005, respondent No.1 acquired land bearing CTS Nos. 382 and 382/1 to 66 of

Village Anik, which is located at a distance of 430-450 meters from the

appellant’s land from Ahmedabad Printing and Calico Mills Company Ltd. for

construction of storage tanks.

4.On 17.3.2006, the appellant made an application to the Industries

Department of the State Government for change of land use. The State

Government informed the appellant that the Industries Department can give

NOC for industrial purpose keeping in view the locational policy, which did not

contain any provision for change of land use and that change of user was within

the jurisdiction of the Planning Authority.

2

Page 3 5.The appellant also made an application to the Maharashtra Pollution

Control Board (MPCB) for grant of environmental clearance. Thereupon, MPCB

issued notice dated 19.6.2006 and invited objections against the proposed grant

of environmental clearance to the appellant’s project. Respondent No.1 filed

objections dated 11.7.2006 and pleaded that permission sought by the appellant

should be rejected because its refinery was very close to the appellant’s land and

construction of building would be a security threat to the large tanks proposed to

be installed for storage of crude oil and finished petroleum products on the plot

purchased from Calico Mills Company Ltd. Another plea taken by respondent

No.1 was that there were several major industrial units in the industrial zone and

setting up residential or commercial complex in that zone next to the refineries

was risky and hazardous and was not in public interest. Respondent No.1 sent

similar communication dated 17.7.2006 to the Corporation. The latter sent

communication dated 26.10.2006 to the Under Secretary, Urban Development

Department informing him about the objections raised by respondent No.1 and

pointed out that proposal of the appellant cannot be withheld under the existing

rules and regulations because issues of safety and security were not within its

jurisdiction. The Corporation also suggested that a strip of land could be left

around the premises as buffer for additional safety of the installation of the

refinery and surveillance could be kept by installing CCTV cameras, etc. The

Labour Commissioner, to whom a copy of application dated 17.3.2006 had been

forwarded, sent communication dated 18.11.2006 to the Corporation that he had

3

Page 4 no objection to the issue of NOC to the appellant. He also mentioned that dues of

workers had already been paid.

6.After one year and one month of the submission of application by the

appellant, the Corporation addressed letter dated 21.4.2007 to the Under

Secretary, Urban Development Department seeking his advice on the objections

raised by respondent No.1. In that letter it was mentioned that colony of HPCL

officers was situated on North-East side of the appellant’s plot, residential

quarters of Maharashtra State Electricity Board were abutting the plot and a

number of Slum Rehabilitation Schemes were in place around the disputed plot.

7.While the appellant’s application was pending, respondent No.1 addressed

letters dated 26.10.2007 and 3.6.2008 to the State Government raising objections

against the proposal of M/s. Metal Box Ltd. and M/s. Apar Industries to

construct residential and commercial complex on plots adjacent to its refinery. In

reply, the Corporation sent letter dated 22.7.2008 to the Chief Manager of

respondent No.1 for issue of NOC for construction of tenements meant for

project affected persons under the Slum Re-development Scheme under Clause

33(10) of Development Control Regulations (for short, “DC Regulations”) .

8.By letter dated 25.7.2008, the Corporation informed the Director of

Refineries, HPCL that Slum Rehabilitation Authority had approved the plan on

the Metal Box plot and letter dated 26.10.2007 sent by respondent No.1 has been

forwarded to the Executive Engineer (SRA).

4

Page 5 9.Vide letter dated 21.10.2008, the Ministry of Environment and Forests

(MoEF) granted environmental clearance to the proposed construction of

commercial buildings consisting of Wings A, B, C and D (G+7), office building

(S+8), amenity building (G+2) and S1-S8 buildings (G+7) on the appellant’s plot

under category 8 (b) of EIA notification 2006 subject to strict compliance of

specific and general conditions contained in the letter.

10.In the meanwhile, Bharat Petroleum Corporation Limited (BPCL) filed

Writ Petition No.1891/2007 against the State of Maharashtra and others. BPCL

also applied for an interim injunction against the construction of residential

building. One of the grounds taken by BPCL was that Development Plan had

been altered ignoring the threat perception to its refinery. By an order dated

11.12.2008, the Division Bench of the High Court declined the prayer for interim

injunction by recording the following reasons:

“2.The land which is the subject matter of dispute belonged to

Mafatlal Group. Mafatlal’s entered into M.O.U. with Petitioner No. 1

to sell the land for housing of the Petitioner’s staff and workers by

agreement dated 23.5.1982. On 25.1.1990, an order came to be passed

under the Urban Land Ceiling Regulation Act, 1976 granting

exemption to the land for development for housing the staff of the

Petitioner No. 1. In the D.P. Plan notified in the year 1992, it was

shown as reserved for housing of the staff of the Petitioner. As the

Petitioner did not show interest, Mafatlal entered into an agreement

with Eversmile who proposed to the Petitioner to purchase the flats

which they would construct, which proposal however was not

accepted.

The Petitioner thereafter sought to acquire the land and this was

informed by communication dated 4.8.1992 by the Petitioner to

Respondent No. 1. The land was not acquired by the Petitioner though

5

Page 6 the persons who had acquired interest in the land were willing for

acquisition. One of the reasons appears to be that the Petitioners did

not want to pay for the land which was to be kept open.

3. On 17.7.1999, a corrigendum was issued to the exemption

Notification under Urban Land Ceiling Act and the land consisting

part-A was tobe developed as per the policy of S.R.A. and the land

occupied at Part-B was to be developed as per order of the

Government.

The Petitioner was also in touch with NEERI who in their

communication dated 19.1.2000 noted that the construction of housing

complex for 2000 buildings was in full swing. They had raised some

objections from the environment point of view. The Petitioner also

approached the Intelligence Bureau. By letter dated 5.7.2000, the

Intelligence Bureau informed that considering the threats and as the

land belonged to private persons, it should be purchased along with

the existing structure.

The Petitioner in a communication dated 4.12.2006 addressed to the

Secretary, Ministry of Environment and Forest, Government of India

pointed out that the construction activities were going on since 1999-

2000 but the work was stopped because of CRZ violation and the

construction activities are likely to be resumed.

4. The main contention urged on behalf of the Petitioners has been

that while making alterations in the D.P. Plan, the threat perception to

the refinery of the Petitioners ought to have been taken into

consideration and that due notice was not given to them. In the instant

case, as may be noted, the plan as notified in the year 1992 itself

showed that the land was reserved for housing of the staff of the

Petitioner. This has now been changed for S.R.A. and other purposes

which are residential. Therefore, the land since the year 1992 was

reserved for residence. The Petitioner in the year 1992 did not raise

any objection to the land which was reserved for residence and on the

contrary they wanted the land for housing their staff. The

correspondence further indicates that the construction activities has

commented from the year 1999-2000, though for some time in view of

C.R.Z. violation that could not be proceeded with.

5. Further from the material before us, it is clear that in the vicinity of

the Petitioner’s project, there are other constructions which are

existing including residential buildings. Eversmile has commenced

construction of buildings under .S.R.A. project. The Petitioners

6

Page 7 allowed the said construction to come up by maintaining silence for

long period of time. They have neither purchased the land nor

acquired it. Considering the fact that there are already other buildings

and as the respondent developers have commenced construction by

spending large amount of money, in our opinion, the contention of the

Petitioners that on account of "security risk" the respondent should be

restrained at the interim stage from constructing on the land on facts

here cannot be granted. The delay must be held against the Petitioners,

as also the fact that since 1992, the land has been reserved for

housing. Though we have granted rule that by itself cannot result in

granting interim relief, which must be considered on the basis of well

known principles of grant of interim relief.

6. On behalf of the Respondents, their counsel had sought to argue

that the Petition itself ought not be be admitted and had relied on a

large number of judgements including the judgment of this court in

the case of BEST Workers Union Vs. State of Maharashtra 20085 All

M.R. 848. Considering the contentions advanced based on the D.C.

