In the year 1995 the Government of Maharashtra being run by Shiv Sena-BJP appointed a study group under the Chairmanship of Dinesh Afzalpurkar an IAS officer to provide for a legal and institutional framework for slum redevelopment. During the 1995 state elctions, the alliance of Shiv Sena-BJP had promised that if elected to power they would provide free houses to the 40 lakh hutment dwellers. This was declared by Bal Thackeray in his election rallies. After getting elected to power, the government appointed a Study Group on 27th April 1995 to provide for a legal and institutional framework that would provide for free housing to slum dwellers. The genesis of the free housing scheme was contained in a letter that Bal Thackeray had written to the earlier Chief Minister Sharad Pawar who had declared it to be unrealistic. After getting elected to power, this very idea became the basis of working out the slum rehabilitation scheme. The Study Group had representatives from different government departments and people like Niranjan Hiranandani, Madhav Jog-Jog Developers, L C Gandhi-Gandhi Developers and Sheela Patel of ngo SPARC.
The Study Group came out with its Report on 20th July 1995 and recommended for appointment of Slum Rehabilitation Authority that would over see the implementation of the Slum Rehabilitation Scheme contained in the Development Control Regulation of 33.10.