Elite Diagnostice Center Pvt Ltd vs Krshna Kunj Coop Housing Society Ltd An Dors

Neeta Sawant
WP 7855 OF 2026
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 7855 OF 2026
Elite Diagnostic Center Pvt. Ltd. ...Petitioner
V/s.
1. Krishna Kunj Co-op. Housing Society

Ltd.
2. Shri. Inderjeet Singh Bhatia
3. Smt. Sushila Agarwal
4. Shri. Thakur Lalji Singh
5. Shri. Rajendra Kanta Prasad
6. Shri. Jainendra Kanta Prasad
7. Smt. Shikha Munim
8. Shri. Dayabhan Singh
9. N.B.R. Singh
10. Smt. Mahar Khan
11. Dr. Satish Kumar Sharma
12. The Dy. Registrar, Co-op. Societies
13. The Divisional Joint Registrar
of Co-operative Societies, Mumbai
...Respondents
________________
Mr. Kishor Patil with Mr. Pratik B. Rahade i/b. Mr. Vinod N. Singh, for the
Petitioner.
Mr. Shriram Kulkarni with Ms. Minal Chavan for Respondent Nos. 1 to 9.
AGP for Respondent/State.
Mr. S.L. Babar,
Dr. Satish Sharma, Director of Petitioner present.
_______________
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Neeta Sawant
WP 7855 OF 2026
CORAM: SANDEEP V. MARNE, J.
JUDGMENT RESD. ON : 25 JUNE 2026
JUDGMENT PRON. ON : 02 JULY 2026
JUDGMENT:
1) The case involves a rather unusual circumstance, where the
director of Petitioner-company has sued himself in connection with
proceedings for de-registration of a cooperative housing society. He
wears two hats. In his individual capacity, he is a member of the society
on the strength of ownership of a garage. He has also functioned as
society’s office bearer. But in his capacity as director of company, he
seeks de-registration of the society inter alia on the ground that a garage
occupier cannot be society’s member. The director of Petitioner thus
purchased a garage, secured membership of the society and now claims
that garage owners cannot become members of the society and on that
count, seeks de-registration of society. His company is aggrieved by
rejection of application for de-registration of the society. He has
accordingly affirmed the present Petition on behalf of his company for
challenging the order rejecting de-registration of the Society in which he
has impleaded himself as Respondent No. 11.
2) Leaving aside the above unusual circumstance, the issue
that arises for consideration in the present Petition is whether de-
registration of a society can be ordered by the Registrar by taking into
consideration events that have occurred after society’s registration.
Whether factors such as existence of title disputes, allegations of
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WP 7855 OF 2026
unauthorised construction of society’s building, rejection of application
of society for deemed conveyance, etc. are germane for seeking de-
registration of a society formed 45 years ago? Also involved is the issue
whether de-registration proceedings can be permitted to be used for the
purpose of safeguarding title in the land?
3) The issues arise in the light of a challenge mounted by the
Petitioner to the Order dated 6 May 2026 passed by the Hon’ble Minister
(Co-operation) allowing Appeal No. 160 of 2025 filed by Respondent
No.1-Society and setting aside the order dated 3 September 2024 passed
by the Divisional Joint Registrar. By order dated 3 September 2024, the
Divisional Joint Registrar had allowed the application preferred by the
Petitioner and had set aside Certificate of Registration dated 23 March
1981 in respect of Respondent No.1-Society and had appointed an
Official Assignee for completion of the necessary legal process.
4) Brief facts of the case are that one Kishinibai Malkani and
Kanayalal Malkani purchased the landed property admeasuring 1331.13
sq.mtrs on 30 March 1951 on joint ownership basis. According to
Petitioner, the purchase was with the benefit of survivorship and that
therefore, upon death of Kishinibai Malkani in 1973, Kanayalal Malkani
became the sole owner of the property. One Chandru Chablani claiming
to be the son of Kishinibai Malkani, produced a will of Kishinibai and
applied for probate by filing Petition No. 356 of 1975. In the meantime,
Chandru Chablani applied to MCGM for sanction of building plans
projecting himself as the owner of the land. The Municipal Corporation
issued Commencement Certificate subject to condition inter alia of
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procuring probate in respect of the will. On behalf of Chandru Chablani,
M/s. Mak & Mak Builders constructed the building and secured
conditional Occupancy Certificate subject to production of probate in
respect of the will. By order dated 21 November 1977, this Court
restrained Chandru Chablani from dealing with the property. M/s. Mak &
Mak Builders sold the flats in the building, which according to the
Petitioner, was in violation of interim order passed by this Court. The
Developer, in capacity as Chief Promoter alongwith the flat purchasers,
submitted a proposal for registration of Co-operative Society on 13
February 1981. The Society was registered on 23 March 1981. According
to the Petitioner, a gross misrepresentation was made at the time of
registration of Society that there were 10 members when in fact only 6
flats were constructed in the building and open spaces were erroneously
shown as garages.
