Surya Lok Coop. Housing Society Ltd vs Dy. Registrar Of Cooperative Societies And Anr
- Court
- Bombay High Court
CNR No : HCBM010087592018
2026:BHC-AS:44326
Neeta Sawant
WP-14286 OF 2018
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 14286 OF 2018
Surya Lok Co-operative Housing Society Ltd. …..PETITIONERS
: VERSUS :
Deputy Registrar of Co-operative Society & Anr. ….RESPONDENT
_____________________________________________________________________________________
Mr. Naushad Engineer, Senior Advocate with Ms. Neeta Jain, Mr. Aman
Anand, Ms. Naina Jain & Ms. Aditi Sharma i/b K.J. Legal & Associates, for the
Petitioner.
Mr. Anil Sakhare, Senior Advocate i/b Mr. Joel J. Carlos, for Respondent No.
2 and 2(A).
Ms. S.D. Chipade , AGP for Respondent No. 1- State.
______________________________________________________________________________________
CORAM : SANDEEP V. MARNE, J.
JUDG. RESD. ON: 21 OCTOBER 2026.
JUDG. PRON. ON: 30 OCTOBER 2026.
JUDGMENT :
1) The Petitioner-society is aggrieved by the order dated 15 January
2018 passed by the Divisional Joint Registrar, Co-operative Societies, Mumbai
Division ( ) dismissing its Revision Application No.
Divisional Joint Registrar
416 of 2017 and confirming the letter dated 8 December 2016 of the Deputy
Registrar. By letter dated 8 December 2016, the Deputy Registrar has conveyed
that his office has no objection for commercial use of the flat by Respondent
No.2. Petitioner-society is opposed to commercial use of the residential flat
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located on ground floor of its building and has accordingly filed the present
Petition. Petition challenges the ‘No Objection Certificate’ dated 8 December
2016 issued by the Deputy Registrar, which is confirmed in revision by the
Divisional Joint Registrar.
2) Petitioner is a cooperative housing society registered under the
provisions of the Maharashtra Cooperative Societies Act, 1960 (MCS Act) . It is
Petitioner’s case that its building comprises of only residential flats. The
building of the Petitioner-society has flats on the ground floor. Flat No.3 on the
ground floor of the Petitioner’s building was initially owned by one Harshdev
D. Pathak, who was the member of the Petitioner-society. By deed of transfer
December
dated 31 2009, the flat was sold and transferred in favour of Mr.
Kunal S. Jumani. Mr. Kunal S. Jumani was admitted as member of the
December
Petitioner-society. After the death of Mr. Kunal Jumani on 2 2010,
letters of administration in respect of the flat was issued in the name of his
mother-Mrs. Kiran S. Jumani. By transfer deed dated 11 January 2016, Mrs.
Kiran S. Jumani transferred Flat No.3 in the name of Fazal Abbas Sayed and Ms.
Aafreen Fatima Fazal Abbas Sayed [Respondent Nos.2 and 2(A)], who applied to
the Petitioner-society for transfer of membership in the society. It is
Petitioner’s case that Respondent Nos. 2 and 2(A) converted Flat No. 3 for
commercial purposes and illegally commenced commercial operations in the
same. Since Petitioner-society did not grant membership to Respondent Nos.2
and 2(A), they filed application under Section 23(2) of the MCS Act before
Assistant Registrar. By order dated 4 August 2016, the Deputy Registrar
directed grant of membership to Respondent Nos.2 and 2(A) qua Flat No.3.
According to the Petitioner, Respondent Nos.2 and 2(A) furnished undertaking
to the society to use Flat No.3 for residential purposes and accordingly the
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society granted membership to Respondent Nos.2 and 2(A). In the meantime,
Respondent Nos.2 and 2(A) commenced proceedings for conversion of use of
Flat No.3 from residential to commercial use by filing proposal before the
Municipal Corporation. Since the Municipal Corporation required society’s
NOC, which it was not willing to grant the same, they approached the office of
the Deputy Registrar who has issued the impugned NOC dated 8 December
2016 communicating that his office does not have objection for commercial
use of Flat No.3. Aggrieved by NOC dated 8 December 2016, Petitioner-society
filed Revision Application No. 416 of 2017 before the Divisional Joint Registrar.
However, society’s revision is dismissed by order dated 15 January 2018.
Petitioner-society has accordingly filed the present petition challenging the
decisions of the Deputy Registrar and the Divisional Joint Registrar.
3) Mr. Engineer, the learned senior advocate appearing for the
Petitioner-society submits that the impugned decisions of the Deputy Registrar
and Divisional Joint Registrar are grossly illegal and arbitrary and deserve to be
set aside. He submits that the Deputy Registrar does not have any jurisdiction
to issue NOC for conversion of use of the premises from residential to
commercial. That in the impugned NOC dated 8 December 2016, the Deputy
Registrar has not quoted any particular provision of the Act under which the
NOC has been issued. He submits that provisions of Section 154B-27 of the
Maharashtra Co-operative Societies Act, 1960 (MCS Act) which empowers the
Registrar to issue NOC does not bring within its ambit power to issue NOC for
conversion of use of the premises. In support he relies on judgments of this
Court in Siddharth Borivali Cooperative Housing Society Limited Versus.
