Sahara had built a canteen, a bungalow and an out-house on plots at Peth Shahapur villages without getting any permission from the appropriate authorities. The Pune district officials had given notices for demolition on March 3, 1998 against which the company filed an application seeking a temporary injunction.

High Court had recently struck down the state government's sanction to the Sahara group to develop the Sahara Amby Valley tourist hill station three years ago. The company is now trying to get the same sanctions under the new development rules framed for the construction of private tourist spots by the state government.

The company argued that though the structures did not have sanction from the authorities, they could still be regularised after fineswere levied on them. They also argued that the structures were developed in the area reserved for tourist spots. They also argued that they were not allowed to put in their side of the argument before the notices were issued by the district authorities.