5) Nayan Construction Company Pvt. Ltd. purchased the same
landed property from Kanayalal Malkani. Nayan Construction Company
Pvt. Ltd. in turn sold the same to Elite Diagnostic Pvt. Ltd. ( Petitioner) ,
who claims to be the owner in respect of the entire land admeasuring
1331.13 sq.mtrs alongwith the building standing thereon. Petitioner
sought de-registration of Respondent No.1-Society and filed Application
No. 25 of 2014 under Section 21A of the Maharashtra Co-operative
Societies Act, 1960 . The application was opposed by the
(MCS Act)
Society. By order dated 3 September 2024, the Divisional Joint Registrar
allowed Application No. 25 of 2014 and set aside the Registration
Certificate dated 23 March 1981 issued by the Assistant Registrar, Co-
operative Societies (Administration Division-H), Mumbai ( Assistant
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Registrar ). The Divisional Joint Registrar appointed Official Assignee
under Section 21A(2) of the MCS Act for completion of procedure as per
the provisions of Section 21A(3). Respondent No.1-Society filed Appeal
No. 160 of 2025 before the Hon’ble Minister (Co-operation). By order
dated 6 May 2026, the Hon’ble Minister has allowed the Appeal and has
set aside the order of the Divisional Joint Registrar. Aggrieved by the
order dated 6 May 2026 passed by the Hon’ble Minister, the Petitioner
has filed the present Petition.
6) Mr. Kishor Patil, the learned counsel appearing for the
Petitioner submits that the Hon’ble Minister has grossly erred in
allowing the Appeal preferred by Respondent No.1. That the Divisional
Joint Registrar had rightly ordered cancellation of registration of the
Society. That the Society’s registration was premised on gross
misrepresentation. That the proposal under Section 8 of the MCS Act was
signed by 10 persons when in fact only 6 flats were constructed in the
building. That there are no constructed garages in the building and
merely open spaces are illegally shown as garages. That under the MCS
Act, a ‘garage’ cannot be treated as a ‘flat’ for the purpose of admission of
occupier thereof as a member of the Society. That the plans were
sanctioned subject to the condition of procuring probate in respect of
the will. That the probate Petition/Suit has been dismissed. That flats in
the building are sold in violation of interim order passed by this Court.
That the person ( Chandru Chablani ), at whose behest developer
constructed the building, has no title therein. That without probate of
the alleged will, the building is constructed and flats are sold. That the
factum of this Court dismissing the probate petition was not disclosed to
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the Registrar at the time of registration of the Society. That there is no
Occupancy Certificate for the building for the last 47 long years. That
there is also misdeclaration in respect of the family members as persons
at serial Nos.1, 7 and 8 in the proposal are family members within the
meaning of Section 6 of the MCS Act. That reliance is placed on
fraudulent communication dated 24 December 1977 as if it was an
Occupancy Certificate, when in fact the said communication rejected the
proposal for issuance of Occupancy Certificate. That clear undertaking
was given to the MCGM at the time of securing development permission
that the same was subject to issuance of probate. That fraud vitiates all
judicial acts. He relies on judgment of this Court in Rameshwar

Cooperative Housing Society Limited and Ors. Versus. Divisional Joint
1
Registrar and Ors. Mr. Patil would accordingly pray for setting aside the
order passed by the Hon'ble Minister.
7) Mr. Shriram Kulkarni, the learned counsel appearing for
Respondent No.1-society opposes the Petition and submits that the
petition is devoid of merits as the Hon'ble Minister has rightly allowed
the Appeal of the society and has rightly set aside the erroneous order of
the Divisional Joint Registrar. That the application for de-registration
was filed by the Petitioner after considerable delay. That director of
Petitioner himself is a member of the society, both in capacity as owner
of a flat earlier and now as owner of a garage. That since the Director of
the Petitioner applied for and secured membership of the Society, it
cannot now turn around and question registration thereof, that too after
lapse of considerable period of time.