Regulations which though were also under consideration in the case of

BEST Workers Union (supra), we have admitted the Petition.

However, as noted earlier the gross delay and the fact that Respondent

Builders have invested large amounts on the project which is being

constructed under the S.R.A. Project, would be a relevant fact not to

exercise discretion in favour of the Petitioner.”

11.After grant of environmental clearance, respondent No.1 sent letters dated

14.1.2009 and 23.2.2009 to Deputy Director, Town Planning reiterating its

objection to the construction of buildings by the appellant. On 27.2.2009, the

State Government issued notice in the light of the recommendation made by Upa

Lokayukta to prepare Security Control Rules and accepted the report of the

Expert Committee for framing Special Regulations for safety of the buildings

from terrorist attack, the requirement for electrical and electronic system, fire,

etc. Thereafter, the State Government issued instructions vide letter dated

7

Page 8 21.3.2009 addressed to the Municipal Commissioner for implementing the

Security Regulations.

12.In view of the communications sent by the State Government, respondent

No.1 sent letter dated 5.5.2009 to the Chief Secretary to highlight the security

threat to its refinery due to the SRA Scheme and requested that 56 SRA

buildings be acquired for housing police personnel as has been done in the case

of SRA buildings constructed near the BPCL refinery.

13.By an order dated 1.9.2009, the Municipal Commissioner accorded

sanction for change of user of the appellant’s plot in the light of Regulation 57(4)

(c) of the DC Regulations subject to the requirement of obtaining NOCs from

different authorities. After about two months, appellant submitted proposal for

amalgamation / sub-division of the plot. The Corporation considered the proposal

and approved the same vide letter dated 10.6.2010 subject to the additional

conditions including the one that amenity space shall be handed over to the

Corporation. On 11.11.2010, the Corporation issued Intimation of Disapproval to

the appellant and on 28.12.2010, the Corporation granted permission to the

appellant for handling, storage, transportation and disposal of waste generated

due to construction of building. Subsequently, the Corporation vide its letter

dated 7.1.2011 issued NOC to the appellant regarding fire protection and fire

fighting requirements in respect of the proposed construction of high rise

8

Page 9 residential building No.9. The Corporation also granted commencement

certificate to the appellant.

14.In the meeting held on 5.2.2011 under the Chairmanship of the Principal

Secretary, Home Department, representatives of respondent No.1 and BPCL

protested against the permission granted for construction by the appellant and

others on the property adjacent to the refinery of HPCL and pleaded that

construction activity should be immediately halted. It was also suggested that a

distance of 500 metres as buffer zone was required to be maintained. Thereafter,

the Principal Secretary asked the representatives of respondent No.1 and BPCL

to make necessary representation to the Brihanmumbai Mahanagar Palika to

maintain the distance. The Principal Secretary also directed the representative of

respondent No.1 to inform the Urban Development Department within 15 days

whether the company was willing to take possession of a portion of 500 metres

from the neighboring property for buffer zone and plant trees, etc. so that the

State Government could take an appropriate decision. The same was also

conveyed to respondent No.1 vide letter dated 15.2.2011.

15.Having failed to convince the State Government and the Corporation to

stop construction of buildings on the land purchased by the appellant, respondent

No.1 filed Writ Petition No.1973/2011 for quashing all approvals and

permissions granted to the appellant and for restraining the official respondents

from granting further permissions or approvals or renewing the approvals /

9

Page 10 permissions already granted. Respondent No.1 heavily relied upon the report

prepared by the Intelligence Bureau highlighting the threat perception to the

refinery and its installations. Respondent No.1 also challenged validity of

Regulation 57(4)(c) of the DC Regulations in terms of which the Commissioner

of the Corporation can permit any open land in special industrial zone to be used

for any of the permissible users in residential zone.

16.The appellant, the Principal Secretary, Urban Development and the

Deputy Director, Town Planning, BMC filed affidavits to oppose the writ

petition. In the affidavit filed on behalf of the MPCB, it was pleaded that the

clearance was granted after due consideration of the record in the light of the

clearance granted by the Ministry of Environment and Forests (MoEF),

Government of India. Secretary, Department of Environment, Maharashtra also

referred to the recommendations of the State Level Environment Impact

Assessment Authority and claimed that in view of the clearance accorded by

several agencies, permission sought by the appellant was granted. Labour

Commissioner filed an affidavit stating that he was only concerned with the

payment of dues of the workers and in the report submitted by him it was made

clear that the dues of workers have already been paid. The Additional Director,

MoEF filed affidavit to the effect that State Expert Appraisal Committee has

accorded environmental clearance in terms of EIA Notification 2011. In a

separate affidavit, Principal Secretary, Home Department pointed out that HPCL

10

Page 11 refinery was Category ‘A’ vital installation and had been declared as prohibited

area under the Official Secrets Act. The Principal Secretary also submitted that

construction of high rise building on the plot in question will be a threat to the

installation of respondent No.1. In an additional affidavit filed on behalf of the

appellant, its Senior Vice-President Dr. Seema Garg averred that large number of

buildings have already been constructed in the vicinity of the plot purchased by

respondent No.1. Paragraphs 9 to 18 of the affidavit of Dr. Seema Garg which

have bearing on the decision of these appeals read as under:

“9. I say that Development Control Regulations 1991 (Regulation 29)

provides that in case of change of user from Industrial to

Residential/Commercial zone, the Corporation can insist for

maintaining distance of 52 metres between the proposed development

and the obnoxious or hazardous industries. I say that plans provide for

a safe distance of far more than 52 metres between the boundary wall

of the said land and the boundary wall of the petitioner's existing

refinery.

10. I submit that the apprehensions sought to be expressed by the

Petitioners in the Petition to the effect that the proximity of the said

land to the Petitioners' refinery causes an environmental and security

threat is misplaced and unwarranted. This would be apparent if the

neighborhood of the Petitioners' refinery is considered. The

Petitioners' refinery is surrounded by dense human habitation i.e. more

than 350,000 occupants & a floating population of approx 50,000.

This has been stated by the Asst. Engr. (DP) ES of the BMC in the

affidavit filed in Writ Petition No. 1891 of 2007. The affidavit of the

Assistant Engineering (D.P.) E.S. Mumbai filed in Writ Petition No.

1891 of 2007 by BPCL was to the effect that:

“…population in the locality is estimated to be 3.5 lakhs.

In addition, there is estimated to be floating population of

approximately 50,000 persons comprising of employees

and visitors. It is pertinent that touching the refinery of

Hindustan Petroleum Corporation Ltd., 7,500 flats have

been constructed with more than 7,500 persons residing

11

Page 12 there. The situation has not caused any breach of or threat

to the security of Hindustan Petroleum's refinery."

11. Moreover there are a number of multistoried/high rise buildings

which are situated much closer to the Petitioners refinery. The

distance between the boundary wall of the Petitioners refinery and the

said land is approx 470 mtrs. Moreover as stated earlier the

Respondent No.20's actual construction site is an additional 400-500

mtrs away from its plot boundary: i.e. the aggregate distance from the

Refinery wall to the said buildings is 800-900 mtrs. As compared to

this, there are multistoried buildings and even a high rise situated

much closer to the Petitioners refinery. Some of such

buildings/habitations which surround the Petitioners' refinery are set

out hereunder:

On the South:At the distance of zero metres /i.e. almost

adjoining the refinery there exist a Gavanpada village with a

population of about 7000 people.

On the East: a) At the distance of 18.53 metres, there exist slums;

namely Paryag Nagar and Prakash Nagar with a population of

approximately 5000 people.

b) At the distance of

about 125 mtrs., situated on raised ground/a hill, is the residential high

rise tower of 14 storey constructed on the Metal Box plot. This

building is almost complete and ready for occupation.

