Supreme Court permits withdrawal of SLP in property development dispute: S.M. Pasha vs. State of Maharashtra (2023)

Date of the Judgment: 17 February 2023

Citation: Not Available

Judges: M. R. Shah, J., C.T. Ravikumar, J., and Sanjay Karol, J.

The Supreme Court recently addressed a case where the petitioners sought to withdraw their Special Leave Petitions (SLPs) due to significant changes in the circumstances of a property development dispute. The core issue was whether the court should allow the withdrawal of the SLPs, considering the termination of the original development agreement and the execution of a new one. This judgment highlights the court’s approach to procedural matters when underlying facts of a case change.

Case Background

The case originated from a dispute involving tenants occupying premises that were subject to a development agreement. The tenants had initially filed writ petitions before the High Court of Judicature at Bombay, challenging the development agreement. Subsequently, the matter reached the Supreme Court through Special Leave Petitions (SLPs). The petitioners in SLP(C) No. 4428 of 2016 were tenants, except for petitioner No. 4. The petitioners in SLP(C) No…CC No. 4922 of 2016 were also tenants. The primary contesting respondent was respondent No. 5. During the pendency of the proceedings, the development agreement in favor of respondent No. 5 was terminated on 08.10.2018. A new development agreement was entered into with another developer. Further, the Maharashtra Housing and Area Development Authority (MHADA) also terminated the development agreement with respondent No. 5.

Timeline:

Course of Proceedings

The petitioners in SLP(C) No. 4428/2016, except petitioner No. 4, sought permission to withdraw their SLP due to the termination of the development agreement with respondent No. 5 and the execution of a new agreement. The petitioners in SLP(C) No…CC No. 4922/2016, while not disputing the withdrawal, requested a copy of the new development agreement to understand its terms. They also sought liberty to challenge the new agreement if they disagreed with its terms. Respondent No. 5 opposed the withdrawal, having challenged the termination of their agreement and initiated perjury proceedings. They also sought liberty to challenge the termination and the new agreement and for their perjury application to be considered.

Legal Framework

The judgment primarily deals with the procedural aspects of withdrawing a Special Leave Petition (SLP) and the rights of the parties involved in a property development dispute. There are no specific sections of statutes or articles of the Constitution mentioned in the judgment. The legal framework is based on the inherent powers of the Supreme Court to regulate its proceedings and the principles of natural justice, ensuring that all parties have an opportunity to be heard and to protect their interests.

Arguments

Arguments of the Petitioners in SLP(C) No. 4428/2016 (except Petitioner No. 4):

• The petitioners sought to withdraw the SLP due to the termination of the development agreement with respondent No. 5 and the execution of a new agreement.
• They submitted that the cause of action against respondent No. 5 no longer survived.

Arguments of the Petitioners in SLP(C) No…CC No. 4922/2016:

• They did not dispute the withdrawal of the SLP.
• They requested a copy of the new development agreement to understand its terms and conditions.
• They sought liberty to challenge the new agreement before an appropriate court/forum if they disagreed with its terms.

Arguments of Respondent No. 5:

• Respondent No. 5 opposed the withdrawal of the SLPs.
• Respondent No. 5 had challenged the termination of their development agreement.
• Respondent No. 5 had initiated perjury proceedings.
• They sought liberty to challenge the termination and the new development agreement before an appropriate court/forum.
• They requested that the grounds stated in the perjury application be considered in accordance with law.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame specific issues in a numbered list. However, the following issues were implicitly addressed:

• Whether the petitioners in SLP(C) No. 4428/2016 should be permitted to withdraw their SLP given the subsequent developments.
• Whether the petitioners in SLP(C) No…CC No. 4922/2016 should be provided with a copy of the new development agreement.
• Whether the tenants should have the liberty to challenge the new development agreement if they are not agreeable to its terms.
• Whether respondent No. 5 should have the liberty to challenge the termination of their development agreement and the new agreement.
• Whether the grounds stated in the perjury application filed by respondent No. 5 should be considered.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Authorities

The judgment does not cite any specific case laws or legal provisions. The decision is based on the court’s assessment of the changed circumstances and the inherent powers of the court to regulate its proceedings. The court considered the procedural aspects of withdrawing a case and the rights of parties to challenge agreements.

