Case Note & Summary
The judgment concerns two writ petitions arising from a dispute between N. Jethani (petitioner in WP 5476/1990) and Shri Shivaji Cooperative Housing Society Limited (petitioner in WP 1497/1992) regarding a superstructure built on the terrace of a bungalow on Plot No. 32, which was allotted to one S.P. Gupte, a member of the society. The society, a Tenant Ownership Cooperative Housing Society registered under the Maharashtra Cooperative Societies Act, 1960, had allotted Plot No. 32 to Gupte for construction of a residential bungalow. On 2 July 1979, Gupte entered into an agreement with Jethani to lease the terrace space for 79 years, and a lease deed dated 12 December 1980 was executed, but it provided for a term of ten years with an option to renew up to 79 years. Jethani constructed a superstructure of approximately 700 sq. feet on the terrace, but there was a dispute over whether it was completed or occupied. In April 1983, the society raised a dispute before the Cooperative Court, Pune, seeking demolition of the superstructure. The Cooperative Court passed an interim order of status quo on 13 March 1982, which was challenged unsuccessfully by Jethani. Gupte later transferred his rights in the plot to a third party. The Cooperative Court, by judgment and award dated 28 August 1989, ordered demolition of the superstructure and directed the society to pay compensation for the value of the structure. The Maharashtra State Cooperative Appellate Court, by judgment dated 12 October 1990, partly allowed the appeal, upholding the demolition order but modifying the compensation. Both parties challenged this order: Jethani sought to set aside the entire order, while the society challenged the direction to pay compensation. The High Court held that the lease of terrace space by Gupte without the society's consent was invalid, as the society holds title to the land and building, and members cannot alienate or lease common areas. The Cooperative Court had jurisdiction under Section 91 of the Act. The court upheld the demolition order but set aside the direction for payment of compensation, as the superstructure was unauthorized and the society was not liable to pay for it. The writ petitions were disposed of accordingly.
Headnote
A) Cooperative Law - Jurisdiction of Cooperative Court - Dispute between society and member - Sections 91, 96 Maharashtra Cooperative Societies Act, 1960 - The Cooperative Court has jurisdiction to entertain a dispute raised by a society against its member and a third party regarding unauthorized construction on common area, as it relates to the management and business of the society. Held that the dispute falls within the purview of Section 91 of the Act (Paras 1-4).
B) Cooperative Law - Tenant Ownership Housing Society - Title to land and building - Bye-laws - A Tenant Ownership Housing Society holds title to the land and building, and members have only a right to occupy the premises allotted to them. The terrace of a bungalow is part of the common area and cannot be leased by a member without the society's consent. Held that the lease of terrace space by Gupte to the petitioner was invalid and without authority (Paras 3-5).
C) Cooperative Law - Unauthorized Construction - Demolition - Sections 91, 96 Maharashtra Cooperative Societies Act, 1960 - The Cooperative Court has the power to order demolition of unauthorized construction put up by a member or a third party on the society's property. Held that the superstructure on the terrace was unauthorized and liable to be demolished, but the society must pay compensation for the value of the structure as per the appellate court's direction (Paras 2, 6).
Issue of Consideration
Whether the lease of terrace space by a member of a Tenant Ownership Cooperative Housing Society to a third party for construction of superstructure, without the consent of the society, is valid and whether the Cooperative Court has jurisdiction to order demolition of such superstructure.
Final Decision
The High Court dismissed WP 5476/1990 filed by N. Jethani and allowed WP 1497/1992 filed by the society, setting aside the direction to pay compensation for the superstructure. The demolition order was upheld.