1
State of Maharashtra and others , Oberoi Springs Cooperative Housing
1
2025 SCC Online Bom 4348
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2
Society Limited Versus. Deputy Registrar Cooperative Society , Vaibhav
Industrial Premises Cooperative Society Ltd. Versus. Divisional Joint
3
Registrar Cooperative Society and order passed by this Court in Shree
4
Raghunandan CHS Ltd. versus. State of Maharashtra
4) Mr. Engineer further submits that Respondent Nos. 2 and 2(A) are
estopped from applying for a change in the user of Flat No. 3, in view of the
express undertakings given by them and their predecessor-in-title that the said
flat would be used exclusively for residential purposes. Mr. Engineer further
submits that the impugned order is passed by the Deputy Registrar in gross
violation of principles of natural justice since no notice was issued to the
Petitioner before issuing the impugned NOC. He submits that though a
resolution is adopted by the society on 16 April 2000 for allowing commercial
use of the flats on the ground floor, the same was withdrawn by subsequent
resolution's dated 5 August 2007 as re-affirmed on 14 September 2014. That
Respondent Nos.2 and 2(A) have purchased Flat No.3 with their eyes wide open
to the fact that all the flats in the building are to be used for residential
purposes only. He therefore prays for setting aside the impugned order.
5) Mr. Sakhare, the learned Senior Advocate appearing on behalf of
Respondent Nos. 2 and 2(A), opposes the petition, submitting that concurrent
findings have been recorded against the Petitioner-Society, holding that the
Society had erroneously withheld its NOC for the conversion of the use of the
flat for commercial purposes. He submits that almost all the flats on the ground
floor of the building are already put to commercial use. He submits that all the
2
2025 SCC Bom Online 4270
3
WP No. 14878/2023 decided on 16 December 2025
4
WP No. 2143 of 2020 dated 5 August 2020
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buildings on the road have shops on the ground floor. That it is easily
permissible to convert the use of Flat No.3 for commercial purpose as per the
planning norms. That it is Petitioner’s right to have the flat converted for
commercial use. He submits that definition of the term ‘flat’ in the bye-laws of
the society includes commercial premises. He further submits that the bye-laws
do not prohibit the use of any flat for commercial purposes and that the flat in
question has been used for commercial purposes since 2001. He draws my
attention to the electricity bills and municipal assessment records in support of
his contention. He further submits that the recitals in the transfer deed make it
clear that the previous owner was using the said flat as a tailoring boutique. He
also points out that Respondent Nos. 2 and 2(A) have paid stamp duty on the
basis of the commercial valuation of the flat. He therefore submits that the
Petitioner-Society was fully aware from the inception that Flat No. 3 was being
used for commercial purposes and that the only purpose of the present
proceedings is to accord legal recognition to such commercial use in the
municipal records.
6) Mr. Sakhare further submits that the issue of commercial use of
the flat has already attained finality by order dated 4 August 2016 passed by the
Deputy Registrar under Section 23(2) of the MCS Act. That the society’s
objection about commercial use has already been adjudicated by the Deputy
Registrar. Society did not challenge order dated 4 August 2016 which has
attained finality. He also invites my attention to NOC dated 22 August 2017
which is not challenged by the society. That society has granted membership to
Respondents Nos. 2 and 2(A) after adjudication of issue of commercial use by
acceptance of donation and transfer fees from Respondents Nos. 2 and 2(A).
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7) Mr. Sakhare further submits that the petition is filed at the
instance of the developer who is not willing to grant commercial premises to
Respondents Nos. 2 and 2(A). He invites my attention to the Development
Agreement to demonstrate that Respondents Nos. 2 and 2(A) have not signed
the same. He, therefore, submits that this Court need not exercise its
extraordinary jurisdiction under Article 227 of the Constitution of India to
assist the developer in increasing profits by not permitting the commercial use
of the premises. He prays for dismissal of the petition.
8) Rival contentions urged on behalf of the parties now fall for my
consideration.
9) Petitioner-society comprises of only residential flats as per the plan
sanctioned by the Municipal Corporation. Apparently, in the original plan
sanctioned, there are no commercial shops and offices in the building of the
Petitioner-society. There is no dispute to the position that Flat No.3 on the
ground floor of Petitioner’s building is sanctioned for residential use.
Respondents Nos. 2 and 2(A), who have purchased Flat No.3 vide transfer deed
dated 11 January 2016, are desirous of using the same for commercial purposes.
Respondent Nos. 2 and 2(A) have already been admitted as members of the
Petitioner-Society. It appears that Respondent Nos. 2 and 2(A) desire to obtain
sanction from the Planning Authority for commercial use of the flat and, for
that purpose, require the Society’s NOC. They, therefore, approached the
Deputy Registrar, who has issued the impugned NOC dated 8 December 2016 in
favour of Respondent Nos. 2 and 2(A), which reads thus:
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जा . क . मुंबई / उपनि / एच . प / बी - ४ / सुर्य लोकहौ .
/ /
१७३१ २०१०
प्रति ,
चेअरम / सेकेटरी
श्री . सय्र्यदफजलअब्बास
३ , सुर्य निकरण , सुचलोकको . ऑप . हौ . सोसा . लिल .
ळमजला , प्लॉट ं . ४६२ , ३३वारस् ा
- ,
खार पति3म मुंबई४०००५२
निवषर्य : ३ , सुर्य निकरण , सुर्य लोकको . ऑप . हौ . सोसा . लिल . र्यासंस्थेच्र्या ळमजलाप्लॉट ं . ४६२चा
.
