Makrand Shirkant Padalkar And Anr vs Monarch Orchid Co Op. Hsg. Soc. Ltd Thru. … on 14 July, 2026

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    Bombay High Court

    Makrand Shirkant Padalkar And Anr vs Monarch Orchid Co Op. Hsg. Soc. Ltd Thru. … on 14 July, 2026

    2026:BHC-AS:28599
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                             IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                      CIVIL APPELLATE JURISDICTION
                                     WRIT PETITION NO.8034 OF 2025
    
    
                  Monarch Orchid Co-operative Housing
                  Ltd.                                               ...Petitioner
    
                                    V/s.
    
                  1) The State of Maharashtra
    
                  2) Joint Registrar of Co-operative
                  Societies (CIDCO)
    
                  3) Assistant Registrar of Co-operative
                  Societies (CIDCO)
    
                  4) Makrand Shrikant Padalkar
    
                  5) Smt. Leena Makrand Padalkar                    ...Respondents
                                               WITH
                            INTERIM APPLICATION (STAMP) NO.32945 OF 2025
                                               WITH
                            INTERIM APPLICATION (STAMP) NO. 36725 OF 2025
                                                 IN
                                   WRIT PETITION NO.8034 OF 2025
    
                  1) Makrand Shrikant Padalkar
                  2) Smt. Leena Makrand Padalkar                    ...Applicants
    
                  In the matter between
                  Monarch Orchid Co-operative Housing
                  Ltd.                                               ...Petitioner
    
                                    V/s.
    
                  1) The State of Maharashtra
    
                  2) Joint Registrar of Co-operative
                  Societies (CIDCO)
                                                  Page No.1 of 33
                                                   14 July 2026
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    3) Assistant Registrar of Co-operative
    Societies (CIDCO)
    
    4) Makrand Shrikant Padalkar
    
    5) Smt. Leena Makrand Padalkar
                                                       ...Respondents
                                ________________
    Mr. Vaibhav Ugle with Ms. Kalpana Pandey i/b. Mr. Vikas Somawanshi for
    the Petitioner.
    
    Mr. S.A. Jabbar with Mr. Yash Bangar i/b. Mr. Akash Tayade for
    Respondent Nos.4 and 5 and for Applicants in IAST/32945/2025 &
    36725/2025.
    
    Mr. P.V. Nelson Rajan, AGP for Respondent-State.
                                 ________________
    
    
                                            CORAM: SANDEEP V. MARNE, J.
                            Judgment reserved on: 2 JULY 2026.
                        Judgment pronounced on: 14 JULY 2026.
    
    
    JUDGMENT:

    1) The issue for consideration in this Petition is whether membership
    to a cooperative housing society can be denied to an auction purchaser,
    who refuses to pay the past maintenance dues of the previous owner.

    2) Rule. Rule is made returnable forthwith. Since pleadings in the
    Petition are complete the same is taken up for final hearing with the
    consent of the learned counsel appearing for parties.

    SPONSORED
    
    
    
    
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    3)      The Petitioner-Society has filed the present Petition challenging
    

    the Order dated 4 January 2024 passed by the Assistant Registrar, Co-
    operative Societies (CIDCO), Navi Mumbai, (Assistant Registrar) under
    Section 23(2) of the Maharashtra Co-operative Societies Act, 1960 (the
    MCS Act), allowing the Application of Respondent Nos.4 and 5 for their
    admission as society members and directing the society to make entries
    of admission in the records (in Forms I & J) of the Society and to issue
    share certificate to them. The order of Assistant Registrar is confirmed by
    the Joint Registrar, Co-operative Societies (CIDCO), Navi Mumbai (Joint
    Registrar) by dismissing Revision Application No.96 of 2024 preferred by
    the Petitioner-Society.

    4) The Petitioner is a co-operative housing society formed by
    occupiers of units of the building-Monarch Orchid situated at plot No.94
    and 95, Sector No.19, Kharghar, Navi Mumbai (the Society) and
    registered under the provisions of the MCS Act. Mr. Milind Purohit and
    Minal Purohit (Purohits) purchased Flat No.1101 (the Flat) in the
    building of the Society by availing mortgage loan from North Kanara
    Goud Saraswat Brahmin Co-operative Bank Limited (the Bank). The
    Purohits had mortgaged the flat in favour of the Bank. The Purohits
    stopped paying monthly maintenance in respect of the Flat and by 12
    November 2017, an amount of Rs.1,91,813/- was due and payable by
    Purohits towards arrears of maintenance. It appears that Purohits also
    defaulted in repayment of the loan of the Bank. With passage of time,
    the arrears of maintenance escalated and by 5 March 2020 an amount of
    Rs.4,53,789/- became due and payable by Purohits, for which the Society
    issued letter dated 5 March 2020. Since the Flat was mortgaged with the
    Bank and since the Bank had initiated recovery proceedings against
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    Purohits, the Society communicated to the Bank by letter dated 7
    February 2021 that amount of Rs.5,46,719/- was due and payable in
    respect of the maintenance of the Flat. By letter dated 12 February 2021,
    the Bank requested the Society to register its lien in its record against
    the Flat and not to permit Purohits to sell the flat without Bank’s
    permission.

    5) The Bank issued possession notice dated 1 March 2021 under sub-
    section (4) of Section 13 of the Securitisation and Reconstruction of
    Financial Assets and Enforcement of Security Interest Act, 2002 (the
    SARFAESI Act) to Purohits for taking over possession of the Flat with a
    copy thereof to the Society. It appears that the Bank took over possession
    of the Flat and proceeded to conduct auction of the Flat for recovery of
    its dues. The auction was conducted on 17 March 2023 and Respondent
    Nos.4 and 5- Mr. Makarand Shrikant Padalkar and Smt. Leena Makarand
    Padalkar (Padalkars) turned out to be the successful bidders. On the
    same day, they wrote to the Society for waiving off the dues payable by
    Purohits but agreed to abide by the Society’s rules and regulations. After
    learning from Padalkars that they had purchased the Flat in auction
    conducted on 17 March 2023, the Society immediately wrote to the Bank
    on 19 March 2023 calling upon the Bank to direct Padalkars to clear
    Society’s dues and not to handover possession of the Flat till the dues
    were cleared by them. The Bank replied on 28 March 2023 intimating to
    the Society that in terms of the E-auction, the auction purchaser had
    undertaken to pay pending and future dues such as maintenance of the
    Society, etc. and that the said condition has been accepted by the
    Padalkars. It appears that the Bank handed over possession of the Flat to
    Padalkars on 28 March 2023. The Bank issued Sale Certificate in respect
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    of the Flat in the name of Padalkars on 28 March 2023, which was
    registered in the office of Sub-Registrar, Assurances, Panvel-5. On 9 April
    2023, Padalkars wrote to the Society that they were liable to pay
    Society’s maintenance charges only from possession of the Flat since 28
    March 2023. The Society wrote to Padalkars on 3 May 2023 calling upon
    them to pay outstanding dues in respect of the Flat. The Society issued
    Demand Notice dated 10 October 2023 demanding an amount of
    Rs.8,05,925/- from Padalkars.

