Supreme Court of India
NIRMITI DEVELOPERS THROUGH ITS PARTNERS & ANR.versusTHE STATE OF MAHARASHTRA & ORS.
- Citation
- 2025 INSC 265
- Decided
- 25 February 2025
- Disposal
- Appeal(s) allowed
- Bench
- B PARDIWALA
Holding
The reservation of the land lapsed under Sections 49(7), 126 and 127 of the Maharashtra Regional & Town Planning Act, 1967, and the land is free for the appellants to use.
Summary
The appellants purchased a 50,138 sq.ft. plot in Amravati that had been reserved for a private school under the Maharashtra Regional & Town Planning Act, 1967. The original owners served a purchase notice under Section 49 in 2006, which was confirmed in 2007, but the authorities failed to acquire the land within the one‑year period prescribed by Section 49(7). Subsequent attempts to acquire the land under Sections 126 and 127 also failed, and no compensation was paid. The Supreme Court held that the reservation lapsed on 2 January 2008 under Section 49(7) and, by operation of Sections 126 and 127, the land was released from reservation, allowing the appellants to use it. The Court also invoked Article 142 to do complete justice given the thirty‑year delay. The High Court order was set aside and the appeals were allowed.
Issues considered
- The reservation of the plot under the MRTP Act lapses if acquisition is not completed within the statutory time‑frame prescribed in Sections 49, 126 and 127.
- Whether Section 49(7) can be invoked by the present purchasers, who were not the original owners, to claim that the reservation has lapsed.
- Whether the gross delay of nearly thirty years justifies a declaration of lapse under Article 142 of the Constitution.
- Whether the authorities’ failure to take any steps after the purchase notice amounts to a lapse of reservation under the MRTP Act.
Legislation cited
Headnote
Issue for Consideration Whether the reservation of the plot of land lapsed under Sections 49, 126 and 127 of the Maharashtra Regional & Town Planning Act, 1967 due to the failure of the authorities to acquire it within the statutory timeframe, thereby entitling the land as permissible under law. Headnotes† Maharashtra Regional & Town Planning Act, 1967 – Section 49, Section 126 and Section 127 – Reservation to lapse if no step taken for acquisition of land within the prescribed time period – Landowners are free to use land as
Subjects
de‑reservation of landland acquisitionreservation lapseSection 49 MRTP ActSection 126 MRTP ActSection 127 MRTP ActArticle 142property rightspublic purpose
Judgment
[2025] 2 S.C.R. 1206 : 2025 INSC 265
Nirmiti Developers Through its Partners & Anr.
v.
The State of Maharashtra & Ors.
(Civil Appeal No(s). 3238-3239 of 2025)
25 February 2025
[J.B. Pardiwala* and R. Mahadevan, JJ.]
Issue for Consideration
Whether the reservation of the plot of land lapsed under Sections 49,
126 and 127 of the Maharashtra Regional & Town Planning Act,
1967 due to the failure of the authorities to acquire it within the
statutory timeframe, thereby entitling the appellants to use the land
as permissible under law.
Headnotes†
Maharashtra Regional & Town Planning Act, 1967 – Section
49, Section 126 and Section 127 – Reservation to lapse if no
step taken for acquisition of land within the prescribed time
period – Landowners are free to use land as if there was no
reservation:
Vide the revised development plan for Amravati under the
Maharashtra Regional & Town Planning Act, 1967 [‘MRTP Act’], plot
of land measuring 50,138 sq. ft. reserved for a private school for
Respondent No. 5, a Public Trust – No steps were taken between
1993 and 2006 by Respondents to acquire the property – On
04.07.2006, the erstwhile owners served a purchase notice under
Section 49 of the MRTP Act – Respondent No. 1 confirmed the
notice on 02.01.2007 and ordered Respondent No. 5 to complete
acquisition within 12 months, failing which the reservation would
lapse – Acquisition proceedings were not completed by 02.01.2008,
and no compensation was deposited by Respondent No. 5 with
any authority – The erstwhile owners sold the land in December
2015 to the Appellants – In March 2016, the Appellants filed a
writ petition in the High Court seeking either compensation from
Respondent No. 5 for land reserved for it or declaration that the
reservation had lapsed under Section 49(7) – The High Court in
impugned order disposed of the Writ Petition taking the view that
* Author
[2025] 2 S.C.R. 1207
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
Section 49(7) would not apply to the present Appellants as the
erstwhile owners did not use the land after de-reserving it – Appeal
against impugned order allowed – Held, as per Section 49(7), the
reservation lapsed on 02.01.2008, allowing the erstwhile owners
to use the plot of land as permissible in law.
Held: It is clear that the scheme of Sections 126 and 127 that if a
period of 10 years has elapsed from the date of publication of the
plan in question, and no steps for acquiring the land have been
taken, then once a purchase notice is served under Section 127,
steps to acquire the land must follow within a period of one year
from the date of service of such notice, or else the land acquisition
proceedings would lapse – The principles underlying in Section 127
of the MRTP Act is either to utilize the land for the purpose for which
it is reserved in the timeline given or let the owner utilize the land for
the purpose as permissible under the town planning scheme – The
reservation shall be deemed to have lapsed if no steps are taken for
acquisition of the said land within the prescribed period – Indisputably,
in the present case, the respondents have not taken any steps to
issue notification after receipt of the notice. [Paras 34, 47]
MRTP Act, 1967 – Section 126 and Section 127 – Statutory period
of ten years sacrosanct – Reservation to lapse after ten years:
Held: The landowner cannot be deprived of the use of the land for
years together – Once an embargo has been put on a landowner
not to use the land in a particular manner, the said restriction
cannot be kept open-ended for indefinite period – The statute has
provided a period of ten years to acquire the land under Section
126 of the Act – Additional one year is granted to the landowner
to serve a notice for acquisition – Such timeline is sacrosanct
and has to be adhered to – It is declared that the reservation of
the plot in question could be said to have lapsed by efflux of time
even under Sections 126 and 127 of the MRTP Act. [Paras 50,51]
Constitution of India – Article 142 – Reservation to have lapsed
owing to gross delay of thirty years:
Held: Having regard to the gross delay of almost thirty years in
acquiring the land, even without the aid of Section 127 of the MRTP
Act, in exercise of jurisdiction under Article 142 of the Constitution
to do complete justice in the matter, the reservation would have
been declared as having lapsed. [Para 52]
1208 [2025] 2 S.C.R.
Supreme Court Reports
List of Acts
Maharashtra Regional & Town Planning Act, 1967.
List of Keywords
De-reserving land; Acquisition; Land Acquisition; Lapse; Reservation
of land.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No(s). 3238-3239
of 2025
From the Judgment and Order dated 09.02.2017 and 07.04.2017
of the High Court of Judicature at Bombay at Nagpur in WP No.
1935 of 2016 and MCA No. 373 of 2017
Appearances for Parties
Advs. for the Appellants:
Gagan Sanghi, Mrs. Farah Hashmi, Rameshwar Prasad Goyal.
Advs. for the Respondents:
Nitin Lonkar, Siddharth Dharmadhikari, Aaditya Aniruddha Pande,
M/s. Black & White Solicitors.
Judgment / Order of the Supreme Court
Judgment
J.B. Pardiwala, J.
1. Leave granted.
2. These captioned appeals arise from an order passed by the High
Court of Judicature at Bombay, Nagpur Bench, dated 09-02-2017
in Writ Petition No.1935/2016 by which the Writ Petition filed by the
appellants – herein came to be disposed of reserving liberty for the
appellants to take necessary steps as open to them in law.
3. The facts giving rise to these petitions may be summarized as under.
4. The subject-matter of this litigation is a vacant plot of land admeasuring
50,138 sq.ft (46.5 R) in Survey No. 81/3 (New) 3 (old) in Mouza
Rajapeth, Amravati, Maharashtra. This plot originally was jointly owned
[2025] 2 S.C.R. 1209
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
by Smt Akhtar Bano Rashid, Abdul Majid A. Samad & Mohammad
Sajid A. Samad (previous owners) respectively, and formed part of
the larger plot admeasuring 2.47 Hectare. The property in question
is situated within the municipal limits of Respondent No.3 – herein.