1
WP 4704 of 2025 decided on 9 May 2025
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8) Mr. Kulkarni further submits that the scope of enquiry under
Section 21A of the MCS Act is extremely limited. That the Divisional
Joint Registrar cannot sit in appeal over the decision of the Assistant
Registrar. That though the remedy of filing Appeal was available at the
relevant time, the same was not exercised and what was sought is
revocation of the registration under Section 21A of the Act. He submits
that there is no misrepresentation on the part of the original purchasers
who have diligently disclosed the fact that there were four garages in the
building. That they were not supposed to disclose anything other than
the requirements in the form. That the Registrar was not supposed to go
into the issue of title while deciding the proposal for registration of the
society. That therefore, disclosure about pending litigation was not
required. That no grounds under Section 21A were made out for
revocation of registration and the Divisional Joint Registrar had
erroneously gone into the issue of title while passing order dated 3
September 2024. That the Hon'ble Minister has rightly set aside the order
of the Divisional Joint Registrar. He prays for dismissal of the Petition.
9) Mr. Babar, the learned AGP has supported the order passed
by the Hon’ble Minister (Cooperation).
10) Rival contentions urged on behalf of the parties now fall for
my consideration.
11) Petitioner is aggrieved by the order passed by the Hon’ble
Minister setting aside the order of the Divisional Joint Registrar, who had
directed de-registration of the society on the ground of
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misrepresentation. Petitioner claims ownership in respect of the landed
property on the part of which the building of the society has been
constructed. As observed above, the building has been constructed by the
developer- M/s. Mak & Mak Builders in pursuance of development rights
granted by Mr. Chandru Chablani. Petitioner claims that Mr. Chandru
Chablani did not have the title in respect of the land and that therefore,
construction of the building itself is illegal. It is also the case of the
Petitioner that since the Municipal Corporation had granted
development permission subject to the condition of securing probate in
respect of the alleged will executed in favour of Mr. Chandru Chablani
and since the probate petition/suit has been dismissed by this Court, the
construction of the building itself is rendered illegal. Petitioner claimed
before the Divisional Joint Registrar that vital information was
suppressed by the Chief Promoter and 10 proposed members while
securing registration of the society, as required number of flats in the
building did not exist and that this difficulty was sought to be
surmounted by showing open spaces as garages, when in fact there are
no garages in the building.
12) Petitioner is the purchaser of the land through Nayan
Constructions Pvt. Ltd, who in turn had purchased the same from Mr.
Kanayalal Malkani. Thus, the building is constructed in pursuance of
rights in the land granted by the alleged legal heir of one co-owner,
whereas the Petitioner has purchased the very same land through
another co-owner. Petitioner claims that though the purchase was joint,
the same was on survivorship benefit and that therefore Kanayalal
Malkani alone remained the owner after death of the joint owner. I have
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only briefly set out the position taken by the Petitioner on the issue of
title and I do not purpose to delve into the issue of title, which is not
germane to the limited controversy involved in the Petition.
13) Thus, the main objective behind filing the present Petition
and seeking de-registration of the society is to protect the title of the
Petitioner in respect of the land. Petitioner apparently apprehends that
registration of society in respect of alleged illegal building affects its title
in the land. The society claims title in respect of whole/part of the land.
Its application for deemed conveyance has however been rejected by the
Competent Authority. Society’s separate writ petition challenging the
order of the Competent Authority is pending.
14) It must be observed at the very outset that the Petition is
filed by a corporate entity named M/s. Elite Diagnostic Pvt. Ltd. and the
same is verified by Dr. Satish Sharma, describing himself as the Director
of the company. However, the Petitioner-company has impleaded Dr.
Satish Sharma as Respondent No.11 to the Petition. This is apparently
because Dr. Satish Sharma is also a member of the Society, of which de-
registration is sought by the Petitioner. Thus, the director of the
Petitioner chose to become a member of Respondent No.1-Society.
Apparently, he had purchased one flat and one garage in the building
and on that strength, had secured membership of the Society. Dr. Sharma
has sold the flat but has retained the garage. Today, his membership
stands on the strength of ownership/occupancy in respect of a garage.
The case thus involves unique situation where the Company is opposed
to registration of society though its director has voluntarily become its
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member. Also, the company claims that there are no garages in the
building and that garages cannot be treated as flats/units for formation
of society, but its director has purchased one of the garages and on that
strength has secured membership of the society.
15) It is also a matter of fact that Dr. Sharma also functioned as
office bearer of the society at some point of time. Thus, Dr. Sharma
conveniently changes his stance. In his individual capacity, he had
purchased a flat and still owns a garage in the building, but in the
capacity as director of Petitioner-company, he claims that the building is
illegally constructed. In his individual capacity, he is a member of the
society for last several decades and functioned as its office bearer, but in
his capacity as director of the company, he sought de-registration of the
society.