    6) Since the Petitioner-Society did not admit Padalkars as members,
    they filed Application dated 26 October 2023 under Section 23 (2) of the
    MCS Act before the Assistant Registrar. The Society resisted the
    Application by filing its reply. After hearing both the sides, the Assistant
    Registrar passed order dated 4 January 2024 allowing the Application
    filed by the Padalkars and directing the Society to admit them as
    members and to issue to them share certificate. The Petitioner- Society
    filed Revision Application No.96 of 2024 before the Joint Registrar.
    During pendency of the Revision Application, Padalkars moved the
    Assistant Registrar, who issued order under Section 154B-7 of the MCS
    Act
    directing the Society to implement the order dated 4 January 2024 by
    making the entries into Forms I and J registers and to issue share
    certificate to Padalkars. The Revision Application No.96 of 2024 was
    thereafter heard by the Joint Registrar and by order dated 4 April 2024,
    the Revision Application has been rejected. Aggrieved by rejection of the
    Revision, the Petitioner-Society has filed the present Petition. By order
    dated 24 June 2025, this Court has stayed the order of the Assistant
    Registrar dated 4 January 2024.

    
    
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    7)      The Padalkars have appeared in the Petition and have filed
    

    affidavit-in-reply bringing on record inter-alia the fact that the
    Petitioner-Society has filed Dispute under Section 91 of the MCS Act for
    recovery of maintenance dues in the Cooperative Court at Alibag and the
    order dated 18 July 2025 rejecting the Dispute under the provisions of
    order VII Rule 11 of the Code of Civil Procedure, 1908 (the Code).
    Padalkars also brought on record order passed by the Co-operative
    Appellate Court on 12 January 2026 setting aside the order of the
    Cooperative Court dated 18 July 2025. The Padalkars have also filed
    Interim Application (Stamp) No.36725 of 2025 for vacation/ setting aside
    of interim order in the light of the judgment of the Apex Court in High
    Court Bar Association Allahabad V/s. State of Uttar Pradesh 1. Instead of
    deciding the Interim Applications, which are aimed mainly at vacating
    the ad-interim stay, this Court has proceeded to hear the Petition finally
    with the consent of the learned counsel appearing for the parties.

    8) Mr. Ugle, the learned counsel appearing for the Petitioner -Society
    submits that the Assistant Registrar and Joint Registrar have grossly
    erred in allowing the Application of Padalkars for admission as members
    of the Society. That Padalkars have purchased the flat in auction with full
    knowledge of past dues of previous owner-Purohits in respect of the Flat.
    That Sale Certificate issued by the Bank to Padalkars is also subject to
    condition of payment of past dues in respect of the Flat. That the
    impugned orders of the Assistant Registrar and Joint Registrar are in the
    teeth of provisions of Section 154B -7 of the MCS Act under which no
    transfer of share or interest of a member can be effective unless the dues
    of the housing society are paid. That therefore, Padalkars cannot secure

    1 2024 6 SCC 267

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    membership in respect of the Flat without first clearing the dues of the
    Society. In support, he relies on judgment of this Court in Tanvi’s
    Diamoda Cooperative Housing Society Ltd. V/s. State of Maharashtra 2.

    9) Mr. Ugle relies on letter dated 17 March 2023 of Padalkars under
    which they had agreed to abide by Society’s rules and regulations. He
    also invites attention of this Court to the email dated 16 October 2023,
    under which Padalkars had agreed to pay the principal amount payable
    by Purohits to the Society. He submits that mere filing/ rejection of
    Dispute by the Petitioner-Society for recovery of maintenance dues
    against Padalkars cannot be a reason for directing their admission as
    members of the Society. That Society is entitled not to admit Padalkars
    as members till all the Society’s dues are cleared by them. He therefore,
    prays for setting aside the impugned orders.

    10) Mr. Jabbar, the learned counsel appearing for Respondent Nos. 4
    and 5-Padalkars opposes the Petition. He submits that the Petition
    suffers from gross suppression since the Petitioner-Society has not
    disclosed in the Petition filing of the Dispute before the co-operative
    Court. That the Society has not approached this Court with clean hands
    and is attempting to recover the dues by indulging in arm twisting tactics
    even though the Dispute filed by it before the Co-operative Court for
    recovery of maintenance dues is pending. That since vital information is
    suppressed, Petition deserves to be dismissed as held by the Apex Court
    in K.D. Sharma V/s. Steel Authority of India Limited and Others 3 and by
    this Court in Ambada Seva Sahakari Sanstha V/s. Special Recovery
    Officer and Sales Officer (CB.), Amravati District Central Co-operative
    2 Writ Petition No.8631 of 2025, decided on 20 November 2025.

    
    3     (2008) 12 SCC 481
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    Bank Ltd. And Others.4 He also relies on the judgment of the Apex Court
    in Amar Singh V/s. Union of India and others 5 in support of his
    contention that parties, who approach the Court with intent to deceive
    and mislead it are not entitled to be heard on merits of the case.

    11) Mr. Jabbar further submits that filing of the present Petition is
    gross abuse of process of law. That the Petitioner is enforcing parallel
    remedies in respect of the same cause of action. That in the light of
    pendency of Dispute before the Co-operative Court for the same cause of
    action, the Petitioner cannot be permitted to maintain the present
    Petition. That in any case, conduct of the Petitioner is such that this
    Court need to be loathe in exercise of jurisdiction under Article 227 of
    the Constitution of India as held by the Apex Court in Garment Craft V/s.
    Prakash Chand Goel 6.