5. The erstwhile owners had submitted a lay-out plan for development of
2.47 hectare to Respondent No.3. The Respondent No.3 sanctioned
the development plan for the residential area and the remaining area
admeasuring 50,138 Sq.ft. was reserved for Government school.
6. On 25-02-1993, a revised development plan for Amravati under the
Maharashtra Regional and Town Planning Act, 1966 (for short “the
MRTP Act”) came into effect in which the property was shown as
reserved for a private school in favour of the Respondent No.5 vide
Reservation No.195. Till 2006, i.e., almost for a period of 13 years,
no steps were taken to acquire the property.
7. On 04-07-2006, the original owners served the purchase notice under
Section 149 of the MRTP Act on the Respondent No.1 calling upon
the said respondent either to acquire the property or to release it
from reservation.
8. On 02-01-2007 the Respondent No.1 acknowledged the purchase
notice. The Respondent No.1 directed the Respondent No.5 to
complete the acquisition proceedings within a period of one year,
failing which the reservation in its favour would lapse.
9. On 29-12-2007, the Respondent No.5 requested the Respondent
No.7 to initiate proceedings for acquiring the land under Section
126 of the MRTP Act.
10. Till 02-01-2008, no action was taken by the Respondent No.5 to
commence the acquisition proceedings within one year of confirmation
of the purchase notice.
11. On 13-08-2014, the previous owners issued a purchase notice under
Section 127 of the MRTP Act to the Respondent Nos.1,3,4 and 6
respectively requesting them to acquire the land.
12. On 12-06-2015, the Respondent No.6 received the proposal from
Respondent No.5 to acquire the land.
13. On 30-12-2015, the petitioner – herein purchased the property from
the erstwhile owners for Rs.1.26 Crore.
1210 [2025] 2 S.C.R.
Supreme Court Reports
14. On 16-03-2016, the appellants filed a Writ Petition praying that (a) the
Respondent No.5 be directed to deposit the amount of compensation
to be paid to the appellants for acquisition under the new Land
Acquisition Act, 2017 and complete the acquisition & (b) declare that
the reservation had lapsed under Section 49(7) of the Act.
15. On 01-10-2016, reply was filed by the Respondent Nos. 6 and 7
respectively stating that on 12-6-2015, proposal from the Respondent
No.5 was received and LAC was registered but till that date the
Respondent No.5 had not deposited a single penny with the LAO
and the Respondent Nos.6 and 7 had reasons to believe that the
Respondent No.5 was not interested in developing the said land.
16. On 13-10-2016, the Respondent No.3 filed an additional claim not
disclosed by the appellants in their notice dated 13-8-2014.
17. In such circumstances, referred to above, the petitions filed by the
appellants came to be disposed of by the High Court which reads thus:-
Order dated 09-02-2017 reads thus:-
“Heard Shri G.K Mundhada, learned Counsel for the
petitioners, Shri N. Rao, learned A.G.P. for respondent
nos.1,2,4,6 and 7, Shri R. Darda, learned Counsel for
respondent nos. 3 and 4 and Shri S. Ghodeswar, learned
Counsel for respondent no.5.
2. Petitioner is a purchaser who has bought property from
original owners. Original owners issued a notice under
Section 49[1] of the Maharashtra Regional and Town
Planning Act, that notice is dated 04-07-2006. It was
confirmed on 02-01-2007, within a period of one year,
thereafter no steps for acquisition were taken. Original
owners thereafter did not take any steps for development.
They have sold the property on 31-12-2015 to the present
developer.
3. Effort of learned counsel for the petitioners is to urge that
before that in 2015, original owners had sought permission
to raise compound wall and the same was declined. Thus,
after confirmation of purchase notice, expiry of period of
one year therefrom, at least for a period of 6 years no steps
to develop the same were taken by the original owners.
[2025] 2 S.C.R. 1211
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
4. Two separate procedures are deliberately made available
under the Act. A person who wants to immediately develop
his property can take recourse to section 49, otherwise he
has to wait for a period of 10 years as envisaged under
Section 127[1] thereof. Section 49 is not meant for getting
the property de-reserved and then to wait for appropriate
time to sell out it in open market.
5. Here petitioner is a developer, it has not taken any steps
after purchase to issue notice either under Section 49 or
under Section 127 of the Act.
6. Notice given by the previous land owners was under
Section 49 only and as no advantage of de-reservation
was taken for more than 6 years, we find that, that notice
or then the benefits flowing therefrom cannot accrue to
the benefits of present petitioners. Hence, with liberty to
petitioner to take such other steps as are open to him in
law, we dispose of the present petition. No costs.”
Order dated 07-04-2017: (IN REVIEW PETITION)
“Heard Shri S.K. Mishra, learned Senior Counsel with
Shri G.K. Mundhada, learned Counsel for applicants and
learned A.G.P. for non-applicant nos. 1,2,6 and 7.
2. Learned Senior Counsel submits that literal meaning of
Section 49 of the Maharashtra Regional and Town Planning
Act, 1966 should be adhered to and as the reservation had
already lapsed, purchaser is not required to go through·
the rigmarole of serving notice either under Section 49
or under Section 127 again. He contends that the finding
of this Court in paragraph no.4 are, therefore, contrary to
Scheme of Section 49.
3. This Court has already in judgment in case of Kishor
Maganlal Vyas vs. State of Maharashtra and others (Writ
Petition No. 506/2011. Dated 11-06-2012), held that
normally procedure for de-reservation is Section 127,
wherein the local authority gets time of 10 years to acquire
the property. However, to mitigate the hardship caused
to a genuine needy owner, a provision has been made
in Section 49 and hence, a specified class of owners
emerging therein can only take recourse to it.
1212 [2025] 2 S.C.R.
Supreme Court Reports
4. Here we have found that after lapsing of reservation
for a period of 6 years the earlier owner had not either
developed the property or sold it out. Thus, the property
was lying as it is, and hence, recourse to Section 49 itself
is found not proper. De-reservation here was used to get
the best desired price after waiting for long time. Section
127 of the Act gives reasonable time to acquiring body to
act and acquire. De-reservation thereunder may therefore
enure to the benefit of purchaser also. Same cannot be
said in respect of Section 49 de-reservation. Section 49
operates on personal need of the owner and it cannot
enure to the benefit of purchaser like petitioner. It is in this
background, that we have held that the purchaser from that
owner [present applicant] has not taken necessary steps
either under Section 49 or under Section 127 of the Act.
5. We, therefore, find no case made out warranting review.
Misc. Civil Application is thus rejected. No costs.”
18. The High Court took the view that the person intending to develop his
property at the earliest can take recourse of Section 49 otherwise he
has to wait for a period of 10 years as envisaged under Section 127(1)
thereof.
19. The High Court took notice of the fact that although the original
owners had completed the procedure to get the land de-reserved
by issuing notice under Section 49 yet as they sold the plot to the
present appellants Section 49 would not apply to the purchasers. In
other words, Section 49 according to the High Court is not meant
for getting the property de-reserved and then to wait for appropriate
time to sell it in the open market.
20. According to the High Court, the petitioner being a developer had
not taken any steps after purchase, i.e., to issue notice either under
Section 49 or under Section 127 of the Act.
21. The High Court, taking the view, as aforesaid, disposed of the petition
granting liberty to the appellants – herein to take appropriate steps
in accordance with law.
22. We heard Mr. Gagan Sanghi, the learned counsel appearing for
the appellants and Mr. Suhaskumar Kadam, the learned counsel
appearing for Respondent No.3 – Corporation.
