Hearing a bunch of petitions that challenged the project, justice Ashok Desai and justice PS Patankar felt that the letter of intent was illegal because SIHL did not own the project land admeasuring 3,736 acres but was merely holding power of attorney on behalf of 69 land owners.

Directing the state government to probe the land deals of SIHL, the bench stayed its order for eight weeks to enable SIHL to file an appeal before the Supreme Court. The bench, however, restrained any further development of the project.

The letter of intent was issued under a state government notification of November 26, 1996, which allowed private parties to develop hill stations and resorts in Maharashtra subject to certainconditions.

Significantly, the court did not strike down the notification because it felt that allowing private sector to develop hill stations was a policy decision of the government. The bench also concurred with the government’s view that the existing hill stations in the state had become saturated and there was a need to develop new ones.

The petitions were filed by Bombay Environmental Action Group, Shankar Brahma Samajvijnam Granthalaya, Mohan Dharia, Parisar, Econet, Sai Paranjpe and Rashmi Mayur.