    12) Mr. Jabbar further submits that dues of the past member can at
    best constitute a charge on the Flat as per Section 154B-14 of the MCS
    Act
    . That the same cannot constitute personal liability for Padalkars.
    That it was Society’s responsibility to recover dues of Purohits from the
    Bank. That Padalkars cannot be forced to pay maintenance charges in
    respect of the period when they never occupied the Flat. That the real
    remedy of the Petitioner is to pursue recovery proceedings under Section
    154B
    -29 of the MCS Act. That the Society has not exercised the summary
    remedy under Section 154B-29 since there are serious disputed
    questions and hence it has adopted remedy under Section 91 of the MCS
    Act. That since there is dispute between the parties, Section 154B-7
    cannot be invoked for denying membership due to existence of past dues.

    4     2025(5) Mh.L.J. 525
    5     2011 (7) SCC 69
    6     (2022) 4 SCC 181
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    He relies on judgment of this Court in Brightland Cooperative Housing
    Society Ltd. V/s. Divisional Joint Registrar, Cooperative Societies and
    Others7 in which it held that when there is dispute about past dues,
    membership of the Society cannot be denied under Section 154B -7 of
    the MCS Act. He relies on judgment of this Court in Banganga Anurag
    Co-operative Housing Society Limited V/s. The Divisonal Joint Registrar,
    Mumbai & Ors.8 submitting that the judgment discusses the ratio of the
    judgments in Brightland as well as in Tanvi’s Diamoda (supra) and held
    that unless the dues are adjudicated in a Section 91 proceedings, non-
    payment of the same cannot be a reason for denial of membership. He
    accordingly prays for dismissal of the Petition.

    13) Rival contentions urged on behalf of the parties now fall for my
    consideration.

    14) The issue that arises for consideration in the Petition is whether
    the membership to an auction purchaser of a flat in a cooperative
    housing society can be withheld on the ground of non-payment of
    maintenance dues of previous owner in respect of the Flat. To
    paraphrase, whether a purchaser can be made liable to pay the
    maintenance dues unpaid by previous owner and whether clearance of
    such maintenance dues can be made a pre-condition for grant of
    membership by the Society.

    15) Since the Society refused to admit Padalkars as its members, they
    invoked jurisdiction of Assistant Registrar under sub-section (2) of
    Section 23 of the MCS Act and accordingly the impugned order has been

    7 2025 SCC OnLine Bom 2795.

    8 2026(3) ALL MR 71
    
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    passed by the Assistant Registrar on 4 January 2024 directing the Society
    to admit Padalkars as its members. Section 23 of the MCS Act, under
    which jurisdiction is exercised by the Assistant Registrar provides thus:

    23. Open membership.

    (1) No society shall without sufficient cause, refuse admission to
    membership to any person duly qualified therefor under the provisions
    of this Act and its by-laws.

    (1A) Where a society refuses to accept the application from an eligible
    person for admission as a member, or the payment made by him in
    respect of membership, such person may tender an application in such
    form as may be prescribed together with payment in respect of
    membership, if any, to the Registrar, who shall forward the application
    and the amount, if any so paid, to the society concerned within thirty
    days from the date of receipt of such application and the amount; and
    thereupon if the society fails to communicate any decision to the
    applicant within sixty days from the date of receipt of such application
    and the amount by the society, the applicant shall be deemed to have
    become a member of such society. If any question arises whether a
    person has become a deemed member or otherwise, the same shall be
    decided by the Registrar after giving a reasonable opportunity of being
    heard to all the concerned parties.

    (2) Any person aggrieved by the decision of a society, refusing him
    admission to its membership, may appeal to the Registrar, within a
    period of sixty days from the date of the decision of the society. Every
    such appeal, as far as possible, be disposed of by the Registrar within a
    period of three months from the date of its receipt :

    Provided that, where such appeal is not so disposed of within the said
    period of three months, the Registrar shall record the reasons for the
    delay.

    16) In the present case, Padalkars have apparently purchased the Flat
    in E-auction conducted by the Bank with full knowledge of past dues
    payable by previous owners-Purohits. As observed above, Purohits had
    mortgaged the Flat with the Bank and the Bank was required to sell the
    same with a view to recover the loan amount through E-auction. The
    Society sent four communications to Purohits on 12 November 2017, 25
    January 2018, 5 February 2020 and 5 March 2020 demanding

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    outstanding maintenance dues. The Society also informed the Bank by
    letter dated 7 February 2021 that there were dues to the tune of
    Rs.5,46,719/- payable by Purohits in respect of the Flat. The Bank
    thereafter proceeded to take possession of the Flat from Purohits on 12
    March 2021 by issuing intimation to the Society vide letter dated 1
    March 2021. The Bank apparently conducted E-auction of the Flat on 17
    March 2023 and Padalkars were the successful auction purchasers. It
    appears that Padalkars had bid Rs.86,20,000/- for purchase of the Flat in
    E-auction.

    17) As observed above, Padalkars were fully aware of pending
    maintenance dues of Purohits towards the Society and this is the reason
    why on 17 March 2023 (date of auction) Padalkars wrote to the Society
    asking for waiving of unpaid society charges of Purohits. Padalkars
    however, undertook to abide by Society’s rules and regulations by
    cooperating in all procedures pertaining to transfer of ownership.
    Relevant part of Padalkars’ letters dated 17 March 2023 reads thus:-

    This is to inform you that I undersigned have been allotted for flat
    1101 in Auction held today. I have heard that tte first owner Mr.
    Milind Purohit has not paid society charges for long time. Also I see
    further procedures where I have to get society shares & owner file on
    my name in which society may demand or recover those due charges
    from me as a new buyer of that property.

    It will lbe quite difficult for me to cater/bear other pending dues not
    paid by first owner Mr. Milind Purohit. Therefore, I kindly and humbly
    request you to this matter across society authorities & General body
    of Society to consider my application & writ off/waive off due society
    charges not paid by the first owner. I assure you that I will abide by
    society rules & regulations followed by co-operate in all procedure
    pertaining to transfer of ownership.

    
    
    
    
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    18)     Immediately after notice of conduct of auction through letter
    

    dated 17 March 2023, the Society once again wrote to the Bank on 19
    March 2023 in which it is stated as under:-

    We came to know vide the letter dated 17/03/2023 written by Mr.
    Makarand Shrikant Padalkar that he has got the above flat on E-
    AUCTION dated 17/03/2023. AS of now wer are not aware about the
    transaction held by the NKGSB Bank and Mr. Makarand Shrikant
    Padalkar.