16) If Dr. Sharma was of the opinion that the society is illegally
formed or that there are no garages in the building, he ought not to have
become member of the Society nor should have purchased the garage or
applied for membership on the strength of ownership of the garage.
While his Company sought de-registration of the society in the year
2014, he functioned as office bearer of the very same society and never
had any problems about its registration. However, after about 33 long
years of formation and registration of the Society, Dr. Sharma's company
came up with idea of seeking de-registration of the society and
accordingly initiated proceedings under Section 21A of the MCS Act.
Since Petitioner has invoked jurisdiction of this Court under Article 227
of the Constitution of India, this conduct on the part of Petitioner's
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director-Dr. Sharma (who is driving the litigation) must be borne in
mind.
17) A cooperative society is registered under Section 9 of the
MCS Act after making application under Section 8 and after satisfying
the eligibility conditions stipulated in Section 6 of the MCS Act. The
order of registration of a society under Section 9 of the MCS Act is
appealable under Section 152. In the present case, the society was
registered by the Assistant Registrar by order dated 23 March 1981. The
aggrieved person had the remedy of filing Appeal to the Divisional Joint
Registrar under Section 152 of the MCS Act. However, the registration
order dated 23 March 1981 was not challenged by any person by filing
Appeal. What Petitioner sought after about 33 years of registration of
society is its de-registration under the provisions of Section 21A of the
MCS Act. It would therefore be necessary to take into consideration
provisions of Section 21A, which provides as under:
21A. De-registration of societies.—
(1) If the Registrar is satisfied that any society is registered on mis-
representation made by applicants, or where the work of the society is
completed or exhausted or the purposes for which the society has been
registered are not served or any primary agricultural co-operative credit
society using the word ‘Bank’, ‘Banking’, ‘Banker’ or any other derivative
of the word ‘Bank’ in its name, he may, after giving an opportunity of
being heard to the Chief Promoter, the committee and the members of
the society, de-register the society:
Provided that, where the number of members of the society is so large
and it is not possible to ascertain the correct addresses of all such
members from the records in the office of the Registrar and, in the
opinion of the Registrar it is not practicable to serve a notice of hearing
on each such individual member, a public notice of the proceedings of
the de-registration shall be given in the prescribed manner and such
notice shall be deemed to be notice to all the members of the society
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including the Chief Promoter and the members of the Committee of the
Society, and no proceeding in respect of the de-registration of the
society shall be called in question in any Court merely on the ground
that individual notice is not served on any such member.
(2) When a society is de-registered under the provisions of sub-section
(1), the Registrar may, notwithstanding anything contained in this Act
or any other law for the time being in force, make such incidental and
consequential orders including appointment of Official Assignee as the
circumstances may require.
(3) Subject to the rules made under this Act, the Official Assignee shall
realise the assets and liquidate the liabilities within a period of one year
from the date he takes over the charge of property, assets, books,
records and other documents, which period may, at the discretion of the
Registrar, be extended from time to time, so however, that the total
period does not exceed three years in the aggregate.
(4) The Official Assignee shall be paid such remuneration and
allowances as may be prescribed; and he shall not be entitled to any
remuneration whatever beyond the prescribed remuneration or
allowances.
(5) The powers of the Registrar under sub-sections (1) and (2) shall not
be exercised by any officer below the rank of a Joint Registrar of Co-
operative Societies.
18) Under sub-section (1) of Section 21A, the Registrar can order
de-registration of the Society only if (i) the Society is registered on
misrepresentation made by the Applicants, (ii) where work of the Society
is complete or exhausted, (iii) the purposes for which the society has
been registered are not served and (iv) if agricultural co-operative credit
society uses the words like ‘bank’, ‘banking’, ‘banker’ etc. Except these
four eventualities, the Registrar cannot exercise the power of de-
registration of the society. In the present case, admittedly ground nos. 2
to 4 enumerated above neither exist nor were alleged by the Petitioner
before the Divisional Joint Registrar. This leaves only the ground of
‘misrepresentation made by applicants’ for the purpose of exercise of
jurisdiction under Section 21A of the MCS Act in the present case. It is
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this ground of misrepresentation, which was pressed into service by the
Petitioner for seeking de-registration of the society. The Divisional Joint
Registrar had recorded a finding of misrepresentation while ordering de-
registration of the Society by order dated 3 September 2024.
