Dharavi redevelopment project: Maharashtra steps up land consolidation

Maharashtra has stepped up land consolidation for the Dharavi Redevelopment Project, issuing lease termination notices while assuring rehabilitation for eligible residents

The Maharashtra government has accelerated efforts to consolidate land for the Dharavi Redevelopment Project (DRP), with state agencies initiating the process of terminating the lease of properties within the Dharavi Notified Area (DNA). 

Documents accessed by Business Standard show that the Maharashtra Housing and Area Development Authority (Mhada) has issued showcause notices to the Mahatma Phule Education Trust for a 5,500 square metre (sqm) playground, citing alleged violations of the lease agreement’s terms and conditions. 

Mhada issued one of the show-cause notices to the trust in June 2026 regarding the plot. While the notices do not expressly state that the proposed termination is to facilitate the DRP, sources said  the action is part of the land aggregation exercise for the project.  

Under the lease agreement, the government has the right to terminate the lease whenever the land is required for a public purpose, including redevelopment. 

Separately, the Brihanmumbai Municipal Corporation (BMC) has begun issuing lease termination notices to cooperative housing societies that fall within DNA. SK Iyer, Dharavi Cooperative Housing Society, Bai Amba Bai, Mukund CHS, and Mahatma Gandhi CHS are among the first five societies to receive the notices. 

A government official said the lease cancellations would not affect rehabilitation rights. Eligible residents would continue to receive rehabilitation benefits under the applicable DRP/SRA (Slum Rehabilitation Authority) policy, including transit accommodation or rental support during redevelopment. 

Another official said that the leaseholders include both slum and non-slum properties. Eligible residents of non-slum buildings will receive either a minimum of 500 square feet (sq ft) of rehabilitation home or 1.35 times their existing carpet area, whichever is higher. 

“The government of Maharashtra is working to ensure the DRP moves ahead on schedule. Our effort is to begin rehabilitation work without delays, while making the transition as smooth as possible for residents through advance planning and, wherever required, transit accommodation or rental support,” Vipin Paliwal, DRP secretary, told Business Standard. 

Anil Harish, managing partner at D M Harish & Co, LLP, said a lessor may terminate a lease for substantial non-compliance by the lessee, but only in accordance with the terms of the lease deed and applicable law. Where the lease requires a notice to rectify breaches, that process must be followed before termination. 

Vishal Gehrana, advocate-on-record at Karanjawala & Co, said the Mhada notice relies on two distinct grounds — alleged breach of lease conditions and the government’s power to resume land for a public purpose, each of which would have to independently satisfy legal requirements.

 

Murtaza Kachwalla, partner at CMS INDUSLAW, said that where a government lease contains a resumption clause, authorities may have the contractual right to terminate the lease if the land is required for a public purpose. In the absence of such a clause, they may have to invoke statutory powers available under laws such as the Mhada Act or the Mumbai Municipal Corporation Act. 

Lawyers said leaseholders can challenge the notices, particularly on procedural grounds such as non-compliance with statutory or contractual requirements or violation of natural justice, rather than by disputing the public purpose of the redevelopment itself. 

Rahul Hingmire, managing partner at Vis Legis Law Practice, said leasehold rights and rehabilitation rights are legally distinct. “Even if a lease is terminated, an eligible resident may continue to enjoy rehabilitation benefits under the applicable redevelopment framework,” he added. 

Lawyers said potential litigation may delay redevelopment of specific land parcels if courts grant interim relief, but it is unlikely to stall the project as a whole. 

Ashwini Kumar, founder of My Legal Expert, said: “As regards delays, litigation is an almost inevitable feature of projects of this scale and complexity. Unless there are serious legal infirmities in the government’s actions, the existence of pending disputes may not necessarily prevent the project from progressing.” 

Emails sent to Mhada and BMC seeking comments remained unanswered till press time. 

Earlier, according to PTI, Devendra Fadnavis, chief minister of Maharashtra, said that the first phase of about 10,000 houses would be completed in the next 18 months. Land consolidation, faster approvals, and timely rehabilitation are seen as key to achieving that milestone. 

DRP, the country’s largest slum redevelopment, is estimated to rehabilitate around 72,000 residential and commercial tenants at a cost of over ₹95,790 crore.

 

How it’s going

• State agencies initiate termination of property lease within the Dharavi Notified Area
• Mhada has issued showcause notices to the Mahatma Phule Education Trust for a playground, citing alleged violations of the lease agreement
• BMC has begun issuing lease termination notices to cooperative housing societies within Dharavi
• Lease cancellations will not affect rehabilitation rights