    Earlier telephonic discussion with the Society Chairman Sh. Manish
    Desai, it was discussed that the bank shall not provide the possession
    fo the flat until the dues are cleared. It is once again requested to you
    to convey the message to the proposed buyer Sh. Makarand Shrikant
    Padalkar to clear the dues.

    Further, we proposed to call a Special General Body Meeting in First
    week of April 2023 to discuss the application received from Sh.
    Makarand Shrikant Padalkar to partially waiving off of interest
    amount. After the resolution is passed in the SGM the Society will
    issue a No Objection Certificate to the proposed owner (Sh. Makarand
    Shrikant Padalkar) for the possession of the flat and copy to the Bank.

    Therefore, you are requested to keep the possession of the flat 1101,
    Monarch Orchid CHS Ltd. On hold till our next intimation.

    19) The Society has requested the Bank to direct Padalkars to clear
    the dues. It also referred to Padalkar’s letter dated 17 March 2023 and
    communicated to the Bank that Special General Meeting was proposed
    to be held in April 2023 to discuss Padalkars’ request for partially
    waiving off the interest amount. The Bank responded on 28 March 2023
    informing the Society that full purchase price was paid by Padalkars and
    that the Sale Certificate was registered on 28 March 2023. The Bank also
    communicated to the Society that it could not hold back the possession
    and that the possession was also handed over to Padalkars on 28 March
    2023. The Bank however, stated in the letter dated 28 March 2023 as
    under:

    Page No.12 of 33

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    Further as per the clause of Terms of E-Auction the auction purchaser
    has to undertake to pay pending & future dues such as, maintenance
    of the Society dues, Local Assessment Taxes, Electricity Bills, any
    other dues and transfer fees to effect the Transfer of said Flat in name
    of Auction Purchaser and the same was accepted by Mr. Makarand
    Padalkar & Mrs. Leena Padalkar.

    Hence considering all of the above from now onwards society may
    communicate directly with Mr. Makarand Padalkar & Mrs. Leena
    Padalkar for any request/demand/explanation in terms of pending
    dues/fees.

    (emphasis added)

    20) Perusal of the Certificate of Sale executed by the Bank in
    favour of Padalkars would indicate that the same was made subject to
    Padalkars undertaking to pay pending and future dues of maintenance
    to the Society. This is clear from following covenants in the Certificate of
    Sale:

    The sale of the scheduled property was made on ‘As is Where is Basis
    & What Is As Is Basis’ on the terms and conditions of E-Auction Sale
    Notice published in daily newspaper ‘The Free Press Journal’ &
    ‘Navshkti’ on 22/02/2023 and hence the auction purchaser undertake
    to pay pending & future dues such as, maintenance of the Society
    dues, Local Assessment Taxes, Electricity Bills, any other dues and
    transfer fees to effect the Transfer of said Flat in name of Auction
    Purchaser.

    (emphasis and underlining added)

    21) Thus, purchase of the Flat by Padalkars was not only with
    full knowledge of pending maintenance dues of Society but is made
    subject to Padalkars paying pending maintenance dues of the Society.

    However, contrary to the conditions of sale, Padalkars refused to pay
    past dues of Purohits vide letter dated 9 April 2023 and communicated
    to the Society that maintenance would be paid w.e.f. 28 March 2023,
    when possession of the Flat was taken by them. The Society did not
    agree and by referring to the condition in the Sale Certificate, called

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    upon the Padalkars to pay all past dues of the Purohits in respect of the
    Flat by letter dated 3 May 2023.

    22) The Petitioner has also brought on record a document in the
    form of email dated 16 October 2023, which contains a forwarded
    message of Mr. Makrand Padalkar, which reads thus:-

    Please refer to our request letter attached herewith dated 09/04/2023
    for subjected formalities pending at your end.

    This is to inform you that it has been more than two weeks since we
    have approached you for completion of subjected formalities. But
    there is no response from your side in writing till today. Shall we
    consider that society is not willing to co-operate & complete these
    formalities moreover delaying it intentionally? If yes then we need to
    know the reason in writing so that we can appeal/complain to the
    Society Registar in this case.

    We still intend to complete remaining formalities of Society
    Membership on Top priority i.e. share transfers & NOC for CIDCO
    transfer. As mentioned earlier, we are ready to pay first owners
    principal due amount on payment against documents basis.

    Kindly let us know when we can proceed for the same so that relevant
    documents & payment can be arranged. You can reach us on below
    contact details…

    (emphasis and underlining added)

    23) Email dated 16 October 2023 was apparently sent by Mr. Makrand
    Padalkar to his Advocate and there is a forwarded message attached
    thereto, which is apparently not sent to any particular person. Upon
    being queried, it is clarified by Mr. Jabbar (after taking instructions from
    Mr. Padalkar, who was personally present before the Court ) that what
    was forwarded to the Advocate was a mere draft prepared by Mr.
    Makrand Padalkar. However, it appears that in that draft email,
    Padalkars had apparently agreed to pay principal amount due from
    Purohits ‘as mentioned earlier’. Thus, there appears to be some
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    willingness on the part of Padalkars to pay at least the principal amount
    of maintenance dues in respect of the period prior to taking over
    possession of the Flat.

    24) The Assistant Registrar has however recorded a virtually
    incorrect finding that the Bank did not communicate to Padalkars about
    pending maintenance dues of Purohits in respect of the Flat. This is
    clear from following findings in the Assistant Registrar’s order:-

    सदर सदनिकेसाठी संबंधित सदनिकाधारक यांचेकडू न संस्थेस येणे
    असले ल्या रकमेबाबत जाब देणार संस्थेने एनकेजीएसबी को.ऑप. बँक.
    लि. याना अवगत केल्याचे दिसून येत नाही.

    25) From the discussion made above, it is more than apparent
    that Padalkars were fully aware of past maintenance dues in respect of
    the Flat and in any case, became aware of the same while conduct of
    auction on 17 March 2023. The sale was not complete on 17 March 2023
    and therefore it cannot be assumed that Padalkars were not aware of the
    past maintenance dues when they decided to purchase the Flat in the E-

    auction.

