Institute of Legal and Management Studies

The Supreme Court on Friday (October 31) dismissed a plea seeking the de-sealing of a commercial premise situated in New Rajinder Nagar Market, Delhi. The Court upheld the sealing, noting an unauthorized misuse of residential spaces for commercial gain.

The Court held that the applicant's property was sanctioned as a “shop-cum-residence”, permitting commercial use only on the ground floor, while the upper floors, which the applicant himself had sought and obtained for residential use, were being illegally utilized for commercial purposes.

A bench of Chief Justice BR Gavai and Justice K. Vinod Chandran heard the case that arose out of the long-standing public interest litigation filed by M.C. Mehta relating to unauthorized constructions and environmental violations in Delhi. The applicant filed an interim application seeking relief on the strength of a general order dated December 18, 2023, issued by a Judicial Committee that had recommended treating the New Rajinder Nagar Market as a fully commercial area. However, the Municipal Corporation of Delhi (MCD) opposed the plea, asserting that the applicant had violated building bye-laws and misused residential areas for commercial activity.

Rejecting the applicant's argument, the Court noted that the Judicial Committee's order was only a general observation and did not automatically entitle individual property owners to de-sealing. The Court emphasized that each case must be examined on its own facts, based on sanctioned building plans, lease deeds, and other documentary evidence.

The applicant contended that the property inherits the commercial nature as it has been used for a long time as a commercial property. "We find that the lease and the subsequent freehold rights granted permits only the ground floor to be used as commercial area," the Court concluded, finding no proof to support the owner's historical commercial use claim.

Further, the Court referred to the conveyance deed, which specifically mentioned that the approval of the construction of the upper floor was for residential spaces, which also negated the applicant's argument about the commercialised effect of the property.

“the admitted position is that the ground floor of the property in question was given in possession on lease, and subsequently conveyed, to be used as a shop for commercial purpose. The question is only whether the upper floors can be constructed and used for commercial purpose.”, the court asked before referring to the conveyance deed obtained by the applicant as produced by him with an approval for the construction of upper floors in the year 2005, which approval is also for residential spaces on the upper floors.

The Court affirmed the classification of New Rajinder Nagar Market as a "designated Local Shopping Centre (LSC)", a shop-cum-residence complex where only the ground floor is meant for commerce, and the upper floors are residential.

“We find the New Rajinder Nagar Market to be a shop-cum-residence LSC as designated in the MPD-2021.”, the court held.

Nevertheless, the Court also provided a route for regularization. It directed the MCD to conduct a fresh inspection of the premises and to issue a detailed order identifying non-compoundable violations that must be demolished, calculating the requisite conversion charges for changing the land use, and imposing penalty charges for the excess construction. The applicant was permitted to seek de-sealing of the property only after removing non-compoundable constructions and paying all prescribed charges in full.

“The FAR of the building already constructed, with the upper floors further fortify the contention of the MCD that over the shop residential spaces were constructed, since the FAR sanctioned exceeds that for commercial spaces. The upper floors though eligible for conversion, it can happen only with payment of the conversion charges. The additional FAR as built and existing in excess of that sanction will also have to be regularised by paying penalty charges and any non-compoundable constructions will have to be removed. In the above circumstances, we reject the I.A. filed by the applicant to de-seal the premises at Shop/Plot no. 106, New Rajinder Nagar Market and also reject the prayer for permitting the use of upper floors as commercial.”, the court said.

“we direct the MCD to issue a further notice for inspection which shall be jointly done and the violations intimated by a written order specifically pointing out the non-compoundable constructions. The order shall also indicate the conversion charges payable for the upper floors and the penalty charges for regularisation of excess FAR from that sanctioned. The applicant would be entitled to comply with the order passed removing the non-compoundable constructions/ projections and depositing the conversion charges as also the penalty charges for regularisation of the excess FAR so as to carry out commercial activities in the upper floors.”, the court ordered.

Accordingly, the application was dismissed.

Cause Title: M.C. Mehta Versus Union of India & Ors.

Citation : 2025 LiveLaw (SC) 1050

Click here to read/download the order

Appearance

Mr. Kailash Vasdev, Senior Counsel, for the applicant,

Mr. S. Guru Krishna Kumar, Senior Counsel as the Amicus Curiae

Mr. Sanjib Sen, Senior Counsel, for the MCD