19) Perusal of the order of the Divisional Joint Registrar dated 3
September 2024 would indicate that he took into consideration three
broad factors for ordering de-registration of the society. First , he went
into the issue of title in respect of the property, which is clear from
following findings in his order:
The Applicant herein has mainly raised the grounds that the building
Krishna Kunj was initially owned by one M/s. Nayan Construction
Company Pvt. Ltd. and the Applicant purchased the said building from
the said M/s. Nayan Construction Company Pvt. Ltd. Now, said building
stands in the name of the Applicant in the records.
From the documentary evidence annexed in the present case, it seems
that from the entries in the Property Card that earlier the suit plot was
in the name of Mrs. Rose Pries in the year 1950. Then, it seems to be
transferred in the name of Kishinibai Nenumal Malkani & Kankyalal
Nemumal Malkani in the year 1951. Thereafter, it seems that said
property card was transferred in the name of M/s. Nayan Construction
Co. Pvt Ltd. in the year 2002. Further, it appears that the said property
card has been transferred and registered in name of M/s. Elite
Diagnostic Centre Pvt Ltd. i.e. Applicant herein on 01/01/2002. Further,
it seems that the Municipal Corporation Property Tax Notices/ bills and
BSES bills are issued in the name of the Applicant herein.
Further, it is brought to my notice that Mr. Chandru Bulchand Chablani
had filed Testamentary Petition No. 356/1975 before Hon'ble High
Court in respect of the Will executed by the deceased Smt. Kishinibai
Nenumal Malkani. It seems that the said Testamentary Petition No.
356/1975 was converted into Suit No. 31/1975. In pursuance that
Hon'ble High Court by order dated-30/03/1978 dismissed the said
Testamentary Petition No. 356/1975 along with the Suit No. 31/1975
came to be dismissed and the said Will was not probated.
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Further, it appears that Mr. Kanayalal Mulkani had filed S. C. Suit No.
2748 of 1979 before Hon'ble Bombay City Civil Court at Bombay against
Mr. Chandru Bulchand Chablani. In pursuance to that Hon'ble Court by
Minutes of Order dated 04/12/1987 has recorded that Plaintiff by and
under a Deed of Conveyance dated 27/09/1987 has sold and conveyed
his right, title and interest in the suit property to M/s. Nayan
Construction Co. Pvt. Ltd. The Defendant states that the Defendant,
who is present in court, has confirmed that sale in favor of M/s. Nayan
Construction Co. Pvt.Ltd and has executed a Deed of Confirmation
dated 29th October, 1987 in respect of and pertaining to the suit
property.
Further, it appears that in the year 1982 the Court Receiver was also
appointed on the suit Property/Building. It seems that the Court
Receiver has issued several letters to the MCGM for demolition of the
said building.
20) Second , the Divisional Joint Registrar also went into the
issue of legality of construction of the building, which is clear from
following findings:
So also, it appears that the Applicant herein has filed Writ Petition No.
1454/2011 before Hon'ble High Court for direction to the MCGM for
taking action for removing the illegal construction/structure. In
pursuance to that Hon'ble High Court by order dated 15/02/2023
granted liberty to the petitioner to make representation to the
Authorized officer of the Corporation and the Authorized officer of the
Cooperation were directed to examine the same on its own merits and
proceed in the matter against all the unauthorized structures and
including if it pertains to the petitioner, after following the due process
in the accordance with law. In pursuance to the aforesaid order of
Hon'ble High Court the M.C.G.M issued notice under M.R.T.P Act to all
concerned parties including-flat holders of the said building and
directed to restore original status of land admeasuring 155 Sq. Meters
land situated on final Plot 139, CTS No. G. 545, T.P.S IV, Main Avenue
Road, Santacurz (West), Mumbai-400054 by removing the development
carried out pursuit to sanction Plan No. CE/4333/BS-I/AH dated
19/06/1974 within one month from the date of receipt of this notice.
Further it seems that the Occupation Certificate has not been issued by
MCGM to the building of Respondent No. 1 society.
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21) Third , the Divisional Joint Registrar relied upon the order
dated 10 June 2014 passed by the Competent Authority rejecting
Society’s application for deemed conveyance and has held that Society
does not have right to obtain transfer of the property.
22) By taking into consideration the above three factors of (i)
title dispute, (ii) unauthorised nature of construction, and (iii) rejection
of Society’s application for deemed conveyance, the Divisional Joint
Registrar had held that there was suppression before the Assistant
Registrar while seeking registration of the Society. The finding in this
regard in the order of the Divisional Joint Registrar reads thus:
From the above observations, it seems that the aforesaid facts,
documents and the Orders of the Hon’ble Court have been suppressed
from the then Respondent Assistant Registrar while registration of
Respondent society.
