Bombay High Court Invalidates Deputy Registrar NOC For Commercial Conversion Of Housing Society Flat, Rules Official Cannot Replace Society Consent Without Express Statutory Authority
Bombay High Court Quashes Commercial Use NOC For Residential Flat, Holds Cooperative Registrar Lacks Jurisdiction And Directs Members To Seek Relief Before Competent Cooperative Court
Facts
Surya Lok Co-operative Housing Society, whose sanctioned building plan permitted residential use, challenged a Deputy Registrar’s 8 December 2016 no-objection certificate (NOC) for converting ground-floor Flat No. 3 to commercial use. Purchasers Fazal Abbas Sayed and Aafreen Fatima Sayed acquired the flat in January 2016 and were admitted as members following a separate membership order. The owners had undertaken on 25 October 2016 to use the flat residentially, but sought municipal approval for commercial conversion. On 15 January 2018, the Divisional Joint Registrar dismissed the society’s revision against the NOC. The society invoked the High Court’s supervisory jurisdiction.
Issues
Whether Section 79(2) of the Maharashtra Co-operative Societies Act, 1960 empowered the Deputy Registrar to issue an NOC for change of user; whether the subsequent Section 154B-27 changed that position; whether a membership order or earlier commercial assessments authorised commercial use; and whether residential undertakings and denial of hearing invalidated the NOC.
Petitioner’s Arguments
The society argued that neither the Act, rules nor bye-laws required it to issue a commercial-use NOC, so the Deputy Registrar could not substitute his own consent. No prior notice or hearing was given. The purchasers’ residential-use undertaking was binding. A 2000 general-body resolution allowing commercial activity had been withdrawn in 2007 and the prohibition reaffirmed in 2014; the sanctioned building comprised residential flats alone.
Respondent’s Arguments
The flat owners maintained that other ground-floor premises had long been used commercially; local assessments, electricity records, historic boutique use and stamp-duty valuation reflected commercial character. They asserted the society’s bye-laws permitted commercial premises, and that the unchallenged August 2016 membership order and later municipal steps supported conversion. They also alleged the challenge was motivated by a redevelopment developer and resisted intervention under Article 227.
Analysis of the Law
At the time of the 2016 NOC, Section 79(2) of the MCS Act allowed the Registrar to perform only an action which a society was already obliged to perform under the Act, rules, bye-laws or a valid order. It conferred no original planning or land-use approval power. Chapter XIII-B and Section 154B-27 commenced in March 2019 and did not govern the original NOC; even under that later provision, enforcement and certificates for sale, mortgage or analogous statutory purposes do not confer general adjudicatory jurisdiction over change of user. A disputed entitlement to society consent belongs, if pursued, before the Co-operative Court under Section 91.
Precedent Analysis
The Court agreed with the prima facie approach in Shree Raghunandan CHS Ltd. v. State of Maharashtra (interim order, 5 August 2020) restricting Section 79(2) NOC powers. It applied Siddharth Borivali CHS Ltd. v. State of Maharashtra, 2025 SCC OnLine Bom 4348, and Oberoi Springs CHS Ltd. v. Deputy Registrar, 2025 SCC OnLine Bom 4270, which narrowly construed Section 154B-27. Vaibhav Industrial Premises CHS Ltd. v. Divisional Joint Registrar (16 December 2025), relying on A.P.D. Jain Pathshala v. Shivaji Bhagwat More, (2011) 13 SCC 99, reinforced that administrative powers cannot become adjudication of contested civil rights.
Court’s Reasoning
Justice Sandeep V. Marne held that the Deputy Registrar did not merely compel an existing statutory duty: he personally declared his office had no objection to commercial use, despite having no such jurisdiction. He issued the NOC without notice to the society, violating natural justice. The August 2016 order concerned membership, not permission to change use. Residential undertakings, the withdrawn 2000 resolution and later prohibitory resolutions weakened the owners’ case; electricity bills, municipal assessments and payment of commercial stamp duty did not themselves effect legal conversion. The redevelopment agreement postdated the filing of the writ petition and did not establish developer-driven litigation.
Conclusion
The writ petition was allowed. The Deputy Registrar’s NOC dated 8 December 2016 and the Divisional Joint Registrar’s revisional order dated 15 January 2018 were quashed, with no order as to costs. The owners may institute a Section 91 dispute to seek society consent for change of user, and any such claim must be decided on its merits without being influenced by the judgment’s observations. The ruling delineates administrative supervision from adjudication and emphasises that use conversion requires legally competent approval rather than an unauthorised Registrar’s NOC.
Case: Surya Lok Co-operative Housing Society Ltd. v. Deputy Registrar of Co-operative Societies & Anr.
Court: Bombay High Court, Civil Appellate Jurisdiction
Case Number: Writ Petition No. 14286 of 2018; 2026:BHC-AS:44326
Judge: Justice Sandeep V. Marne
Date: 30 October 2026 (reserved 21 October 2026)
Result: Petition allowed; NOC and revisional order quashed; liberty to file Section 91 dispute; no costs.