On the North: a) At the distance of 30 to 130 mtrs. there are more

than 50 multi storey buildings constructed for Slum Rehabilitation by

RNA SRA Scheme and Videocon SRA Scheme consisting more than

6000 housing units and hundreds of shops.

b) At the distance of

50 mtrs. there exists Vishnunagar Slum having a population

approximately of 10,000 people.

c) At the distance of

approx. 400 metres, there exists Bharat Nagar slum having a

population of approx. 20000 people.

On the West: Across the road and

opposite the main Gate of Refinery are the shops and hutments with a

population of about 200 people.

12

Page 13 Hereto annexed and marked Exhibit "A" is the satellite map showing

the location of the Petitioners refinery and its surroundings. Some of

those developments have taken place as recently as 2009-2010. Also,

annexed hereto as Exhibits "B-1" to "B-13" are some of the

photographs clearly showing the extent of residential development

and the surroundings of the Petitioners' refinery.

12. The Petitioners after making initial objections in 2007, have not

filed any proceedings to stop or obstruct the construction and

completion of the SRA High Rise project constructed on the land of

Metal Box which is at the distance of only 125 mtrs. from the

Petitioners' refinery.

13. I say that that on the Northern side touching the boundary of

Respondent No.20's land which is notified as Residential Zone, there

is the MSEB Colony, buildings constructed for MHADA and various

SRA Projects. Even the Petitioners' own residential colony falling

within the Residential zone is situated only a few metres away from

the Boundary wall of Respondent No.20's land. Not only that, Bharat

Nagar and New Bharat Nagar residential areas having population of

approximately 20,000 people is also in the vicinity.

14. I say and submit near the refinery of the Petitioners, there is a

refinery of Bharat Petroleum Corporation Limited (BPCL). I say that

just opposite to their refinery, the area as sanctioned under the

Development Plan was shown for residential use. As a matter of fact,

BPCL itself required the area near the refinery to house their

workmen and staff quarters. I therefore, say and submit that statutory

authorities while finalizing the Development Plan had taken all

required steps to safeguard the hazardous industries by providing for

maintaining safe distance under the DCR. I say that the said area has

now have been developed with construction of multi storey buildings.

I say that the Plans annexed hereto clearly show the nature of

constructions surrounding the BPCL refinery also. Not only that

monorail route is passing just outside the boundary wall of BPCL

refinery and a railway station is also built which is having direct line

of site vision into refinery. I say that Exhibits "C-1 to C-3" are some

of the photographs clearly and unequivocally show that there are

number of buildings already constructed near the refinery of BPCL

and also the monorail track. I therefore, say and submit that the

Petitioners carrying on similar activities as that of BPCL cannot allege

the environment or the security concerns more particularly when all

the authorities have sanctioned the project of Respondent No.20.

13

Page 14 15. I say that despite repeated requests, the Petitioners have not shared

with Respondent No.20 the alleged report of Intelligence Bureau with

regard to the Security concerns. I say that in absence of such report

the Petitioners are unable to deal with the same. I submit that unless,

the Petitioners disclose the IB report, this Hon'ble Court should not

take cognizance of the alleged extracts relied on /referred to. I

however say that the issue regarding the proposed construction posing

a security risk to the Refinery (being within its line of sight) is

misconceived and untenable. I say that the Petitioners' property is

enclosed on all sides by a boundary wall. Adjoining the boundary wall

there is a public road, which is used by the public at all times of the

day and night. Heavy vehicular traffic is also a constant phenomenon

on the said road. The said road does not have any security checks or

any persons patrolling it. I say that in order to enable any person a

direct line of site vision into refinery areas, one does not require to

climb multistoried buildings, as the refinery/storage tanks are clearly

visible & in the line of sight of a pedestrian walking along the road or

any occupant of a vehicle using the said road had a clear line of sight

to the Petitioners storage tanks. The Petitioners have also not raised

any security issue in respect of the buildings/multi storeyed buildings

built on almost three sides of the refinery at a distance ranging from

50 mtrs to 300 mtrs. In these circumstances the Petitioners cannot

contend that construction being carried out by these Respondents at a

distance of 800 to 900 mtrs constitutes a security risk and is required

to be stopped. Hereto annexed and marked Exhibit "D" is the satellite

image of the Petitioners refinery along with photographs of the

residential colonies, SRA projects, commercial establishments, slums

around the same as also the developments opposite BPCL refinery.

16. I say that the Petitioners are merely apprehending that use of fire

crackers by residents would pose constant hazard and threat to the

refinery. The Petitioners have rather ignored the fact that the proposed

development of Respondent No.20 shall be at the distance of more

than 800 mtrs.

17. I say that as the project on the said property is covered by the

Notification issued under the Environment Protection Act, 1986.

Accordingly, the Environment Impact Assessment (EIA) was

necessary to be obtained from MoEF, and Respondent No.20 had

applied for the said sanction for the said project. I say that the said

process of EIA also requires a public hearing. I say that Petitioners

participated in the public hearing conducted by the Maharashtra

Pollution Control Board.

14

Page 15 18. The petitioners have acquired land admeasuring 2,30,407.40 sq.

metres bearing CTS No.382, 382/1 to 22 belonging to one

Ahmedabad Printing and Calico Mills Co. Ltd. A part of this land falls

between the exiting refinery of the Petitioners and the said land of

Respondent No.20. Considering this area, which is as on date an open

area there is a distance of more than 500 metres between the

Petitioners' existing refinery and the said land. It is not open to the

Petitioners to now carry on construction of additional/new storage on

the said Calico and thereafter contend that safety distances are not

being maintained. The Petitioners are seeking to render the Petitioners

buildable land sterile without acquiring and paying for the same.”

(reproduced from the SLP paper book.)

The details of the buildings existing in the vicinity of the refineries of

respondent No.1 and BPCL, to which reference has been made in the

affidavit of Dr. Seema Garg, are given hereunder in the form of the

following table:

Location

from the

Refinery

Distance from the

Refinery

Name of

building/habitation

Population

South 0 metres; i.e., almost

adjoining the refinery

Gavanapada Village 7000

East a) 18.53 metres Slums of Paryag Nagar

and Prakash Nagar

5000

b) 125 metres On a raised ground-

residential high rise

tower of 14 storey on

the Metal Box plot

Almost

complete

and ready

for

occupation

North a) 30-130 metresMore than 50 multi

storied constructed

under the SRA scheme

6000

housing

units and

hundreds of

shops

b) 50 metres Vishnunagar Slum 10,000

c) 400 metres Bharat Nagar Slum 20,000

West Across the road and

opposite the main

gate of the refinery

Shops and hutments 200

15

Page 16 17.The Division Bench of the High Court allowed the writ petition and

quashed the permission accorded by the Corporation and other authorities for

conversion of the appellant’s land from Special Industrial Zone (I-3) to Local

Commercial Zone (C-1) under Regulation No. 57(4)(c) of DC Regulations,

approval granted for amalgamation / sub-division of the plot and sanction

accorded to amended building plans for construction of residential buildings. The

High Court also quashed NOC issued by MPCB and environmental clearance

granted by MoEF and directed the Municipal Commissioner to re-consider the

applications made by respondent No.1 for change of land use and for sanction of

plan and decide the same afresh after considering the objections raised by

various Departments and the provisions of Security Control Regulations.

18.One of the grounds which found favour with the High Court was that the

Corporation is duty bound to ensure that large human habitation does not grow

around the refinery, which comes within the definition of hazardous industries.

