De-registration of Cooperative Housing Society – Direction of the Minister to initiate action only based on pendency of a title civil suit – Section 21A of the MCS Act, 1961.
Judgment dated 30.4.2024 in W.P.No.1421 of 2024 of New Manoday Cooperative Housing Society Ltd Vs. Uday Madhavrao Jagtap and others with W.P.(L) No.4104 of 2024
The reason for passing both the orders is the pendency of a civil suit for title by persons claiming ownership and/or share in the land against the promoters.
Madhavrao Jagtap was the original owner of the land Final Plot CTS Nos.229, 229/1 to 7 admeasuring 7890.17 sq.mters at village Kanheri, Borivali East, Mumbai. After his death, Manoramabai and Uday Jagtap came in possession of the said larger land and they took portion of 1583.46 sq.mts for development.
Nalini daughter of Alice who claim marriage with Madhavrao Jagtap had filed Suit No.246 of 1977 for partition and possession and later on, for declaration that she is the sole owner of the property. The said suit is pending in the City Civil Court and prosecuted by heirs of deceased Nalini.
During the pendency of the suit, there was no injunction in the civil suit against Manoramabai or Uday against construction or sale of flats. The building was constructed, flats were sold and an occupancy certificate was given on 3.1.1978. The society was registered on 18.11.1988.
Though the agreements of flat purchasers were only in respect of the land of 1583.46 sq.mts. Society made the application for unilateral deemed conveyance for the entire larger land. On 7.1.2012, the application for deemed conveyance was filed.
On 31.12.2012, the Competent Authority rejected the said application on the ground Nalini Jadhav is the owner of the land and did not execute sale agreements of flats. The writ petition against the said order was disposed by the Order dated 12.1.2023 on the submission of the petitioner society it would seek conveyance only for 1583.46 sq mts.
In the meanwhile, on 31.1.2023 i.e. after 36 years, the heirs of Nalini Jagtap fled Application No.6 of 2023 before the Divisional Joint Registrar of Cooperative Societies for de-registration of the petitioner society under Section 21A of the Maharashtra Cooperative Societies Act, 1960.
The said application was dismissed on 24.4.2023 as time-barred.
However, the Minister for Cooperation has set-aside the said order in the appeal under Section 152 of MCS Act and directed the Divisional Joint Registrar to initiate proceedings for de-registration of the society vide order dated 24.1.2024.
Section 21A of MCS Act provides for mis-representation as one of the grounds for de-registration of the society. However, the question is whether failure to obtain consent of Nalini Jadhav can be treated as “misrepresentation” by the applicants & flat purchasers who sought registration of the society?
Nalini Jadhav / her heirs are yet to establish their right, title and interest in the land in question in the pending title civil suit. Therefore, necessity of their consent for registration of the society is something which is yet to be decided. In these circumstances, failure to obtain Nalini Jadhav’s consent cannot be treated as misrepresentation within the meaning of Section 21A of the MCS Act.
The society has managed its affairs since last 36 years and number of transfers of flats /memberships would have taken place. The order of the learned Minister, if implemented, would result in suspending collective body of flat purchasers till Nalini Jadhav establish rights in the pending suit.
Interestingly, the suit is not even a party to the civil suit, whereas, the intervention application of the Society in the said suit is opposed.
The society as of now has absolutely no connection with the civil suit, however, its pendency is used as a ruse to annihilate collective body of flat purchasers formed 36 years ago.
Moreover, what is done by the Minister is exercise of determination of title dispute between the parties which is not the scope of inquiry under section 21A of MCS Act.
