Bombay HC Declines To Interfere In MIDC Plot Allotments | Holds Direct Applications and Concessional Rates Permissible Under Land Disposal Regulations, 1975 If Bona Fide
Sanchayita Lahkar
The High Court of Judicature at Bombay Division Bench of Chief Justice Alok Aradhe and Justice Sandeep V. Marne held that the allotment of plots by the Maharashtra Industrial Development Corporation (MIDC) to educational institutions at concessional rates is not invalid in the absence of a challenge to the statutory regulations and board resolutions governing such allotments. The Court directed that as the concerned lands have already been utilized for establishing educational institutions where lakhs of students are being imparted education, it would be “too late in the day” to interfere with the allotments merely because the tender process was not followed. The petition challenging the allotments was therefore disposed of without granting relief.
The proceedings originated from a public interest litigation challenging the allotment of plots by the Maharashtra Industrial Development Corporation (MIDC) in favor of multiple respondents. The petitioners, identifying themselves as a social organization and a public trust engaged in the objective of eradicating corruption, alleged that MIDC allotted several plots to individuals and entities closely connected to political figures, including Ministers and Members of the Legislative Assembly. The allegations centered on claims that the land, which was intended for industrial development, was allotted at concessional prices without following the tender process.
The petitioners contended that the allotments were made selectively, contrary to the provisions of the Maharashtra Industrial Development Corporation Act, 1961, and without issuing public notices or allowing competition among eligible entities. They further alleged that land was allotted for irrelevant purposes such as the construction of monuments, thereby deviating from statutory objectives.
The petitioners were represented by learned counsel who argued that public largesse could not be distributed without an open, transparent, and competitive process. They relied upon judgments of the Supreme Court including Akhil Bhartiya Upbhokta Congress v. State of Madhya Pradesh, City Industrial Development Corporation v. Platinum Entertainment, and Indian Oil Corporation Ltd. v. Shashi Prabha Shukla, which held that State largesse must not be distributed arbitrarily or selectively.
The Maharashtra Industrial Development Corporation (Respondent No. 2) opposed the petition, represented by learned counsel who argued that the allotments had been made strictly in accordance with the Maharashtra Industrial Development Corporation Disposal of Land Regulations, 1975. Regulation 4 of the said regulations empowered MIDC to allot plots either by public auction or by entertaining direct applications. The Corporation further stated that within industrial areas, a certain proportion of land was earmarked for amenities such as schools, colleges, educational institutions, post offices, and playgrounds, and that the impugned allotments fell within this framework.
The MIDC submitted that as per Resolution No. 3872 dated 2 August 2004, plots allotted to educational institutions were charged at 50% of the industrial rate, and if plots were allotted from industrial areas where amenity plots were unavailable, the rate applied was 75% of the industrial rate. It was further stated that open space plots for playgrounds were charged at 10% of the industrial rate. These resolutions were not under challenge in the petition.
The Government of Maharashtra supported the submissions of MIDC. Certain respondent institutions also defended the allotments, stating that the land had been utilized for establishing educational facilities such as Ayurvedic Medical Colleges, Engineering Colleges, Schools of Pharmacy, and playgrounds, thereby serving the purpose for which it was allotted.
The Court noted that MIDC, as a statutory corporation and special planning authority, had the mandate of planned industrial development while also providing necessary amenities including educational institutions. The statutory framework provided the Corporation with powers to allot land either through auction or direct application, and to determine concessional rates for institutions providing amenities.
The Court recorded that the petitioners’ grievance was twofold, namely that allotments were made without a tender process and that land was given at concessional rates. The Court stated: “Thus, under the Land Disposal Regulations, it is lawful for MIDC to make allotment of plots in a given case by entertaining direct applications and it is not necessary that in every case, the allotment must be done by implementing a tender process.”
The Bench further observed: “The conspectus of the above discussion is that the allotment of land in industrial areas set up by MIDC is governed by provisions of Land Disposal Regulations, DCR of MIDC and various Board Resolutions. The Land Disposal Regulations empower MIDC to make allotments either by implementing tender process or by entertaining direct applications. Thus, allotment of lands by entertaining direct application is something which is not prohibited under the Land Disposal Regulations.”
The Court considered the Supreme Court judgements relied upon by the petitioners, including Akhil Bhartiya Upbhokta Congress, which held that largesse could not be distributed at the whims of the State, and that public notices and equal opportunities must be provided. However, the Court distinguished those cases by noting that in the present matter, the statutory provisions themselves allowed allotment by direct application and such provisions were not under challenge.
The Court stated: “In ordinary circumstances, allotment of public land cannot be made by entertaining private applications and the State and its instrumentalities are required to implement auction process. However, in the present case, there is no challenge to MIDC’s Land Disposal Regulations, which empower MIDC to make allotments even by entertaining private applications.”
The Bench noted that allotments were specifically made for educational purposes and that: “It is not the case of the Petitioners that the allotment has been taken for one purpose and the land is utilized for some other purpose.” The Court stated that educational institutions had been established on the concerned plots and that lakhs of students had been educated there during the pendency of the petition. It therefore stated: “It would be too late in a day now to take back the lands from the said educational institutions only because MIDC did not implement auction process.”
Regarding concessional rates, the Court recorded that: “MIDC has formulated a policy for charging only 50% of industrial rate while allotting lands to educational institutions. MIDC is an instrumentality of State and appears to have taken a policy decision of charging only 50% of industrial rate both for attracting educational institutions in various industrial areas as well as to promote educational activities by offering land at concessional rates.” The Court observed that the validity of these resolutions had not been challenged.
The Court also remarked: “We are also not impressed by the contention raised on behalf of Petitioner that other needy educational institutions in the area are deprived of land.” It noted that if any institution desired allotment, it could apply to MIDC and that no aggrieved institutions had come forward to challenge the allotments.
On the basis of the above findings, the Court issued its final directives, stating: “In view of the fact that Petitioners have chosen not to challenge the Land Disposal Regulations as well as Board Resolutions fixing concessional rates, coupled with the fact that the concerned plots are used for the purpose for which the same are allotted, we are not inclined to grant any relief in favour of the Petitioners in the present petition.”
The Court directed that the public interest litigation petition stood disposed of. It added: “Needless to observe that, in the event, MIDC notices any unauthorized change of user of the concerned plots, the MIDC shall initiate necessary action against the concerned allottee.”
Consequently, the Court ordered that the connected civil application also stood disposed of.
Advocates Representing the Parties
For the Petitioners: Mr. Uday Warunjikar, Mr. Hrishikesh Nabar, Mr. Sumit Kate, and Mr. Yash Jagdale, Advocates
For the Respondents: Mrs. Neha S. Bhide, Government Pleader, with Mr. O. A. Chandurkar, Additional Government Pleader, and Ms. G. R. Raghuwanshi, AGP; Ms. Shyamali Gadre with Mr. Ashwin Kulkarni, Advocates; Mr. I. M. Khairdi, Advocate; Mr. Huzefa Nasikwala with Mr. Idris Balasinorwala, Advocates and 8; Mr. Atharv A. Gidaye with Mr. Harshad Bhadbhade, Advocates
Case Title: Bhrastachar Nirmoolan Sangathana v. State of Maharashtra & Ors.
Neutral Citation: 2025: BHC-AS:35833-DB
Case Number: Public Interest Litigation No. 155 of 2006 with Civil Application No. 41 of 2012
Bench: Chief Justice Alok Aradhe, Justice Sandeep V. Marne