Judgment

How each submission made by the Parties was treated by the Court?

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following factors:

• Changed Circumstances: The termination of the original development agreement and the execution of a new one significantly altered the factual matrix of the case, making the initial cause of action less relevant.
• Procedural Fairness: The Court ensured that all parties, including the tenants and respondent No. 5, had the opportunity to protect their interests by allowing them to challenge the new agreement and the termination of the old agreement, respectively.
• Right to Information: The Court recognized the tenants’ right to know the terms of the new development agreement by directing the present management to furnish a copy of the same.
• Consideration of Perjury Application: The Court acknowledged the perjury application filed by respondent No. 5 and directed that the grounds be considered in accordance with law.

Fact:Law Ratio:

The Court’s decision was more influenced by the factual changes in the case (60%) than the legal principles (40%). The primary reason for the decision was the change in circumstances due to the termination of the original development agreement and the execution of a new one, which made the original cause of action less relevant.

Logical Reasoning

Key Takeaways

• Withdrawal of SLP: The Supreme Court allowed the withdrawal of SLP(C) No. 4428 of 2016, except for petitioner No. 4, due to the changed circumstances.
• Access to Information: The present management is required to provide a copy of the new development agreement to the tenants.
• Right to Challenge: Both the tenants and respondent No. 5 have the liberty to challenge the new development agreement and the termination of the old agreement, respectively, before an appropriate court/forum.
• Consideration of Perjury Application: The grounds stated in the perjury application filed by respondent No. 5 will be considered in accordance with law.

Directions

The Supreme Court gave the following directions:

• The present management must furnish a copy of the new development agreement to the respective tenants.
• The tenants are at liberty to challenge the new development agreement before an appropriate court/forum if they are aggrieved by its terms.
• Respondent No. 5 is at liberty to challenge the termination of their development agreement and the new agreement before an appropriate court/forum.
• The grounds set out in the perjury application(s) filed by respondent No. 5 may be considered in accordance with law and on its own merits.

Development of Law

The judgment primarily deals with procedural aspects rather than establishing new legal principles. The ratio decidendi of the case is that when significant factual changes occur during the pendency of a case, such as the termination of a development agreement and the execution of a new one, the court may allow the withdrawal of a Special Leave Petition. Additionally, the judgment reinforces the importance of ensuring that all parties involved have the opportunity to protect their interests by challenging new agreements or terminations of previous agreements. This case also highlights the court’s focus on procedural fairness and ensuring that all parties have the right to be heard.

Conclusion

The Supreme Court allowed the withdrawal of the Special Leave Petition (SLP) in S.M. Pasha & Ors. vs. State of Maharashtra & Ors., except for petitioner No. 4, due to the termination of the original development agreement and the execution of a new one. The Court directed that a copy of the new agreement be provided to the tenants and granted liberty to both the tenants and respondent No. 5 to challenge the new agreement and the termination of the old agreement, respectively. The court also directed that the grounds in the perjury application by respondent No. 5 be considered.

Category

Parent Category: Property Law

Child Categories:

• Development Agreements

Parent Category: Civil Procedure

Child Categories:

• Special Leave Petitions

Parent Category: Property Law

Child Categories:

• Civil Procedure

FAQ

Q: Why was the Special Leave Petition (SLP) allowed to be withdrawn?

A: The SLP was allowed to be withdrawn because the original development agreement was terminated, and a new agreement was executed. This significantly altered the facts of the case, making the initial cause of action less relevant.

Q: What are the rights of the tenants in this case?

A: The tenants have the right to receive a copy of the new development agreement. They also have the liberty to challenge the new agreement before an appropriate court/forum if they disagree with its terms.

Q: What are the implications for respondent No. 5 whose agreement was terminated?

A: Respondent No. 5 has the liberty to challenge the termination of their development agreement and the new agreement before an appropriate court/forum. The grounds stated in their perjury application will also be considered.

Q: What does this judgment mean for future property development disputes?

A: This judgment highlights the importance of procedural fairness and ensuring that all parties have the opportunity to protect their interests when the facts of a case change significantly. It also reinforces the right of tenants to be informed about new development agreements affecting their properties.