BMC Cannot Use a Contract Clause or Delay to Deny Landowner’s Statutory Right to Amenity TDR

Case Name: Brihanmumbai Municipal Corporation and Ors. v. Vijay Nagar Apartments and Ors.

Citation: 2026 INSC 517

Date of Judgment/Order: 20 May 2026

Bench: Justice J.K. Maheshwari and Justice Atul S. Chandurkar

Held: The Supreme Court held that where land reserved for a public purpose is surrendered under Section 126(1)(b) of the Maharashtra Regional and Town Planning Act, 1966, and the landowner develops or constructs an amenity on such land at its own cost, the landowner has a statutory right to additional amenity TDR/FSI as compensation. The Court held that such statutory compensation cannot be taken away by contractual clauses in a Letter of Intent, undertaking or maintenance agreement, particularly where the landowner is made to accept such conditions in the process of statutory acquisition. The Court further held that delay and laches cannot defeat a claim for fair compensation under Section 126(1)(b), especially when the right to additional TDR crystallised upon surrender and development of the amenity, and denial of such compensation would offend the protection of property under Article 300A.

Summary: The land owned by the respondents at Anik, Bhakti Park, Chembur, was reserved for a garden under the development plan. The landowner developed the garden as per the Corporation’s specifications and surrendered the land to the Brihanmumbai Municipal Corporation between January 2002 and October 2002. The Corporation released TDR for the land component but denied additional amenity TDR for development of the garden, relying upon the LOI, undertaking and maintenance agreement under which the landowner had agreed not to claim amenity TDR while maintaining the garden on an adoption basis. After possession was taken back by the Corporation in 2016 pursuant to Lokayukta proceedings, the landowner claimed additional amenity TDR in 2019, which was rejected on grounds of delay, supersession of DCR 1991 by DCPR 2034, and contractual waiver. The Bombay High Court allowed the claim. The Supreme Court affirmed the High Court’s conclusion, holding that a garden is an “amenity” under the MRTP Act and DCR 1991, that the right to additional TDR accrued when the land and developed amenity were surrendered, and that the Corporation could not contract out of the statutory compensation mechanism or rely on alleged misuse of the garden to defeat the landowner’s statutory entitlement.

Decision: The Supreme Court dismissed the appeal filed by the Brihanmumbai Municipal Corporation and declined to interfere with the Bombay High Court’s judgment directing grant of additional amenity TDR to the landowner. The Court rejected the Corporation’s objections based on waiver, contractual undertaking, delay and laches, applicability of DCPR 2034, and alleged non-use or misuse of the garden as an amenity. The Corporation was directed to comply with the High Court’s directions within two months, and all interlocutory applications were disposed of.