The other ground accepted by the High Court was that while sanctioning change

of land use and building plans, the Corporation did not pay due attention to the

issue of security of the refinery and health of people likely to reside in the newly

constructed buildings. The High Court also held that even in the absence of

specific provision in DC Regulations, the Municipal Commissioner was duty

bound to keep in mind the larger public interest, i.e., health of the people living

in the vicinity before granting permission for construction of residential and

16

Page 17 commercial complex. The High Court accepted the affidavit filed by the

Assistant Commissioner of Police that the proposed construction would pose

serious threat to the refineries of respondent No.1 and BPCL and held that such

construction cannot be allowed. The High Court rejected the appellant’s

contention that the restriction proposed to be imposed in the name of security

threat amounted to violation of its property rights. The High Court referred to the

incidents like Bhopal gas tragedy, terrorist attack in Mumbai and the reports of

the Intelligence Bureau and the Ministry of Home Affairs and held that the

Municipal Commissioner had approved change of user and sanctioned the

building plan without applying mind to various issues.

19.R.D. Dhanuka, J., who authored the main judgment recorded the

arguments of the learned counsel in 35 pages. He rejected the objection raised

on behalf of the appellant that the writ petition was not maintainable because

respondent No.1 had not approached the Court with clean hands. The learned

Judge then referred to several judicial precedents on the interpretation of the

1966 Act and held:

“In our opinion even these above-referred provisions clearly provides

that even if the relaxation in respect of the dimensions in case of

hardship, can be granted by the Municipal Commissioner, Municipal

Commissioner is prohibited from granting such relaxations if such

relaxation affects health, safety, fire safety, structural safety and public

safety of the inhabitants of the building and the neighbourhood. In our

view, the Learned Counsel for HPCL is right in his submission that

this prohibition against the Municipal Commissioner in relaxing

certain conditions even in case of hardship, if it affects the public

17

Page 18 safety, health etc. should be read in the powers of Commissioner under

Regulation 16(a) (b) and (n). We are of the opinion that the issue of

security and health aspect, which is for members of the public at large

and is in pubic interest and therefore, by not considering the security

and health aspect or refusing to consider such aspects while

sanctioning the plan or while permitting change of user, is totally

illegal and contrary to Regulations 16(a) (b) (n) read with section

64(b) of the D.C. Regulations.

From the perusal of the aforesaid judgments and applying the

principles thereof to the facts of this case, we are of the opinion that

the learned counsel for Oswal as well as Municipal Corporation are

not right in their submission that the security aspect should not have

been considered at all by the Municipal Commissioner while

sanctioning the plan for development or while permitting change of

user under any of the provisions of the D.C. Regulations or Mumbai

Municipal Corporation Act or Maharashtra Regional Town Planning

Act. We are of the opinion that it is not only the power but also duty of

the Municipal Commissioner to consider the security aspect in public

interest before granting permission to development any land as well as

permitting change of user from one zone to another zone. Under

Regulation 16(a), (b), (n) read with Regulation 64(b) read with section

46 of the M.R.T.P. Act. We are, therefore, unable to accept the

submission of the learned counsel for Oswal as well as B.M.C. that

there was no enabling provisions under the present D.C. Regulations

or any other provisions to consider security and health aspect before

sanctioning the plan or before permitting change of user by the

Municipal Commissioner.”

The learned Judge then referred to the judgment of the Division Bench of the

High Court in an un-reported judgment titled TCI Industries Limited v. The

Municipal Corporation of Greater Bombay and others and held:

“The principal argument of the petitioner was that

none of the authorities have considered Intelligence Bureau

report categorically pointing out that any planning to

construct high rise residential buildings at the site of

demolished factory of M/s. Oswal Agro Mills Limited, Anik,

Chembur (Near HPCL Refinery) would be detrimental to the

18

Page 19 security/safety of the vital installation and that the Mumbai

terrorist attack in November, 2008 had exposed vast

coastline of Mumbai to danger through the sea due to which

oil installations have become more vulnerable to threat from

inimical forces and such installations and other public places

were likely to be targeted. Inspite of petitioner bringing these

facts to the notice in the public meeting held, strongly

objecting to the permissions if any being granted to Oswal

for development, none of the authorities have even bothered

to look into the security aspect while granting the approval to

Oswal and have taken very casual approach in the matter. The learned

counsel for the HPCL as well as learned counsel appearing for

Government of India invited our attention to the instructions given by

the Government of India, Ministry of Home Affairs to their advocate

appearing in this matter requesting its advocate to appraise this Court

of the view of the Ministry of Home Affairs about the security aspect.

Even in the said letters, it is made clear that vital installations

including located near the coastline are vulnerable to threats from

inimical forces in view of the prevailing security situation. It is

recorded that the construction of building at the site of Oswal cause

security hazard to vital installations in HPCL Refinery. The Ministry

of Home Affairs have also addressed separate letter and has advised to

the State Government of Maharashtra requesting to review the matter

of permissions and clearance granted to Oswal for change of user and

construction of such high rise construction in view of the safety

reasons involved. We have also perused the affidavit in reply filed by

Mr. Didarsingh, Assistant Commissioner of Police, stating that as per

police record, HPCL is "A" category vital installation in terms of

National importance and has been declared as prohibited area in the

Official Secret Act, 1923. It is further stated that the high rise

buildings, if permitted on the Oswal Mills land may enable direct line

of sight vision into not only HPCL Refinery area but also BPCL

Refinery area which is also close to Oswal Agro Mills Ltd. towards

south direction. It is further stated that any upper floors of complex on

Oswal land if permitted may provide an ideal launching pad for any

external subject to be directed or targeted at the said refinery storage

tank which may contain highly inflammable substances like LPG,

Naptha, Crude oil etc. The Police department have placed reliance

upon the threat assessment as per the report of the inspection of the

Industrial Security carried out by the Intelligence Bureau, Government

of India in the said affidavit. However, the learned counsel appearing

for Oswal submitted that the so called assessment of Intelligence

Bureau regarding security threat to refinery of petitioner is of no

19

Page 20 significance as according to him, the ministry of Environment had

granted approval to the project of Oswal much after the said report of

Intelligence Bureau and while granting such approval the Ministry of

Environment had considered all aspects including the security aspect.

On the other hand, the learned counsel appearing for the HPCL

strongly canvassed that this court is not an expert in the issue of

security aspect. The serious threats of life and security perceived by

the Intelligence Bureau can not be brushed aside by the authorities as

well as by this Court. Oswal has not alleged any malafides on the part

of Petitioners in raising issue of security or health or in placing

reliance upon Intelligence Bureau Report or has not made such

allegations against Intelligence Bureau. Oswal has also not produced

any other report from expert showing different position.”

20.P.B. Majmudar, J., who agreed with R.D. Dhanuka, J. referred to Section

37 of the 1966 Act which contains the procedure for modification of final

development plan, Clause 57 of the D.C. Regulations and observed:

“4.It is required to be noted that in the instant case, after due

application of mind, the area in question was placed under 13 Zone,

considering the fact that it is surrounded by industries which include

hazardous industry like the refinery. It is not in dispute that the

refinery in question is considered as a hazardous industry. In an

industrial zone, commercial-cum-residential activities are not

permitted. Respondent No. 20 after purchasing the property decided

to use the said property for its commercial benefits. The

Commissioner who is empowered to consider such request for change

of Zone is required to apply his mind in an appropriate manner. The

concerned Commissioner at the relevant time, for the reasons best

known to him, failed to take into consideration various aspects such as

hazardous activity being carried out by the Refinery as high fumes are

going in the sky, refinery which is prone to security threats, etc. simply

because one may apply for conversion from one zone to another and

simply because the Commissioner is empowered to grant such

permission, he is not required to grant such conversion mechanically.

