In a significant order that highlights the strict evidentiary standards in cooperative court proceedings, the Co-operative Court No. 3, Mumbai has dismissed a dispute filed by Riddhi Siddhi Complex B Wing CHS Ltd., Borivali (East) against one of its members for allegedly converting a residential flat into commercial use.
The judgment, delivered on 29 June 2026 by Smt. V. R. Kulkarni, Judge, came in Dispute No. CC/III/117/2020 filed under Section 91 of the Maharashtra Cooperative Societies Act, 1961. The society had sought a declaration that Flat No. B-103 was being used illegally for commercial purposes and directions to restore it to residential use.
Background of the Case
The building forms part of an SRA (Slum Rehabilitation Authority) scheme in Sukurwadi, Borivali (East). As per the approved plans and Letter of Intent, the flats in the sale component were permitted only for residential use. The society’s bye-laws, adopted in the first General Body Meeting on 9 March 2014, also restrict flats to residential purposes only.
The opponents, Mr. Sunil J. Modi and Mrs. Shilpa S. Modi, are members in possession of Flat B-103. The society alleged that they had put the flat to commercial use by running operations of ANG India Ltd., a company engaged in sales and service of electronic security systems. According to the society, 10-15 employees worked from the flat, which also housed a server room and multiple computers. This, the society claimed, caused security concerns, inconvenience, and hardship to other residents.
Society’s Efforts and Allegations
The society stated that it had issued several notices, including a detailed notice dated 5 June 2018, reminding the member that non-residential use violated the sale agreements, approved SRA plans, and society bye-laws. Despite personal follow-ups and resolutions passed in General Body Meetings, including a Special General Body Meeting on 26 January 2020, the member allegedly continued the commercial activity.
The society further submitted that the flat owners had purchased the premises on the clear understanding that all flats would be used solely for residential purposes. It argued that the member had no right to change the user without society’s NOC and that such misuse attracted provisions of the MRTP Act as well.
Court Proceedings
The opponents appeared in the matter but failed to file their written statement. Consequently, the dispute proceeded ex-parte against them. The society led evidence through an affidavit of its Treasurer, Shridhar H. Kokate (Exh-6), and relied on several documents including the society’s registration certificate, LOI and approved plans, sale agreement, the 2018 notice, BMC assessment, and an SRA inspection report dated 4 January 2023.
However, these documents were only marked as Articles 1 to 6 and were never formally exhibited in evidence.
Why the Court Dismissed the Dispute
Despite the matter proceeding ex-parte, the Court held that it could not grant relief merely because the opponents had not contested the proceedings. It observed that the burden of proof lies squarely on the disputant to establish its case through cogent and legally admissible evidence, especially when seeking declaratory and injunctive relief that affects valuable civil rights.
The Judge noted that mere marking of documents as “Articles” does not amount to proof of their execution or contents. The oral testimony in the affidavit, while unchallenged, largely reiterated the pleadings without the foundational documentary evidence being properly proved. In the absence of duly exhibited documents, the Court held that it could not conclusively establish that the flat was being used commercially in violation of the rules.
Consequently, the Court ruled that the society had failed to discharge the burden of proof. The claim for compensation towards mental harassment was also not substantiated.
The Order
The Co-operative Court passed the following order:
- The dispute is dismissed with costs.
- Decree be drawn accordingly.
Implications
This judgment serves as a reminder to housing societies across Maharashtra about the importance of strictly following procedural requirements while leading evidence in cooperative court matters. Even strong factual cases can fail if documents are not properly exhibited and proved.
For societies dealing with commercial misuse of residential flats in SRA or redevelopment buildings, the order underscores the need for meticulous documentation and proper legal procedure when approaching the court.
The society has the option to appeal the order before the higher appellate forum if it chooses to do so.
