Bombay HC Divides ₹10.94 Crore Siddhivinayak Temple Land Compensation Equally Between Owners, Tenant

Mumbai, November 3, 2026: The Bombay High Court on Tuesday divided Rs 10.94 crore in land acquisition compensation equally between the owners of a Prabhadevi plot and its long-standing tenant, Sadanand Garage, holding that both had substantial interests in the property acquired for the expansion of the Shree Siddhivinayak Ganapati Temple.

Justice Amit Borkar fixed the market value of the 642.98-square-metre plot at Rs 1,70,200 per square metre as on September 19, 2002. The land was acquired by the State for constructing a waiting hall and rest house for devotees visiting the temple.

The court directed that Rs 5.47 crore each be paid to the owners and Sadanand Garage from the land compensation of Rs 10.94 crore. An additional Rs 3.85 lakh awarded for the existing structure and trees will go entirely to the owners.

Owners And Tenant Claim Compensation

The dispute arose over the share of compensation payable to the Garage, which claimed to have occupied the entire property since 1971 and sought 75 per cent of the amount. The owners, on the other hand, claimed the entire compensation.

Rejecting both claims, the court held that the garage had established substantial tenancy and occupation rights but had failed to prove exclusive tenancy or ownership over the entire plot. At the same time, the owners could not claim the entire amount as the property was subject to the garage’s established occupation rights.

“The owners have proved their ownership interest. But their claim to receive the entire compensation is rejected because the land was subject to the established tenancy and occupation rights of the Garage,” Justice Borkar observed.

The court noted that documents, including rent receipts, municipal tax records, electricity bills and business licences, established the garage’s long-standing occupation and business activity. However, they did not establish exclusive tenancy over the entire 642.98-square-metre plot.

Court Determines Market Value

On valuation, the court rejected the State’s reliance on ready reckoner rates as the primary basis for determining compensation. Referring to Supreme Court rulings, it reiterated that such rates have no statutory foundation for determining market value under Section 23 of the Land Acquisition Act, 1894.

The judge relied on two comparable sale transactions in the vicinity, which, after appropriate adjustments, indicated market rates of Rs 1,70,200 and Rs 1,76,500 per square metre. He noted that the second transaction independently supported the valuation arrived at through the first. The court also considered the property’s proximity to the temple, road frontage and development potential.

“The Ready Reckoner cannot be the only basis for deciding market value under Section 23 of the Land Acquisition Act. Genuine sale transactions provide better evidence,” the judge observed.

Other Compensation Claims Rejected

The court also rejected Century Developers’ claim for Rs 20 lakh from the compensation, noting that its development agreement with the owners had been terminated and its suit for specific performance dismissed.

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The claims of prospective flat purchasers for a share in the compensation were also rejected for want of proof of an enforceable interest in the acquired land. However, the court clarified that their separate contractual rights and remedies, if any, would remain unaffected.

The competent authority was directed to calculate and release the respective amounts within eight weeks.

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