Bombay HC Sets Aside Deputy Registrar's Order Cancelling Co-operative Society Membership, Holds Section 79(2) Confers No Adjudicatory Power Over Title Disputes
Justice Sandeep V. Marne held that a Deputy Registrar acting under Section 79(2) of the Maharashtra Co-operative Societies Act cannot decide title disputes or direct cancellation of membership and share certificates.
The Bombay High Court has partly allowed a writ petition challenging a 2016 order by the Deputy Registrar, Co-operative Societies, G/N Ward, Mumbai, that directed Nandan Co-operative Housing Society Limited to cancel the membership and share certificate of the petitioner, Saili Durgadas Acharya, in relation to Flat No. A/4 at Veer Savarkar Marg, Shivaji Park, Mumbai. Justice Sandeep V. Marne, sitting singly, held that Section 79(2) of the Maharashtra Co-operative Societies Act, 1960 (MCS Act) is purely supervisory in character and does not empower the Registrar to adjudicate title disputes or to direct removal of a member's name from a share certificate where no prior order of the Registrar required such removal. The direction for cancellation of membership was set aside; directions for restoration of water supply and return of car parking were maintained.
A Flat, Two Families, and Four Decades of Dispute
The flat in question was originally in the sole name of Balmukund Acharya, whose name appeared in the share certificate from 1 March 1978. In October 1981, the society added the name of his brother Dattakumar Parshuram Acharya as a joint or nominal member on the basis of Dattakumar's occupation of the flat. Balmukund protested this addition by letter in July 1996.
In April 1997, Balmukund filed a suit before the Small Causes Court at Mumbai seeking eviction of Dattakumar as a gratuitous licensee and deletion of Dattakumar's name from society records. The plaint was returned for want of jurisdiction in October 1997. An appeal restored the suit in July 1998. Dattakumar then filed Writ Petition No. 5764 of 1998 before the High Court. During that writ petition, Balmukund agreed to withdraw the prayer for deletion of Dattakumar's name from the membership register, and the writ petition was disposed of accordingly. The Small Causes Court returned the plaint again on 27 January 2005 for lack of jurisdiction. A subsequent writ petition challenging that order was dismissed by this Court on 4 March 2009.
Balmukund died on 28 June 2011. His son Durgadas died on 3 August 2012. Saili, daughter of Durgadas and granddaughter of Balmukund, applied to the society on 23 August 2012 for transfer of membership. On 21 October 2012, the society transferred membership to Saili and issued a duplicate share certificate in her name alone. Separately, Saili asked the society to cancel car parking allotted to Dattakumar, which the society did by letter of 9 February 2013. The society had also passed a resolution on 31 August 2008 for cancellation of Dattakumar's associate membership.
Dattakumar then filed an application before the Deputy Registrar seeking cancellation of the duplicate share certificate issued to Saili, restoration of water supply to the flat, and restoration of his car parking. By the impugned order dated 16 May 2016, the Deputy Registrar issued three directives to the society under Section 79(2) of the MCS Act: cancel the membership and share certificate of Saili, restore water supply to Flat No. A/4, and return the car parking to Dattakumar. The society was given 15 days to comply and directed to file a compliance report within a further 7 days.
The Legal Issue: Scope of Section 79(2) of the MCS Act
Section 79 of the MCS Act governs a society's obligation to file returns and statements, and the Registrar's power to enforce performance of those obligations. Under sub-section (1), the Registrar may direct a society to maintain accounts and furnish statements. Sub-section (2) comes into play where a society fails to take action required under the Act, rules, or bye-laws, or fails to comply with an order made under the preceding sub-sections. In such cases, the Registrar may himself take that action at the expense of the society.
The Deputy Registrar's order rested on five broad reasons: office bearers of the society had troubled Dattakumar by stopping water supply and cancelling car parking; a site visit report confirmed water supply was disrupted only on the first floor where Dattakumar resided; Balmukund's withdrawal of the prayer for deletion of Dattakumar's name had crystallised Dattakumar's joint membership; the society's chairman had failed to appear before the Deputy Registrar; and title disputes, if any, were to be resolved by a competent court, with Dattakumar continuing as joint member in the interim.
Counsel for Saili argued that no authority had previously ordered cancellation of her membership, so the Deputy Registrar could not issue such a direction under the guise of Section 79(2). Counsel for Respondent No. 2 contended that Dattakumar's joint membership had crystallised once Balmukund gave up the deletion prayer, and that the Deputy Registrar had correctly exercised jurisdiction to restore the original position. The society's counsel supported the petition, adding that the resolution of 31 August 2008 removing Dattakumar's associate membership had already attained finality.