[2025] 2 S.C.R. 1213
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
23. Section 49 of the MRTP Act reads thus:-
“49. Obligation to acquire land on refusal of permission
or on grant of permission in certain cases.—(1) Where—
(a) any land is designated by a plan as subject to
compulsory acquisition, or
(b) any land is allotted by a plan for the purpose of
any functions of a Government or local authority or
statutory body, or is land designated in such plan as
a site proposed to be developed for the purposes of
any functions of any such Government, authority or
body, or
(c) any land is indicated in any plan as land on which a
highway is proposed to be constructed or included, or
(d) any land for the development of which permission
is refused or is granted subject to conditions, and
any owner of land referred to in Clause (a), (b), (c)
or (d) claims—
(i) that the land has become incapable of
reasonably beneficial use in its existing state, or
(ii) (where planning permission is given subject
to conditions) that the land cannot be rendered
capable of reasonably beneficial use by the
carrying out of the permitted development in
accordance with the conditions; or
(e) the owner of the land because of its designation
or allocation in any plan claims that he is unable to
sell it except at a lower price than that at which he
might reasonably have been excepted to sell if it were
not so designated or allocated, the owner or person
affected may serve on the State Government within
such time and in such manner, as is prescribed by
regulations, a notice (hereinafter referred to as “the
purchase notice”) requiring the Appropriate Authority
to purchase the interest in the land in accordance
with the provisions of this Act.
1214 [2025] 2 S.C.R.
Supreme Court Reports
(2) The purchase notice shall be accompanied by a copy
of any application made by the applicant to the Planning
Authority, and of any order or decision of that Authority
and of the State Government, if any, in respect of which
the notice is given.
(3) On receipt of a purchase notice, the State Government
shall forthwith call from the Planning Authority and the
Appropriate Authority such report or records or both, as
may be necessary, which those authorities shall forward
to the State Government as soon as possible but not later
than thirty days from the date of their requisition.
(4) On receiving such records or reports, if the State
Government is satisfied that the conditions specified in
sub-section (1) are fulfilled, and that the order or decision
for permission was not duly made on the ground that the
applicant did not comply with any of the provisions of this
Act or rules or regulations, it may confirm the purchase
notice, or direct that planning permission be granted without
condition or subject to such conditions as will make the land
capable of reasonably beneficial use. In any other case,
it may refuse to confirm the purchase notice, but in that
case, it shall give the applicant a reasonable opportunity
of being heard.
(5) If within a period of six months from the date on which
a purchase notice is served the State Government does not
pass any final order thereon, the notice shall be deemed
to have been confirmed at the expiration of that period.
(6) [* * *]
(7) If within one year from the date of confirmation of the
notice, the Appropriate Authority fails to make an application
to acquire the land in respect of which the purchase
notice has been confirmed as required under Section
126, the reservation, designation, allotment, indication or
restriction on development of the land shall be deemed
to have lapsed; and thereupon, the land shall be deemed
to be released from the reservation, designation, or, as
the case may be, allotment, indication or restriction and
[2025] 2 S.C.R. 1215
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
shall become available to the owner for the purpose of
development otherwise permissible in the case of adjacent
land, under the relevant plan.
24. Section 126 of the MRTP Act reads thus:
“126. Acquisition of land required for public purposes
specified in plans
(1) When after the publication of a draft Regional plan, a
Development or any other plan or town planning scheme,
any land is required or reserved for any of the public
purposes specified in any plan or scheme under this Act at
any time, the Planning Authority, Development Authority, or
as the case may be, [any Appropriate Authority may, except
as otherwise provided in section 113A] [acquire the land,—
“(a) by agreement by paying an amount agreed to, or
(b) in lieu of any such amount, by granting the land-
owner or the lessee, subject, however, to the lessee
paying the lessor or depositing with the Planning
Authority, Development Authority or Appropriate
Authority, as the case may be, for payment to the
lessor, an amount equivalent to the value of the
lessor’s interest to be determined by any of the said
Authorities concerned [on the basis of the principles
laid down in the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013], Floor Space Index (FSI)
or Transferable Development Rights (TDR) against
the area of land surrendered free of cost and free
from all encumbrances, and also further additional
Floor Space Index or Transferable Development
Rights against the development or construction of
the amenity on the surrendered land at his cost, as
the Final Development Control Regulations prepared
in this behalf provide, or
(c) by making an application to the State Government
for acquiring such land [under the provisions of the
Right to Fair Compensation and Transparency in
Land Acquisition, Rehabilitation and Resettlement
1216 [2025] 2 S.C.R.
Supreme Court Reports
Act, 2013] , and the land (together with the amenity,
if any so developed or constructed) so acquired
by agreement or by grant of Floor Space Index
or additional Floor Space Index or Transferable
Development Rights under this section [or under the
provisions of the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013], as the case may be, shall
vest absolutely free from all encumbrances in the
Planning Authority, Development Authority, or as the
case may be, any Appropriate Authority.
(2) On receipt of such application, if the State Government
is satisfied that the land specified in the application is
needed for the public purpose therein specified, or 4[if the
State Government (except in cases falling under section
49 5[and except as provided in section 113A)] itself is of
opinion] that any land included in any such plan is needed
for any public purpose, it may make a declaration to that
effect in the Official Gazette, [in the manner provided
in section 19 of the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013], in respect of the said land. The
declaration so published shall, notwithstanding anything
contained in the said Act, be deemed to be a declaration
duly made under the said section:
[Provided that, subject to the provisions of sub-section
(4), no such declaration shall be made after the expiry of
one year from the date of publication of the draft Regional
Plan, Development Plan or any other Plan, or Scheme,
as the case may be.]
[(3) On publication of a declaration under the said 3
[section 19], the Collector shall proceed to take order for
the acquisition of the land under the said Act; and the
provisions of that Act shall apply to the acquisition of the
said land with the modification that the market value of
the land shall be,—
(i) where the land is to be acquired for the purposes of
a new town, the market value prevailing on the date of
[2025] 2 S.C.R. 1217
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
publication of the notification constituting or declaring the
Development Authority for such town;
(ii) where the land is acquired for the purposes of a
Special Planning Authority, the market value prevailing
on the date of publication of the notification of the area
as undeveloped area; and
(iii) in any other case, the market value on the date of
publication of the interim development plan, the draft
development plan or the plan for the area or areas for
comprehensive development, whichever is earlier, or as
the case may be, the date of publication of the draft Town
Planning Scheme:
Provided that, nothing in this sub-section shall affect the
date for the purpose of determining the market value of land
in respect of which proceedings for acquisition commenced
before the commencement of the Maharashtra Regional
and Town Planning (Second Amendment) Act, 1972:
Provided further that, for the purpose of clause (ii) of this
sub-section, the market value in respect of land included
in any undeveloped area notified under sub-section (1) of
section 40 prior to the commencement of the Maharashtra
Regional and Town Planning (Second Amendment) Act,
1972, shall be the market value prevailing on the date of
such commencement.]
[(4) 5[Notwithstanding anything contained in the proviso
to sub-section (2) and subsection (3), if a declaration,]
is not made, within the period referred to in sub-section
(2) (or having been made, the aforesaid period expired
on the commencement of the Maharashtra Regional and
Town Planning 6[(Amendment) Act, 1993),] the State
Government may make a fresh declaration for acquiring the
land [under the provisions of the Right to Fair Compensation
and Transparency in Land Acquisition, Rehabilitation
and Resettlement Act, 2013], in the manner provided by
sub-sections (2) and (3) of this section, subject to the
modification that the market value of the land shall be
the market value at the date of declaration in the Official
Gazette, made for acquiring the land afresh.]”
1218 [2025] 2 S.C.R.
Supreme Court Reports
25. We must now look into Section 127 of the MRTP Act. Section 127
reads thus:
“127. Lapsing of reservations.—(1) If any land reserved,
allotted or designated for any purpose specified in any
plan under this Act is not acquired by agreement within
ten years from the date on which a final Regional Plan, or
final Development Plan comes into force [or if a declaration
under sub-section (2) or (4) of Section 126 is not published
in the Official Gazette within such period, the owner or any
person interested in the land may serve notice, alongwith
the documents showing his title or interest in the said
land, on the Planning Authority, the Development Authority
or, as the case may be, the Appropriate Authority to that
effect; and if within twelve months] from the date of the
service of such notice, the land is not acquired or no
steps as aforesaid are commenced for its acquisition, the
reservation, allotment or designation shall be deemed to
have lapsed, and thereupon, the land shall be deemed to
be released from such reservation, allotment or designation
and shall become available to the owner for the purpose
of development as otherwise, permissible in the case of
adjacent land under the relevant plan.
(2) On lapsing of reservation, allocation or designation of
any land under sub-section (1), the Government shall notify
the same, by an order published in the Official Gazette.”
