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The Bombay High Court has directed the Mumbai Metropolitan Region Development Authority (MMRDA) to refund INR 646 crore to Reliance Industries Limited in a major ruling linked to a long-standing dispute over a commercial development project at Bandra Kurla Complex in Mumbai. The court has set aside penalty and demand notices issued by the authority, observing that the recovery action lacked legal backing and was applied in an arbitrary manner. It further noted inconsistency in extension benefits granted to similar projects, leading to unequal treatment, and ordered the refund within a fixed timeframe with interest applicable on delay.
The Bombay High Court has ordered the Mumbai Metropolitan Region Development Authority (MMRDA) to refund INR 646 crore to Reliance Industries Limited in connection with a dispute over a large commercial and convention development project at Bandra Kurla Complex in Mumbai. Advertisement
The court has quashed two demand notices issued by MMRDA in earlier proceedings, including a major claim of INR 646 crore and another demand of INR 1,116 crore. It observed that the recovery of INR 646 crore was carried out in a manner that was arbitrary, unfair and not supported by proper legal reasoning. The court also noted that the action appeared to have been taken under pressure linked to possible lease termination, which affected the company's operational interests.
Reliance Industries had been allotted the plot in 2006 for developing a convention-cum-commercial centre along with related infrastructure. The project, due to its scale, required phased construction within a stipulated timeline, which later became the subject of disagreement when delays were recorded and penalties were imposed by the authority.
The court highlighted that in similar development agreements executed after 2015, a six-year extension provision was being applied by the authority. It stated that the same benefit should have been extended uniformly, and failure to do so in this case resulted in discriminatory treatment against the company.
MMRDA had defended its position by relying on the original lease terms and approvals granted for increased built-up area during the development process. However, the court did not accept these arguments and held that no additional penalty or premium could be legally justified in the present matter.
The judgment further stated that the demand notices and recovery steps did not comply with fair administrative standards and therefore could not be sustained under law. The court has directed MMRDA to complete the refund within 90 days, and added that interest will apply if the payment is delayed beyond the stipulated period.
The ruling also comes against the backdrop of several ongoing disputes in Mumbai's infrastructure and real estate sector, where issues related to lease conditions, project delays and extension policies have frequently been examined by courts in recent years.
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