Bombay High Court on Registration of Multiple Housing Societies in a Single Building: Matter Remanded for Fresh Inquiry.

Headnote:

The Bombay High Court set aside orders permitting the registration of two separate cooperative housing societies—one for residential and another for commercial unit holders—within a single building. The Court held that the registration of multiple societies under the Maharashtra Cooperative Societies Act, 1960 (MCS Act) and the Maharashtra Ownership Flats Act, 1963 (MOFA) is permissible only if the building is functionally and physically independent. As the authorities failed to conduct a factual inquiry to determine such independence, the matter was remanded for a fresh decision. The Court also clarified that the Government Circular dated 30 July 2004, relied upon by the respondents, has no statutory force under Article 13 of the Constitution.

Background:

1. The petitioner, Sadguru Universal CHS Ltd., represented by its Secretary Sanjay More, challenged orders allowing separate registration of Sadguru Universal Premises Cooperative Society Ltd. (respondent no. 4) for commercial units within the same building.
2. The building, developed by Sadguru Infra Project (I) Pvt. Ltd. (respondent no. 5), comprised 24 commercial units on the ground floor and 88 residential units on upper floors (3rd to 13th).
3. CIDCO had approved one composite plan for a single building, and an Occupancy Certificate was issued in June 2020.
4. The petitioner alleged that the promoter unlawfully secured registration for two independent societies—one for residential and another for commercial units—without disclosing this to purchasers and despite there being only one building plan and shared amenities.
5. Authorities, however, upheld the dual registration under Sections 154B-2(4) and 154B-1(8) of the MCS Act, prompting the writ petition.

Court’s Observations:

1. Purpose of Law: MOFA mandates promoters to form a single cooperative body of all flat purchasers to manage property collectively. The MCS Act allows more than one society only if each can function independently.
2. Test for Independence: The Court laid out mandatory parameters for determining whether multiple societies can exist:
3. Structural Design & Layout: Separate entrances, staircases, and utilities must exist for independent functioning.
4. Access & Entry Points: Distinct access routes for residents and commercial users are essential.
5. Utilities & Amenities: Shared utilities like water, fire safety systems, or lifts indicate a single integrated structure.
6. Maintenance & Financial Responsibility: Common expenses and repairs necessitate one unified society.
7. Additional Factors: Parking, use pattern, sanctioned plans, and effect on members’ rights must also be examined.
8. The authorities erred by granting registration based solely on the existence of commercial and residential units, without verifying physical or functional independence.
9. On Government Circular (30 July 2004): The Court ruled that the circular, not issued under any statutory authority or authenticated under Article 166 of the Constitution, lacks the force of law under Article 13. It is only an internal administrative instruction and cannot override statutory provisions.

Decision:

1. The Court set aside the orders dated 8 December 2021 (Assistant Registrar) and 27 June 2024 (Minister for Cooperation).
2. The case was remanded to the Assistant Registrar (respondent no. 3) for a fresh factual inquiry to determine if the building satisfies the parameters for registering two separate societies.
3. The inquiry must be completed within four months after providing a hearing to all parties.
4. The writ petition was disposed of with no order as to costs.

Legal Provisions Discussed:

1. Section 10, Maharashtra Ownership Flats Act, 1963 (MOFA) – Promoter’s duty to form a cooperative society or association of flat purchasers.
2. Sections 6, 9, 154B-1(8), 154B-2(4), Maharashtra Cooperative Societies Act, 1960 – Conditions and framework for registration of cooperative housing societies and associations.
3. Article 13 & Article 166, Constitution of India – Definition of “law” and authentication of executive actions.

Citation: 2025:BHC-AS:47797

Case: Sadguru Universal CHS Ltd. v. State of Maharashtra & Ors.

Court: High Court of Judicature at Bombay (Civil Appellate Jurisdiction)

Coram: Justice Amit Borkar

Date of Decision: 11 November 2025

Writ Petition No.: 18153 of 2024