Bombay High Court
Sahayog Chs Ltd. And Ors vs The Divisional Joint Registrar Co-Op. ... on 13 November, 2025
Author: Amit Borkar
Bench: Amit Borkar
2025:BHC-AS:48646
23-wp-13761-2023.doc
Shabnoor
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.13761 OF 2023
SHABNOOR
AYUB
PATHAN
Digitally signed by
SHABNOOR AYUB
Sahayog CHS Ltd. & Ors. ... Petitioners
PATHAN
Date: 2025.11.13
18:08:36 +0530
V/s.
The Divisional Joint Registrar,
Cooperative Societies, Mumbai Division
& Ors. ... Respondents
Mr. N. N. Bhadrashete i/b Ms. Priyanka Bharashete, for
the petitioners.
Mr. B. V. Samant, Additional GP with Smt. S. D.
Chipade, AGP for the State - respondent.
CORAM : AMIT BORKAR, J.
DATED : NOVEMBER 13, 2025
P.C.:
1. Rule. Rule made returnable forthwith.
2. The petitioners are members of the Managing Committee of
the Housing Society. They challenge the order passed under
Section 148(3) of the Maharashtra Cooperative Societies Act 1960.
The said order grants sanction to prosecute them for an alleged
offence under Section 146(n) of the Act. Section 146(n) of the
MCS Act reads as under:
"It shall be an offence under this Act, if -
(n) a member of a society fraudulently disposes of
property over which the society has a prior claim, or a
member or officer or employee or any person disposes of his
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property by sale, transfer, mortgage, gift or otherwise, with
the fraudulent intention of evading the dues of the society;
or"
3. Section 148(3) of the Act requires prior permission of the
Registrar before any prosecution is filed for offences under the Act.
In this case, Respondent No.2 applied to the Registrar seeking such
permission against the petitioners. The Registrar granted the
permission. He recorded that the draft development agreement
was not placed before the general body. He noted that the area
mentioned in the draft differed from the earlier agreement dated 9
December 2013 with M/s PNK Space Development Pvt. Ltd. He
observed that under the agreement dated 22 December 2020, M/s
Beautiful Properties Pvt. Ltd. paid Rs. 5.50 crore to the society as
corpus fund. The society transferred its development rights to M/s
Beautiful Properties Pvt. Ltd. in exchange for this amount.
According to the Registrar, this transfer violated the Government
Resolution dated 4 July 2019 because the development rights were
shifted from PNK Space Development Pvt. Ltd. to M/s Beautiful
Properties Pvt. Ltd. without authority. He also noted that no
general body resolution was passed for sale of the society's land.
4. I have examined the reasons recorded by the Registrar. The
order rests mainly on two conclusions. First, that the draft
Development Agreement was not placed before the general body
and that there was a difference in area when compared with the
earlier agreement of 9 December 2013. Second, that there was a
breach of the Government Resolution dated 4 July 2019. These
findings form the sole foundation for the permission accorded. At
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this stage the Court must see whether these grounds, taken as they
stand, disclose the essential elements of the offence alleged. The
Registrar must record reasons which show a clear nexus between
the act complained of and the statutory offence. A mere procedural
lapse or internal irregularity in the decision making of the society
cannot be equated with fraudulent disposal of property.
5. Respondent No. 2 has been served but has chosen to remain
absent. The material on record is therefore considered on its own
merits. The absence of the respondent does not relieve the Court of
its duty to examine the legality of the sanction order.
6. This Court has already explained in earlier decisions,
including the judgment in Maya Developers v. Neelam R. Thakkar,
(2016) 6 Bom CR 629; Kamgar Swa Sadan Co-op. Hsg. Society
Ltd. v. Divisional Joint Registrar, 2018 SCC OnLine Bom 1319; and
Bay Home Properties Developers (P) Ltd. v. National Properties
Builders and Developers, 2019 SCC OnLine Bom 5299, that the
Government Resolution dated 4 July 2019 is directory. The
Resolution seeks to secure transparency in redevelopment of
cooperative housing societies. It provides for an Authorised Officer
to monitor whether resolutions are properly placed before the
members and whether the process retains fairness. These duties lie
with the Authorised Officer or with the representative of the
Registrar. The Managing Committee is not the sole custodian of
compliance with these procedural safeguards. A breach of a
directory requirement may call for administrative correction. It
does not, by itself, furnish the basis to launch a criminal
prosecution unless the statute creates such liability.
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7. Section 146(n) requires a clear finding that a member has
fraudulently disposed of property over which the society has a
prior claim. Fraudulent disposal of property is a serious charge. It
involves intent to defeat the society's rights. The reasons recorded
by the Registrar do not disclose any such act. They only point to
non-disclosure before the general body and to an alleged breach of
a directory Resolution. These facts, even if accepted in full, do not
satisfy the ingredients of the offence. There is no material to show
that any member disposed of property with fraudulent intent or
that the society's prior claim was defeated. When the foundational
requirement of the offence is missing, permission to prosecute
could not have been granted.
8. Rule made absolute in terms of prayer clause (a).
9. The writ petition stands disposed of in above terms.
10. There shall be no order as to costs.
(AMIT BORKAR, J.)
