All for the builder

Published : Apr 07, 2006 00:00 IST

There is disappointment in Mumbai as an apex court order makes 240 hectares of mill land available for private development.


ON March 7, the Supreme Court cleared the decks for the sale and development of 600 acres (240 hectares) of land belonging to 60 textile mills in Mumbai. This has allowed builders to pounce on prime property in the island city. They have announced that they will build shopping malls, commercial buildings and residential towers on the land.

Concerned citizens, social activists and environmentalists are aghast at the ruling. It was widely believed that Mumbai would get 400 acres (160 ha) for open space and for public housing. The present ruling gives it a measly 133 acres (53 ha). "The city has virtually been gifted to the real estate lobby," said a statement of the Mumbai People's Action Committee (MPAC), a coalition of 40 organisations that oppose the sale. It said Mumbai needed a comprehensive development plan. The city needed public open spaces, low-income housing, channels for employment and land to enhance infrastructure, definitely not shopping malls, it argued.

"The judgment has far-reaching implications," said the MPAC statement. Not only has it dealt a blow to the teeming metropolis, but it will set a precedent for other cities as well. "Obviously, the state has little interest in providing open space, low-income housing, infrastructure and channels for employment. Who knows what the government or other State governments will do with other lands that they have a hold on?" asks Neera Punj of Citispace, which is part of the MPAC.

The judgment has brought the curtains down on a protracted legal battle which involved the sharing of mill land between the state and private owners. Led by the Bombay Environment and Action Group (BEAG), the fight centred on an amendment to Rule 58 of the Development Control Regulations (DCR), 1991. DCR 58 allowed the sale of mill land but only according to a sharing formula.

The "one-third formula" gave the Brihanmumbai Municipal Corporation (BMC) a third of the mill lands to create open spaces and civic amenities. A third was to be given to the Maharashtra Housing and Area Development Authority (MHADA), which would provide affordable housing particularly to workers who lost their jobs when the mills closed in the 1970s and 1980s. Mill owners could keep a third of the property. Not many owners made use of DCR 58.

In 2001, the Vilasrao Deshmukh government, using a loophole in the Maharashtra Town and Planning Act, 1966, amended DCR 58 to DCR 58 (I), which stated: "Only land that is vacant on mill properties, that is, with no built-up structure, would be divided by the one-third formula." This was a bonanza for mill owners who now had to part with only a minuscule percentage of the land. However, little activity was seen on the mill lands until 2003.

When real estate prices began a rapid upward climb, suddenly there was construction activity across Central Mumbai, where many of the mills are located. Since DCR 58 (I) was in force they were well protected and stood to make huge amounts of money given the dearth of land in the island city. The returns on investment would be huge. In fact, apartment prices in Parel are known to be upwards of Rs.7,000 a square foot.

By 2005, construction activity had picked up on various mill properties. Residential towers, high-tech office complexes and shopping malls began mushrooming across the area. Seizing the opportunity, the National Textile Corporation (NTC) put up for sale its five properties.

Each sold for prices never heard of before: Elphinston Mills for Rs.441.8 crores, Jupiter Mills for Rs.276 crores and Apollo Mills for Rs.180 crores. Kohinoor Mill No. 3 was bought for Rs.421 crores by a company allegedly promoted by some politicians including Shiv Sena leaders.

Waking up a little late to the realities, the BEAG filed a public interest petition in the Bombay High Court challenging the amendment of DCR 58, which it said only benefited mill owners and the builders' lobby. The High Court struck down the sale of the five NTC properties and accepted the BEAG's plea that the modified DCR 58, 2001, was arbitrary, illegal and unconstitutional. "By changing the definition of the open land, it deprived the city of much needed green space," said the court.

Obviously, builders were not the ones to let go prime land. The case went up to the Supreme Court, which not only struck down the High Court's ruling on reverting to DCR 58, 1991, but upheld the NTC's sale. The Supreme Court, in fact, questioned the late reaction of the BEAG in filing its opposition to the amended DCR and the sale of land.

"This is big disappointment. It will have a bad effect on the lower-income groups, particularly those in this area which is among the most densely populated in the city," said Shyam Chainani, BEAG member.

"It is the workers who have lost out the most," said Gayatri Singh, a labour lawyer. Paying dues and giving compensation is not the same as providing work and housing. The DCR of 1991 actually allowed the mills to sell some land if they would use the funds towards the revival of sick mills.

Well-known urban planner Chandrasekhar Prabhu said the government had lost an opportunity for planned development. Rampant construction could lead to man-made disasters like the July 26, 2005 flood, which was a result of widespread development putting a strain on the drainage system.

On the other side of the fence are those who are euphoric about the Supreme Court ruling. A real estate broker said: "This is good for Mumbai. We need to show the world we are serious about becoming a global player. By building state-of-the-art facilities, we will be able to prove this."

Rajen Shirodkar, who along with two politicians bought Kohinoor Mills, told Frontline: "Our plans include a high-tech commercial complex for big companies - mainly multinationals - and a shopping mall." Incidentally, Raj Thackeray, while announcing his new party in Mumbai, told mediapersons that he planned to provide a job to every Kohinoor mill worker or a member of the family. The area is a Shiv Sena stronghold.

Informed sources told Frontline that Mumbai Mill will house a hotel and mall, Elphinston Mills will be turned into a commercial complex, Jupiter Mills will become an Information Technology park, China Mills will house residential complexes, Simplex Mills upmarket residential towers, and Matulya Mills residential apartments.

In order to save the land the MPAC is pressing the State government to issue an ordinance that would allow DCR 58, 1991, to be brought back. An indefinite dharna by the 40 organisations in the MPAC will begin soon at Bharat Mata cinema in Parel. The location is significant as the cinema, which was famous for screening Marathi films for mill workers, was about to be torn down by NTC a few years ago. Mill workers protested and saved the cinema.

Whether the people of the city can do the same for the mill lands is an important question.

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