Inorbit mall in Vashi is illegal

On Friday, The Bombay high court stated that CIDCo (City and Industrial Development Corporation) was irregularly allotted the 31,000sq m of land in Vashi. Star hotel and Inorbit mall. The bench of Justices A. S. Gadkari and Abhay Oak said that the developer could apply for CIDCo for regularization in this period.

Earlier, CIDCo had issued the showcase notice to the developer in current month, asking why the allotment should not be cancelled. The state-appointed D K Sankaran panel, which probed the matter, had also said in its report in 2005 that the allotment should be cancelled. The land in Vashi, on which Four Points hotel and Inorbit Mall stand, to K Raheja Corp and directed the developer to “hand back vacant possession” of the land to the planning agency in next six months.

While checking the lease agreement between developer and CIDCo, it’s clear that developer illegal directed that land be “restored”, and later the court rejected the developer’s plea on stay the order for 12 weeks. It is also said that since it has given six months’ time to developer to vacant the possession, now developer has a choice to go for appeal. The court stated, no third-party interest should be created during this period.

The Inorbit Mall and hotel were built in 2008-2009, a total of 11 plots opposite Navi Mumbai railway station, which comprised a total area of 31,000sq m, were allotted by CIDCo to K Raheja Corp in 2003. While in 2004, two PILs were filed in HC by stating that land had been given at cheap rates without issuing tenders and later the HC clubbed the PILs together as they were similar.

The counsel of  V A Gangal, for the developer stated that “We will not depend on the mercy of CIDCo to regularize our land but will move the apex court, as my clients had followed all the rules to construct the shopping mall and hotel after a legal stay was earlier vacated. The total cost f construction was more than Rs 450 crore, currently, land involves 2,000 employees and 150 retailer shops it means more than 8,000 peoples livelihood will be affected. So it is also a human problem”.

The panel of D K Sankaran reported that CIDCo had suffered a loss of nearly Rs 50 crore because of this allotment which was “in gross violation of rules, CIDCo constitutional norms and policy. According to policy, after cancellation of allotment, the land “needs to be disposed of by inviting tenders and recommended the strong action against the then MD of CIDCo and other officers who dealt in the same file.

However, Gangal said that developer had paid Rs 31 crore for the land and it is more than the market price in 2003, and the IT land and later it had been converted in to commercial at that time as there had been no takers for it. Gangal further said that the Supreme Court had, in a similar case, and HC to take a ”pragmatic” view and directed, if there were any losses caused so it could be recovered from the developer.

CIDCo had terminated the services of one of GM in 2011 for allegedly showing undue favors to the developer and later he admitted in an affidavit in HC in September 2014, that the allotment was “arbitrary and illegal.” According to Thakur, This judgment is good and will send out a strong message to other developers. In past CIDCo had made the mistake of giving prime plots to a single builder at very low rates without tenders.  In the first half of 2014, the HC had allowed activist Sandeep Thakur to intervene in the PIL because two original petitioners were absent. The court also appointed lawyer M S Karnik as amicus curiae (friend of the court) in the matter.

The bench of High Court, also appreciated the efforts of the intervener, Thakur, and the amicus curiae, Karnik. High Court also asked to CIDCo to pay Rs 50,000 to the original petitioner because of land irregularities.

Increasing the speed of redevelopment

As the speed of rebuilding of ceased structures by MBRRB was not adequate enough to cover the entire ceased structures in the Island City of Mumbai, Government decided upon involving tenants, landlords and private developers for increasing the speed of redevelopment.

As per Development Control Rules FSI or Floor Space Index is the area of construction permitted on a particular land. Permitted FSI in Mumbai depends on various factors such as land’s location, kind of current residence and the project to be developed.

Because of the conflicts between while Navi Mumbai Municipal Corporation (NMMC) and City and Industrial Development Corporation (Cidco) board over the FSI rates, Government of Maharashtra is indecisive over finalizing the FSI for redevelopment of dilapidated buildings in Navi Mumbai area. NMMC has offered 2.5 FSI previously, whereas Cidco board agreed upon 3 FSI. Government has to select either of the two choices or find an agreeable solution.

Each of these proposals has their pros and cons. Though Cidco’s offer may look more convincing and transparent to the residents and they also state that their proposal will generate housing stock for economically weaker section but it also comes with the condition that members of the society will not have the right to choose their developers.

As per NMMC, 3 FSI proposed by Cidco will produce infrastructure problem for the city. On the other hand, Cidco says that NMMC’s proposal will be more helpful to developers rather than occupants. This way the developers will load the property buyers with added cost as they have to pay premium for Free of Floor Space Index Area.