23) This is how the Divisional Joint Registrar had proceeded to
order de-registration of Respondent No.1-Society by order dated 3
September 2024.
24) The Hon’ble Minister took into consideration the remit of
enquiry under Section 21A of the MCS Act and has held that the ground
of misrepresentation can be adjudicated only on the basis of documents
submitted at the time of registration of the Society. The Hon’ble Minister
has held that the Divisional Joint Registrar did not record any finding
about any flaw in the document submitted at the time of registration. He
took into consideration the factum of Dr. Sharma himself being member
of the Society and he purchasing a garage in the building. He also took
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into consideration delay of 33 long years in filing application for de-
registration. Holding that the Divisional Joint Registrar did not specify
exact misrepresentation in the application for registration, the Hon'ble
Minister has allowed the Appeal of the Society and has set aside the
order passed by the Divisional Joint Registrar.
25) I am in agreement with the findings recorded by the Hon'ble
Minister. The remit of enquiry under Section 21A of the MCS Act is in
extremely narrow compass. As observed above, there is a separate
remedy of filing Appeal against registration of the society under Section
152 of the Act, which is a much broader remedy. The power of de-
registration is to be exercised in rare circumstances where one out of the
four enumerated circumstances under Section 21A is made out. The first
circumstance of ‘misrepresentation’ is not to be misunderstood as giving
wide or unbridled power on the Registrar of recalling the decision of
registration. While exercising the power under Section 21A, the Joint
Registrar cannot sit in appeal over the decision of the Assistant Registrar.
It is only in a rare case where registration of the society is based on
misrepresentation by the Applicants that the power of de-registration
can be exercised. The misrepresentation must be of such nature and
degree that if not made, the society would not have been registered.
Mere giving of inaccurate or incomplete information cannot be a
misrepresentation capable of de-registering the society. The
misrepresentation must be noticed in the information given while
seeking registration. The information on the basis of which registration
is obtained must be demonstrated as false or the documents submitted
must be demonstrated as forged or fabricated. Misrepresentation cannot
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be assumed on the basis of events occurring subsequent to the
registration of the society.
26) Perusal of the order of Divisional Joint Registrar would
indicate that he did not spell out as to how the original applicants
misrepresented the Assistant Registrar while seeking registration of the
society. As observed above, the Divisional Joint Registrar took into
consideration only three factors of (i) litigation relating to title of the
property, (ii) initiation of proceedings by MCGM in respect of alleged
unauthorised construction in the building and (iii) rejection of Society's
application for deemed conveyance. Most of the events concerning the
above three factors have taken place after registration of the society on
23 March 1981. This is clear from the following:
(i) Almost all events relating to title dispute, except one, have
occurred after registration of the society. Petitioner claims to
have purchased the property from Nayan Construction Company
Pvt. Ltd., and its name was mutated to the revenue records on 1
January 2002. Even the name of Nayan Construction Company
Pvt. Ltd. was apparently mutated to the revenue records in the
year 2002. So far as Testamentary Petition No. 356 of 1975,
which was converted into Testamentary Suit No. 31 of 1975, is
concerned, the dismissal of the Suit was on 30 March 1978.
However, subsequent S.C. Suit No. 2748 of 1979 was filed by
Kanayalal Malkani against Chandru Chablani in which minutes
of order dated 4 December 1987 were recorded which resulted
into conveyance dated 27 September 1987 in favour of Nayan
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Construction Company Pvt. Ltd. Thus, the title in respect of the
land is acquired both by Nayan Construction Company Pvt. Ltd.
as well as by the Petitioner well after registration of the society.
When the society was registered, Petitioner had no title in the
land. Therefore, the title claim of the Petitioner has no relevance
to determination of ground of misrepresentation at the time of
formation of society.
(ii) Appointment of Court Receiver in respect of the building
was apparently in the year 1982. The notices issued by MCGM in
respect of the construction are post registration of the Society.
Thus, all the events relating to alleged illegality in the
construction are post issuance of registration certificate.
(iii) The rejection of deemed conveyance application is on 10
June 2014 i.e., after lapse of 33 long years after registration of
the Society.
27) Thus, except dismissal of Testamentary Suit on 30 March
1978, all other events discussed by the Divisional Joint Registrar are post
registration of the Society. Since they have occurred after registration,
there is no question of any misrepresentation by the Applicants in
respect of those events at the time of registration. So far as the event of
dismissal of the Testamentary Petition/Suit is concerned, the same
concerns title to the land in question. The Assistant Registrar
entertaining application for registration of Society is neither supposed to
nor is empowered to adjudicate the issue of title. In the form submitted
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for registration of society, there was no column which required the
promoters to disclose information relating to dismissal of probate
petition/suit. Therefore, there is no question of any misrepresentation in
that regard by the Original Applicants, who sought registration of the
Society.