व्र्यवसातिर्यकरणासाठीवापरकरणेबाब
संदर्भ :- १ . आपलेनिद . १० / ११ / २०१६चेपत्र .
वरीलसंदर्भिर्भर्यनिवषर्याकडेआपलेलक्षवेधण्र्या र्ये आहे .
उपरोक्तनिवषर्याच्र्याअ ुषंगा ेआपणसंदर्भDर्यपत्रा ेकेलेल्र्याअजाच्र्याअ ुषंगा ेआपणासकळनिवण्र्या
, . , . . . . . , . ,
र्ये ेकी ३ सुर्य निकरण सुचलोकको ऑप हौ सोसा लिल र्यासंस्थेच्र्या ळमजला प्लॉट ं ४६२ र्या
सदनि केमध्र्येबृहन्मुंबईमहा गरपालिलकेच्र्यामान्र्य े ुसारव्र्यापारीव्र्यवसार्यकरण्र्यासर्याकार्यालर्याची
कोण ीहीहरक ाही .
सही /-
उपनि बंधक
सहकारीसंस्था , एच - पति3मनिवर्भाग , मुंबई .
10) Armed with the NOC dated 8 December 2016, Respondent
approached Municipal Corporation for processing the proposal change of user
from residential to commercial and Municipal Corporation has apparently
issued permission dated 27 July 2017 for carrying out certain works for change
of use by approving the attached plan. Petitioner-society filed Revision
Application No. 416 of 2017 challenging the NOC issued by the Deputy
Registrar after noticing that such NOC was issued by the Deputy Registrar.
Though the Deputy Registrar has condoned the delay in filing the Revision
Application, the same is dismissed by order dated 15 January 2018.
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11) The first objection raised by the Petitioner-society to the
impugned NOC dated 8 December 2016 is absence of jurisdiction of Deputy
Registrar to issue any such NOC. The impugned NOC reproduced above does
not refer to any specific provision of the MCS Act, under which the Deputy
Registrar purported to exercise jurisdiction while issuing the same. At the time
when the impugned NOC was issued, provisions of Section 79 of the MCS Act
applied to cooperative housing societies. Under sub-section (2) of Section 79
Registrar was empowered to take any action which society fails to take under
the Act, Rules or bye-laws. Section 79 of the MCS Act provides thus:
79. Society's obligation to file returns and statements and Registrar's
power to enforce performance of such obligations
(1) The Registrar may direct any society or class of societies to take action to
comply with the provisions of this Act, rules made thereunder, by-laws of the
society or any order passed by the Registrar under this Act; and the officer or
officers of the society shall be bound to comply with order within the period
specified therein.
(1-1A) The registrar may direct any society or class of societies, to keep proper
books of accounts "[in such form, including electronic or any other form, as
may be prescribed] with respect to all sums of money received and expended by
the society, and the matters in respect of which the receipt and expenditure
take place all sales and purchases of goods by the society, and the assets and
liabilities of the society, and to furnish such statements and returns and to
produce such records as he may require from time to time; and the officer or
officers of the society shall be bound to comply with his order within the period
specified therein.
[(1A) Every society shall file returns within six months of the close of every
financial year to which such accounts relate, to the Registrar or to the person
authorised by him. The returns shall contain the following matters, namely:-
(a) annual report of its activities;
(b) its audited statement of accounts;
(c) plans for disposal of surplus funds as approved by the general body of the
society;
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(d) list of amendments to the bye-laws of the society, if any;
(e) declaration regarding date of holding of its general body meeting and
conduct of elections when due;
(f) any other information required by the Registrar in pursuance of any of the
provisions of this Act.
(1B) Every society shall also file a return regarding the name of the auditor or
auditing firm from a panel approved by a State Government in this behalf,
appointed in the general body meeting together with his written consent,
within a period of one month from the date of annual general body meeting.]
(2) Where any society is required to take any action [including filing of returns]
under this Act, the rules or the bye-laws, or to comply with an order made
under the [foregoing sub-sections], and such action is not taken-
(a) within the time provided in this Act, the rules or the bye laws, or the order
as the case may be, or
(b) where no time is so provided, within such time, having regard to the nature
and extent of the action to be taken, as the Registrar may specify by notice in
writing
the Registrar may himself, or through a person authorised by him, take such
action, at the expense of the society; and such expense shall be recoverable
from the society as if it were an arrear of land revenue.
(3) Where the Registrar takes action under sub-section (2), the Registrar may
call upon the officer or officers of the society whom he considers to be
responsible for not complying with the provisions of this Act, the rules or the
bye-laws, or the order made under [sub-sections (1) and (1-1A)] and after
giving such officer or officers an opportunity of being heard, may require him
or them to pay to the society the expenses paid or payable by it to the State
Government as a result of their failure to take action and to pay to the assets of
the society such sum not exceeding '[one hundred rupees] as the Registrar may
think fit for each day until the Registrar's directions are carried out.
