Bombay High Court on Registrar’s obligation when registering separate societies in a single building
Background of the dispute
The Bombay High Court in Sadguru Universal CHS Ltd. Vs State of Maharashtra examined an important issue under the Maharashtra Cooperative Societies Act, 1960 and the Maharashtra Ownership Flats Act, 1963 (MOFA). The core question was whether a promoter governed by MOFA can validly secure registration of two different co-operative housing societies for a single building where the ground floor houses commercial units and the upper floors consist of residential flats.
The building in question is situated on Plot No.19, Sector 17, New Panvel (West), District Raigad. The planning authority, CIDCO, had sanctioned a single building consisting of ground plus thirteen floors. On this basis:
- 24 commercial units were constructed on the ground floor; and
- 88 residential units were constructed from the third to the thirteenth floors.
The construction was completed in 2020, and an Occupancy Certificate was issued on 24 June 2020 for this one sanctioned building.
The promoter, respondent No.5, subsequently obtained registration for two distinct societies—one representing residential flat purchasers (the petitioner society) and another for commercial unit holders (respondent No.4 society). The residential society questioned the validity of such dual registration on the basis that the entire structure was a single building with common facilities.
Facts leading to the writ petition
Registration of residential and commercial societies
According to the petitioner, respondent No.5 (the promoter):
- Submitted a proposal to respondent No.3 (Registrar) for registration of the petitioner society representing residential purchasers.
- Respondent No.3, by order dated 8 December 2021, granted registration to the petitioner society.
- In that proposal, the purchasers of commercial units were not included.
- Later, it emerged that a separate co-operative society for commercial units in the same building had already been registered, based on another proposal submitted by the promoter.
The petitioner pointed out that, of the 24 commercial units, respondent No.5 had retained ownership of 9 units, indicating continued promoter presence and control within the commercial society.
Challenge before revisional authority and High Court
The petitioner approached respondent No.1 (Revisional Authority) challenging the order dated 8 December 2021 on the ground that registration of a separate society for commercial units in the same building was contrary to the scheme of the Maharashtra Cooperative Societies Act, 1960 and MOFA.
Respondent No.1, by order dated 27 June 2024, dismissed the revision petition. The Revisional Authority relied on Section 154B-2(4) and Section 154B-1(8) of the Maharashtra Cooperative Societies Act, 1960, taking the view that registration of two societies is permissible in law.
Aggrieved by this, the petitioner filed Writ Petition No. 18153 of 2024 before the Bombay High Court.
Rival contentions before the Court
Submissions on behalf of the petitioner society
The learned Advocate for the petitioner contended that the authorities had misdirected themselves in their interpretation and application of Section 154B-2(4) and Section 154B-1(8) of the Maharashtra Cooperative Societies Act, 1960.