    26) Assistant Registrar has recorded further perverse finding
    that the Society did not initiate any action against Purohits for recovery
    of maintenance dues and failed to perform its statutory duty. This
    finding is contrary to the factual position where the Society wrote as
    many as four communications to Purohits during 12 November 2017 to 5
    March 2020. The Society issued Demand Notice dated 5 February 2020
    and also issued a reminder letter dated 5 March 2020. Thereafter Covid-
    19 Pandemic possibly prevented the Society from initiating any action
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    for recovery of maintenance dues from Purohits and the Bank thereafter
    started recovery proceedings and took over possession of the Flat in
    March 2021. The Bank had already issued notice under Section 13(2) of
    the SARFAESI Act to Purohits on 12 April 2018. In these circumstances it
    is unfair to accuse the Society of not performing statutory duty as
    erroneously held by the Assistant Registrar.

    27) The Assistant Registrar has further erred in holding that the
    maintenance dues became part of disputed amount and that therefore
    dispute relating to the same was outside his Jurisdiction and could only
    be adjudicated by the Co-operative Court under Section 91 of the MCS
    Act. As a matter of fact, there is absolutely no dispute about amount of
    maintenance dues payable. The dispute is only about Padalkars’ liability
    to pay the same. While repeatedly referring to Sale Certificate dated 28
    March 2023, the Assistant Registrar has conveniently ignored specific
    stipulation therein that the sale was subject to payment of pending
    maintenance dues to the Society. The Assistant Registrar has further
    ignored the provisions of Section 154B-7 of the MCS Act, which are
    discussed in the latter portion of the judgment. The order passed by the
    Assistant Registrar is thus clearly erroneous.

    28) The Joint Registrar ought to have set aside the order of the
    Assistant Registrar. However, instead of doing so, the Joint Registrar
    proceeded to dismiss the Revision Application by merely narrating facts
    of the case, recording submissions of parties and by making following
    observations:-

    उक्त निरिक्षणे विचारात घेता आव्हानित आदेशाच्या अनुषंगाने संस्थेने फ्लॅट क्र
    ११०१ च्या थकीत देखभाल शुल्काकरीता मा को ऑप कोर्ट अलिबाग यांचेकडे
    दावा दाखल केले ला असून तो प्रलं बित आहे. याचा अर्थ संस्थेने प्रतिवादी क्र १ यांचे
    Page No.16 of 33
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    आदेशाचे अंशतः पालन केले असल्याचे दिसून येत आहे त्यानुसार संबंधित
    थकबाकी वसुली संस्थेस करता येणार आहे. प्रतिवादी क्र २, ३ यांनी अर्जदार
    संस्थेतील फ्लॅट क्र ११०१ हा ई लिलावाव्दारे नोंदणीकृत दस्तानुसार खरेदी केल्याचे
    दिसून येत आहे. नोंदणीकृत दस्तानुसार प्रतिवादी क्र २, ३ हे संस्थेचे सभासदत्व
    मिळविणेस पात्र आहेत. संस्थेने प्रतिवादी क्र २, ३ यांना सभासदत्व नाकारल्याने
    सदर प्रकरण कलम २३ (२) नुसार निर्णयीत करण्यात येत असल्याचे प्रतिवादी क्र १
    यांनी त्यांचे आदेशात नमूद केले आहे. प्रतिवादी क्र १ यांनी संबंधितांना सुनावणीची
    संधी देऊन दाखल कागदपत्रे विचारात घेऊन दि. ०४.०१.२०२४ रोजीचा आदेश
    पारित केल्याचे दिसून येत आहे. त्यामुळे सदर आदेश कायम करणे योग्य होईल या
    निर्णयाप्रत मी आले आहे.

    29) The Joint Registrar has thus put a premium on errors already
    committed by the Assistant Registrar. The Joint Registrar has merely
    referred to the act of the Society in filing dispute before the Co-
    operative Court under Section 91 of the MCS Act and has proceeded to
    uphold the order passed by the Assistant Registrar. In my view therefore,
    even the order passed by the Joint Registrar, being wholly erroneous,
    deserves to be set aside.

    30) Coming to the statutory scheme of the MCS Act, special provisions
    therein are made relating to Co-operative Housing Society by inserting
    Chapter XIII-B vide Maharashtra Act 23 of 2019 w.e.f 9 March 2019. The
    special provisions relating to Co-operative Housing Societies are made
    taking into consideration the special needs of housing societies. Section
    154B
    -7 is inserted into the MCS Act making a special provision in
    relation to transfer of share or interest of a member. Section 154B-7 puts
    a restriction on transfer of share and interest of a member and provides
    thus:-

    154B-7. Restriction on transfer of share or interest of a Member.–

    Subject to the provisions of this Act, in case of a housing
    society, no transfer of share or interest of a Member or the occupancy
    right, except the transfer of his heir or a nominee, shall be effective
    unless,–

    
                                          Page No.17 of 33
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                  (a) the dues of housing society are paid ;
    
    

    (b) the transferee applies and acquires Membership of the co-operative
    housing society in due course of time :

    Provided that, the transfer of share or interest in respect of lease hold
    properties shall be governed by the terms of the lease, which are not
    inconsistent with lease of land to the co-operative housing society or
    with lease by housing society to its Members.

    Explanation.– For the purpose of this section, occupancy right shall
    not include right of a tenant or a licensee on leave and license basis

    31) Thus under Section 154B-7 of the MCS Act, no share or
    interest of a member becomes effective unless dues of the housing
    society are paid. Provisions of Section 154B-7 are in negative form,
    which ensures that the transaction of transfer of share or interest of a
    member does not take place unless the dues of the housing society are
    paid. Section 154B-7 is inserted in the MCS Act keeping in mind special
    circumstances relating to housing society where unpaid dues of
    maintenance by a member makes other members of the Society suffer.

    Housing society maintenance charges are mandatory contributions that
    fund essential daily services like security, water supply, and lift
    operations, while also building reserves for major repairs. Timely
    payment ensures uninterrupted facilities and prevents property value
    depreciation.

    32) Cooperative Housing societies have long since shunned their role
    of a mere collective body for looking after common basic needs of the
    building. They now function as sophisticated, democratic, financial, and
    legal entities. The housing societies are now akin to service providers to
    the residents of the building. They now undertake myriad activities than
    restricting their role as a collective body looking after basic common

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    needs of the building. Nowadays modern buildings have several facilities
    such as gardens, clubhouse, swimming pool, play-areas, mechanical
    parkings, high speed elevators, etc. Many societies have also adopted
    sustainable practices such as recycling of water via STP plants, solid
    waste management facilities, rainwater harvesting, etc. The planning
    authorities have been encouraging the housing societies to adopt such
    sustainable practices. Modern housing societies in cities like Mumbai,
    Thane, Pune, etc have evolved into self-contained micro-townships,
    focusing on luxury, wellness, and digital convenience. They need to
    employ large number of staff for security, house-keeping, club-house,
    operation of office, for maintaining accounts, etc. There are also
    statutory requirements of maintaining sinking fund, repairs fund, etc.
    These activities undertaken by housing societies require substantial
    expenses and most of the societies are dependent only on contributions
    made by members for meeting that expenditure.