26. Section 127 of the MRTP Act is enacted for lapsing of reservation,
allotment or designation for any purpose specified in the plan. The
section prescribes, that if any land reserved, allotted or designated for
any purpose specified in any plan under this Act is not acquired by
agreement within ten years from the date on which a final Regional
Plan or Development Plan comes into force or if proceedings for the
acquisition of such land under this Act or under the Land Acquisition
Act are not commenced within such period the owner or any, person
interested in the land may serve notice on the Planning Authority,
Development Authority or as the case may be, Appropriate Authority
to that effect. If the concerned Authority within twelve months from the
date of service of such notice, fails to acquire the land or no steps as
aforesaid are initiated for its acquisition the reservation, allotment or
[2025] 2 S.C.R. 1219
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
designation shall be deemed to have lapsed, and thereupon the land
shall be deemed to be released from such reservation, allotment or
designation and shall become available to the owner for the purpose
of development as otherwise, permissible in the case of adjacent
land under the relevant plan.
POSITION OF LAW
27. This Court in Chhabildas v. State of Maharashtra and others reported
in 2018 INSC 106 while explaining Sections 49 and 127 of the MRTP
Act respectively observed as under:
“9. The scheme of Section 49 of the MRTP Act is to lay
down timelines within which the appropriate authority must
make an application to acquire the land in respect of which
a purchase notice has been confirmed. The moment any
of the conditions specified in the sub-section (1) are met,
the owner or person affected may serve on the State
Government, within the time and manner prescribed by
regulations, a purchase notice requiring the appropriate
authority to purchase the interest in the land in accordance
with the provisions of this Act.
10. On the receipt of the purchase notice as per sub-section
(3), the State Government is to forthwith call from the
planning authority or the appropriate authority such report
or records as may be necessary, which the authority shall
then forward to the State Government as soon as possible
but not later than 30 days from the date of acquisition.
11. In sub-section (4), if the State Government is satisfied
that the conditions specified in sub-section (1) are fulfilled,
it may either confirm the purchase notice; refuse to confirm
the purchase notice; or direct that planning permission be
granted with or without conditions. Under sub-section (5),
if the steps contemplated after service of purchase notice
leads to a situation where the State Government does not
pass any orders thereon, the notice shall be deemed to
have been confirmed at the expiration of that period. And
finally, under sub-section (7), if within one year from the
date of confirmation of purchase notice, the appropriate
authority fails to make an application to acquire the land in
1220 [2025] 2 S.C.R.
Supreme Court Reports
respect of which the purchase notice has been confirmed,
the reservation, designation, allotment, indication or
restriction on development of the land shall be deemed
to have lapsed. Section 49(6), which was deleted by
Maharashtra Act 6 of 1976, read as follows:
“Upon confirmation of the notice, the State Government
shall proceed to acquire the land or that part of any
land regarding which the notice has been confirmed,
within one year of the confirmation of the purchase
notice, in accordance with the provisions of Chapter
VII.”
It is clear that, under this provision, if within one year
from the confirmation of the purchase notice, the State
Government did not acquire the land, then the consequence
would be that the acquisition shall be deemed to have
lapsed. This was a salutary provision, but seems to have
been deleted so that Section 49 cases are brought on par
with Section 126 cases.
12. The object of Section 49 is thus clear that once a
purchase notice is received by the authorities, there arises,
as the marginal note to the Section also indicates, an
obligation to acquire land. The timelines contemplated by
the section also indicate that the owner or person affected
cannot be left to hang indefinitely without a decision to follow
up the purchase notice by acquisition of the land in question.
13. However, it has been argued on behalf of the State that
Section 49 abruptly ends with sub-section (7), after which
there are no timelines indicated as to what is to happen after
the appropriate authority makes an application to acquire
the land within one year from the date of confirmation of
the notice. In our view, this argument must be rejected,
inasmuch as Section 49(1) itself states that the purchase
notice must require the appropriate authority to purchase
the interest in the land “in accordance with the provisions
of this Act”. This being so, once the appropriate authority
makes the necessary application to acquire the land within
time under Section 49(7), we move over to Sections 126
and 127 of the Act.
[2025] 2 S.C.R. 1221
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
14. Under Section 126(1)(c), when after the publication
of a draft regional plan or development or other plan,
any land is required or reserved for a public purpose,
the appropriate authority may make an application to the
State Government, for acquiring such land under the Land
Acquisition Act. Under sub-section (2) thereof, on receipt
of such application, if the State Government is satisfied
that the land specified in the application is needed for the
public purpose specified therein, then excepting the cases
falling under Section 49, the State Government may make
a declaration under Section 6 of the Land Acquisition Act,
to that effect. However, such declaration under Section
126(2) must be made within a period of one year from
the date of publication of the plan in question.
15. A purchase notice may be served under Section 49,
after the expiry of one year from the date of publication of
the plan in question, in which case Section 126(2) of the Act
will not apply. Under Section 126(4), the State Government
may make a declaration under Section 6 subject to the
modification that the market value of the land shall be the
market value at the date of the declaration in the official
gazette made for acquiring the land. But this does not
mean that the State Government has carte blanche to do
as it pleases. Ordinarily, the State Government is bound
to act under Section 126(4) within a reasonable time from
the appropriate authority making an application to acquire
the land. This should ordinarily be within a period of one
year from the date such an application is made. However,
if such declaration is not made within the aforesaid period,
it will be open for the aggrieved person to move the Court
to direct the State Government to make the requisite
declaration immediately.
16. But the matter does not end here. Thereafter, Section
127 kicks in. If a declaration under Section 6 of the Land
Acquisition Act is not made within a period of 10 years
from the date on which a plan comes into force under
sub-section (4) of Section 126, the owner or any person
interested in the land may serve a purchase notice on the
authorities, and if within one year from the date of service
1222 [2025] 2 S.C.R.
Supreme Court Reports
of such notice, the land is not acquired or no steps are
commenced for its acquisition, the reservation, allotment
or designation shall be deemed to have lapsed.”
28. In Girnar Traders v. State of Maharashtra reported in (2007) 7 SCC
555, a three-Judge Bench, by a majority judgment delivered by
Naolekar, J. framed the question before the Court thus:
“19. The question that requires consideration and answer
in the present case is: Whether the reservation has lapsed
due to the failure of the planning authority to take steps
within the period of six months from the date of service of
the notice of purchase as stipulated by Section 127 of the
MRTP Act; and also the question as regards applicability
of new Section 11-A of the LA Act to the acquisition of
land under the MRTP Act.”
29. After setting out Sections 126 and 127 respectively, this Court
then laid down the scheme of Section 126, which makes it clear
that the Section 6 notification under the Land Acquisition Act is
to be issued, in cases where acquisition is made under Section
126(1)(c), in pursuance of an application by an appropriate authority
to the State Government within one year from the publication of the
plan in question, or by way of the State Government making a fresh
declaration beyond a period of one year under Section 126(4). This is
stated by the Court in para 28 as follows: (Girnar case SCC para 28)
“28. Sub-section (2) of Section 126 provides for one year’s
limitation for publication of the declaration from the date
of publication of the draft plan or scheme. Sub-section
(4), however, empowers the State Government to make
a fresh declaration under Section 6 of the LA Act even
if the prescribed period of one year has expired. This
declaration is to be issued by the State Government for
acquisition of the land without there being any application
moved by the planning/local authority under clause (c) of
Section 126(1).”
30. Insofar as Section 127 is concerned, the Court went on to hold:
(Girnar case, paras 31-32)
“31. Section 127 prescribes two-time periods. First, a period
of 10 years within which the acquisition of the land reserved,
[2025] 2 S.C.R. 1223
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
allotted or designated has to be completed by agreement
from the date on which a regional plan or development
plan comes into force, or the proceedings for acquisition
of such land under the MRTP Act or under the LA Act are
commenced. Secondly, if the first part of Section 127 is
not complied with or no steps are taken, then the second
part of Section 127 will come into operation, under which
a period of six months is provided from the date on which
the notice has been served by the owner within which the
land has to be acquired or the steps as aforesaid are to
be commenced for its acquisition. The six month period
shall commence from the date the owner or any person
interested in the land serves a notice on the planning
authority, development authority or appropriate authority
expressing his intent claiming dereservation of the land. If
neither of the things is done, the reservation shall lapse. If
there is no notice by the owner or any person interested,
there is no question of lapsing reservation, allotment
or designation of the land under the development plan.
