MUMBAI, Oct 17: The Mumbai high court on Monday ordered the sale of hundreds of acres of prime central city land owned by defunct textile mills in a decision that could lower property prices in India’s crowded financial hub.

The court directed that the 600 acres of land worth as much as two billion dollars be sold in three equal parcels — for low-cost government housing, development by the city municipal body and projects by the mill owners.

“The court ruled in our favour saying the land be distributed in the three categories equally,” said Datta Iswalkar, general secretary of Mill Workers Association, one of the petitioners in the court.

Iswalkar and a group of environmentalists had filed a case against the mill owners accusing them of violating environmental rules while selling the land on which the mills, some shut for decades, sit in central Mumbai.

In 1991 the mill owners and the then state government of Maharashtra, decided that the 600 acres be divided on the “one-third” formula.

“But in 2001 the new Congress-led government amended the 1991 decision and permitted the mill owners to offer only the open space available around the defunct mills under the formula,” Iswalkar told AFP.

“In effect this meant around 58 acres in each category. The court today scrapped this 2001 amendment.”

The court has also set aside five deals worth 500 million dollars that took place in the last year between mill owners and property developers for land.

Mumbai stands to gain vital new breathing space with the court’s decision because the mills would be the first large tracts of land developed in the narrow peninsular city in decades.—AFP