    33) In such circumstances, if members stop paying monthly
    maintenance charges, such action puts strain on the finances of the
    Society, which finds it difficult to maintain the building. Defaults in
    payment of monthly maintenance charges many times force the other
    members to contribute extra amounts in order to ensure that the
    building and its facilities are maintained. It is keeping in mind these
    special circumstances relating to a co-operative housing societies that
    the legislature has consciously incorporated provisions of Section 154B
    7 in the MCS Act.

    34) The objective behind provisions of Section 154B-7 of the MCS Act
    has been considered by this Court in Tanvi’s Diamoda (supra). This

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    Court has dealt with the situation of auction purchaser’s liability to pay
    the past maintenance dues. It is held in paragraphs 12 to 17 of the
    judgment as under:

    12. Section 154B 7 is mandatory. The requirement in Section 154B 7
    that no transfer becomes effective unless dues are paid is mandatory.

    The Legislature has used a negative form to show that it is compulsory.
    It states that a transfer does not take effect unless the dues are paid.
    This rule applies to all transfers, whether voluntary or through auction.
    When the amount payable is indisputable or undisputed , the
    transferee must satisfy this condition. The law requires that statutory
    conditions must first be fulfilled. Section 154B 7 imposes a specific
    condition. It states that a transfer becomes effective only when all dues
    of the society are paid. It also states that the purchaser must apply for
    membership and the society must process that application in
    accordance with law. These conditions are equally important. The
    Legislature intended that societies should not suffer financial loss
    because a member leaves behind arrears. If societies are compelled to
    accept transfers without clearance of dues, they will not be able to
    recover common expenses. This will affect all existing members. The
    provision therefore protects the financial stability of the society. A
    cooperative housing society survives on the timely collection of
    maintenance charges. Members enjoy common facilities because every
    member contributes. When arrears remain unpaid for years, the society
    and its members suffer. The law protects the society in such
    circumstances. Section 154B 7 ensures that the financial structure of
    the society is not disturbed by transfers that leave arrears behind. It
    places the responsibility upon the transferee to clear dues when the
    earlier member defaults.

    13. Membership in a cooperative society is not an unconditional right.
    It is governed by the Act and the by laws. The society must act fairly
    and within the framework of law. It cannot impose conditions that the
    law does not permit. However, it also cannot ignore conditions that the
    law expressly requires. If Section 154B 7 says that dues must be paid
    first, the society is duty bound to insist on it. The purchaser’s
    ownership of the flat remains unaffected. What remains incomplete is
    the entry of his name in the membership register until dues are settled.

    14. Section 154B 12 deals with transfer through a registered document.
    It gives a member the right to transfer his interest by following
    required legal procedure. This right is recognized. However, this right is
    not absolute. It must be read together with Section 154B 7. Both
    provisions work together. Section 154B 12 explains the process of
    transfer between individuals. Section 154B 7 explains when such
    transfer becomes effective in the records of the society. A transfer may

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    be valid between the parties, but it becomes effective in the society
    only when dues are cleared.

    15. When a flat is sold in execution proceedings, the auction purchaser
    receives a lawful title to the flat. That title cannot be questioned.
    However, the Cooperative Societies Act still requires that membership
    must follow the statutory procedure. The auction purchaser cannot
    skip this legal step. If arrears exist, the society has a right to insist on
    their payment. The law applies equally to voluntary and involuntary
    transfers. The statute does not exempt auction purchasers. Its purpose
    is to ensure that the society is not deprived of legitimate dues.

    16. An auction purchaser may say that he is not responsible for unpaid
    dues of the previous member. This argument may be accepted only to
    the extent that he is not personally liable for the earlier default.
    However, this does not remove the statutory condition. The law does
    not force him to pay. It only states that the society is not required to
    record the transfer until dues are cleared. If the purchaser wants
    membership, he must clear the dues as part of the burden attached to
    the property. This approach is supported by the language of the
    statute.

    17. In this background, the legal position becomes clear. The auction
    purchaser may apply for membership. The society must examine the
    application in accordance with law. The society may insist on payment
    of arrears because Section 154B 7 mandates it. Once dues are paid and
    the application meets the requirements of the Act, the society must
    admit him as a member. In this manner, the law maintains a balance
    between the right of the purchaser and the collective interest of the
    society.

    35) In Tanvi’s Diamoda, this Court has considered interplay
    between provisions of Sections 154B-7 and 154B-12 of the MCS Act,
    under which a member is entitled to transfer his share, right, title and
    interest of his property in the Society by way of registered document by
    following due procedure provided in the Rules or bye laws.

    36) Provisions of Section 154B-7 are also considered by this
    Court in Brightland (supra) in which this Court has dealt with a
    situation where there was a serious dispute about the maintenance dues.
    This Court held as under:

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    29. Since Section 154B-7 is expressly made subject to the provisions of the
    Act. The provisions contained in Sections 22 and 23 of the Act, would govern
    the aspect of membership of the housing societies. However, as noted above,
    Rule 19 of the Rules, 1961, mandates that the person seeking membership of
    the society shall fulfill all other conditions laid down in the Act, 1960, the Rules
    and the by-laws. Thus, a harmonious construction of the provisions contained
    in Sections 22 and 23, on the one part, and Section 154B-7, on the other part, is
    required to be made. The legislature’s anxiety in insisting for the payment of
    the dues of the housing society before the transfer of interest of the member is
    appreciable. If the dues of the society are not paid, it would have cascading
    effect on the orderly management of the affairs of the housing society. Thus,
    the provisions contained in Section 154B-7 deserve adequate weight.

