Bombay High Court Restores Co-operative Society Registration; Holds Developer Cannot Seek De-Registration by Relying on His Own Illegalities and Alleged Registration Irregularities
Bombay High Court Restores Co-operative Society; Holds Developer Cannot Benefit from His Own Wrong
Facts
The petitioners were members of Hatkesh Udyog Nagar Industrial Premises Co-operative Housing Society Ltd., whose registration dated 11 November 2008 was cancelled by the Divisional Joint Registrar under Section 21A of the Maharashtra Co-operative Societies Act, 1960, on the ground that the society had been registered through misrepresentation. The cancellation was affirmed by the Hon’ble Minister (Co-operation), prompting the members to challenge both orders before the Bombay High Court.
The dispute arose after the developer, Respondent No.1, alleged that the society had obtained registration by relying upon forged and manipulated documents relating to development permissions and land particulars. The petitioners contended that the developer himself had constructed and sold the industrial units, promised formation of a co-operative society, and could not subsequently seek de-registration by relying upon deficiencies attributable to his own conduct.
Issues
- Whether the society’s registration was liable to be cancelled under Section 21A of the Maharashtra Co-operative Societies Act, 1960 on the ground of misrepresentation.
- Whether the alleged discrepancies and irregularities in the registration documents constituted “misrepresentation” within the meaning of Section 21A.
- Whether the developer could seek de-registration after constructing, selling the units and promising formation of a co-operative society.
Petitioners’ Arguments
The petitioners argued that Section 21A confers only a narrow power of de-registration and cannot be used as an appellate mechanism against an order granting registration. They submitted that none of the statutory grounds for de-registration existed and that alleged construction irregularities or absence of development permissions could not justify cancellation of the society’s registration.
They further contended that any inaccuracies in the registration proposal did not amount to misrepresentation of such a nature as would have prevented registration. The society had functioned for nearly eighteen years, and the developer’s application was motivated solely by an attempt to regain control over the property after selling the industrial units.
Respondent’s Arguments
The developer argued that the society had secured registration by producing forged, fabricated and manipulated documents, including documents relating to another property and altered land descriptions. According to him, the registration proposal contained false development permissions, manipulated survey numbers and suppressed material facts, thereby constituting misrepresentation under Section 21A.
He submitted that once fraud and misrepresentation were established, the Registrar was fully justified in cancelling the society’s registration.
Analysis of the Law
The High Court analysed Section 21A of the Maharashtra Co-operative Societies Act, 1960, observing that the Registrar’s power to de-register a society is extremely limited and can be exercised only upon proof of one of the statutory grounds enumerated therein, including registration obtained through misrepresentation.
The Court held that the expression “misrepresentation” must be construed narrowly. Mere inaccuracies, incomplete disclosures or subsequent disputes cannot justify de-registration. The misrepresentation must relate to the material furnished at the time of registration and must be of such significance that, had the true facts been disclosed, the society would not have been registered at all.
Precedent Analysis
The Court relied upon:
- Elite Diagnostic Center Pvt. Ltd. v. Krishna Kunj Co-operative Housing Society Ltd., holding that Section 21A is a narrow provision and de-registration can be ordered only where the registration itself was obtained through material misrepresentation.
- Sukhsagar Co-operative Housing Society Ltd. v. State of Maharashtra, holding that absence of development permission alone cannot justify refusal of registration.
- Airoli Neha Apartments Co-operative Housing Society Ltd. v. State of Maharashtra, holding that construction irregularities are not by themselves grounds for de-registration.
- Waghamay Mahila Machchimar Sahakari Sanstha Maryadit v. Commissioner of Fisheries, explaining the meaning of “misrepresentation” under Section 21A.
Court’s Reasoning
The High Court observed that although certain discrepancies appeared in some documents forming part of the registration record, the developer himself had conceived the industrial project, sold the units, represented that construction had been undertaken pursuant to sanctioned plans and expressly promised formation of a co-operative society. Having induced purchasers to acquire units and manage them collectively, he could not later seek cancellation of the society by relying upon defects attributable to his own acts.
The Court held that permitting de-registration in such circumstances would allow the developer to take advantage of his own wrong, particularly where the alleged absence of planning permissions or non-agricultural permissions stemmed from his own conduct. Even assuming certain irregularities existed in the registration documents, the extraordinary power under Section 21A could not be exercised to dismantle a society functioning for nearly eighteen years merely to advance the developer’s private interests. The Court therefore concluded that the impugned orders were legally unsustainable.
Conclusion
The Bombay High Court allowed the writ petition, set aside the orders of the Divisional Joint Registrar and the Hon’ble Minister, and dismissed the developer’s application seeking de-registration of the society. The Court held that, in the peculiar facts of the case, the developer could not invoke Section 21A to obtain an advantage arising from his own alleged illegalities and defaults.
Case Details
Case: Uday Patil & Ors. v. Paresh Satyendra Vohra & Ors.
Court: Bombay High Court
Case Number: Writ Petition No. 6144 of 2026
Judge: Hon’ble Mr. Justice Sandeep V. Marne
Date: 05 August 2026
Result: Writ Petition allowed; orders de-registering the co-operative society set aside; de-registration application dismissed.