Second part of Section 127 stipulates that the reservation
of the land under a development scheme shall lapse if the
land is not acquired or no steps are taken for acquisition
of the land within the period of six months from the date
of service of the purchase notice. The word “aforesaid”
in the collocation of the words “no steps as aforesaid are
commenced for its acquisition” obviously refers to the steps
contemplated by Section 126 of the MRTP Act
32. If no proceedings as provided under Section 127
are taken and as a result thereof the reservation of the
land lapses, the land shall be released from reservation,
allotment or designation and shall be available to the
owner for the purpose of development. The availability
of the land to the owner for the development would only
be for the purpose which is permissible in the case of
adjacent land under the relevant plan. Thus, even after
the release, the owner cannot utilise the land in whatever
manner he deems fit and proper, but its utilisation has
to be in conformity with the relevant plan for which the
adjacent lands are permitted to be utilised.”
1224 [2025] 2 S.C.R.
Supreme Court Reports
31. The Court then went on to consider Municipal Corpn. of Greater
Bombay v. Dr Hakimwadi Tenants’ Assn reported in 1988 Supp SCC
55, and was of opinion that, the observations on the expression “no
steps as aforesaid are commenced for its acquisition” stipulated under
Section 127 were obiter in nature. The majority then went on to state
the law under Section 127 as follows: (Girnar case paras 54-57)
“54. When we conjointly read Sections 126 and 127 of
the MRTP Act, it is apparent that the legislative intent is
to expeditiously acquire the land reserved under the Town
Planning Scheme and, therefore, various periods have
been prescribed for acquisition of the owner’s property. The
intent and purpose of the provisions of Sections 126 and
127 has been well explained in Municipal Corpn. of Greater
Bombay case [Municipal Corpn. of Greater Bombay v. Dr
Hakimwadi Tenants’ Assn., 1988 Supp SCC 55]. If the
acquisition is left for time immemorial in the hands of the
authority concerned by simply making an application to
the State Government for acquiring such land under the
LA Act, 1894, then the authority will simply move such
an application and if no such notification is issued by the
State Government for one year of the publication of the
draft regional plan under Section 126(2) read with Section
6 of the LA Act, wait for the notification to be issued by the
State Government by exercising suo motu power under
sub-section (4) of Section 126; and till then no declaration
could be made under Section 127 as regards lapsing of
reservation and contemplated declaration of land being
released and available for the landowner for his utilisation
as permitted under Section 127. Section 127 permitted
inaction on the part of the acquisition authorities for a
period of 10 years for dereservation of the land. Not
only that, it gives a further time for either to acquire the
land or to take steps for acquisition of the land within a
period of six months from the date of service of notice
by the landowner for dereservation. The steps towards
commencement of the acquisition in such a situation
would necessarily be the steps for acquisition and not a
step which may not result into acquisition and merely for
the purpose of seeking time so that Section 127 does not
come into operation.
[2025] 2 S.C.R. 1225
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
55. Providing the period of six months after the service
of notice clearly indicates the intention of the legislature
of an urgency where nothing has been done in regard
to the land reserved under the plan for a period of 10
years and the owner is deprived of the utilisation of his
land as per the user permissible under the plan. When
mandate is given in a section requiring compliance within a
particular period, the strict compliance is required therewith
as introduction of this section is with legislative intent to
balance the power of the State of “eminent domain”. The
State possessed the power to take or control the property
of the owner for the benefit of public cause, but when the
State so acted, it was obliged to compensate the injured
upon making just compensation. Compensation provided
to the owner is the release of the land for keeping the land
under reservation for 10 years without taking any steps
for acquisition of the same.
56. The underlying principle envisaged in Section 127 of
the MRTP Act is either to utilise the land for the purpose
it is reserved in the plan in a given time or let the owner
utilise the land for the purpose it is permissible under the
town planning scheme. The step taken under the section
within the time stipulated should be towards acquisition
of land. It is a step of acquisition of land and not step
for acquisition of land. It is trite that failure of authorities
to take steps which result in actual commencement of
acquisition of land cannot be permitted to defeat the
purpose and object of the scheme of acquisition under
the MRTP Act by merely moving an application requesting
the Government to acquire the land, which Government
may or may not accept. Any step which may or may not
culminate in the step for acquisition cannot be said to be
a step towards acquisition.
57. It may also be noted that the legislature while enacting
Section 127 has deliberately used the word “steps” (in
plural and not in singular) which are required to be taken
for acquisition of the land. On construction of Section 126
which provides for acquisition of the land under the MRTP
Act, it is apparent that the steps for acquisition of the land
would be issuance of the declaration under Section 6 of the
1226 [2025] 2 S.C.R.
Supreme Court Reports
LA Act. Clause (c) of Section 126(1) merely provides for a
mode by which the State Government can be requested for
the acquisition of the land under Section 6 of the LA Act.
The making of an application to the State Government for
acquisition of the land would not be a step for acquisition
of the land under reservation. Sub-section (2) of Section
126 leaves it open to the State Government either to
permit the acquisition or not to permit, considering the
public purpose for which the acquisition is sought for by
the authorities. Thus, the steps towards acquisition would
really commence when the State Government permits the
acquisition and as a result thereof publishes the declaration
under Section 6 of the LA Act.”
32. The scheme of Sections 126(2) and (4) was again reiterated in para
61 as follows: (Girnar case para 161)
“61. Proviso to sub-section (2) of Section 126 prohibits
publication of the declaration after the expiry of one
year from the date of publication of draft regional plan,
development plan or any other plan or scheme. Thus,
from the date of publication of the draft regional plan,
within one year an application has to be moved under
clause (c) of Section 126(1) which should culminate into
a declaration under Section 6 of the LA Act. As per the
proviso to sub-section (2) of Section 126, the maximum
period permitted between the publication of a draft regional
plan and declaration by the Government in the Official
Gazette under Section 126(2) is one year. In other words,
during one year of the publication of the draft regional plan,
two steps need to be completed, namely, (i) application
by the appropriate authority to the State Government
under Section 126(1)(c); and (ii) declaration by the State
Government on receipt of the application mentioned in
clause (c) of Section 126(1) on satisfaction of the conditions
specified under Section 126(2). The only exception to this
provision has been given under Section 126(4).”
33. In Shrirampur Municipal Council v. Satyabhamabai Bhimaji Dawkher
reported in (2013) 5 SCC 627, this Court reiterated the findings given
in Girnar (supra) majority judgment, and held that there was no
conflict between the judgment in Hakimwadi (supra) and the majority
judgment in Girnar(supra). This Court, thereafter, went on to hold:
[2025] 2 S.C.R. 1227
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
“42. We are further of the view that the majority in Girnar
Traders [Girnar Traders v. State of Maharashtra, (2007)
7 SCC 555] had rightly observed that steps towards
the acquisition would really commence when the State
Government takes active steps for the acquisition of the
particular piece of land which leads to publication of the
declaration under Section 6 of the 1894 Act. Any other
interpretation of the scheme of Sections 126 and 127 of
the 1966 Act will make the provisions wholly unworkable
and leave the landowner at the mercy of the Planning
Authority and the State Government.
43. The expression “no steps as aforesaid” used in
Section 127 of the 1966 Act has to be read in the context
of the provisions of the 1894 Act and mere passing of a
resolution by the Planning Authority or sending of a letter
to the Collector or even the State Government cannot
be treated as commencement of the proceedings for the
acquisition of land under the 1966 Act or the 1894 Act.
