In a strongly worded judgment, the Bombay High Court has quashed the disqualification of an elected managing committee of a Borivali housing society and ordered the Maharashtra Government to conduct a probe against the Deputy Registrar for allegedly acting under political influence.
Justice Amit Borkar, in his order pronounced on 7 May 2026, allowed the writ petition filed by Vishal T. Lathia and other members of the Managing Committee of Nensey Cottage Co-operative Housing Society Ltd, located at Sant Dyaneshwar Marg, Borivali (East). The court set aside the orders passed by the Deputy Registrar, Co-operative Societies (R-North Ward), and the Divisional Joint Registrar, terming the action as a “colourable exercise of power” influenced by external political pressure.
Background of the Dispute
The controversy arose when the society, which had secured 85% member consent for redevelopment and appointed a developer, faced opposition from a section of members. These members, instead of approaching the appropriate forums, routed their grievances through a local Member of Legislative Council (MLC) belonging to the same political party as one of the complainants, Mr. Sudhir Hattangadi.
On 26 August 2025, the MLC wrote to the Deputy Registrar. On the same day, the Deputy Registrar issued a show cause notice. Subsequently, on 27 November 2025, the Deputy Registrar passed an order under Section 75(5) of the Maharashtra Co-operative Societies Act, 1960, disqualifying the managing committee members for two years (later reduced to six months), citing non-submission of Audit Rectification Reports for FY 2022-23 and 2023-24.
Later, on 20 January 2026, an Administrator was appointed under Section 77A(1)(b-1), and one of the complainants was made part of the board. The bank accounts of the society were also frozen.
High Court’s Key Observations
Justice Borkar observed that the petitioners had submitted clear documentary evidence — letters dated 25 September 2023 and 10 September 2024 with official acknowledgements from the Deputy Registrar’s office — proving that the audit rectification reports and accounts were duly submitted. However, both the Deputy Registrar and the Divisional Joint Registrar failed to consider this material and passed orders mechanically.
The court noted that the entire proceedings were triggered by a politically motivated complaint. Relying heavily on the Supreme Court’s judgment in State of M.P. vs. Sanjay Nagayach (2013), Justice Borkar held that statutory authorities like the Registrar must function independently and cannot act under external pressure or political influence.
The judge remarked that the “chain of events” — complaint to the MLC, immediate letter from the MLC, and swift action by the Deputy Registrar on the same day — created a strong impression that the authority did not apply its mind independently. The court described this as a colourable exercise of power.
The appointment of the Administrator was also set aside as it was based on the flawed disqualification order. The court further criticised the use of the urgency proviso under Section 77A without recording valid reasons and noted the conflict of interest in appointing a complainant as part of the Administrator board.
Relief Granted and Directions Issued
The High Court passed the following directions:
- All impugned orders dated 27.11.2025, 20.01.2026, and 15.04.2026 stand quashed and set aside.
- The disqualification of the petitioners is cancelled.
- The original Managing Committee stands restored forthwith.
- The Administrator must immediately hand over charge, records, and documents to the restored committee.
- The society’s bank accounts shall be restored to the Managing Committee.
In a significant direction, the court ordered the Secretary, Co-operation Department, to examine the conduct of the Deputy Registrar (who passed the original orders) and the Divisional Joint Registrar. The State Government has been directed to call for their explanations and decide on disciplinary action within three months. A compliance affidavit must be filed in the High Court.
The request for stay of the judgment made by Respondent No. 12 was rejected by the court.
Significance of the Order
This judgment sends a strong message against political interference in the functioning of cooperative housing societies, especially in redevelopment matters. It reiterates that democratically elected bodies cannot be removed casually on the basis of politically motivated complaints without independent application of mind by statutory authorities.
The matter has been listed for compliance on 10 August 2026.
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