MHADA De-Acquires Chawl, Private Builder Gains
For the first time, the Maharashtra state government has let go the land acquisition of a residential chawl in South Mumbai for redevelopment purposes. Instead, a private developer has taken over the property. The chawl is Dattatray Chawl in South Mumbai.
Acquiring Dattatray Chawl
Dattatray chawl is located in South Mumbai behind Bhatia Hospital at Grand Road. The chawl is one among the 320 properties built before 1940s and approved by MHADA for acquisition. It is spread over 2 acres (approx. 87,100 sq.ft) and has about 297 tenements. This is a chawl selected for acquisition based on chapter 8A of MHADA’s Act. The chawl is expected to have a development potential in excess of Rs. 1,200 crore according to real estate experts.
Chapter 8A of MHADA act talks about the tenants ownership scheme. This scheme was announced in 1980s. According to this scheme, at least 70% of the tenants of the cessed buildings built by private developers can come together and pay the landlord a 100 months’ rent. By doing this, the housing authority can acquire the property from the landowner and convey it to the tenants as a cooperative housing society. This was done in order to redevelop cessed buildings built by developers in the island city.
In 1994, about 254 tenants approved the acquisition process by MHADA and the housing body had announced the acquisition accordingly.
Opposition for MHADA acquisition
Acquiring of Dattatray chawl was however opposed by landlords who challenged the scheme. The case wound up in the Supreme Court and a stay order on the acquisition was given. The case has been now pending for years in the court. Meanwhile, private developers have been eyeing the development potential of the seven ageing buildings in the chawl complex, as Grant Road is a prime area and property prices for new buildings are as high as Rs. 40,000 per sq.ft.
Legal consequences
The housing body’s chief officer placed a proposal before the Maharashtra state government in August this year for cancelling the chawl acquisition. Accordingly, the state housing department officials granted the permission for cancelling the acquisition. Permission was also granted for redevelopment of the plot by private developers.
The MHADA Act however does not have any provisions for de-acquiring an acquired property. The chief promoter of the proposed Shree Dattaprasad Cooperative Housing Society has sent a legal notice to MHADA against the government’s move. The notice said that cancelling the acquisition would be against the interest of the occupants. It says that almost 80 housing units had changed hands illegally, as chapter 8A does not allow tenancy transfers. The notice also says that pressure for de-acquiring the units may have been exerted by vested interests. De-acquiring the property can be made legal only if amendments are made to the act without which, it would be illegal.
MHADA is the state agency responsible for low cost housing in Maharashtra. Redevelopment of a cessed colony by MHADA is expected to keep housing units affordable. However, private builders usually look at redeveloping a colony from the point of profits than redevelopment itself. This can alter the affordability quotient of housing units.