By enacting Sections 125 to 127 of the 1966 Act, the
State Legislature has made a definite departure from the
scheme of acquisition enshrined in the 1894 Act. But a
holistic reading of these provisions makes it clear that while
engrafting the substance of some of the provisions of the
1894 Act in the 1966 Act and leaving out other provisions,
the State Legislature has ensured that the landowners/other
interested persons, whose land is utilised for execution of
the development plan/town planning scheme, etc., are not
left high and dry. This is the reason why time-limit of ten
years has been prescribed in Section 31(5) and also under
Sections 126 and 127 of the 1966 Act for the acquisition of
land, with a stipulation that if the land is not acquired within
six months of the service of notice under Section 127 or
steps are not commenced for acquisition, reservation of
the land will be deemed to have lapsed. Shri Naphade’s
interpretation of the scheme of Sections 126 and 127, if
accepted, will lead to absurd results and the landowners
will be deprived of their right to use the property for an
indefinite period without being paid compensation. That
would tantamount to depriving the citizens of their property
without the sanction of law and would result in violation
of Article 300-A of the Constitution.”
1228 [2025] 2 S.C.R.
Supreme Court Reports
34. It is, thus, clear that the scheme of Sections 126 and 127 respectively
would leave nobody in doubt, for the reason that if a period of 10
years has elapsed from the date of publication of the plan in question,
and no steps for acquiring the land have been taken, then once a
purchase notice is served under Section 127, steps to acquire the
land must follow within a period of one year from the date of service
of such notice, or else the land acquisition proceedings would lapse.
35. This Court in Chhabildas (supra) summed up the position in law as
under:
“24.1. In all Section 49 cases, where a purchase notice has
been served and is confirmed within the period specified, the
appropriate authority must make an application to acquire
the land within one year from the date of confirmation of
the notice. If it does not do so, the reservation, designation,
etc. shall be deemed to have lapsed.
24.2. If within the period specified in Section 49(7), the
appropriate authority makes the requisite application, then
the State Government may acquire the land by making a
declaration under Section 6 of the Land Acquisition Act as
set out under Section 126(4), wherein the market value
shall be the market value of the land as on the date of
Section 6 declaration. Ordinarily, such declaration must be
made within 1 year of the date of receipt of the requisite
application. In case this is not done, it will be open to the
aggrieved person to move the Court to direct the State
Government to make the requisite declaration immediately.
24.3. If 10 years have passed from the date of publication of
the plan in question, and a purchase notice has been served
under Section 127, and no steps have been taken within a
period of one year from the date of service of such notice,
all proceedings shall be deemed to have lapsed. Thus, even
in cases covered by Section 49, the drill of Section 126(4)
and Section 127 will have to be followed, subsequent to
the appropriate authority making an application to acquire
the land within the period specified in Section 49(7).”
36. We take notice of the following:
a. On 11-01-1967, the MRTP Act came into force in the State of
Maharashtra.
[2025] 2 S.C.R. 1229
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
b. The property in question – Vacant plot admeasuring 50,138.
Sq ft in Survey No. 81/3 (NEW) 3 (old) in Mouza Rajapeth
Amravati, Maharashtra was originally owned jointly by Smt.
Akhtar Bano Rashid, Abdul Majid A. Samad and Mohd. Sajid
A. Samad respectively which was a part of the bigger plot
admeasuring 2.47 hectare.
c. The erstwhile owners had submitted Land Development Plan
for development of 2.47 hectare. The respondent No. 3 herein
sanctioned the development plan for residential area and the
remaining area admeasuring 50,138 sq. ft. was reserved for
Government school.
d. On 25-02-1993, the revised development plan for Amravati
came into effect in which the property in question was shown
as reserved for a private school i.e., for the respondent No.
5. Respondent No. 5 is a Public Trust registered under the
Maharashtra Public Trust Act, 1950.
e. From 1993 till 2006 no action was taken by the respondents
to acquire the property for the private school.
f. On 04-07-2006, the erstwhile owners served purchase notice
under Section 49 of the Act, 1966 on respondent No. 1 calling
upon him either to acquire the said property or release it from
reservation.
g. On 02-01-2007, the respondent No. 1 confirmed the purchase
notice issued by the erstwhile owners.
h. By a letter dated 02-01-2007, the respondent No. 1 directed
the respondent No. 5 to complete the acquisition proceedings
within twelve months from the 02-01-2007 failing which the
reservation would lapse and the property would stand released
from reservation.
i. Respondent No. 1 was aware that the land acquisition
proceedings had to be completed within twelve months from
02-01-2007 i.e., by 02-01-2008 failing which the property would
stand de-reserved by operation of Section 49(7) of the MRTP Act.
j. On 29-12-2007, i.e., just three days before the expiry of the last
date of acquiring the property i.e., 02-01-2008, the respondent
No. 5 issued a letter to the respondent No. 7 to commence the
land acquisition proceedings under Section 126 of the MRTP Act.
1230 [2025] 2 S.C.R.
Supreme Court Reports
k. On 13-08-2014, erstwhile owner issued purchase notice under
Section 127 of the MRTP Act to Respondent Nos. 1,3,4 and 6
requesting them to acquire their land.
l. Indisputably, till 2018 the respondent No. 3 did not make any
application to acquire the property and no notification under
Section 6 of the Land Acquisition Ac t, 1894 was published by
the competent authority.
m. Indisputably, no amount towards compensation was deposited
by the respondent No. 5 with any authority for the said property.
n. Thus, by operation of Section 49(7) of the MRTP Act reservation
of the property lapsed on 02-01-2008 and the erstwhile owners
were free to use the same as permissible in law.
o. On 09-04-2015, the erstwhile owners submitted an application
addressed to the respondent No. 4 seeking permission to
construct boundary wall surrounding the property with a view
to prevent encroachment.
p. The respondent No. 4 vide letter dated 27-08-2015 declined to
grant the permission to put up the wall on the ground that the
property was reserved for respondent No. 5.
q. On 30-12-2015 by registered sale deed the erstwhile owners
sold the property to the appellants herein.
r. On 16-03-2016 the appellants herein filed a writ petition seeking
direction that either the respondent No. 5 shall deposit the
amount towards compensation for the land reserved for it since
1993 or declare that the reservation had lapsed under Section
49(7) of the MRTP Act.
37. According to the learned counsel appearing for the appellants, in
view of the aforesaid, the reservation lapsed even under Section
127 on 13-08-2015.
38. It is very unfortunate to note that although the land was reserved
almost 33 years back for the benefit of Respondent No.5 yet the
said respondent was unable to avail the benefit of the same.
39. It does not make any good sense to keep a plot reserved in a
development plan for past 33 years. The Authority did not allow the
original owners to use the land and are now not permitting even the
purchasers i.e. the appellants – herein to utilize the land.
[2025] 2 S.C.R. 1231
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
40. This Court in Chhabildas (supra) after explaining the provisions of
Sections 49 and 127 of the MRT Act respectively thought fit to invoke
Article 142 of the Constitution to do complete justice having regard
to the long and inordinate delay in acquiring the land.
41. In the aforesaid context, we may refer to paras 25 to 31 of the
Chhabildas (supra) as under:
“25. The learned counsel appearing for the State has
relied upon this Court’s judgment in Prakash R. Gupta v.
Lonavala Municipal Council and others, (2009) 1 SCC 514,
wherein this Court held that the scheme contemplated by
Section 49 is totally different from that of Section 127, for
the reason that there is no period of 10 years in Section
49 as mentioned in Section 127.
26. This judgment does not carry the matter any further
as it is clear that, once an application is made within the
requisite period contained in Section 49(7), land acquisition
must follow in terms of Section 49(1) to purchase the
interest in the land, in accordance with the provisions of
the MRTP Act, as indicated above.
27. This Court, in Hasmukhrai V. Mehta v. State of
Maharashtra & Ors., (2015) 3 SCC 154, held that where
an inordinately long delay takes place from the date on
which the appropriate authority makes an application to
acquire the land (in that case 20 years), the land in question
stands released from reservation.
28. In the aforesaid judgment, the purchase notice under
Section 49 of the Act was dated 17th August, 2000. The
Director, Town Planning, wrote a letter to the Chief Officer
of the Khopoli Municipal Council stating that proceedings
for land acquisition for an Agricultural Produce Market Yard
would be initiated within one year from 16th March, 2001.