The Commissioner is required to take into consideration various

aspects such as security threats, fire, safety, health, etc. While

considering such aspects, one cannot lose sight of as to what had

happened in Bhopal few years back. It is required to be noted that the

20

Page 21 Commissioner is not having unfettered and uncontrolled powers, while

taking such decision. Once these powers are there, it is required to be

exercised sparingly by application of proper mind while taking into

consideration various other aspects in the matter. In a given case, for

the purpose of residential quarters of the employees of a particular

industry or for providing food facilities, permission to carry out

commercial-cum-residential activities can be granted but it should not

mean that large scale commercial activities by putting high rise

buildings for the purpose of residence also can be permitted in a

mechanical manner. In my view, while permitted the developer to put

high rise buildings, the Commissioner was required to apply his mind

in an appropriate manner instead of deciding the question in a

mechanical manner. It is the duty of the authority to see that by

permitting conversion from industrial zone to commercial-cum-

residential zone, it may not result into health hazards or security

threats. On going through the voluminous records and photographs, it

cannot be denied that the area is surrounded by a large scale refinery

and large fumes are also going in the sky. When the question relates to

the town planning, those who are in the charge of town planning

should see to it that after 50 or 60 years, the future generations may

not curse those who were in charge of planning as the planning

authority is required to consider the future needs and interest of the

future generation also. It is not out of place to mention at this stage

that before independence when Baroda State was in existence, its ruler

Sayajirao Gaekwad, who was a great visionary, never permitted any

industries within the city limits as, according to him, if the industrial

activities are permitted near the residential area, it is bound to affect

the health, safety and security aspects. The said aspect was considered

by the said Ruler more than 70 years ago. In the instant case, since the

area is surrounded by industries and is in an industrial zone, the

authorities are required to consider as to whether it will create any

nuisance to the people who are permitted to reside, if high rise

buildings are constructed near such industries. The planning authority

in its wisdom is required to consider this aspect in an appropriate

manner. The Commissioner was required to consider even the aspect

of security threat as it is pointed out that so far as refinery is

concerned, there is also a security threat. In my view, therefore, the

Commissioner was required to consider the matter appropriately and

should not decide the matter mechanically simply on the basis of

discussions during the meeting with the officers of the Petitioner

Company.”

21

Page 22 The learned Judge further observed that the concerned authority did not

apply mind while sanctioning change of land use of the plot owned by the

appellant.

21.We have heard S/Shri Dushyant A. Dave, Rakesh Tiku, Shekhar Naphade

and Pallav Shishodia, Senior Advocates appearing for the appellants and S/Shri

Harish N. Salve and Rakesh Dwivedi, Senior Advocates appearing for the

respondents and carefully scrutinized the records.

22.Although learned counsel for the parties raised several contentions, I do

not consider it necessary to deal with the same because the High Court has not

considered the issues of security and possible adverse impact on the health of

those who may occupy the buildings to be constructed by the appellant due to

existence of the refineries and industries in the area in a correct perspective. A

reading of additional affidavit dated 12.12.2011 filed by Dr. Seema Garg, Senior

Vice-President of the appellant and photographs annexed with it shows that large

number of multi-storied buildings have been constructed near the refineries of

respondent No.1 and BPCL and over 3,50,000 persons are living in those

buildings. The photographs marked ‘Exhibit D’ clearly demonstrate the

existence of several buildings in the vicinity of the refineries of respondent No.1

and BPCL. These include the colony of the officers and employees of

respondent No.1 which is at a distance of 30 meters from BPCL refinery. The

22

Page 23 photographs further show that Mono Rail is being constructed at a distance of 18

meters from BPCL refinery.

23.The averments contained in the affidavit of Dr. Seema Garg on the issue of

existence of multi-storeyed buildings in the vicinity of the refinery of respondent

No.1 and BPCL remained substantially uncontroverted, but the Division Bench

of the High Court virtually ignored the same and allowed the writ petition of

respondent No.1 by relying upon the report of Intelligence Bureau and the

affidavit filed by the Assistant Commissioner of Police, a reading whereof

shows that the report as well as the affidavit are not based on any scientific

study. It is extremely difficult, if not impossible, to visualise any security threat

from the buildings being constructed by the appellant when no such threat is

perceived from the buildings already constructed in the close vicinity of the two

refineries. Gavanpada Village having a population of 7,000 is just adjacent to the

refinery. On East and North, several buildings have been constructed at a

distance of 18.53 meters to 130 meters. Lakhs of people are residing in these

buildings. Respondent No.1 did not get any scientific study conducted by

experts to find out the effect of gases emanating from the refineries and other

industrial units operating in the area on the health of the people occupying the

building. Not only this, the said respondent did not explain as to how the security

persons who may occupy some of the buildings already constructed will not be

affected by the pollution caused due to operation of the refineries and industries.

23

Page 24 This being the position, the bald assertions made on behalf of respondent No.1,

the report of the Intelligence Bureau and affidavit filed by the Assistant

Commissioner of Police on the issues of security threat and public health could

not have been relied upon for recording a finding that the buildings proposed to

be constructed by the appellant would pose security threat and adversely affect

the health of the prospective occupants of the buildings.

24.The omission on the part of respondent No.1 to challenge the

sanction/permission accorded by the Corporation and other public authorities for

construction of other residential buildings is inexplicable. If the buildings

proposed to be constructed by the appellant at a distance of 800 meters from the

refinery are considered future security threat to the establishment of respondent

No.1, the buildings already constructed in the close vicinity of the refinery etc.

would certainly pose greater security threat. The solution found by the State and

its functionaries as also the officers of the Corporation, i.e., use of upper floors of

the buildings for housing the members of Police force and other security

agencies can equally be applied to the case of the appellant and there is no

rational reason to discriminate the appellant vis-à-vis others, who have already

constructed the buildings. Similarly, the plea of respondent No.1 that the

operation of refineries would adversely affect the health of the occupants of the

buildings proposed to be constructed by the appellant will be equally relevant for

the occupants of the buildings already constructed. Respondent No.1 has not

24

Page 25 placed any report of the experts to prove that the residents of the buildings

already constructed have become prone to various kinds of diseases and,

therefore, it is opposing the construction of new buildings which may be

occupied by the members of public. Therefore, this objection cannot be pressed

into service for restraining the appellant from constructing the buildings.

25.On the premise aforesaid, the appeals are allowed, the impugned order is

set aside and the matter is remitted to the High Court for deciding the writ

petition of respondent No.1 afresh after considering the material produced by the

parties on the issues of security threat and possible danger to the health of the

occupants of the buildings already constructed and those who may occupy the

buildings to be constructed by the appellant. The High Court shall decide the writ

petition afresh uninfluenced by the observations and findings contained in the

order of the High Court and this judgment. The parties may, if so advised, file

additional affidavits and documents within six weeks from today.

26.Since the construction of buildings by the appellant had been halted

pursuant to the interim order passed by this Court, the High Court is requested to

decide the writ petition afresh as early as possible but latest within a period of

four months from the date of receipt of copy of this order in the Registry of the

High Court.

25

Page 26 27.The Registry is directed to send a copy of this judgment to the Registrar

General of the Bombay High Court who shall place the same before the Chief

Justice for appropriate order.

……………………………….…J.

(G.S. SINGHVI)

New Delhi;

December 10, 2013.

26

Page 27 REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.10933 OF 2013

(@ out of SPECIAL LEAVE PETITION (CIVIL) NO.14202/2012)

Oswal Agro Mills Ltd. …

Appellants

Versus

Hindustan Petroleum Corporation Ltd. & Ors. …

Respondents

With

CIVIL APPEAL NO.10934 OF 2013

(@ out of SPECIAL LEAVE PETITION (CIVIL) NO.30858/2012)

Municipal Corporation of Greater Mumbai …

Appellants

Versus

Hindustan Petroleum Corporation Ltd. & Ors. …

Respondents

J U D G E M E N T

H.L. Gokhale J.

We have gone through the judgment prepared by our

Learned Brother G. S. Singhvi, J. wherefrom we have benefited.

