Case Note & Summary
The petitioners, owners of land bearing Survey No.429/1/2 and CTS No.1069-A/A-1 and 1069-A/B-1, sought a refund of Rs.2,66,75,750/- paid as one-time premium under the 2019 GR and 2021 GR issued pursuant to the repeal of the Urban Land (Ceiling and Regulation) Act, 1976. The petitioners had applied for a No Objection Certificate to develop/sell their land. Respondent No.2 demanded a one-time premium of Rs.5,73,74,466/- calculated on the entire land area of 4163 square meters at 15% of market value. The petitioners paid the amount under protest on 2nd June 2021. Subsequently, in Salim Alimahomed Porbanderwalla v. State of Maharashtra, a Division Bench held that the premium is chargeable only on the exempted surplus vacant land, not on retainable land. The petitioners then sought refund of the excess, which was refused. The court analyzed the 2019 GR and 2021 GR and found that the premium was intended only for exempted surplus land. Since the exempted surplus land was only 2227.45 square meters, the premium payable was Rs.3,06,98,716/-, resulting in an excess of Rs.2,66,75,750/-. The court directed the respondents to refund the excess amount with 6% interest per annum from the date of payment, within four weeks.
Headnote
A) Interpretation of Government Resolutions - One-time Premium - Urban Land (Ceiling and Regulation) Act, 1976 - Sections 8(4) and 20 - The court interpreted the 2019 GR and 2021 GR to hold that the one-time premium is chargeable only on the exempted surplus vacant land, not on the retainable land. The demand on the entire land was illegal and contrary to the GRs. (Paras 10-14)
B) Refund of Excess Payment - Unjust Enrichment - No Specific Act - The court held that the petitioners are entitled to a refund of the excess amount paid under protest, as the respondents cannot retain money illegally collected. The refund was directed with interest at 6% per annum from the date of payment. (Paras 15-18)
Issue of Consideration
Whether the one-time premium under the 2019 GR and 2021 GR can be charged on the entire land or only on the exempted surplus vacant land under Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976
Final Decision
The court allowed the writ petition, directing Respondent No.2 to refund Rs.2,66,75,750/- to the petitioners with interest at 6% per annum from the date of payment (2nd June 2021) within four weeks.
Law Points
- Interpretation of Government Resolutions
- One-time premium under ULC Act repeal scheme
- Refund of excess payment
- Chargeability on exempted surplus land only
Case Details
2024 LawText (BOM) (08) 2808
WRIT PETITION NO. 1125 OF 2024
B. P. Colabawalla, Firdosh P. Pooniwalla
Mr. Pravin Samdani, Sr. Advocate a/w. Mr. Viraj Maniar, Ms. Sneha Patil, Mr. Amish Gandhi i/b. Maniar Srivastava Associates for Petitioners; Ms. Prachi Tatake AGP for Respondents
Riyaz Ismail Machhiwala & Anr.
The State of Maharashtra & Anr.
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Nature of Litigation
Writ petition under Article 226 seeking refund of excess one-time premium paid under the ULC Act repeal scheme.
Remedy Sought
Petitioners sought a direction to Respondent No.2 to refund Rs.2,66,75,750/- paid as excess one-time premium, with interest.
Filing Reason
Respondent No.2 demanded one-time premium on the entire land instead of only on the exempted surplus vacant land, and refused to refund the excess after a Division Bench judgment clarified the correct interpretation.
Previous Decisions
The Division Bench in Salim Alimahomed Porbanderwalla v. State of Maharashtra held that one-time premium is chargeable only on exempted surplus land, not retainable land.
Issues
Whether the one-time premium under the 2019 GR and 2021 GR can be charged on the entire land or only on the exempted surplus vacant land?
Whether the petitioners are entitled to a refund of the excess amount paid?
Submissions/Arguments
Petitioners argued that the one-time premium is chargeable only on the exempted surplus vacant land of 2227.45 sq.mtrs, not on the entire land of 4163 sq.mtrs, as per the GRs and the decision in Salim Porbanderwalla.
Respondents argued that the premium was correctly calculated on the entire land as per the GRs and that the petitioners had voluntarily paid the amount.
Ratio Decidendi
The one-time premium under the 2019 GR and 2021 GR is chargeable only on the exempted surplus vacant land under Section 20 of the ULC Act, and not on the retainable land. Any excess payment made under a mistaken interpretation is liable to be refunded with interest.
Judgment Excerpts
Under the 2019 GR, read with the 2021 GR, the one-time premium could be charged by the Government only in respect of the surplus vacant land which is exempted under Section 20 of the ULC Act.
The respondents cannot retain the excess amount collected from the petitioners, which was paid under protest, and are liable to refund the same with interest.
Procedural History
Petitioners filed application on 15th March 2021 for NOC; Respondent No.2 demanded Rs.5,73,74,466/- on 22nd April 2021; Petitioners paid on 2nd June 2021; After the decision in Salim Porbanderwalla on 30th March 2023, petitioners sought refund on 26th May 2023; Refusal on 5th July 2023; Writ Petition filed in 2024.
Acts & Sections
- Urban Land (Ceiling and Regulation) Act, 1976: Section 8(4), Section 20
- Constitution of India: Article 226