Consequently, the Khopoli Municipal Council wrote a letter
on 23rd April, 2001 to the Agricultural Produce Market
Committee to initiate acquisition proceedings. As nothing
was done, the Appellant ran from pillar to post and ultimately
filed a writ petition in February, 2004, complaining that the
Respondents are neither acquiring the land belonging to
the Appellant nor releasing the same from reservation
for the Agricultural Produce Market Yard. The High Court
1232 [2025] 2 S.C.R.
Supreme Court Reports
dismissed the aforesaid writ petition stating that as the
provisions of Section 127 were not attracted, there could
be no lapse. This Court, after referring to Sections 49 and
127 of the Act, held:
“12. We think it pertinent to mention here that APMC,
Respondent 5, even after service of notice, has not
cared to contest this appeal. Also, we think it relevant
to mention that till date no steps appear to have been
taken for acquisition of the land in question or to
release the same. The land of the appellant, in our
opinion, cannot be held up, without any authority of
law, as neither the same is purchased till date by the
respondent authorities, nor acquired under any law,
nor the appellant is being allowed to use the land
for the last more than twenty years.”
29. It thereafter referred to Vijayalakshmi v. Town Planning
Member (2006) 8 SCC 502 and Girnar (supra) and then
held:
“15. In view of the principle of law laid down by
this Court, as above, we are of the view that in the
present case since neither have steps been taken
by the authorities concerned for acquisition of the
land, nor is the land of the appellant purchased under
purchase notice, nor is he allowed to use the land for
the last more than twenty years, the land will have
to be released as the appellant cannot be deprived
from utilising his property for an indefinite period.
xxx xxx xxx
18. Accordingly, we allow the appeal and set aside
the impugned order passed by the High Court. Since
no steps appear to have been taken till date for the
last more than twenty years either for acquisition or
for purchase of the land under the MRTP Act, 1966
by the authorities concerned, as such, the land in
question stands released from reservation under
Section 127 of the MRTP Act.”
30. The aforesaid judgment lays down that since more than
20 years had elapsed since the date of the purchase notice
[2025] 2 S.C.R. 1233
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
under Section 49 on the facts of that case, the land will
have to be released from acquisition. No doubt this Court
held that over 20 years is an inordinately long period of
delay, and therefore, lapsing has taken place under Section
127 of the MRTP Act. However, on the facts of that case,
no purchase notice under Section 127 was issued after
10 years had elapsed from the date of publication of the
requisite plan. This being the case, we read the judgment
as having allowed a lapse to take place, in view of the
inordinately long delay of over 20 years, by really doing
complete justice on the facts of that case under Article
142 of the Constitution of India.
31. In the present case, 15 years have passed since the
date of publication of the development plan, and over 10
years have passed since the date of the purchase notice
issued under Section 49. Considering the fact that there
has been no stay at any stage by any Court, it is clear that
an inordinately long period of time has elapsed, both since
the date of publication of the development plan, as well as
the date of the purchase notice served under Section 49.
No doubt, the letter of 26.9.2008 shows that an application
was made within the requisite time period to acquire the
aforesaid land. However, on the facts of this case, since after
the aforesaid letter nothing has been done to acquire the
appellant’s property, we are of the view that the reservation
contained in the development plan as well as acquisition
proposal have lapsed. We make it clear that we hold this
in order to do complete justice between the parties under
Article 142 of the Constitution of India. However, in all
future cases that may arise under the provisions of Section
49, the drill of Section 127 must be followed, i.e. that after
10 years have elapsed from the date of publication of the
relevant plan, a second purchase notice must be served
in accordance with the provisions of Section 127, in order
that lapsing can take place under the aforesaid section.
With these observations, the appeal is disposed of.”
42. In the context of delay, we would also like to refer to the decision of
this Court in the case of Bhavnagar Universit v. Palitana Sugar Mills
Pvt. Ltd. and Others reported in AIR 23 SC 511 more particularly
paras 27, 32 to 35 and 38 respectively as under:
1234 [2025] 2 S.C.R.
Supreme Court Reports
“27. An owner of a property, subject to reasonable restrictions
which may be imposed by the Legislature, is entitled to
enjoy the property in any manner he likes. A right to use a
property in a particular manner or in other words a restriction
imposed on user thereof except in the mode and manner
laid down under statute would not be presumed.
xxx xxx xxx
32. Subsection (2) of Section 20, however, carves out an
exception to the exercise of powers by the State as regards
acquisition of the land for the purpose of carrying out the
development of the area in the manner provided for therein;
a bare reading whereof leaves no manner of doubt that
in the event the land referred to under subsection (1) of
Section 20 thereof is not acquired or proceedings under
the Land Acquisition Act are not commenced and further
in the event an owner or a person interested in the land
serves a notice in the manner specified therein, certain
consequences ensue, namely, the designation of the land
shall be deemed to have lapsed. A legal fiction, therefore,
has been created in the said provision.
33. The purpose and object of creating a legal fiction in
the statute is well known. When a legal fiction is created,
it must be given its full effect. In East End Dwelling Co.
Ltd. v. Finsbury Borough Council, [(1951) 2 All.E.R 587],
Lord Asquith, J. stated the law in the following terms:”
If you are bidden to treat an imaginary state of affairs as
real, you must surely, unless prohibited from doing so,
also imagine as real the consequences and incidents
which, if the putative state of affairs had in fact existed,
must inevitably have flowed from or accompanied it. One
of these in this case is emancipation from the 1939 level
of rents. The statute says that you must imagine a certain
state of affairs; it does not say that having done so, you
must cause or permit your imagination to boggle when it
comes to the inevitable corollaries of that state of affairs.”
The said principle has been reiterated by this Court
in M. Venugopal v. Divisional Manager, Life Insurance
Corporation of India, Machilipatnam, A.P. & Anr. [(1994) 2
[2025] 2 S.C.R. 1235
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
SCC 323]. See also Indian Oil Corporation Limited v. Chief
Inspector of Factories & Ors. etc., [(1998) 5 SCC 738],
Voltas Limited, Bombay v. Union of India & Ors.,[(1995)
Supp. 2 SCC 498], Harish Tandon v. Addl. District
Magistrate, Allahabad, U.P. & Ors. [(1995) 1 SCC 537]
and G. Viswanathan etc. v. Hon’ble Speaker, Tamil Nadu
Legislative Assembly, Madras & Anr. [(1996) 2 SCC 353].
34. The relevant provisions of the Act are absolutely
clear, unambiguous and implicit. A plain meaning of the
said provisions, in our considered view, would lead to
only one conclusion, namely, that in the event a notice is
issued by the owner of the land or other person interested
therein asking the authority to acquire the land upon
expiry of the period specified therein viz. ten years from
the date of issuance of final development plan and in the
event pursuant to or in furtherance thereof no action for
acquisition thereof is taken, the designation shall lapse.
35. This Court in Municipal Corporation of Greater Bombay’s
case (supra), in no uncertain terms while construing the
provisions of Section 127 of the Maharashtra Regional
and Town Planning Act, 1966 held the period of ten years
as reasonable in the following words:
“While the contention of learned counsel appearing
for the appellant that the words ‘six months from the
date of service of such notice’ in Section 127 of the
Act were not susceptible of a literal construction,
must be accepted, it must be borne in mind that the
period of six months provided by Section 127 upon
the expiry of which the reservation of the land under
a Development Plan lapses, is a valuable safeguard
to the citizen against arbitrary and irrational executive
action. Section 127 of the Act is a fetter upon the
power of eminent domain. By enacting Section 127
the legislature has struck a balance between the
competing claims of the interests of the general public
as regards the rights of an individual.”
It was observed that:
“The Act lays down the principles of fixation by providing
first, by the proviso to Section 126(2) that no such
1236 [2025] 2 S.C.R.
