Cooperative Court can adjudicate disputes over housing society redevelopment: HC

Justice Amit Borkar delivered the verdict while deciding a batch of petitions filed by members of a housing society in the city, challenging a 2019 cooperative appellate court order which limited the cooperative court’s powers to hear their dispute with a developer.

The dispute arose after the administrator of the housing society signed a redevelopment agreement with Pancharatna Properties in 2006, allegedly without the authority to do so. Society members approached the cooperative court in 2013, seeking to declare both the resolution approving the redevelopment and the agreement itself illegal.

Initially, the cooperative court held that it had the right to hear the case. But the appellate court later restricted its jurisdiction, saying only certain prayers could be considered. The society members then approached the high court.

Setting aside the Appellate Court’s decision, justice Borkar ruled that when a redevelopment agreement “touches the business or management of the society”, the cooperative court is the proper forum. The developer, having signed the agreement through the society’s administrator, acted merely as the society’s agent and not as an independent party, the judge said.

“The agreement does not confer ownership or title on the developer. It only authorises him to act for and on behalf of the society,” the court observed. All disputes arising from such arrangements must be decided under section 91 of the Maharashtra Cooperative Societies Act, it said.

The court then quashed the appellate court’s 2019 order and allowed the cooperative court to hear the full case.