Case Note & Summary
The petitioners, Balaji Tower Coop. Housing Society Ltd. and Parthasarathy Rangachari, filed a writ petition challenging the amendment to bye-law 28A of the respondent society, Shree Ganesh Coop. Housing Society Ltd., which required members to pay an additional contribution of Rs. 500 per month for non-residential use of their flats. The petitioners also challenged the appointment of an administrator by the Joint Registrar, Cooperative Societies. The court examined the validity of the bye-law amendment and the appointment. It held that the amendment was ultra vires the Maharashtra Cooperative Societies Act, 1960, as it imposed a financial burden not authorized by the Act or the original bye-laws. The court also found that the appointment of the administrator was illegal as it was done without following the procedure under Section 77 of the Act. The court allowed the petition, set aside the amendment and the appointment, and directed the society to refund any amounts collected under the impugned amendment.
Headnote
A) Cooperative Law - Bye-law Amendment - Validity - Amendment to bye-law 28A requiring members to pay additional contribution for non-residential use - Held that such amendment is ultra vires the Maharashtra Cooperative Societies Act, 1960, as it imposes a financial burden not authorized by the Act or the original bye-laws (Paras 10-15). B) Cooperative Law - Appointment of Administrator - Procedure - Appointment of administrator under Section 77 of the Act without following the prescribed procedure - Held that the appointment was illegal and set aside (Paras 16-20). C) Cooperative Law - Recovery of Charges - Non-residential use - Society cannot recover additional charges from members for non-residential use unless specifically authorized by the Act or bye-laws - Held that the demand for additional contribution was without authority of law (Paras 12-14).
Issue of Consideration
Whether the amendment to bye-law 28A of the respondent society requiring members to pay additional contribution for non-residential use is valid under the Maharashtra Cooperative Societies Act, 1960, and whether the appointment of an administrator was lawful.
Final Decision
The court allowed the writ petition, set aside the amendment to bye-law 28A and the appointment of the administrator, and directed the society to refund any amounts collected under the impugned amendment.
Law Points
- Cooperative society bye-law amendment must be within the framework of the Act
- Bye-law amendment requiring additional contribution for non-residential use is ultra vires
- Administrator cannot be appointed without following procedure under Section 77 of the Act
- Members cannot be compelled to pay charges not authorized by the Act or bye-laws
