Mumbai: The Bombay High Court has prima facie opined that if a mall or a shopping complex is built upon land owned by the state government then the profit generated should be divided equally between the local civic body and the private entity constructing the mall.
The HC accordingly ordered the Thane Municipal Corporation (TMC) to consider constructing a mall on a land, which had been initially reserved for a municipal market.
The important order was passed by a bench of Justices Satyaranjan Dharmadhikari and Riyaz Chagla while dealing with a petition filed by a Thane resident alleging change in use of the land.
The plea claimed that the land was reserved as a market in 1992 by the then collector but there was no market; instead, a building was developed, housing a few shops.
Taking note of the matter, Justice Dharmadhikari said, “Today, in the era of globalisation, privatisation and industrialisation, the economy is witnessing a change of ideas.
Even if the land was designated or reserved as a market, traditionally, a market was understood as merely providing a facility in the form of open space to traders to sell their products.”
“However, now the property is developed by setting up a market building, which houses shops, as well as convenience areas commensurate with the development of the localities adjoining this building,” the bench noted.
The judges further noted that since huge residential complexes have come up, the people residing there would require a modern market, which houses not only shops, but also provides other amenities such as banks, restaurants etc.
“We have found that in market buildings, there are multiplex cinemas as well. Thus, today a market building has become a mall, which houses not only shops, but much more than that,” Justice Dharmadhikari noted.
“In these circumstances, the civic body, through its chief, should explore the possibility of calling upon the private entities to share the revenue or income generated from it, by permitting alterations to be carried out in the building as,
what was traditionally used only for construction of shops and commercial units has now taken on the character of a complex housing marriage halls, branch of a bank etc.” the judges added.
The bench further said that the revenue generated from such mall complexes, ought not to be pocketed entirely by private parties, who had developed the plot of land, but equally by a public body.
“Ultimately, the land belongs to the superior title holder – the state, and vests in it. It is granted through the civic body for a public purpose.
The civic bodies are a unit of local governance and, therefore, the expectation is that it does not allow the potential of land to be exploited by private players or entities to the exclusion of the public,” the bench said.
“If the land is valuable, then, commensurate with the value of the land, all dealings and transactions in relation to these structures or buildings constructed thereon or on portion thereof ought to be shared with the civic body is our prima facie view,” the bench held.
The judges accordingly adjourned the matter for further hearing in February to enable the TMC to spell out its future plans.