[(4) The Registrar or the authorised person on his behalf shall scrutinise the
returns and information so received and take further necessary action, if
required]
12) After amendment of the MCS Act by introduction of Chapter XIII-
B w.e.f. 9 March 2019, special provisions have been made in relation to
cooperative housing societies. Under Section 154B-27, an obligation is
imposed on the society to take action and powers are conferred on the
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Registrar to enforce performance of some acts by the society. Section 154B-27
of the MCS Act provides thus:
154B-27. Obligation of society to take action and Registrar's powers to
enforce
(1) If any society is required to take action for performance of its obligations,
responsibilities and duties as provided in this Act, rules and bye-laws or to
execute the orders issued by the State Government or by the Registrar, from
time to time, and such actions are not taken or such orders are not executed,
the Registrar suo motu or on an application may issue directions to take such
action or actions or execute such orders
(2) Where any society is required to take any action or to execute the orders
provided in the foregoing sub-section and such action is not taken or orders
are not
executed,-
(i) within the time provided in this Act, rules or the bye-laws or in the order, as
the case may be;
(ii) where no time is provided, within such time having regard to the nature
and extent of the action to be taken as the Registrar may specify by notice in
writing,
the Registrar may himself or through a person authorized by him take such
action or execute such order at the expense of the society and such expenses
shall be recoverable from the responsible officer of the society as if it were
arrears of land revenue:
Provided that, before issuing an order or direction and fixing the responsibility
of payment of expenses an opportunity of being heard shall be given to the
officer of society to whom the Registrar considers to be responsible for not
taking such action or not executing such orders.
(3) The Application submitted by a Member to the society for the certificate or
certificates for sale of his flat or mortgaging it for obtaining loan or for any
other purpose shall be decided by the society within a period of thirty days
from the date of receipt of such application and decision thereon shall be
intimated to him within a period of fifteen days. If society fails to decide and
intimate such application within such time or if such application is rejected,
the Member may file appeal to the Registrar for appropriate relief within a
period of three months from date of submission of application to the society or
within a period of two months from the date of decision of rejection by society,
whichever is earlier:
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Provided that, every such appeal shall be disposed of by the Registrar within a
period of sixty days from the date of its receipt after giving opportunity of
being heard to all the parties.
13) Thus, under sub-section (3) of Section 154B-27, society is
obligated to decide application submitted by a member for certificate of
sale/mortgage of its flat or any other purpose within 30 days and upon failure
of the society to decide the application, an aggrieved member can file an appeal
before the Registrar. Thus, Section 79 and Section 154B-27 are the only two
provisions which are referable to Registrar’s power to perform an action which
the society fails to perform. As observed above, Section 154B-27 was not in
force when the impugned notice was issued. Thus, what applied at that time
was provisions of Section 79 of the MCS Act.
14) The issue as to whether the Registrar can issue NOC for change of
user of the premises under Section 79(2)(a) of the MCS Act fell for
consideration before this Court in Shree Raghunandan in which an interim
order is passed on 5 August 2020, holding in paragraphs 4 to 6 as under:
4. Having perused the impugned order dated 9 July 2019 passed by the Deputy
Registrar of Co-operative Societies, it is clear that the same is passed on a
complaint which was made by respondent no. 3 interalia in regard to the
petitioner-society not issuing a NOC for improvement or the change of user of
the premises. In making this complaint, respondent no.3 invoked the
provisions of Section 79(2)(a) of MCS Act 1960 praying before the Deputy
Registrar, that the petitioner-Society be directed to grant such a NOC which
would be ultimately submitted to the planning authority/Municipal
Corporation for the proposed changes in the premises, respondent no.3 wishes
to carry out. Admittedly the premises belong to the petitioner society of which
respondent No.3 is a beneficial member. By the impugned order, the Deputy
Registrar has issued a direction to the petitioner to issue a NOC, which is
challenged in the present petition.
5. Prima facie perusal of Section 79(2)(a) provides for a co-operative society's
obligation to file returns and statements and concerns the Registrar's power to
enforce performance of obligations. It is in this context, sub-section (2)(a)
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provides for a compliance mechanism. A plain reading of this provision would
show that when a Co-operative Society is required to take any action under the
Act, the rules or the bye-laws or to comply an order made under the said
provision and if such an action is not taken, in that event, an appropriate
direction can be issued by the Registrar by himself or through any person as
appointed by him.
6 It is difficult to conceive that the nature of the complaint as made by
respondent no. 3 before the Deputy Registrar invoking Section 79(2)(a) for
issuance of interalia a Fire NOC and a NOC for improvements can at all fall
within the purview of this provision. (In my prima-facie opinion the Deputy
Registrar of Cooperative Societies ex facie did not have any jurisdiction and
authority to issue such a direction to the petitioner to issue a NOC as
contained in the impugned order. In my prima facie opinion, respondent no.3's
case was clearly a case of a dispute between the member and the Society which
would require adjudication as per the provisions of Section 91 of Maharashtra
Co-operative Societies Actor before any other forum as may be permissible in
law. To read such wide powers to issue such directions as contained in the
impugned order under Section 79(2)(a) would amount to reading something
into the provision which the legislature has not provided for and in fact if so
construed would amount to something contrary to the statutory scheme of the
MCS Act 1960, including Section 91.
15) This Court recorded a prima-facie opinion in Shree Raghunandan
that provisions of Section 79(2)(a) cannot be invoked in for the purpose of
issuing NOC for change of user of the premises in the building of a society. I am
in agreement with the above prima-facie view expressed by the Coordinate
Bench of this Court in Shree Raghunandan.
