Mumbai: Kalpataru will get prime 5-acre Shree Ram Mills land for Rs 105 crore

MUMBAI: Development of the prime 16-acre Shree Ram Mills at Worli Naka in central Mumbai appears to be jinxed for the property owner.
After losing control of Palais Royale, touted as India's tallest residential skyscraper, in an auction last year, mill owner Vikas Kasliwal will now have to cede another five acres of the land to developer Kalpataru. That too at merely Rs 105 crore for a property which today has a development potential multiple times that amount.
Last week, Supreme Court ruled in favour of Kalpataru, settling a 15-year legal battle between the developer and the mill owner over development rights of the five-acre property.
The apex court upheld the award given by the arbitral tribunal in favour of the developer while dismissing appeals filed by the insolvency resolution professional (IRP) on behalf of Shree Ram Urban Infrastructure Ltd (SRUIL) against the earlier orders passed by Bombay high court. The Supreme Court order caps the decade-and-a-half-long legal battle for one of Mumbai's prized properties.
The dispute dates back to 2004, when the Kasliwal family and Kalpataru signed an agreement for a portion of the Shree Ram Mills property. Kalpataru was to buy the five-acre parcel of the mill for Rs 105 crore. But the sale-touted as one of the largest mill land transactions of 2004-turned sour in less than a year. Kalpataru alleged that after making an initial payment of Rs 30 crore, the mill owners started to drag their feet on the deal as they realized they could get a higher price from other developers for the plot.
Countering this, the Kasliwals said Kalpataru did not have the financial resources to make the purchase and had delayed arranging a bank guarantee and funds for payment. The mill owner said the payment was to be made within four months of the agreement but Kalpataru couldn't come up with the money. In 2005, Kalpataru approached Bombay high court, seeking to restrain the mill owners from selling, alienating, transferring or creating third-party rights on the portion of land till the pending arbitration proceedings between the two parties are completed. In 2016, the arbitration ruling went in favour of Kalpataru and the matter then went to the Bombay high court.
In 2018, a division bench of the high court agreed with the arbitration order. "We find that the developer (Kalpataru) was always ready and willing to perform its part of the contract by furnishing the bank guarantees in the format required by SRUIL and VIT (mill owner)," the bench said. It referred to the conduct of the developer in getting plans made by the contractor to start construction work in 2005, as well as reminders sent by them to complete the agreement. The Supreme Court dismissed the IRP's special leave petition in its October 16, 2020, order, observing that the court "did not find any reason to interfere in the matter". Kalpataru will now have to pay the balance Rs 75 crore to the mill owner.