Cannot Dismember An Existing Factory: Bombay High Court Quashes BMC Notices To Acquire Private Land Under Section 299 MMC Act

"The impact of the proposed acquisition therefore, substantially and actually dismsembers an existing factory by invoking a provision which is intended to deal with land and structures falling within the regular line of a public street in the circumstances contemplated by that provision." Bombay High Court, in a significant ruling dated 11th August 2026, held that the Municipal Corporation of Greater Mumbai cannot invoke Sections 297 and 299 of the Mumbai Municipal Corporation Act, 1888 to acquire private land where no public street exists, particularly when such action would dismember a running industrial unit.

A division bench comprising Acting Chief Justice Ravindra V. Ghuge and Justice Gautam A. Ankhad observed that statutory powers intended for prescribing the regular line of a public street cannot be extended to arbitrarily take over settled private property.

The petitioners, in exclusive possession and use of a factory property at Lake Road, Bhandup since 1957, challenged the public notices dated 5th July 2024 and 1st April 2025 issued by the civic body. The municipal corporation sought to prescribe a 12.20-metre regular line for Aatmaram Bhoir Marg and take possession of a portion of the petitioners' land between points C and D to establish a connector road. Aggrieved by the possession notice issued under Section 299 of the Act, the petitioners approached the High Court seeking to quash the proceedings.

The primary question before the court was whether the municipal commissioner could exercise powers under Sections 297 and 299 of the MMC Act to take possession of private land over which no public street exists. The court was also called upon to determine whether the civic body could utilize street-line provisions when the acquisition severely disrupts and dismembers an operational factory.

Scope Of Municipal Powers Under Sections 297 And 299 MMC Act

The bench examined the statutory scheme governing public streets under the Act, specifically analyzing Sections 3(x), 291, 297, 299, and 301. The court observed that while Section 297(1)(a) empowers the Commissioner to prescribe a line on each side of any public street and Section 297(1)(b) allows prescribing a fresh line in substitution of an existing line, such powers cannot be applied mechanically to unencumbered private lands.

The judges observed that there was no dispute regarding the factual position that the petitioners have enjoyed exclusive possession and use of the property since 1957. The court highlighted that the existing road abruptly terminates at point C, leaving no existing public road between points C and D, which forms an integral part of the petitioners' long-standing industrial establishment.

Acquisition Substantially Dismembers Functioning Factory

Evaluating the physical repercussions on the industrial unit, the bench took note of the petitioner's reliance on the co-ordinate bench ruling in Steel Plant Pvt. Ltd. v. Municipal Corporation of Greater Mumbai (2022 SCC OnLine Bom 1804). The court accepted that running a road through the land would separate essential factory amenities, including the stores, workers' canteen, administrative area, and discharge facilities from the primary plant.

The bench further underscored that the proposed road alignment contained vital industrial utilities, including two natural gas pipeline connections, electrical rooms, and buried power cables. Taking over this portion would completely disrupt truck loading and unloading operations necessary for dispatch activities, causing severe structural and operational injury to the enterprise.

"The alignment between points C and D also contains gas pipes, electrical rooms and buried power cables connected with the factory."

No Genuine Public Interest Subserved By Road Alignment

The High Court scrutinized the civic body's justification of easing traffic and curbing pollution, finding that the proposed connector between Gamdevi Road and Lake Road would save a negligible distance of merely 400 metres. The court took judicial notice of the fact that the existing stretch of Aatmaram Bhoir Marg was heavily encroached, narrowing down to less than 6 metres in several spots against the sanctioned width of 9.15 metres.

The bench expressed displeasure over the corporation's failure to place any material demonstrating steps taken to clear encroachments or restore the existing road to its sanctioned width. The court observed that without clearing encroachments on the existing stretch, creating a partial connector through private property could neither resolve traffic congestion nor reduce vehicular pollution.

"We do not see how public interest will be sub-served, upon the Petitioners land being acquired."

Statutory Powers Cannot Be Extended For Private Benefit

Addressing allegations of arbitrariness, the bench found merit in the contention that the administrative machinery was activated to benefit a private developer executing a nearby project on C.T.S. No. 206 who sought dual road access. The court remarked that initiating summary acquisition under Sections 297 and 299 solely at the behest of an elected representative's representation, rather than objective public necessity, constitutes an impermissible extension of statutory powers.

The bench held that the summary procedure under Section 299 is strictly meant for taking possession of land and structures falling within the regular line of an existing public street. The judges ruled that statutory powers granted under the municipal enactment cannot be stretched to override private rights and bypass standard land acquisition safeguards.

"In our view, the statutory power under Section 297 and 299 cannot be extended to such an exercise."

Partly allowing the writ petition, the High Court quashed and set aside the impugned notices dated 5th July 2024 and 1st April 2025 insofar as they sought possession of the petitioner's factory land between points C and D. The ruling firmly establishes that municipal authorities cannot invoke regular line provisions under Section 299 of the MMC Act to acquire private property where no public street exists.

Date of Decision: 11th August 2026