Bombay High Court: Cooperative Housing Society Cannot Refuse Membership Transfer If Applicant Meets Statutory Requirements

Mumbai: The Bombay High Court recently held that a cooperative housing society cannot refuse transfer of membership if the applicant fulfils statutory requirements, clarifying that such proceedings do not extend to deciding property ownership disputes.

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Dispute Over Row House No. 1 Originally Allotted to Shah

Justice Amit Borkar passed the order while hearing a petition filed by Clover Park Cooperative Housing Society Limited, through its chairman Firdaus Dastoor, challenging an order that allowed transfer of membership in favour of Parvinder Singh Dhillon.

The dispute revolved around the transfer of Row House No. 1 in the society, originally allotted to Narendra Ratilal Shah. Shah executed a registered Deed of Assignment on May 4, 2024, in favour of Dhillon, who subsequently applied for transfer of the share certificate and membership. The application was received by the society on May 13, 2024, but no action was taken.

Dhillon Represented by Advocates Aradhye & Velankar

Aggrieved by the inaction, Dhillon approached authorities under the Maharashtra Cooperative Societies Act. Though his appeal was rejected, the revisional authority later ruled in his favour, prompting the society to move the High Court, through advocate Sureshkumar Firodiya.

Dhillon was represented by advocates Sarang Aradhye and Gauri Velankar before the HC.

Court: Membership Transfer Is Not a Title Trial

The society opposed the transfer, citing a dispute over a marginal open space or garden area adjoining the property, claiming it belonged to the society and could not be part of the transfer.

The court, however, rejected this objection, stressing that the scope of membership transfer is limited. “The enquiry at that stage is administrative and statutory in character. It is not a full trial of rival title claims,” the court observed.

Society Did Not Alleged Document Was Invalid

It further held that once an applicant produces a valid registered document and satisfies eligibility criteria under the Act, Rules and bye-laws, the society is obligated to process the transfer. “The Society cannot withhold transfer on grounds foreign to such enquiry,” the court said.

Notably, the court pointed out that the society had not alleged that the Deed of Assignment was unregistered, fabricated, or invalid. In such circumstances, it could not assume the role of deciding title disputes.

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Addressing the society’s concerns, the court clarified that transfer of membership does not confer ownership beyond what is legally transferred. “If rights are disputed, membership does not conclude the dispute,” it noted.

Civil Court Must Decide Open Space & Property Claims

The court added that issues such as ownership of open spaces, extent of property, or validity of conveyance must be decided by a competent civil court after examining evidence.

Disposing of the petition, the High Court upheld the revisional authority’s order but clarified that the transfer of membership would be restricted only to Row House No. 1 and would not affect any claims over the disputed open space. No order as to costs was passed.

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