Real estate growth in Navi Mumbai

Of all the factors that have contributed immensely to the growth of Navi Mumbai, access to schools and colleges has been an important criterion.

For that reason, property prices also tend to be higher in locations like Vashi, Sanpada, Nerul which are close to established educational institutions.

The Oxford of the Eastern suburbs is the title is commonly used in context with Navi Mumbai because of the number of reputed schools, colleges and management institutions in the region. Apart from the real estate spaces required for the many educational institutions seeking to make an entry or to expand in Navi Mumbai, this fact has also served to drive demand for residential real estate. Many families prefer living in Navi Mumbai because of the variety of schools and colleges available within easily commutable distances. Reputable developers make it a point to source plots in areas that have ready access to these institutes by private and public transport. Large schools too have responded by ensuring that their own school bus services reach all parts of the city. In fact, access to schools and colleges is an important criterion for families who are looking for homes in Navi Mumbai. For that reason, property prices also tend to be higher in locations which are close to established educational institutions. Nevertheless, the marginal premium that home buyers pay for this convenience is still far lower than it is in the mainland city of Mumbai. Nor does proximity to schools and colleges necessarily carry the same market clout in all cities. In a city like Mumbai, home buyers are primarily concerned with buying flats that allow them to travel to and from work. In smaller cities like Navi Mumbai, the public transport system may not be cutting-edge, but most families find that their personal vehicles suffice for most commuting purposes. Shopping in suburbs like Vashi is an enjoyable experience as it has all the brand malls and shopping hubs that are available in the neighbouring cities like Thane and Kalyan. Navi Mumbai has more hospitals, clinics and assorted healthcare facilities per square kilometer than most other cities in Maharashtra. With a number of other home buying considerations taken care of in many of Navi Mumbai’s established and upcoming areas, proximity to schools continues to be high on priority list of property buyers. In this way, the growth of real estate and educational institutions are interlinked in Navi Mumbai.

Prime Minister Narendra Modi laid the Foundation Stone of Jawaharlal Nehru Port Trust Special Economic Zone (SEZ) , at Sheva in Navi Mumbai.

He also laid the Foundation Stone for widening of Port Connectivity Road from JNPT to the National Highway and symbolically handed over land allotment letters to JNPT Project Affected Persons under the 12.5 % scheme.

Addressing a large public gathering at the function site, the Prime Minister said his Government had conceived the Sagarmala, an ambitious project for maritime states. This would envisage not merely port development, but port-led development which would include ports, SEZs; and rail, road, air and waterway connectivity with the hinterland, including linkages of cold storage and warehousing facilities.

Noting that two-thirds of all global trade and 50 percent of container trade happens through the Indian Ocean, Modi highlighted the importance of the ports sector. “Ports can become gateways to India’s prosperity,” he added.

The Prime Minister said the Government is concerned at the large number of stalled SEZ projects across the country, and a high-level team has been constituted to review the problems and resolve them at the earliest.

The Prime Minister said export promotion was the need of the hour. “Until we join manufacturers in export promotion, and unless States and Centre work together, we cannot achieve new heights in exports” he observed. The Prime Minister added that the Union Government had recently convened a meeting with States to understand bottlenecks in exports, and States would soon be given the right to form their own Export Promotion Councils. “Let there be competition among States for exports,” the Prime Minister said.

Faced with depleting revenues due to the economic slowdown and rising inflation, industrial units around Mumbai, Thane, Pimpri Chinchwad are diversifying into the real estate business to develop additional sources of income.

Many companies are converting their land holdings from industrial to residential purposes. For example, so far the Pimpri Chinchwad Municipal Corporation has converted 5.32 lakh square metres of land from industrial to residential use and residential buildings have been constructed on these sites.

A few decades ago, when industrial development was being promoted in Thane and Navi Mumbai, the government had acquired land from local farmers and handed it over to the industries. With changing economic conditions, many industries shifted their production units out of Thane, Mulund, Bhandup, leaving many plots vacant. Taking advantage of the real estate boom, many industrialists have started converting their plots from industrial to residential. So far 30 companies have applied for the conversion.

Sandeep Belsare, secretary of the Pimpri Chinchwad Small Industries Association, said that although all necessary facilities are available in the city for industries, production costs have remained high compared to other places. Hence, all big manufacturers have shifted their bases elsewhere in the State or outside the State.

On account of the shifting of the big companies, small industries are not getting enough work, which is hurting their revenues. Moreover, rising real estate prices present a lucrative option for companies to change the purpose of their vacant plots from industrial to residential. Most industrial units are moving their facilities away from residential areas due to stringent safety norms and space constraints in such areas, said Anant Sardeshmukh, Director General, Mahratta Chamber of Commerce Industries and Agriculture (MCCIA).