Supreme Court Reports
declaration under subsection (2) shall be made after the
expiry of three years from the date of publication of the
draft regional plan, development plan or any other plan,
secondly, by enacting subsection (4) of Section 126 that
if a declaration is not made within the period referred
to in subsection (2), the State Government may make
a fresh declaration but, in that event, the market value
of the land shall be the market value at the date of the
declaration under Section 6 and not the market value at
the date of the notification under Section 4, and thirdly,
by Section 127 that if any land reserved, allotted or
designated for any purpose in any development plan is
not acquired by agreement within 10 years from the date
on which a final regional plan or development plan comes
into force or if proceedings for the acquisition of such
land under the Land Acquisition Act are not commenced
within such period, such land shall be deemed to be
released from such reservation, allotment or designation
and become available to the owner for the purpose of
development on the failure of the Appropriate Authority
to initiate any steps for its acquisition within a period of
six months from the date of service of a notice by the
owner or any person interested in the land. It cannot
be doubted that a period of 10 years is long enough.,
The Development or the Planning Authority must take
recourse to acquisition with some amount of promptitude
in order that the compensation paid to the expropriated
owner bears a just relation to the real value of the land
as otherwise, the compensation paid for the acquisition
would be wholly illusory. Such fetter on statutory powers
is in the interest of the general public and the conditions
subject to which they can be exercised must be strictly
followed.”
It is true that Section 21 of the Act imposes a statutory
obligation on the part of the State and the appropriate
authorities to revise the development plan and for the
said purpose Section 9 to 20 ‘so far as may be’ would be
applicable thereto, but thereby the rights of the owners in
terms of subsection (2) of Section 20 are not taken away.
xxx xxx xxx
[2025] 2 S.C.R. 1237
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
38. Section 21 does not envisage that despite the fact that
in terms of subsection (2) of Section 20, the designation of
land shall lapse, the same, only because a draft revised
plan is made, would automatically give rise to revival
thereof. Section 20 does not manifest a legislative intent
to curtail or take away the right acquired by a landowner
under Section 22 of getting the land defreezed. In the
event the submission of the learned Solicitor General is
accepted the same would completely render the provisions
of Section 20(2) otiose and redundant.”
43. In the last, we may refer to the decision of this Court in the case
of Chairman, Indore Vikas Pradhikaran v. Pure Industrial Coke and
Chemicals Ltd. reported in (2007) 8 SCC 705 more particularly paras
53, 54 and 55 respectively therein:
“53. The right of property is now considered to be not only
a constitutional right but also a human right.
54. The Declaration of Human Rights (1789) enunciates
under Article 17
“since the right to property is inviolable and sacred, no
one may be deprived thereof, unless public necessity,
legally ascertained, obviously requires it and just and
prior indemnity has been paid”.
Further under Article 217 (IIII) of 10th December, 1948,
adopted in the General Assembly Resolution it is stated
that : (i) Everyone has the right to own property alone
as well as in association with others. (ii) No one shall be
arbitrarily deprived of his property.
55. Earlier human rights were existed to the claim of
individuals right to health, right to livelihood, right to shelter
and employment etc. but now human rights have started
gaining a multifacet approach. Now property rights are also
incorporated within the definition of human rights. Even claim
of adverse possession has to be read in consonance with
human rights. As President John Adams (17971801)put it,:
“Property is surely a right of mankind as real as liberty.”
Adding,
1238 [2025] 2 S.C.R.
Supreme Court Reports
“The moment the idea is admitted into society that
property is not as sacred as the laws of God, and
that there is not a force of law and public justice to
protect it, anarchy and tyranny commence”.”
44. The facts before us are very clear. We once again reiterate them
before we close this matter:
(i) On 13-08-2014, the erstwhile owners issued purchase notice
under Section 127 of the MRTP Act.
(ii) Development Plan came into effect on 25-02-1993.
(iii) The land had to be acquired within ten years of 25-02-1993 in
view of Section 127 of the Act which indisputably was not done.
(iv) After the issuance of notice under Section 127 of the MRTP Act
on 13-08-2014, the appropriate authority could have acquired
the land within twelve months, i.e., on/or before 13-08-2015.
The same was not done. This puts an end to the entire debate.
(v) The reservation could be said to have lapsed even under
Section 127 on 13-08-2015.
45. In such circumstances, when the erstwhile owners sold the land
to the appellants herein on 30-12-2015, there was no reservation.
46. This Court in the case of Prafulla C. Dave and Ors. v. Municipal
Commissioner and Ors. reported in (2015) 11 SCC 90 held thus:
“21. Under Section 127 of the M.R.T.P. Act, reservation,
allotment or designation of any land for any public purpose
specified in a development plan is deemed to have lapsed
and such land is deemed to be released only after notice
on the appropriate authority is served calling upon such
authority either to acquire the land by agreement or to
initiate proceedings for acquisition of the land either under
the M.R.T.P. Act or under the Land Acquisition Act, 1894 and
the said authority fails to comply with the demand raised
thereunder. Such notice can be issued by the owner or any
person interested in the land only if the land is not acquired
or proceeding for acquisition are not initiated within 10
years from the date on which the final development plan
had come into force. After service of notice by the land
[2025] 2 S.C.R. 1239
Nirmiti Developers Through its Partners & Anr. v.
The State of Maharashtra & Ors.
owner or the person interested, a mandatory period of six
months has to be lapsed within which time the authority
can still initiate the necessary action. Section 127 of the
M.R.T.P. Act or any other provision of the M.R.T.P. Act
does not provide for automatic lapsing of the acquisition,
reservation or designation of the land included in any
development plan on the expiry of 10 years. On the
contrary, upon expiry of the said period of 10 years, the
land owner or the person interested is mandated by the
statute to take certain positive steps i.e. to issue/serve a
notice and there must occur a corresponding failure on the
part of the authority to take requisite steps as demanded
therein in order to bring into effect the consequences
contemplated by Section 127 of the M.R.T.P. Act………”
(Emphasis supplied)
47. Thus, the principles underlying in Section 127 of the MRTP Act is
either to utilize the land for the purpose for which it is reserved in
the timeline given or let the owner utilize the land for the purpose as
permissible under the town planning scheme. The reservation shall
be deemed to have lapsed if no steps are taken for acquisition of the
said land within the prescribed period. Indisputably, in the present
case, the respondents have not taken any steps to issue notification
after receipt of the notice.
48. In Kolhapur Municipal corporation and Others v. Vasant Mahadev
Patil (dead), through LRs & Ors. reported in (2022) 5 SCC 758, this
Court held that when by operation of law the reservation is deemed to
have lapsed under Section 127(1) of the MRTP Act, the reservation
lapses for all purposes and for all times to come. In the said decision,
this Court was further pleased to observe that on the deemed lapse
of such reservation under Section 127(1) of the said Act no writ of
mandamus can be issued by the High Court to direct acquisition of
that land and pay compensation to the landowners as on the lapse
of such reservation, the land becomes free and the landowners can
use the land as if there was no reservation.
49. This Court in Municipal Corpn., Greater Mumbai v. Hiraman Sitaram
Deorukhar reported in (2019) 14 SCC 411 was examining the
reservation of land for a garden in a Development Plan in the year
1240 [2025] 2 S.C.R.
Supreme Court Reports
1966 but the same was not acquired even after purchase notice
was served by the landowner. However, relying upon the judgment
of this Court reported as Bangalore Medical Trust v. B.S. Muddappa
reported in (1991) 4 SCC 54 and some other judgments, it was held
that the land reserved for public park cannot be permitted to be
converted for other public purposes.
50. The landowner cannot be deprived of the use of the land for years
together. Once an embargo has been put on a landowner not to
use the land in a particular manner, the said restriction cannot be
kept open-ended for indefinite period. The statute has provided a
period of ten years to acquire the land under Section 126 of the Act.
Additional one year is granted to the landowner to serve a notice for
acquisition prior to the amendment by Maharashtra Act 42 of 2015.
Such timeline is sacrosanct and has to be adhered to by the State
or by the authorities under the State.
51. In the result, the appeals are allowed and the impugned order passed
by the High Court is set aside. It is declared that the reservation of
the plot in question could be said to have lapsed by efflux of time
in view of the provisions under Sections 126 and 127 of the MRTP
Act respectively.
52. Having regard to the gross delay of almost thirty years even without
the aid of Section 127 of the MRTP Act, we would have declared
the reservation to have lapsed in exercise of our jurisdiction under
Article 142 of the Constitution to do complete justice in the matter.
53. Pending applications if any shall stand disposed of.
Result of the case: Appeals allowed.
†
Headnotes prepared by: Mukund P Unny, Hony. Associate Editor
(Verified by: Shibani Ghosh, Adv.)
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