Yet with great respect, we are unable to persuade ourselves to

agree therewith for the reasons which we record herein below.

27

Page 28 2. Both these appeals seek to challenge the judgment

and order dated 12.4.2012 rendered by a Division Bench of

Bombay High Court allowing Writ Petition No.1973 of 2011 filed

by respondent No.1 in these appeals. For the sake of

convenience, we will refer to the facts as disclosed in the appeal

filed by Oswal Agro Mills Ltd. (‘Oswal’ for short). The dispute in

this matter is essentially with respect to the proposed

construction of the residential-cum-commercial complex of the

appellant herein, which is permitted by the Municipal

Corporation of Greater Mumbai to come up in the vicinity of the

Refinery run by the first respondent Hindustan Petroleum

Corporation Ltd. (‘HPCL’ for short) at Mahul, Chembur, Mumbai.

The refinery is situated on B.D Patil Marg, Mahul, on a property

comprising of various CTS Numbers. Apart from the refinery, the

first respondent has about 117 storage tanks on this property

which store, at any given point of time, oil and petroleum

products of over 118883860 KL. The proposed construction is

to come up on the adjoining property of Oswal bearing CTS

No.381, 381/1 to 21 of Village Anik, in ‘M’ Ward at R.C. Marg,

Chembur, Mumbai . The project involves construction of four

commercial buildings, one office building, one amenity building,

28

Page 29 and eight more buildings for residential purposes, consisting of

about 3000 flats. The principal contention of the first

respondent is two-fold viz. that from the point of view of the

safety and security of the refinery, and of the occupants who

will be residing in this housing complex, as well as their health,

this development ought not to be permitted. It is their

submission that such a construction would be contrary to law,

apart from being potentially dangerous and, therefore,

undesirable on both these counts.

3. The refinery of the first respondent was set up in this

area way back in year 1952 on an area of about 416 acres. The

refinery of BPCL is opposite the refinery of the first respondent.

The factory of Rashtriya Chemicals and Fertilizers is in the

vicinity. Bhaba Atomic Research Centre at Trombay is also

close by. When all these vital installations were set up, there

was hardly any population in this area, and in any case there

were no tall buildings. The only nearby locality which was

occupied was a village by name Gavanpada. All these

installations were set up in this area principally because it was

sparsely populated and it is far away from the main island city

of Mumbai.

29

Page 30 4. This area was designated as the Special Industrial

Zone, and the commercial-cum-residential activities were not

permitted therein. The appellant was owning the concerned

property since about 1989, and its factory thereon, but it moved

for the construction of a residential-cum-commercial complex

therein, only in the year 2006. The requisite change of user has

been permitted by the Municipal Corporation and hence, this

litigation between the parties.

5. As can be seen from the synopsis of the SLP No.

14202 of 2012 filed by the appellant, it specifically states as

follows:-

“The petitioners’ said plot is located approximately 500 mtrs

north of the boundary wall of the HPCL Refinery. The building

moreover being constructed by them is a further 470 mtrs to

the north of the Petitioners’ plot boundary i.e. at about 970

mtrs (almost 1 kilometer away) from wall.”

6. The appellant has contended that at the most, the

first respondent is seeking a buffer zone of 500 meters along its

refinery, and they also referred to the construction of some

other buildings which have come up and are coming up in the

vicinity. The proposal of the appellant is to construct buildings

of 7 to 8 storeys, and it is their submission that when other

similar constructions are permitted in the vicinity, there is no

30

Page 31 reason why their construction should be objected. The first

respondent has, however, pointed out in their affidavit before

the High Court that whatever may be the initial proposal of the

appellant, some of these buildings would be going upto 24

floors. As against that, the appellant has tried to explain this

high-rise construction on the basis of utilization of F.S.I., but

they have not denied the existence of such a subsequent

proposal. In this behalf, it is to be noted that the first

respondent has objected to all the similar constructions in the

vicinity all throughout.

7. As stated above, the first respondent objected at all

stages when it came to know about the proposed development

of the appellant. Firstly, when the public notice was issued on

19.6.2006 for environmental public hearing, the first respondent

lodged their objection by letter dated 11.7.2006. They pointed

out that a residential-cum-commercial complex next to

oil/petroleum refinery was inherently not environment friendly.

It has been their submission that the operation of the refinery

and ancillary installations, including storage facilities, release

Volatile Organic Compounds into the atmosphere, some of

which are carcinogenic, particularly at the height of funnel

31

Page 32 chimney. It was also pointed that a construction overlooking

the refinery was not desirable from the point of view of the

safety and security of the refinery. When the first respondent

learnt about the other development projects such as those on

the Metal Box Co.’s plot and on that of Apar Ltd., they had

protested by their letters dated 26.10.2007 and 3.6.2008 to the

Chief Secretary of the State of Maharashtra. By their

subsequent letter dated 26.8.2008 to the Additional Chief

Secretary, they lodged their objections once again. The first

respondent by their letter dated 15.10.2010 requested the

Municipal Corporation to intervene and stop the construction of

residential/commercial complex of the appellant near their

refinery. However, the Municipal Corporation by their letter

dated 28.10.2010 informed the first respondent that the

development around the refineries was being carried out by

Oswal in accordance with the Development Control Regulations

(DCR) for Greater Mumbai, 1991 framed under the Maharashtra

Regional and Town Planning Act, 1906 (‘MRTP Act’ for short),

and legally the development could not be stopped by the

Corporation.

32

Page 33 8. Ultimately, when the first respondent learnt that

permission had been granted to the appellant for conversion of

the land from industrial to residential-cum-commercial

purposes, the first respondent filed the earlier referred Writ

Petition in the Bombay High Court bearing No.1973 of 2011. The

prayers in the Writ Petition were to set aside the approvals and

permissions granted by various statutory authorities, and

particularly the approvals and permissions granted for the

development purpose and for the change of user as disclosed

from exhibits Q to Z to the Writ Petition. Prayer (b) of the

petition was that the permission to develop the residential-cum-

commercial complex on the said plot be set aside. The Writ

Petition having been allowed, these two appeals have been

filed. Mr. Dushyant Dave, learned senior counsel has appeared

for the appellant Oswal, Mr. Harish Salve, learned senior counsel

has appeared for HPCL, Mr. Shekhar Naphade, learned senior

counsel has appeared for the Municipal Corporation of Greater

Mumbai, and Mr. Sanjay Kharde, learned counsel has appeared

for the State of Maharashtra.

9. The principal submission on behalf of the appellant

Oswal was that they had been granted the change of user

33

Page 34 (conversion from industrial zone to residential/commercial zone)

by the municipal corporation, under its permission dated

1.9.2009, on this parcel of land (exhibited at Annexure P-23 to

the Writ Petition). Since, this permission was as per DCR 57(4)

(c), which allows such a change of user with the previous

approval of the Municipal Commissioner, it should not be

interfered with. This change of user was defended by the

Municipal Corporation also through the affidavit of the Assistant

Engineer, Development Plan, ‘M’ Ward, dated 19.11.2011. It

was stated in paragraphs 4 (c) and (d) of this affidavit that

various complaints had been received from HPCL/BPCL

concerning the issue of security, and a reference was therefore

made to the Urban Development Department of the State of

Maharashtra, vide letters dated 26.10.2006 and 21.4.2007.

However, no clarification as sought was received from the

Government, and hence in view of the order of the Municipal

Commissioner dated 24.8.2009, the conversion from Special

Industrial Zone (I-3) to Commercial Zone (C-1) was granted.

That was on an undertaking from Oswal, that if the Government

issues an adverse clarification, that will have to be complied

34

Page 35 with, and also on an indemnity, as against any legal

consequences arising out of any action initiated by HPCL.