16) Under Section 79(2) of the MCS Act, the Registrar is empowered to
take such action which the society fails to take in terms of the MCS Act, the
Rules made thereunder or as per the bye-laws. Section 79(2) of the MCS Act is
not an enabling provision for the Deputy Registrar to issue notice for change of
user of the premises in the building of the society. There is no provision under
the MCS Act, Rules made thereunder or bye-laws, which obligates the society
to issue such NOC. Thus, what society is not obligated to do cannot be directly
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done by the Deputy Registrar. Post amendment of the MCS Act in the year 2019
and after incorporation of Section 154B-27 therein, this Court has repeatedly
held that Deputy Registrar has no jurisdiction to issue NOC for change of user.
In Siddharth Borivali Cooperative Housing Society Limited , the Respondent
therein had sought permission form the society for change of user of its
premises from residential to commercial. The society refused to grant
permission. The Respondent approached the Deputy Registrar and sought
direction against the society to allow change of user. But the application was
rejected by the Deputy Registrar. However, the revisional authority directed
the society to issue NOC to the Respondent for change of user. After taking
into considerations the provisions of Section 154B-27 of the MCS Act,
coordinate Bench of this Court has held in paragraphs 7 to 13 of the judgment
as under:
7. On perusal of the said provision, it is evident that the said provision
provides that when the Act, Rules, bye laws, or any order issued by the State
Government or the Registrar requires a society to take a particular action, the
society must carry out that action. If the society does not act, the Registrar
may either on his own or on an application issue directions and require the
society to take such action.
8. If the society still fails to take the required action within the time given
under the Act, Rules, bye laws, or the order, or within the time fixed by the
Registrar, then the Registrar may himself take the necessary action. He may
also authorize another person to do so. The expenditure incurred for such
action will be recovered from the defaulting officer of the society as arrears of
land revenue. Before fixing such responsibility, the Registrar must give an
opportunity of hearing to the concerned officer.
9. Further, when a member applies to the society for any certificate required
for sale or mortgage of his flat or for any other similar purpose, the society
must take a decision within thirty days and communicate it within fifteen days.
If the society fails to decide or communicates rejection beyond this period, the
member has a right to appeal before the Registrar. The appeal must be filed
within three months from the date of application, or within two months from
communication of rejection, whichever is earlier. The Registrar must decide
such appeal within sixty days after giving hearing to all parties.
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10. The expression “for any other purpose” appearing in Section 154B-27(3)
cannot be detached from the context in which the legislature has placed it. The
legislature first refers to a certificate required for sale of a flat, then to a
certificate required for mortgaging it for obtaining a loan. These are specific
and well defined situations. Both relate to the member’s lawful dealing with his
property and to the need of a certificate from the society in that process.
11. The words “for any other purpose” follow these specific situations. They
must therefore be read in the same line. They include only those purposes
where a member seeks a certificate or permission from the society in respect of
his flat, based upon an obligation which arises under the Act, the Rules, or the
bye laws. The provision does not give a blanket authority to seek certificates
for every conceivable purpose. The action must have a nexus with the rights
and liabilities of a member under co operative law and with the duties of the
society towards its members.
12. When the legislature intended to empower the member to approach the
Registrar, it ensured that the society does not delay or obstruct a genuine
request. At the same time, the scope of the expression cannot be stretched to
compel the society to issue certificates in matters which fall outside the
cooperative framework. Therefore, “for any other purpose” must be interpreted
as any other legally permissible purpose of a similar nature which requires
issuance of a certificate relating to the member’s flat, and which arises from
the governing statutory provisions or bye laws.
13. This interpretation gives effect to the legislative intent. It protects the right
of the member. It ensures that the society performs its statutory duty within a
fixed time. It also maintains the balance, so that the society is not compelled to
act in matters beyond its authority.
17) In Oberoi Springs Cooperative Housing Society Limited (supra)
the Registrar had directed the Petitioner-society to grant permission for
submitting a proposal before the planning authority and the issue before this
Court was about interpretation of the expression ‘for any other purpose’
appearing in Section 154B-27 of the MCS Act. This Court held in paragraphs 6
to 9 of the judgment as under:
6. Therefore, the expression or for any other purpose must be read in the same
line. It must relate to matters similar to sale or mortgage. In simple terms, the
Registrar can intervene only when the member needs certification from the
society in matters connected with transfer or financial dealings concerning the
flat. The provision does not allow the Registrar to decide every dispute
between a member and a society.
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7. Request for permission to consolidate four flats before the planning
authority has nothing to do with sale or mortgage. Consolidation of flats
involves structural changes. Such decisions are taken by the planning authority
under the Development Control Regulations. Whether four flats can be merged
or not is a question governed entirely by the planning authority. The society's
views may be taken. However, the final authority lies with the planning
authority. Section 154B-27(3) does not give power to the Registrar to compel
the society to issue a no objection certificate for such consolidation.
8. The power of the Registrar under this provision is supervisory. It ensures
that a society does not withhold a certificate when the member requires it for
sale, mortgage, or similar legal purposes. It does not permit the Registrar to
command the society to support structural modifications of the building or to
influence proceedings before the planning authority.
9. There is nothing on record to show that refusal of the society to grant such
no objection falls within any legal obligation under the Act, rules, or bye laws.
