Kiran Raj

The Supreme Court Division Bench of Justice Vikram Nath and Justice Sandeep Mehta held that when a co-operative housing society does not take a decision on membership, or keeps an application pending for an extended period, the statutory authorities may intervene to ensure the matter is concluded. In the case, flat occupants in a Mumbai co-operative housing society sought membership despite having lived in the flat for years, while some existing members opposed their induction on the ground of delayed compliance with the society’s requirements. Setting aside the High Court’s direction to remit the issue back to the society’s general body, the Supreme Court restored the occupants’ entitlement to membership and sustained the subsequent transfer and membership of the purchaser, while leaving objecting members free to seek determination of additional interest for delay.

The dispute concerns Flat No.7 in a seven-flat building owned by a co-operative housing society formed after the original owner company went into liquidation. The occupants, who were tenants, resolved to form a society and acquired conveyance of the property upon payment made to the Official Liquidator. Six occupants contributed towards settlement of liabilities, while the predecessor-in-interest of the appellants did not deposit his quantified share of Rs.5,00,000/- for induction as a member. The society issued a letter offering membership subject to payment, and an AGM resolution recorded that he would be admitted upon receipt of the amount.

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Decades later, his legal heirs applied for membership before the Authorised Officer and deposited the quantified amount with interest. The Deputy Registrar directed convening of a Special General Body Meeting. The Revisional Authority directed admission of the appellants as members. The High Court set aside that order. The Supreme Court examined whether belated payment could defeat the claim for membership.

The Court recorded that “The short controversy which falls for consideration of this Court in these appeals is whether the belated prayer of the appellants… to gain membership in the Society by making payment at a highly belated stage, could have been accepted by the Joint Registrar.” It observed that “The fact that the said appellants are the legal heirs of Shri Narendra Patel, who was admittedly in occupation of Flat No.7 for several decades, is not in dispute.”

The Bench noted that “The crucial fact which remains undisputed is that the peaceful possession and occupation of Shri Narendra Patel and, thereafter, his legal heirs… over Flat No.7 has never been in question.” It further recorded that “The said offer letter is undisputed and does not appear to have ever been withdrawn.” Referring to the AGM resolution, the Court stated that “a resolution was passed resolving to admit Shri Narendra Patel… as a member of the Society upon receipt of the requisite payment.”

On the consequence of denial, the Court observed that “denial of the appellants’ request for grant of membership would create a serious anomaly inasmuch as the appellants would continue to occupy Flat No.7 without being conferred membership of the Society.”

The Bench also noted that “the Society, in its AGM held on 30th September, 2025, resolved to re-affirm the proceedings and decisions of the AGM dated 11th August, 2005.” It recorded that the membership of the appellants and subsequent transferee had been accepted by the General Body and that no challenge to those minutes was brought to its notice.

Regarding the High Court’s reasoning, the Court observed that “The High Court, while allowing the writ petition filed by respondent Nos. 1-3, reasoned that the Joint Registrar had acted in excess of his jurisdiction in directing the Authorised Officer of the society to grant membership to the appellants... However, such a conclusion cannot be countenanced in view of the fact that the appellants in the said appeal had initially approached the Authorised Officer of the society by way of an application seeking membership, which came to be refused on the ground that he did not have the jurisdiction to take policy decisions. It was only thereafter that the appellants…availed of the statutory remedies of appeal and revision provided under the MCS Act, 1960. Hence….reasoning adopted by the High Court is unsustainable in law and cannot be upheld”

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The Court directed that “we hereby set aside the impugned judgment of the High Court to the extent of Para Nos. 58 (ii) to (vi).  The aggrieved members of the Society, if so advised, would be at liberty to move an application before the appropriate authority/body for the determination of a suitable additional amount payable by the appellants by way of enhanced interest, as may be determined, having regard to the significant delay in making payment of the contribution for the acquisition of membership in the Society.”

“If any challenge is laid to the decision taken in the AGM dated 30th September, 2025, as to the membership of the appellants, the same would be examined as per law without being prejudiced by the above observations. The parties will be at liberty to work out their remedies before the appropriate forum(s) in accordance with law. The appeals are partly allowed in these terms. No order as to costs.”

Advocates Representing the Parties:

For the Petitioners: Mr. Shyam Divan, Sr. Adv. Mr. Rudreshwar Singh, Sr. Adv. Ms. Tushita Ghosh, AOR Mr. Aniruddha Choudhury, Adv. Mr. Rohit, Adv. Mr. Pranav Deshmukh, Adv. Ms. Tanishka, Adv. Mr. Balbir Singh, Sr. Adv. Mr. Mahesh Agarwal, Adv. Mr. Rishi Agrawala, Adv. Mr. Himanshu Saraswat, Adv. Ms. Bedotroyi Gupta, Adv. Ms. Pratima Mishra, Adv. Mr. E. C. Agrawala, AOR

For the Respondents: Mr. Dhruv Mehta, Sr. Adv. Mr. Deeptakirti Verma, AOR Ms. Neha Sharma, Adv. Ms. Nishi Sangtani, Adv. Mr. Subhoday Banerjee, Adv. Mr. Neeraj Kishan Kaul, Sr. Adv. Mr. Aayush Agarwala, Adv. Mr. Yash Dhruva, Adv. Mr. Shlok Parekh, Adv. Mr. Aman Shekhar, Adv. M/S. Pba Legal, AOR, Mr. Deeptakirti Verma, AOR Ms. Neha Sharma, Adv. Mr. Subhoday Banerjee, Adv. Mr. Aniruddha Joshi, Sr. Adv. Mr. Aayush Agarwala, Adv. Mr. Yash Dhruva, Adv. Mr. Shlok Parekh, Adv. Mr. Aman Shekhar, Adv. M/S. Pba Legal, AOR

Case Title: Shashin Patel And Anr. v. Uday Dalal And Ors.

Neutral Citation: 2026 INSC 125

Bench: Justice Vikram Nath, Justice Sandeep Mehta