10. Various submissions were advanced on behalf of the

first respondent, though the principal ones from amongst them

were as follows:-

(i) Firstly, it was submitted that the permission for conversion

of the land from industrial to residential-cum-commercial

purpose was granted even prior to the public hearing in

pursuance to the notice issued by the Maharashtra Pollution

Control Board. Besides, the conversion from Special Industrial

Zone (I-3 Zone) to Local Commercial Zone (C-1) under

regulation 57 (4) (c) of the DCR 1991 required a certain

procedure to be followed which had not been followed, and it

could not be without considering the objections of Respondent

No 1.

(ii)Secondly, the likely health hazards for the occupants were

not considered at all, as pointed out earlier.

(iii)Last but not the least, they emphasised the security

aspect. In paragraph 28 of the Writ Petition, the first

respondent specifically relied upon the inspection carried out by

the Intelligence Bureau of Government of India in the refinery

35

Page 36 on 10.1.2011. The report stated in paragraph 3 thereof as

follows:-

“3. Threat Assessment

The Mumbai terrorist attack of November 26, 2008 has

exposed our vast coastline to danger through the sea due to

which oil installations have become more vulnerable to threat

from inimical forces. This was revealed during interrogation of

various arrested militants in the country over last few years.

David Coleman Headly disclosed during his interrogation that

during his nine visits to India (2006-09), he has identified a

large number of sensitive establishments including economic

targets like Mumbai Stock Exchange, World Trade Tower, Oil

Installations, BARC Mumbai, etc.

Several multi storied buildings (57) constructed under SRA

scheme near the HPCL Refinery, presently not allotted to

anybody due to security concerns, if allotted to persons other

than security agencies, may be misutilised to cause damage to

the Refinery.

Any planning to construct high rise residential buildings at the

site of demolished factory of M/s Oswal Agro mills Ltd., Anik,

Chembur (Near HPCL Refinery) would be detrimental to the

security/safety of the vital installation.” (emphasis added)

11. It is relevant to note that on the security aspect, the

first respondent referred to their letter dated 13.4.2011 to the

then Chief Secretary, Government of Maharashtra, wherein they

drew his attention to the recent incident of fire at Indian Oil

Depot at Jaipur resulting into loss of life and damage to

property. They relied upon the letter dated 1.3.2012 by the

Deputy Secretary, Ministry of Home Affairs, Government of India

which specifically stated in Paragraph (2) (ii) as follows:-

36

Page 37 “ii) With specific reference to the construction of within building

at the site of demolished factory of M/s Oswal Agro Mills Ltd.,

Anik Village Chembur near HPCL refinery, they pose a security

hazard to the above vital installation in HPCL refinery.

Accordingly, MHA has already issued an advisory in this regard

to the State Government of Maharashtra vide letter No VI

23014/448/2011-VS dated 16.1.2012 (copy enclosed). As

regard the possibility of such construction being used by

security agencies, the matter, needs to be examined in depth in

consultation with all concerned.”

Lastly, they relied upon the affidavit of the Assistant

Commissioner of Police of Trombay filed in the Writ Petition. In

paragraph 3, he has specifically stated that any upper floors in

the complex on Oswal land, if permitted, may provide an ideal

launching pad for any external object to be directed or targeted

at the said refinery storage tanks which may contain highly

inflammable substances like LPG, Naphtha and Crude Oil.

12. The Division Bench of the High Court considered all

these aspects, and by a very detailed judgment came to the

conclusion that such a construction could not be permitted as it

would be hazardous to health, and would also create a threat to

the security of the refinery. It came to the conclusion that the

development permission in favour of Oswal was granted without

any application of mind, and without considering the security

aspect. All these considerations led the High Court to allow the

Writ Petition. In paragraph 60 (a) of its judgment, the High

37

Page 38 Court set aside all the orders/permissions which were issued

from 2006 onwards, and which were annexed at exhibits Q to Z

to the Writ Petition. The High Court, thereafter, specifically

directed in paragraphs 60 (b) and (c) as follows:-

b) The Municipal Commissioner is directed to reconsider the

application made by Oswal for change of user and also

application for sanction of plan after considering the objections

of the Petitioners, Police Department, Ministry of Petroleum,

Ministry of Environment and Intelligence Bureau Report referred

by HPCL and also Security Control Regulations issued by State

of Maharashtra, issued under Section 37 (1AA) of the

Maharashtra Regional and Town Planning Act, 1996 and after

hearing the parties concerned, pass the fresh order after

considering the views expressed by us and in accordance with

law within a period of eight weeks from today.

c)Ministry of Environment is also directed to reconsider their

decision while considering the permission applied for by Oswal

after considering the views expressed by us and after hearing

all the concerned parties including HPCL and should pass a

fresh order within a period of eight weeks in accordance with

law.”

13. (i)Our Learned Brother Singhvi, J. appears to have been

persuaded to accept the submissions of the appellant in view of

the affidavit of Dr. Seema Garg, Vice President of the appellant.

The affidavit points out that on the southern side of the refinery,

the Gavanapada Village is located with a population of about

7000 people. We must, however, note that this is an old village

establishment and one cannot do away with it. It is stated that

on the eastern side there is a slum at a distance of about 18.53

38

Page 39 meters. On the northern side, there are two slums at Vishnu

Nagar and Bharat Nagar, and on the western side, there are

some shops and hutments. In our view, HPCL cannot be held

responsible for these structures. We must, in any case, note

that they are all structures of an insignificant height. On

eastern side, there is a high-rise tower of 14 storeys which is

almost completed, but yet not occupied, but which had all

throughout been objected to by HPCL. On the northern side,

there are more than 50 multi-storey buildings constructed in the

Slum Rehabilitation Scheme which also are not occupied. We

must, however, note that because of the resistance of the first

respondent, the upper floors of these buildings are to be

allotted to the Police department.

(ii) The affidavit of Dr. Seema Garg has emphasized all

these aspects which have been quoted in the order prepared by

our Learned Brother, but he has not considered the above

explanation of HPCL in that behalf. It has been stated in

paragraph 22 of his judgment that the High Court has allowed

the Writ Petition by relying upon the report of Intelligence

Bureau and the affidavit of the Assistant Commissioner of

Police, but according to him they are not based on any scientific

39

Page 40 study or expert analysis. In our view, the statement in the

affidavit of the Assistant Commissioner of Police as well as the

extracts from the report of the Intelligence Bureau are quite

cogent. The view of the Police Commissioner is reinforced by

the Central Home Ministry on the background of the terrorist

attack in the city on 26.11.2008. It has also been mentioned in

paragraph 23 of his judgment that some other buildings are

coming up at a distance of about 800 meters from the refinery.

As stated above that all throughout these developments have

been objected to by HPCL. Therefore, HPCL cannot be faulted

for such constructions which are permitted by the Municipal

Corporation. Besides, merely because such constructions have

been permitted so far, that does not justify any more high-rise

constructions coming up in the vicinity. We are aware of the

serious accidents which took place at the IOCL refinery at Jaipur,

and also at the Union Carbide Factory, Bhopal. Any such

accident would cause serious loss of life and property, and

would be hazardous to the occupants of these constructions.

14. What is most relevant to note is that when the

refinery of the first respondent came up in the year 1952, and

the other earlier referred vital installations of national

40

Page 41 importance also came up in the nearby area, the population

over there was sparse, and that is why these installations were

permitted to be set up at locations in the Mahul area of

Chembur far away from the Island city of Mumbai. Now the city

has grown-up, as also the suburbs, and people are trying to

occupy the vacant spaces wherever available. The Municipal

Corporation and the State of Maharashtra ought to have

checked and stopped these constructions, particularly the high-

rise ones in the vicinity of these installations, but they have

failed in doing the same. It cannot, however, justify further

dereliction of their responsibilities. Merely because some

constructions have been permitted at some distance from the

refinery of the first respondent, does not mean that further

high-rise constructions should be permitted to come up nearby.