28) Thus, the ground of ‘misrepresentation by applicants’ was
not made out by the Petitioner and the Divisional Joint Registrar had
erroneously ordered de-registration of the Society by order dated 3
September 2024 and the Hon’ble Minister has rightly set aside his order.
29) Before me, a new ground is sought to be raised in respect of
non-fulfillment of conditions prescribed under Section 6 of the MCS Act
at the time of registration of the Society. It is contended that under
Section 6 of the Act, the Society could not be formed unless it consisted
of at least ten persons and who are not members of same family. It is
contended that only 6 flats were constructed in the building and that
therefore, there is no question of there being 10 members for formation
or registration of the Society. It is contended that the eligibility
condition of 10 members was sought to be artificially met by showing
four garages in the building which do not actually exist. It is contended
that there are only open spaces which were sanctioned as garages with
enclosures from three sides but never constructed so by the developer. It
is also contended that a garage meant for parking of vehicles cannot be
treated as a flat/unit for the purpose of registration of Society. However,
the Divisional Joint Registrar did not accept this contention of the
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Petitioner which was apparently raised vaguely in the application for de-
registration.
30) This Court could have refused to entertain the new ground
not considered by the Divisional Joint Registrar and by the Minister.
However because the same was vaguely raised in the application, I
proceed to examine the same. Perusal of the application for registration
of Society would indicate that a full disclosure was made that there are 6
flats and 4 garages in the building. Thus, registration of society was
sought by disclosing that four members were garage occupiers. Thus,
there is no misrepresentation at the time of registration of the Society.
Now, if a belief is carried that garage occupiers cannot be members of the
Society, the same would not fit into the ambit of the term
‘misrepresentation’ used under Section 21A of the MCS Act. Registration
of Society with 4 garage occupiers as members, would at the highest,
constitute an error in judgment by the Assistant Registrar, correction of
which could have been sought by filing Appeal under Section 152 of the
Act. However, the alleged error committed by the Assistant Registrar in
considering garage occupiers as eligible members within the meaning of
Section 6 of the Act cannot be treated as a misrepresentation on the part
of the Applicants. The objection sought to be raised by the Petitioner in
this regard therefore deserves outright rejection.
31) So far as the objection of family members joining together
for formation of Society is concerned, the names of all the occupants
were clearly disclosed to the Assistant Registrar. Similarly, a specific
declaration was made that two or more promoters were related to each
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other and were from the same family. Thus, it cannot be contended that
there is any misrepresentation on the part of the Applicants in this
regard.
32) The judgment of this Court in Rameshwar CHSL (supra)
relied upon by Mr. Patil actually militates against the Petitioner. In that
judgment, this Court has dealt with the concept of fraud and
misrepresentation in law in the context of provisions of Section 21A of
the MCS Act and has held in paras-33 and 34 as under :
33. Both in general jurisprudence and under Section 21A, fraud is a
serious charge requiring strong proof. The law regards fraud as an
extrinsic, collateral act that vitiates even the most solemn proceedings.
Fraud involves deliberate deception – a person knowingly making false
representations or concealing material facts to induce another (here,
the Registrar) to do something he would not have done otherwise. Our
Supreme Court has observed that fraud must be pleaded and proved
with particularity; it cannot be presumed from technical violations.
Minor errors or omissions do not equate to fraud. In S.P. Chengalvaraya
Naidu v. Jagannath (1994) 1 SCC 1, the Supreme Court famously stated
that “a fraud is an act of deliberate deception with the design of
securing something by taking unfair advantage of another... It is
cheating the court or tribunal, and every such act vitiates the entire
proceeding.” But the threshold to label something as fraud is high:
there must be cogent evidence of a false statement or willful
concealment of a decisive fact.
34. This Court, in Aurum Avenue Co-op Housing Society Ltd. & Anr.
(supra) in the context of Section 21A, has echoed that mere procedural
lapses or technical defects cannot be elevated to fraud so as to
summarily dissolve a society. This Court clearly distinguished between
procedural illegality or irregularities and fraud or misrepresentation.
Section 21A can only be invoked if the registration itself was obtained
by fraud, i.e., through deliberate concealment or misstatement of facts
that go to the root of the registration process. Misrepresentation, as
contemplated under Section 21A, is not merely providing inaccurate or
incomplete information. It must involve: Deliberate deception,
Suppression of material facts, or Presentation of forged or fabricated
documents. Thus, any finding of misrepresentation or fraud must be
substantiated by cogent evidence, not merely inferred from procedural
shortcomings.