    30. At the same time, the attendant facts of the case cannot be lost sight of.

    Where the dues of the housing society are not in dispute or indisputable, the
    requirement to pay the same before seeking membership can hardly be
    contested. However, in cases where there is a serious dispute as to what are
    ‘the dues’ of the society, the matter cannot be left to the sweet will of the
    managing committee of the society. Lest the said provision would operate
    onerously and may be abused to seek unjustified sums from the transferor or
    transferee disguised as dues of the housing society. Where there is a genuine
    dispute as regards the dues of the housing society owed by the erstwhile or
    prospective member of the housing society, determination by the authorities
    under the Act, 1960, would be warranted. In such a situation, the attendant
    circumstances, acts and omissions on the part of the parties assume
    importance.

    37) In Brightland this Court considered the effect of sale of a flat by a
    secured creditor on ‘As is where is’ and ‘whatever there is’ basis and
    rejected the contention that the said expressions refer to only physical
    condition of the property. This Court held that a greater responsibility is
    cast on the person who purchases the property with express
    superimposed conditions of “As is where is” and “Whatever there is”

    basis to carry out due diligence and find out for himself not only the
    condition of the subject property, but also the vulnerability of the title
    thereto and the obligations in relation to such property. It is held thus:

    Page No.22 of 33

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    33. I am afraid, the aforesaid stipulation in the sale certificate is of determinitive
    significance, especially in the face of the express term of the bargain that the
    sale of the subject flat was on “As is where is” and “whatever there is” basis.

    The import of the superimposed conditions of “As is where is” and “Whatever
    there is” basis is not confined to the physical condition of the property which
    is the subject matter of the sale. Such conditions, in given circumstances, may
    extend to the quality of title to the subject property and the claims against
    such property. A greater responsibility is cast on the person who purchases the
    property with express superimposed conditions of “As is where is” and
    “Whatever there is” basis to carry out due diligence and find out for himself
    not only the condition of the subject property, but also the vulnerability of the
    title thereto and the obligations in relation to such property.

    34. A useful reference, in this context, can be made to a three Judge Bench
    judgment of the Supreme Court in the case of K.C. Ninan v. Kerala State
    Electricity Board
    wherein the Supreme Court, after a survey of precedents,
    enunciated the position in law, as under:

    “143. Thus, the implication of the expression “as-is-where-is” or “as-is-
    what-is-basis” or “as-is-where-is, whatever-there-is and without recourse
    basis” is not limited to the physical condition of the property, but extends
    to the condition of the title of the property and the extent and state of
    whatever claims, rights and dues affect the property, unless stated
    otherwise in the contract. The implication of the expression is that every
    intending bidder is put on notice that the seller does not undertake any
    responsibility to procure permission in respect of the property offered for
    sale or any liability for the payment of dues, like water/service charges,
    electricity dues for power connection and taxes of the local authorities,
    among others.”

    (emphasis supplied)

    35. The aforesaid being the position in law, the question as to whether the
    Respondent Nos. 3 and 4 were required to discharge the liability to pay the
    outstanding maintenance/service charges qua the subject premises cannot be
    determined solely on the basis of the stipulation in the sale certificate that, to
    the best of the knowledge of the secured creditor (PNB), the subject property
    was free from all encumbrances. Therefore, the broad submission sought to be
    canvassed by Respondent No. 3 that the Respondent Nos. 3 and 4 were not
    liable to pay outstanding dues towards the maintenance/service charges for
    the period prior to purchase cannot be readily acceded to.

    (emphasis added)

    38) Thus in Brightland this Court did not accept the contention raised
    by the auction purchaser that they were not liable to pay outstanding
    dues towards the maintenance/service charges for the period prior to

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    purchase. However, this Court found that there were disputes about the
    exact amount payable by the past owners. Also, this Court found that the
    Society had not demanded the past dues from the purchasers. The
    Society in that case had not refused to admit the purchasers as
    members. These were the peculiar circumstances why this Court in
    Brighland upheld the order of the authorities directing admission of
    purchasers as members.

    39) In Tanvi’s Diamoda (supra) this Court has considered the ratio of
    the judgment in Brightland and has held in paragraphs 18 to 23 of the
    judgment as under:-

    18. I now consider the judgment in the Brightland case cited by the
    respondent. I examine it only to see whether its reasoning applies to
    the present facts. I do so keeping the focus on what the evidence
    shows and what the statute requires.

    19. In this case, there is no dispute about the amount owed to the
    housing society. The dues are admitted. The single question is
    whether an auction purchaser can seek membership without paying
    these dues, keeping in view Sections 154B 7 and 154B 12.

    20. The judgment relied upon by the respondent was delivered in very
    different circumstances. In that case, the society claimed arrears
    going back many years. The auction purchasers questioned both the
    existence and the calculation of those dues. They repeatedly asked
    the society to provide a clear break up. The society did not respond.

    The record showed uncertainty about the actual amount payable.
    Because of this uncertainty, the Court held that Section 154B 7 could
    not be applied without first determining the dues through proper
    legal proceedings under Section 91 or Section 154B 29. The Court
    noted that if Section 154B 7 is used without clarity of dues, societies
    may misuse the provision to demand amounts that are not supported
    by evidence. It was for this reason that the Court permitted deemed
    membership under Section 22(2).

    21. This factual foundation does not exist here. The dues are
    admitted and undisputed. There is no confusion about the amount. In
    the Brightland judgment itself, the Court made it clear that when
    dues are definite, the requirement under Section 154B 7 must be
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    followed. Paragraph 30 of that judgment states that if the amount
    claimed by the society is not in dispute, then payment of the dues
    before seeking membership cannot be avoided. This principle applies
    squarely to the present case.

    22. In the Brightland case, this Court intervened because the society
    had failed to crystallise dues, failed to respond to repeated requests,
    and failed to issue a proper communication. That case turned on
    uncertainty and prolonged inaction. None of those elements are
    present here. The dues are admitted. The society communicated its
    refusal within time. The statutory mandate must therefore prevail.

    23. In these circumstances, Sections 154B 7 and 154B 12 do not
    permit an auction purchaser to demand transfer of membership
    without clearing the dues. The society’s insistence on prior payment
    is lawful. The judgment relied upon by the respondent does not
    support his case because the reasoning in that judgment depended
    on facts that are entirely absent here.

    40) Thus, in Tanvi’s Diamoda (supra) this Court has dealt with almost
    similar case where the Flat was purchased in an auction and there were
    past dues of the ex-member. This Court has held that auction purchaser
    cannot seek membership without paying past dues of maintenance. It is
    held that SARFAESI Act does not water down the obligations to clear
    past maintenance dues. Even in Brightland (supra) this Court has not
    accepted the contention raised by the auction purchaser that they were
    not liable to pay outstanding dues towards the maintenance/service
    charges for the period prior to purchase.

