Mere pendency of the application for approval of the builder does not vest any right; SC.

Supreme Court of India

Justice R Banumathi, Justice A S Bopanna and Justice Hrishikesh Roy

The SC { CHENNAI METROPOLITAN DEVELOPMENT AUTHORITY v. D. RAJAN DEV AND OTHERS} holds that that no right accrued to the applicant-builder by mere filing of application for approval and the right accrues only after approval is granted by the Government/concerned authorities. 

It was held that mere pendency of the application for planning permission does not create a vested right in an applicant. Right accrues only when the permission/sanction is granted by the Government/concerned authorities. It was held that this is because planning permission is accorded on the basis of scrutiny of application form and the concerned documents. There is always possibility of an application not meeting the requisite criteria for carrying out the proposed development and being rejected.

Further held that until and unless an application complete in all respect is approved, it remains a mere application and no right can be claimed on the basis of such an application. A proposal cannot be equated with an approval, otherwise the later will lose all significance. The obvious logical conclusion is that the right to an applicant accrues when the permission has been granted. Further, as a corollary, it can be said that the rates prevailing at the time of granting of permission are the rates which an applicant has to pay. The respondent/applicant cannot claim the benefit of the earlier guideline value existing prior to the date when approval was granted by the government. It was held by the bench that the respondent will have to pay FSI Premium charges based on the guideline value as existing on the date of grant of approval. 

The issue in the present case was; whether to calculate the Premium FSI charges at the rate prevalent as on the date of filing of application by the first respondent or at the time of grant of approval. Allowing the appeal, the SC held it to be latter.