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33) Thus, mere act of providing inaccurate or incomplete
information does not amount to misrepresentation under Section 21A.
To constitute misrepresentation, there needs to be deliberate deception,
suppression of facts or presentation of forged or fabricated documents.
In the present case, there is nothing on record to indicate that there was
any intention to deceive on the part of the ten original members. They
did not indulge into suppression of any of the facts nor presented any
forged or fabricated documents. Therefore, the ground of
misrepresentation could not have been invoked by the Joint Registrar for
exercise of power under Section 21A of the MCS Act.
34) Misrepresentation by the applicants while seeking
registration of the society is a jurisdictional fact for the Divisional Joint
Registrar to exercise jurisdiction under Section 21A of the Act. Since such
misrepresentation was not established, the order of the Joint Registrar
would be without jurisdiction. The Order is rightly set aside by the
Hon’ble Minister.
35) Even otherwise, this Court is not inclined to exercise
extraordinary jurisdiction under Article 227 of Constitution of India
considering the facts of the case. The society has been registered in the
year 1981. Its de-registration was sought after 33 long years. As observed
above, Petitioner’s director had purchased a flat in the very building and
had become member of the society. Thereafter he purchased a garage
and on the basis of such purchase also, he acquired membership of the
society. He still owns that garage and is a member of the society of which
he seeks de-registration. The director of the Petitioner, who has affirmed
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the Petition, is a Respondent to the Petition in his capacity as member.
Petitioner’s director has thus sued himself in the Petition. Jurisdiction of
this Court under Article 227 of the Constitution of India is supervisory
and it need not be exercised to correct every error of law or fact,
especially when the Court is satisfied with the ultimate outcome of the
litigation. Reference in this regard can be made to the judgment of the
2
Apex Court in Garment Craft vs. Prakash Chand Goel, in which it is
held in paragraph 15 as under:
15. Having heard the counsel for the parties, we are clearly of the view
that the impugned order 1 is contrary to law and cannot be sustained
for several reasons, but primarily for deviation from the limited
jurisdiction exercised by the High Court under Article 227 of the
Constitution of India. The High Court exercising supervisory
jurisdiction does not act as a court of first appeal to reappreciate,
reweigh the evidence or facts upon which the determination under
challenge is based. Supervisory jurisdiction is not to correct every
error of fact or even a legal flaw when the final finding is justified
or can be supported. The High Court is not to substitute its own
decision on facts and conclusion, for that of the inferior court or
tribunal. The jurisdiction exercised is in the nature of correctional
jurisdiction to set right grave dereliction of duty or flagrant abuse,
violation of fundamental principles of law or justice. The power
under Article 227 is exercised sparingly in appropriate cases, like
when there is no evidence at all to justify, or the finding is so
perverse that no reasonable person can possibly come to such a
conclusion that the court or tribunal has come to. It is axiomatic
that such discretionary relief must be exercised to ensure there is no
miscarriage of justice.
(emphasis added)
36) This Court is satisfied with the ultimate outcome of the
litigation between the parties. Ordering de-registration of the Society at
this stage ( after passage of 45 long years from its registration ) is otherwise
uncalled for. The society is ultimately formed for collective management
2
2022 (4) SCC 181
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of the building. It has managed the building for the last 45 long years,
and the director of Petitioner has been a part of the managing committee
and has taken active part in its management. If the society is de-
registered at this stage, the same would put the management of the
building in a quandary. The real motive of the Petitioner for initiation of
proceedings for de-registration is securing title in respect of the land.
That dispute cannot be adjudicated in de-registration proceedings, nor
those proceedings can be permitted to be misused for achieving the
oblique or veiled objective of securing title in respect of the land.
Petitioner can secure declaration of title in respect of the land without
de-registration of the society in appropriate proceedings. For that
purpose, de-registration of the society after 45 long years is
unwarranted.

37) Considering the above circumstances, in my view, no error
can be traced in the order passed by the Hon'ble Minister allowing the
Appeal and setting aside the order of the Divisional Joint Registrar.
38) In view of the above discussion, I do not find any valid
reason to interfere in the impugned order. The Writ Petition is devoid of
merits. It is accordingly dismissed with no order as to costs.
Digitally
signed by
NEETA
SHAILESH
SAWANT
Date:
2026.07.02
19:30:37
+0530
NEETA
SHAILESH
SAWANT
[SANDEEP V. MARNE , J.]
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