Law Points
- Lease of common area by member without society's consent is invalid
- Cooperative Court has jurisdiction over disputes between society and member
- Tenant Ownership Housing Society has title to land and building
- Member cannot alienate or lease common areas without society's permission
- Superstructure on terrace without society's consent is unauthorized and liable to be demolished
Case Details
2015 LawText (BOM) (01) 22
Writ Petition No. 5476 of 1990 with Writ Petition No. 1497 of 1992
Mr Prashant Chavan a/w. Ms R. J. Nathani for Petitioner in WP 5476/1990 and for Respondent No.1 in WP 1497/1992; Mr. Sanjay Kshirsagar for Respondent No.1 in WP 5476/1990 and for Petitioner in WP 1497/1992; Ms Sheetal Thakur i/b Mr. Vikram Chavan for Respondent No.3 in both petitions
N. Jethani (in WP 5476/1990); Shri Shivaji Cooperative Housing Society Limited (in WP 1497/1992)
Shri Shivaji Cooperative Housing Society Limited and ors. (in WP 5476/1990); N. Jethani and ors. (in WP 1497/1992)
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Nature of Litigation
Civil writ petitions challenging the judgment and order of the Maharashtra State Cooperative Appellate Court regarding demolition of superstructure and compensation.
Remedy Sought
In WP 5476/1990, N. Jethani sought to set aside the entire appellate order; in WP 1497/1992, the society sought to set aside the direction to pay compensation for the superstructure.
Filing Reason
The society raised a dispute before the Cooperative Court seeking demolition of the superstructure built by Jethani on the terrace of a bungalow on Plot No. 32, which was allotted to Gupte, a member of the society.
Previous Decisions
The Cooperative Court, Pune, by judgment and award dated 28 August 1989, ordered demolition of the superstructure and directed the society to pay compensation. The Maharashtra State Cooperative Appellate Court, by judgment dated 12 October 1990, partly allowed the appeal, upholding the demolition order but modifying the compensation.
Issues
Whether the lease of terrace space by a member of a Tenant Ownership Cooperative Housing Society to a third party for construction of superstructure, without the consent of the society, is valid.
Whether the Cooperative Court has jurisdiction to order demolition of such superstructure.
Whether the society is liable to pay compensation for the unauthorized superstructure.
Submissions/Arguments
Jethani argued that the lease was valid and the superstructure was constructed with the consent of the member, and the Cooperative Court had no jurisdiction.
The society argued that the lease was invalid as the terrace is common property, and the superstructure was unauthorized and liable to be demolished without compensation.
Ratio Decidendi
In a Tenant Ownership Cooperative Housing Society, the society holds title to the land and building, and members have only a right to occupy the premises allotted to them. The terrace of a bungalow is part of the common area and cannot be leased by a member without the society's consent. Such a lease is invalid, and any construction thereon is unauthorized and liable to be demolished. The Cooperative Court has jurisdiction under Section 91 of the Maharashtra Cooperative Societies Act, 1960 to entertain disputes regarding such unauthorized construction. However, the society is not liable to pay compensation for unauthorized construction put up without its consent.
Judgment Excerpts
The Society, which is a 'Tenant Ownership Cooperative Housing Society' deemed to have been registered under the Maharashtra Cooperative Societies Act, 1960 (said Act) had allotted Plot No.32 to Shri. S.P. Gupte (respondent No.2) in Writ Petition No. 5476 of 1990 for purposes of construction of a residential bungalow.
On 2 July 1979, Gupte entered into an agreement for grant of lease of Terrace space of the bungalow, so as to enable the petitioner to put up a super structure thereon.
The agreement stated that such lease would have a term of 79 years.
In pursuance of such agreement, Gupte entered into Lease dated 12 December 1980 with the petitioner, which however, indicates that the term of lease shall be ten years alongwith option of renewal for further term extending, in entirety to 79 years.
There is nothing on record to indicate that the term of lease was ever extended beyond ten years.
The petitioner putup a super structure admeasuring approximately 700 sq. feet upon the terrace.
In April 1983, the Society raised a dispute being Dispute No. 503 of 1984 before the Cooperative Court, Pune, inter alia, against Gupte and the petitioner, primarily seeking demolition of the super structure put up by the petitioner.
Procedural History
The society raised a dispute before the Cooperative Court, Pune, in April 1983 (Dispute No. 503 of 1984). The Cooperative Court passed an interim order of status quo on 13 March 1982. The Cooperative Court delivered judgment and award on 28 August 1989, ordering demolition and compensation. The Maharashtra State Cooperative Appellate Court partly allowed the appeal on 12 October 1990, upholding demolition but modifying compensation. Both parties filed writ petitions in the Bombay High Court, which were disposed of on 22 January 2015.
Acts & Sections
- Maharashtra Cooperative Societies Act, 1960: 91, 96