In absence of such statutory oblignation, the Registrar cannot invoke Section
154B-27(3) to issue mandatory directions.
18) Similar issue is dealt with by this Court in Vaibhav Industrial
Premises Cooperative Society Ltd. (supra) in which again, provisions of Section
154B-27 of the MCS Act are interpreted and this Court held in paragraphs 5 to 7
of the judgment as under :
5. A plain reading of Section 154B-27 of the MCS Act leaves no manner of
doubt about its true scope. The provision is designed as an enforcement tool.
Its purpose is to ensure that the Act, the Rules, and the Bye-laws are duly
implemented. It enables the Registrar to compel compliance. It does not create
a forum for deciding disputes. It does not confer authority to examine rival
claims or to pronounce upon civil consequences between a member and the
society. The provision operates within the administrative domain and no
further.
6. Tested on this touchstone, the action taken in the present case travels far
beyond the limits of Section 154B-27. The Registrar issued notice. He heard
both sides. He examined their rival stands. He recorded findings on contested
issues. He then directed refund of amounts alleged to have been illegally
recovered. Such an exercise is not supervisory or corrective in nature. It bears
all the attributes of adjudication. It determines rights. It imposes liabilities.
This is a dispute squarely falling within the realm of a lis. Such disputes can be
resolved only by an authority vested with adjudicatory power under the
statute.
7. The respondent sought to justify this exercise by placing reliance on Model
Bye-law No. 174. This submission cannot be accepted. The law on this point
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stands settled. In A.P.D. Jain Pathshala v. Shivaji Bhagwat More, (2011) 13 SCC
99, the Supreme Court examined whether an executive or administrative
instrument could create an adjudicatory mechanism for deciding substantive
rights. The Court answered the question in the negative. It held that
adjudication of disputes is a legislative function. Such power must flow from
the statute itself. It cannot be assumed by executive instructions or bye-laws.
The Supreme Court emphasized the doctrine of separation of powers and
struck down the attempt to confer adjudicatory authority through an executive
resolution. Applying this principle, it is clear that neither Section 154B-27 of
the MCS Act nor Model Bye-law No. 174 clothes the Registrar with power to
adjudicate disputes between a member and the society. The impugned order is
thus without jurisdiction. It cannot be sustained in law.
19) In my view, therefore the impugned NOC issued by the Deputy
Registrar on 8 December 2016 is wholly without jurisdiction. The Deputy
Registrar is not invested with the power of directly issuing NOC permitting
particular use of the premises in the building of the society when provisions of
the MCS Act, rules made thereunder or bye-laws of the society do not obligate
the society to issue such NOC.
20) The action of the Deputy Registrar in the present case is wholly
untenable in law. The Deputy Registrar has not merely directed the society to
issue an NOC, rather, he has himself issued the NOC, stating that ‘ his office has
no objection to the commercial use of the premises ’. The Deputy Registrar has no
jurisdiction or authority to issue such an NOC in his own capacity. The
provisions of the MCS Act, do not contemplate issuance of an NOC by the
Deputy Registrar for a change in the use of the premises. Even assuming
arguendo that the Deputy Registrar has the power to direct the society to issue
an NOC, such power cannot, by any stretch of interpretation, be construed as
conferring upon him the authority to issue the NOC himself. The distinction
between directing the society to issue an NOC and issuing the NOC himself is
fundamental. The latter action is wholly beyond his jurisdiction and is legally
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unsustainable. The Deputy Registrar has acted in a most arbitrary manner in
the facts and circumstances of the present case by stating that ‘ his office does
not have objection ’ to change of user of the premises to commercial use.
21) It is unfathomable that Deputy Registrar sitting in his office grants
NOC for particular use of the premises without even bothering to hear the
society or verifying whether there are any commercial premises in the building
of the society or not. The Deputy Registrar has clearly usurped the powers and
functions of the society by issuing the NOC himself, despite having no
statutory authority to do so. In such circumstances, the impugned NOC issued
by the Deputy Registrar deserves to be set aside as being completely arbitrary
and ab-initio void.
22) The Deputy Registrar has also breached the principles of natural
justice to the impunity while issuing the impugned NOC. Respondent
approached the Deputy Registrar by letter dated 10 November 2016 and the
Deputy Registrar proceeded to issue him NOC on a platter without even
bothering to issue notice to the Petitioner-society. The impugned NOC is thus
granted by the Deputy Registrar without even affording an opportunity of
hearing to the Petitioner. This is yet another reason why the impugned NOC
deserves to be set aside.
23) Perusal of the impugned NOC would indicate that the same is
addressed both to the Chairman/Secretary as well as to Respondent No.2. The
Deputy Registrar was thus laboring under a misconception as if the society also
desired his NOC for conversion of the premises to commercial use. He
apparently thought that society inquired with him as to whether he personally
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has any objection of change of use of premises and by letter dated 8 December
2016, the Deputy Registrar conveyed to the society that his office does not have
any objection for change of user. The impugned NOC thus indicates complete
non application of mind on the part of the Deputy Registrar who has acted
arbitrarily, capriciously and illegally. Unfortunately, the Divisional Joint
Registrar has failed to notice the illegalities committed by the Deputy Registrar
in issuing the impugned notice.
