In a significant ruling that reinforces the legal position on housing society redevelopment in Maharashtra, the Maharashtra State Co-operative Appellate Court has reiterated that the redevelopment guidelines issued under Section 79A of the Maharashtra Co-operative Societies (MCS) Act, 1960 are directory in nature and not mandatory. Relying on earlier Bombay High Court judgments, the appellate court dismissed an appeal filed by three members of Shree Vivekanand Nagar Co-operative Housing Society in Borivali (West), who had sought to halt the redevelopment project on the ground that the society had allegedly failed to comply with various procedural requirements under the Government Resolution (GR) dated July 4, 2019 issued under Section 79A.
The judgment was delivered by Member-2 A. S. Wanve on July 13, 2026, in Appeal No. 36 of 2025, arising out of an order passed by the Co-operative Court, Mumbai, which had earlier refused to grant an interim injunction against the redevelopment.
The dispute involved three members of the society who jointly own Flat No. 201. They challenged several resolutions passed by the society between September 2022 and June 2024 relating to the appointment of Inspira Developers Pvt. Ltd., approval of redevelopment proposals, execution of the Development Agreement (DA), and other redevelopment-related decisions. They sought to restrain the society from implementing these resolutions and from proceeding with redevelopment until the dispute was finally decided.
According to the appellants, the society had violated Section 79A of the MCS Act and the Government Resolution dated July 4, 2019 governing redevelopment of co-operative housing societies. They alleged that the developer was not selected through the prescribed procedure, the mandatory role of the Registrar’s authorised representative was ignored, the meetings lacked proper quorum and procedure, members were not supplied documents and video recordings, and redevelopment was initiated without first obtaining conveyance of the land in the society’s name. They also argued that the society ignored objections raised by several members during various Special General Body Meetings.
The society, however, defended its actions by pointing out that the redevelopment process had commenced as early as October 2021 because the buildings, constructed around 1978, were more than four decades old and urgently required redevelopment. It informed the court that multiple Project Management Consultants (PMCs) and developers had been invited to submit proposals, members had been consulted at every stage, and overwhelming majorities had approved the appointment of Inspira Developers and the redevelopment proposals in successive meetings. The society also informed the court that the Development Agreement had already been executed and registered, creating contractual rights in favour of the developer.
The appellate court examined the voting pattern in the various meetings and noted that 73 of the 78 members present had approved the revised offer of the developer in March 2024. Subsequently, 82 members voted in favour of appointing the developer in April 2024, while 76 members supported the proposal in May 2024. Even after the dispute arose, the society convened another Special General Body Meeting in July 2025 in the presence of a representative of the Deputy Registrar, where 72 members voted in favour of reaffirming the appointment of the developer while only five members opposed it.
The court held that the redevelopment had received overwhelming support from the society’s members and observed that the appellants represented only one residential unit in a society consisting of 109 members. It further noted that the registered Development Agreement had not been challenged separately and that the developer had not even been impleaded as a party to the proceedings, despite rights having already been created in its favour. These factors weighed heavily against granting any interim relief.
A key aspect of the judgment is its discussion on Section 79A. The court relied on earlier Bombay High Court decisions, including Kamgar Seva Sadan vs. Divisional Joint Registrar (2018) and Vilas Vishnu Jadhav vs. State of Maharashtra (2024), to reiterate that the Government Resolution issued under Section 79A is directory rather than mandatory. In simple terms, this means that the procedural guidelines are intended to ensure transparency and fairness during redevelopment, but every procedural deviation does not automatically render the redevelopment process illegal or invalidate the decisions taken by the society.
What are the Section 79A redevelopment guidelines?
Section 79A empowers the Maharashtra Government to issue binding directions to co-operative societies in matters of public interest. Exercising this power, the State Government issued the redevelopment guidelines, first in 2009 and later through a revised Government Resolution on July 4, 2019.
The 2019 guidelines lay down a structured process for redevelopment. Some of the important requirements include:
- Appointment of an experienced Project Management Consultant (PMC) to conduct the redevelopment process.
- Preparation of a feasibility report before inviting redevelopment proposals.
- Inviting competitive offers from eligible developers.
- Conducting Special General Body Meetings with proper notice and agenda.
- Presence of an authorised representative of the Registrar during crucial redevelopment meetings.
- Transparent evaluation of redevelopment proposals.
- Approval of the selected developer by the prescribed majority of members.
- Circulation of the draft Development Agreement among members before execution.
- Video recording of important redevelopment meetings to maintain transparency.
- Proper documentation of objections and suggestions received from members.
These guidelines were framed to minimise disputes, improve transparency, and prevent arbitrary selection of developers.
Which provisions did the appellants say were violated?
The appellants alleged several departures from the 2019 guidelines, including:
- The developer was allegedly not selected through the prescribed tendering and evaluation process.
- The Registrar’s authorised representative was not present during the meetings in which the developer was selected.
- The Government Resolution dated July 4, 2019 was allegedly not fully complied with.
- Members were allegedly not given sufficient opportunity to study the redevelopment proposal before voting.
- Minutes of meetings allegedly did not properly record proposers and seconders.
- Certain documents, including video recordings of meetings, were allegedly not supplied despite repeated requests.
- Redevelopment was initiated before conveyance issues had been resolved.
- Members’ written suggestions on the draft Development Agreement were allegedly ignored.
However, the court found that these allegations did not justify stopping the redevelopment at the interim stage, particularly because the redevelopment had already advanced substantially, the Development Agreement had been executed and registered, and the society had subsequently conducted another meeting in the presence of the Deputy Registrar’s representative to reaffirm the appointment of the developer.
The court also rejected the argument that redevelopment could not proceed in the absence of conveyance. It observed that the appellants had failed to identify any statutory provision prohibiting redevelopment merely because conveyance had not been completed.
Applying the well-established principles governing interim injunctions, the appellate court concluded that the appellants had failed to establish a prima facie case, that the balance of convenience was in their favour, or that they would suffer irreparable loss if redevelopment continued. On the contrary, the court held that granting an injunction would prejudice more than a hundred members waiting for redevelopment of an ageing building.
Consequently, the Maharashtra State Co-operative Appellate Court dismissed the appeal and upheld the earlier order refusing to stay the redevelopment, while directing both parties to bear their own costs.
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