SHIVRAJ NAGAR CO OP HSG SOC LTD THR CHAIRMAN v. MEXTECH REALTY PVT LTD AND ORS
Interpretation of Section 28 and Chapter XIII-B of the Maharashtra Co-operative Societies Act, 1960: Membership in Housing Societies and Restrictions on Shareholding.
Court: Bombay High Court
Citation: 2025:BHC-AS:57193
Decision Date: 24-12-2025
List of Laws
The Maharashtra Co-operative Societies Act, 1960; Section 28 of the Maharashtra Co-operative Societies Act, 1960; Chapter XIII-B of the Maharashtra Co-operative Societies Act, 1960; Section 154B of the Maharashtra Co-operative Societies Act, 1960; Section 154B-31 of the Maharashtra Co-operative Societies Act, 1960; The Indian Contract Act, 1872; Section 23 of the Indian Contract Act, 1872
- Facts: Mextech Realty Pvt. Ltd. (Respondent No. 1) purchased five bungalows in Shivraj Nagar Co-op. Hsg. Soc. Ltd. (Petitioner) in 2008. Based on these purchases, Mextech applied for membership in the society. The society did not decide on the application within the prescribed period, leading Mextech to claim deemed membership. The society challenged the sale deeds and the conferment of membership. After a series of appeals and revisions, the High Court, in a previous order dated 14 February 2024, granted Mextech liberty to submit fresh applications for membership. The society rejected these fresh applications, which led to further appeals and revisions, culminating in the present writ petitions.
- Procedural Posture: The petitioner, Shivraj Nagar Co-op. Hsg. Soc. Ltd., filed writ petitions challenging the order of the Divisional Joint Registrar, which had dismissed the society's revision application against the conferment of membership to Mextech Realty Pvt. Ltd. The writ petitions were heard together as they raised identical questions of law and arose from the same set of facts.
- Issue: Can Mextech Realty Pvt. Ltd. be denied membership in the Shivraj Nagar Co-op. Hsg. Soc. Ltd. based on Section 28 of the Maharashtra Co-operative Societies Act, 1960, which restricts holding of shares, given that Mextech purchased five out of fifteen bungalows in the society, and does this restriction survive after the introduction of Chapter XIII-B governing housing societies?
- Holding: No, Mextech Realty Pvt. Ltd. cannot be denied membership solely based on Section 28 of the Maharashtra Co-operative Societies Act, 1960, because Section 28 does not apply to housing societies after the introduction of Chapter XIII-B. The Court dismissed the writ petitions.
- Reasoning: The Court reasoned that Section 28 of the Maharashtra Co-operative Societies Act, 1960, which restricts holding of shares, is expressly excluded from applying to housing societies under Section 154B(2) after the introduction of Chapter XIII-B. The Court emphasized that Section 28 only deals with the number of shares a member can hold and does not bar the purchase of property. The Court also noted that the fresh applications for membership submitted by Mextech Realty Pvt. Ltd. after the Court's order on 14 February 2024, initiated a new round of proceedings governed by the law as it then stood, making Chapter XIII-B applicable. The Court further held that the sale deeds were not void under Section 23 of the Indian Contract Act, 1872, as Section 28 does not operate on the execution of a sale deed but only when shares are transferred or allotted. The Court clarified that the conferment of membership is subject to compliance with specific clauses of the society's order.
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