24) It is also contended by the Petitioner-society that Respondent
Nos.2 and 2(A) are estopped from applying for change of user of Flat No.3. It
appears that Respondent Nos.2 and 2(A) have purchased Flat No.3 with their
eyes wide open to the fact that there are only residential premises in the
building of the Petitioner-society. There are apparently notices prominently
displayed in the premises of the society prohibiting any commercial activity in
any of the premises of the society. It appears that the Petitioner-society was
averse to grant of membership to Respondent Nos.2 and 2(A) on account of
their intention to use Flat No.3 for commercial purposes. The society therefore
did not decide application of Respondent Nos.2 and 2(A) for grant of
membership. Therefore, they approached the Deputy Registrar under Section
23(2) of the MCS Act. By order dated 4 August 2016 the Deputy Registrar
directed grant of membership to Respondent Nos.2 and 2(A) qua Flat No.3.
25) Mr. Sakhare has strenuously relied on findings recorded by the
Deputy Registrar in the order dated 4 August 2016 in support of his plea that
the issue of commercial use of Flat No.3 has attained finality by order dated 4
August 2016. He has relied on following findings recorded by the Deputy
Registrar in order dated 4 August 2016:
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अज दारर्यां ीसदनि काक्र३चावापरफक्तराहण्र्यासबंधीहे ूसाठीकरणारअसल्र्याचेहमीपत्रसंस्थेकडे
निदले रचप्रति वादीसंस्थासदनि काक्र३हीअजदारर्यांचे ावेहस् ां री करी निहसंस्थेचीअट
र्योग्र्य ाही
सर्भासदत्ववसदनि केच्र्यावापरा ीलबदलर्यानिवभिर्भन्नबाबीअसू सदनि केच्र्यावापरा ीलबदलाच्र्या
.
कारणास् वअजदारर्यां ासर्भासदत्व ाकारणेर्योग्र्यहोणार ाही
अज दारर्यां ीनिवक घे लेलीसदनि काक्र३ही ळमजल्र्यावरीलअसु प्रति वादीसंस्थे ील
ळमजल्र्यावरीलबहु ांशसदनि काचावापरव्र्यापारववाभिणज्र्यकवापरासाठीहो असल्र्याचाव
त्र्याबाब महा गरपलिलकेकडू व्र्यापारववाभिणज्र्यनिवषर्यकवापरासंबंधीकरांचीआकारणीकेलीजा
असल्र्याचापूरावाअज दारर्यां ीसदरअनिपला दाखलकेलेलाआहे . त्र्यामुळेप्रति वादीसंस्थे ेअजदार
र्यां ाव्र्यापारववाभिणज्र्यवापरासाठीसर्भासदत्व ाकारणेर्योग्र्य ाही
अज दारर्यां ी ोंदणीकृ करारान्वर्येसदनि काक्र३हीनिवक घे लीअसल्र्या ेत्र्यां ासर्भासदत्वदेणे
गरजेचेआहे .
र्याप्रातिधकरणासराहण्र्यासबंधी / व्र्यापारववाभिणज्र्यवापरासबंधीवेगवेगळेसर्भासदत्वदेण्र्याची
कार्यदर्या र ुद सु सर्भासदत्वदेण्र्याचेअतिधकारआहे .
उपरोक्तपरिरस्थिस्थ ीचानिवचारकर ाअजदारर्यां ीदाखलकेलेलाअनिपलअज मंजूरकरणेउतिच होईल
अशीमाझीखात्रीझाले ेमीखालीलप्रमाणेआदेशदे आहे .
26) In my view however, while deciding the issue of grant of
membership, the Deputy Registrar has not adjudicated the issue of commercial
or residential use of the flat. He cannot decide the issue of use while passing
order under Section 22(2) or Section 23(2) of the MCS Act. The order dated 4
August 2016 cannot be read to mean as if commercial use of Flat No.3 is
permitted by the Deputy Registrar. All that is held by the Deputy Registrar is
that grant of membership is a concept different than use of the flat. Though
some stray observations are made about use of other flats on the ground floor
for commercial purposes and commercial assessment by the Municipal
Corporation, the said observations cannot be read to mean as if the Deputy
Registrar has permitted commercial use of Flat No.3. The Deputy Registrar
steered clear of the controversy regarding the use of the premises by holding,
in his order dated 4 August 2016, that the purpose for which the flat was to be
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used could not constitute a ground for refusing membership to Respondent
Nos. 2 and 2(A).
27) It also appears that the Petitioner-society had specifically
contended before the Deputy Registrar that if Respondent Nos. 2 and 2(A) were
to submit an undertaking of use of the premises for residential purpose,
membership would be granted to them. This is clear from the following stand
taken by the Petitioner-society before the Dy. Registrar, as recorded in the
order dated 4 August 2016 which reads thus :
अज दारर्यां ीसदनि काक्र३चावापरफक्तराहण्र्यासबंधीच्र्याहे ूसाठीकरणारअसल्र्याचेजरहमीपत्र
प्रति वादीसंस्थेसनिदले रअजदारर्यांचे ावेसदनि का३होहस् ां री करण्र्यासकाहीहरक
सल्र्याचे मूदकेलेआहे .
28) It appears that after passing of order dated 4 August 2016,
Respondent No. 2 submitted an undertaking before the society on 25 October
2016 as under:
25.10.2016
To,
The Secretary/Chairman,
Surya Lok CHS Ltd., 33/14 Road Khar (W), Mumbai 400 052.