Two wrongs do not make one right.

15. Having dealt with the appeal filed by Oswal, we may

now deal with the appeal filed by the Municipal Corporation. In

this behalf, we must say at the outset, that we are rather

surprised that the Municipal Corporation has also chosen to file

an appeal against the order of the High Court. This is on the

41

Page 42 background that Oswal had given an Indemnity Bond to the

Municipal Commissioner dated 7.1.2011 which reads as follows:-

“INDEMNITY BOND

To,

The Municipal Commissioner,

M.C.G.M.

Municipal Office,

Mahapalika Marg, Mumbai

Hon’ble Sir,

Sub: Request to allow the users permission in Local Commercial

Zone (C-1) on the land bearing CTS No. 381, 381/1 to 21 of

Village Anik, in ‘M’ Ward at R.C. Marg, Chembur, Mumbai.

M/s Oswal Agro Mills Ltd.

Ref:File No. CHE/683/DPES

I, the undersigned Shri Mahesh Rawal, Authorised Signatory of

M/s Oswal Agro Mills Ltd, of the above mentioned property

whose office situated at Sea Building, Off Carter Road, Behind

Cafe Coffee Day, Opposite Chandni Building, Bandra (W)

Mumbai-400 052, hereby undertake to indemnify MCGM of any

legal consequences arising out of HPCL or any other

organization/person moves any court of law restraining

development on the land under reference.

This Indemnity Bond is binding to me, to my heirs, executors,

assignees, assigns and to everybody derives title through or

under me.

Dated this 7

th

day of January, 2011

Yours faithfully

Oswal Agro Mills Ltd.”

In view of this Indemnity Bond, the Municipal Corporation had

no reason to file any appeal against the order of the High Court,

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Page 43 and we disapprove of the same. We refrain from saying

anything more.

16.(i)It was contended on behalf of Oswal, as well as on

behalf of the Municipal Corporation, that the Corporation is not

required to go into the security aspect and the environmental

clearance as a pre-requisite before any such proposal is cleared.

It was submitted that this was outside its jurisdiction. In this

behalf, we may refer to the relevant portion of DCR No.16 which

falls in Part II of the DC Regulation of 1991 containing ‘General

planning requirements, Land uses and manner of development’.

The relevant portion reads as follows:-

“16. Requirements of Sites

No land shall be used as a site for the construction of buildings-

(a)if the Commissioner considers that the site is insanitary or

that it is dangerous to construct a building on it or no

water supply is likely to be available within a reasonable period

of time;

(b)……

(c)…..

(d)…..

(e)if the use of the said site is for a purpose which in

the Commissioner’s opinion may be a source of danger

to the health and safety of the inhabitants of the

neighbourhood;

(f)…..

(g) …..

(h)…..

(i)…..

(j)…..

(k)…..

(l)…..

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Page 44 (m)…..

(n)if the proposed development is likely to involve damage to

or have deleterious impact on or is against urban aesthetics or

environment or ecology and/or on historical/architectural/

aesthetical buildings and precincts or is not in the public

interest.”

Even DCR No.64 which gives the ‘Discretionary powers’ to the

Commissioner, does not permit him under sub-clause (b)

thereof to grant relaxation which will affect safety, fire safety

and public safety of the inhabitants of the building and the

neighbourhood. Thus, this power is coupled with the duty to

give paramount importance to safety. These provisions cast an

obligation on the Municipal Commissioner to take into

consideration the objections in this behalf. (ii)DCR 57 (4)

(c) was relied upon by the appellant and the Municipal

Corporation in defence of the change of user. We are conscious

that this DCR contains a non-obstante clause, but all that it

states is that ‘notwithstanding anything contained above’ (i.e.

earlier in the DCRs), such a change of user may be permitted.

Thus, it is an enabling provision, though it does not mean that

the power therein is to be exercised disregarding the objections

that are raised. The power under DCR 57 (4) (c) could not be

exercised as a stand alone power, when specific objections

relatable to DCR 16 had been raised. MRTP Act being an act to

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Page 45 provide for planned development, the provisions of the DCRs

will have to be read purposively and harmoniously, and not

disjunctively. The appellants had relied upon paragraphs 41 and

42 of the judgment of this Court in Bombay Dyeing & MFG

Co. Ltd. Vs. Bombay Environmental Action Group and

Ors. reported in 2006 (3) SCC 434. However, all that these

paragraphs state is that DCR 57 (4) (c) is pari materia with DCR

56 (3) (c), which is on the General Industrial Zone (I-2 Zone).

However, the judgment does not lead us anywhere further on

the issue in hand. As against that, we must note that this Court

has held that the wide amplitude of a non-obstante clause must

be kept confined to the legislative policy, and it can be given

effect to, to the extent Parliament intended and not beyond the

same (See Para 36 of ICICI Bank Vs. Sidco Leather Ltd.

2006 (10) SCC 452 ). HPCL had lodged their objections, and

the Municipal authorities were required to consider the same

but they have not. Rather, they refused to consider these

objections on a totally erroneous reading of the DCRs as can be

seen from their earlier referred letter dated 28.10.2010. Where

human habitation is permitted in proximity of hazardous plants,

there is an immediate, as well as long term, danger of exposure

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Page 46 to health hazards. The planning authority cannot ignore these

aspects. The public interest cannot be sacrificed at the altar of

commercial interests. The submissions of the Municipal

Corporation and Oswal are clearly contrary to the above

regulations, and are therefore rejected.

(iii) Oswal and the Municipal Corporation had contended

that the Writ Petition was belated. With reference to this

submission, we must note that the I.O.D was issued to Oswal on

11.11.2010, and the Commencement Certificate (to start the

construction upto the stilt) was issued on 11.11.2011. The Writ

Petition filed on 16.9.2011 could not therefore be said to have

been filed belatedly.

17. Our Brother Singhvi, J. has apart from allowing the

appeal and setting aside the order, directed the High Court to

re-hear the matter after considering the material produced by

the parties on the issue of security threat and possible danger

to the health of the occupants of the buildings already

constructed and that of the prospective occupants of the

appellant’s buildings. As stated above, in our view the security

threat is clearly placed on record, as also the possible danger to

the health of the occupants of the buildings already constructed

46

Page 47 and to be constructed as well. The order of the High Court has

set aside all the approvals in favour of Oswal. It has taken care

of some of these issues when it directed the Municipal

Commissioner to reconsider the application made by Oswal

after considering (a) the objections of the Police Department,

Ministry of Petroleum, Ministry of Environment and Intelligence

Bureau report, and also the Security Control Regulations framed

by the State of Maharashtra. (b) The High Court has also

directed that the Municipal Commissioner will pass the order

after hearing the parties and after considering the views

expressed by the High Court and in accordance with law. In

addition, we further direct the Municipal Commissioner to

consider the issue of possible danger to the health of the

occupants of the buildings already constructed, and those to be

constructed by the appellants, as desired by Singhvi, J.. He has

referred to the statement in the affidavit of Vice-President of the

appellant that HPCL is seeking to make the property of Oswal

sterile and unbuildable without acquiring the same. The parties

can certainly utilise the time now available for appropriate and

fruitful negotiations in this behalf. And, in any case, Oswal can

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Page 48 certainly use the land for an agro-industry or any permissible

industry.

18. This being the position, we cannot find any fault with

the impugned judgment and order of the High Court, and it

need not be set aside. On the contrary, these two appeals

deserve to be dismissed. Accordingly, we pass an order

dismissing these two appeals. The parties will bear their own

costs.

………………….…………………J.

[ H.L. Gokhale ]

……………….………………………J.

[ Ranjana Prakash Desai ]

New Delhi

Dated: December 10, 2013

48