The Supreme Court on Friday gave the Madras Race Club a full opportunity to be heard on the question of arrears of rent payable for 52.34 acres of land dispossessed from it by the Nilgiris district administration.
A Bench of Justices Hrishikesh Roy and S.V.N. Bhatti directed a competent authority within the Tamil Nadu government to adjudicate the issue of arrears due from the club.
The club, represented by senior advocate C.A. Sundaram and advocate Rohini Musa, had challenged a Madras High Court order of July 5, which held that the rent arrears added up to a whopping ₹822.63 crore (without interest) as on June 30, 2023.
The court held that the club deserved ‘no further leniency’.
By the time of the High Court order, the district administration had already taken possession and sealed the property. The land is proposed to be used for an eco park project.
On Friday, Mr. Sundaram said the amount of ₹822.63 crore was decided without any adjudication. The club should have been given an opportunity to be heard. It had been thrown out of the property overnight.
The Madras Race Club has been operating on the leased premises at Udhagamandalam (Ooty) for over 50 years. Horse racing had been held at the premises for over a century. The club had made substantial investments in the infrastructure and facilities at the racecourse, including the construction of stables and other buildings to support horse racing and related activities.
Mr. Sundaram said imposing over ₹820 crore on the club was like “flogging a dead horse”.
Senior advocate Jaideep Gupta, for the State of Tamil Nadu, said the amount of ₹822.63 crore was based on a show cause notice issued by the government against the club on July 4.
“A show cause notice can even say ₹3000 crore… The question is whether there was adjudication,” Justice Bhatti reacted.
The July 4 notice had said the amount was fixed taking into consideration the fact that the “substantial loss of revenue could have been utilised for public welfare, infrastructure development and other essential services”.
Disposing of the case, the court said the club must be allowed a fair opportunity to respond to the claim of ₹822.63 crore in rent arrears mentioned in the show cause notice of July 4.
The Bench left it open for the club to raise all contentions.
The court had on an earlier occasion, on July 10, refused to intervene in the dispossession of the land on the expiry of the lease.
On Friday, the apex court clarified that the order had however not endorsed the claim of ₹822.63 crore as rent arrears
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