Sir/s.
Re: Transfer of Flat No.03
This is to record that you have agreed to transfer the said flat 03 is your Society
for Residential purpose.
That in view of the above I irrevocably undertake to withdraw all Police
complaint, court case or any other disputes between us as fully settled.
That the Society undertakes to irrevocably withdraw any legal proceeding
against me including appeal before Registrar.
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Sd/-
Sayed Fazal Abbas
Witness:
1. Neelam Nayyar
29) Thus, Respondent No. 2 specifically undertook to use Flat No. 3
exclusively for residential purposes. Membership was ultimately granted to the
Respondents on the basis of the undertaking dated 25 October 2016 submitted
by Respondent No. 2. It is for this reason that Mr. Engineer submits that,
having expressly undertaken to use the flat for residential purposes, the
Respondents cannot now turn around from their undertaking and seek to
convert the use of the flat from residential to commercial. It is also seen that
while submitting various forms for membership, Respondent Nos. 2 and 2(A)
specifically gave an undertaking that they would use the premises for purpose
mentioned in the letter and that there would be no change of user made by
them without previous permission of the society in writing. However,
Respondent Nos. 2 and 2(A) appear to have grossly violated the undertaking by
changing the use of the premises by directly approaching the Deputy Registrar
seeking his NOC for change of user.
30) Respondent Nos. 2 and 2(A) have relied upon the resolutions
adopted by the General Body of the Society at its meeting held on 16 April
2000. Para No. 7 of the minutes of the said meeting records that the Society
had no objection to the use of flats for commercial purposes. While selectively
relying on General Body resolution dated 16 April 2000 and by producing the
same at Exh.B to the affidavit in reply, Respondent Nos. 2 and 2(A) have
suppressed subsequent resolutions adopted by the society. In the AGM held on
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5 August 2007, the society withdrew Para/Resolution No.7 of the minutes of
the Special General Body Meeting dated 16 April 2000. The decision to not
allow commercial use of the premises in the building was reiterated in
subsequent AGM held on 14 September 2014. Both these resolutions of 5
August 2007 and 14 September 2014 are suppressed by Respondent Nos. 2 and
2(A) while selectively relying on resolution dated 16 April 2000. This Court
does not appreciate this conduct on the part of the Respondent Nos. 2 and
2(A).
31) Mr. Sakhare has relied on electricity bills, municipal assessment,
payment of stamp for commercial premises in support of the contention that
the premises are always used for commercial purpose. However, mere
municipal assessment for commercial purposes does not automatically convert
the use from residential to commercial. Similar is the position with regard to
supply of commercial electricity connection. Payment of stamp duty for
commercial purposes is a voluntary act of Respondent Nos. 2 and 2(A) which
does not ipso-facto convert use of the flat from residential to commercial.
Respondent Nos. 2 and 2(A) are both aware of this position and therefore they
submitted proposal to the Municipal Corporation for change of user and for
that purpose, applied for NOC. Thus, in the absence of an NOC from the
Society, even the Municipal Corporation cannot sanction a change in the user
of the premises. The Society is a tenant co-partnership society, wherein the
Society is the owner of the land and building, while its members have only the
right to occupy the premises allotted to them. In these circumstances, a change
in the user of the premises from residential to commercial is impermissible
without obtaining Society’s NOC. Since the building of the Society comprises
exclusively residential premises, the Society has refused to permit the use of
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any of the flats for commercial purposes. Whether action of the society in not
permitting commercial use is valid or not can be tested before a Co-Operative
Court by an aggrieved member by filing a dispute under Section 91 of the MCS
Act. The Deputy Registrar cannot be a machinery for securing NOC for change
of user. As observed above, the Deputy Registrar does not have jurisdiction to
either himself issue NOC or even to direct the society to issue NOC for change
of user.
32) Mr. Sakhare’s contention that the developer is driving the entire
litigation does not appeal to this Court. The redevelopment agreement is
executed on 12 November 2025 whereas the present petition is filed on 9
February 2018. It therefore cannot be contented that the developer appointed
in 2025 has initiated the present Petition with a view to earn more profits by
denying commercial premises to Respondents Nos. 2 and 2(A) as alleged.
33) In view of the above discussion, the NOC issued by the Deputy
Registrar is clearly unsustainable and liable to be set aside. Even the order of
the revisional authority which refuses to interfere with the impugned NOC is
also liable to be set aside. The Petition accordingly succeeds and I proceed to
pass the following order :
December
(i) The letter/NOC dated 8 2016 issued by the Deputy Registrar
and order dated 15 January 2018 passed by the Divisional Joint
Registrar are set aside.
(ii) Respondent Nos.2 and 2(A) shall however be at liberty to exercise
remedy under Section 91 of the MCS Act for the purpose of securing
NOC of the society for change of user. If dispute is filed by them under
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Section 91 of the MCS Act, the same shall be adjudicated on its own
merits without being influenced by any observations made in the
judgment.
34) With the above directions, the Writ Petition is allowed . Rule is
made absolute. There shall be no order as to costs.
NEETA
SHAILESH
SAWANT
[SANDEEP V. MARNE, J.]
Digitally signed by
NEETA SHAILESH
SAWANT
Date: 2026.10.30
21:24:42 +0530
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