How the Court Reasoned
Justice Marne identified Section 79(2) as operating in two parts. The first part applies where a society fails to take action required by the Act, rules, or bye-laws. The second part applies where a society fails to comply with an order already passed by the Registrar under the preceding sub-sections. To act under either limb, the court held, there must be either a statutory duty of the society or a prior Registrar's order — neither of which existed here for the purpose of cancelling Saili's membership.
The court was unambiguous: “Power conferred under Section 79(2) of the MCS Act merely supervisory in nature.” It cannot be equated with adjudicatory power to decide questions of title or possession of a flat. The MCS Act does not envisage societies resolving title disputes, and the Registrar has no jurisdiction to adjudicate such disputes under Section 79.
Justice Marne drew on the reasoning of a co-ordinate bench in Sadashiv Nagappa Kadam v. State of Maharashtra and others (Writ Petition No. 2595 of 2026, decided 4 May 2026), which had held that the Registrar acting under Section 79 or Section 154B-27 of the MCS Act is conferred only with limited and supervisory powers, not with powers to decide questions relating to title or ownership in immovable property.
The court found that the dispute between the families had been alive since 1981. The share certificate was initially issued solely to Balmukund and Dattakumar's name was inserted as a joint or nominal member. Balmukund objected and later filed a suit. The withdrawal of the deletion prayer in the Small Causes Court proceedings was explained by the court on practical grounds: the Small Causes Court had no jurisdiction to direct deletion of a name from a share certificate, that power vesting only in the Co-operative Court. Balmukund withdrew that prayer to preserve his eviction suit, not to concede Dattakumar's membership. That withdrawal could not, in the court's view, become a foundation for the Deputy Registrar to exercise quasi-adjudicatory powers over membership.
On the Deputy Registrar's reasoning that Dattakumar's name should continue pending resolution of title: the court found this equally erroneous. By 21 October 2012, Saili's name had already been entered as sole member. If Dattakumar wished to contest that or claim ownership, he was required to pursue appropriate proceedings before the competent authority or court. The Deputy Registrar's assumption that deleting Saili's name would automatically revive Dattakumar's joint membership was, in the court's words, fallacious — particularly since the society had itself resolved in 2008 to remove Dattakumar's associate membership.
For directions 2 and 3 (restoration of water supply and return of car parking), the court took a different view. Directing a society to restore water supply to a flat and return a parking space to an occupant falls within the supervisory reach of Section 79(2). Since Dattakumar's successor, Nandita Acharya, occupied the flat, the court saw no basis to disturb those two directions.
Maintainability Objections Rejected
Respondent No. 2 raised three objections to the petition's maintainability. First, that Saili had suppressed her filing of an intervention application in the society's Appeal No. 340 of 2016 before the Divisional Joint Registrar and her filing of Dispute No. III/119 of 2016 before the Co-operative Court. Justice Marne rejected this outright: both events were clearly disclosed in paragraphs 21 and 22 of the petition. The court described the suppression allegation as “not only factually incorrect but also irresponsible.”
Second, Respondent No. 2 argued that Saili had exercised parallel remedies and the petition was therefore not maintainable. The court disagreed. Filing an intervention application in the society's appeal did not prevent Saili from filing her own independent challenge. The society's appeal had itself been dismissed for default on 1 August 2022. Had the petition not been entertained, Saili would have been left without any remedy against the 16 May 2016 order.
The filing and subsequent withdrawal of Dispute No. III/119 of 2016 before the Co-operative Court also presented no bar. That dispute sought a declaration that the share certificate dated 21 October 2012 was binding and sought injunction and possession. It did not challenge the Deputy Registrar's order. Saili's challenge to the Deputy Registrar's order was a separate and necessary step, and once she filed the present petition, she withdrew the Co-operative Court dispute on 12 March 2020.
Third, Respondent No. 2 objected that Saili had an alternate remedy by way of appeal under Section 152 of the MCS Act. Justice Marne applied the settled principle, relying on Whirlpool Corporation v. Registrar of Trade Marks (AIR 1999 SC 22), that where an authority acts entirely without jurisdiction, the availability of an alternate statutory remedy does not bar a writ petition. The petition had also been pending for eight years and the impugned order was already under stay. Relegating Saili to appeal at this stage was declined.
Order
The writ petition was partly allowed. The court passed the following directions:
Direction No. 1 in the order dated 16 May 2016 — cancellation of Saili's membership and share certificate — was set aside as wholly without jurisdiction.
Direction No. 2 (restoration of water supply to Flat No. A/4) and Direction No. 3 (return of car parking) were maintained.
Respondent No. 2A (Nandita Acharya, who was brought on record after Dattakumar's death on 24 February 2021) was granted liberty to pursue available remedies before the competent authority or court for securing removal of Saili's name from the membership register and share certificate.
The court clarified that nothing in the judgment would come in the way of either party seeking a declaration as to title and possession from a court of competent jurisdiction. No order as to costs was made.