    41) Mr. Jabbar has relied on Banganga Anurag (supra), which
    considers ratio of both the judgments in Brightland and Tanvi’s
    Diamoda (supra). It is held by this Court in Banganga Anurag as under:-

    28. This very question came up in the decision of this Court in Tanvi’s
    Diamoda Cooperative Housing Society Ltd. In that case, the buyer had
    not disputed the dues. He had accepted the amount and did not
    question the society’s calculations. The Court held that when there is
    no dispute about the dues, then Section 154B-7 must be applied
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    strictly. The buyer cannot seek membership without first clearing the
    outstanding amounts. Payment of dues is a legal precondition and
    cannot be avoided.

    29. In contrast, in the earlier case of Brightland Cooperative Housing
    Society Ltd., the Court dealt with a situation where the dues were
    seriously disputed. There was no clarity from the society. No proper
    details were given, and the amounts were questionable. In that
    background, the Court held that if there is a real and serious dispute
    about the amount or the legality of the dues, then the society cannot
    use Section 154B-7 as a weapon to indefinitely block membership. In
    such a case, the law expects the Registrar or the concerned authority
    to first examine the correctness of the dues, either in a Section 91
    dispute or Section 154-B-29. Only when the dues are determined and
    no longer disputed can the society insist on full payment before
    admitting the buyer as a member.

    42) Thus, in Banganga Anurag this Court has held that where the
    buyer has not disputed the dues, the case would fall within the ratio of
    the judgment in Tanvi’s Diamoda. However, where dues are seriously
    disputed and there was no clarity from the Society, the case would fall
    within the ratio of the judgment in Brightland. This Court thereafter
    proceeded to hold in Banganaga Anurag that case fell within the
    framework of law laid down in Tanvi’s Diamoda. It is held in paragraphs
    35 to 38 as under:-

    35. Unlike in Brightland, the present case does not show any delay or
    silence from the Society. In Brightland, the society did not provide any
    clear break-up of dues despite repeated requests, and it was only much
    later that a large amount was suddenly demanded. That conduct was
    found to be unreasonable and the Court, therefore, protected the buyer
    from arbitrary treatment. In contrast, in this case, the Society issued
    the demand within the 90- day period. It clearly explained the reasons
    for refusal and listed out the dues with supporting documents. There
    was no inaction or casual behaviour from the Society. This places the
    case squarely within the framework laid down by this Court in Tanvi’s
    Diamoda. There too, the purchaser had bought a flat in auction and
    dues were outstanding. The Society refused membership until the dues
    were cleared. The Court upheld that refusal, stating that society dues
    survive the auction and must be paid before seeking membership. The
    Court clearly laid down that SARFAESI auction purchasers are not
    exempt from society dues and cannot rely on the auction to defeat the
    statutory protection granted to societies under Section 154B-7.

    
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    36. Further, in Tanvi’s Diamoda, the Court rejected the argument that
    refusal of membership should be overlooked due to a pending dispute.

    It noted that unless the dispute is genuine and raised promptly, and
    unless the buyer approaches proper legal forums like the Registrar or
    cooperative court under Section 91, the society cannot be blamed.
    Respondent No. 3, in the present case, never initiated any such
    proceeding. He never sought an official determination on what portion
    of the dues was illegal or excessive. Instead, he refused to pay and
    demanded membership.

    37. In the present case, the Society has made it clear that the amount
    demanded from Respondent No. 3 consists of four well- identified
    categories: unpaid maintenance charges, unpaid repair charges,
    unpaid conversion charges (for converting the society’s land from
    leasehold to freehold), and interest on the delayed payments. This
    detailed break-up, often referred to as “bifurcation,” was formally
    shared by the Society with R3 before his membership application was
    rejected. This bifurcation shows exactly how the total dues are made
    up. The Society has given proper communication, explaining the basis
    of each head of demand. What is most important to note is that
    Respondent No. 3 has not challenged the accuracy or computation of
    these charges. He has not pointed out any mathematical error or any
    illegality in the categories themselves. He has not said that the
    maintenance or repair charges are wrongly calculated or that the
    conversion charges were never approved. His only argument is that
    these dues should be recovered from the previous flat owner and not
    from him. However, this argument cannot be accepted in law. Once
    Respondent No. 3 purchased the flat under an “as-is-where-is” and
    “whatever-there-is” condition through an auction, he stepped into the
    shoes of the previous member. The dues are not personal to the earlier
    member; they are linked to the flat. Therefore, whoever becomes the
    new owner inherits the liabilities attached to the flat unless there is a
    contract to the contrary or the society has waived the dues. Hence, the
    facts of this case align completely with Tanvi’s Diamoda and not with
    Brightland.

    38. This Court’s decision in Tanvi’s Diamoda is recent, authoritative,
    and directly applies to auction purchasers like Respondent No. 3. It
    emphasises that the rights of housing societies to recover their dues
    cannot be bypassed by citing auction purchases or vague disputes. The
    Court made it clear that both the rights of financial institutions under
    SARFAESI and those of cooperative societies under the MCS Act must
    be respected. One cannot override the other. The situation here
    reflects Tanvi’s Diamoda such as an auction purchase, known society
    dues, detailed communication by the society, and refusal of
    membership based on unpaid charges. Accordingly, the legal position
    is settled. Membership cannot be claimed unless the dues are cleared.
    The alleged dispute lacks merit and was never taken to the proper

    Page No.27 of 33
    14 July 2026
    Megha 905_WP_8034_2025_fc.odt

    forum for determination. In conclusion, the facts of the present case
    fit squarely within the pattern laid down in Tanvi’s Diamoda. The
    protection of Section 154B-7 applies in full force. The reliance on
    Brightland is misplaced and does not help Respondent No. 3. The
    Society’s refusal of membership was lawful, justified, and in strict
    compliance with the law.

    (Emphasis added)

    43) In my view, the judgments of this Court in Brightland, Tanvi’s
    Diamoda and Banganga Anurag provide direct answer to the issue
    involved in the present case. In all the three cases, the sale was on ‘As is
    Where is Basis & What Is As Is Basis’. Thus, Padalkars have inherited the
    liability attached to the Flat. In that sense, the charge created on the
    Flat by virtue of provisions of Section 154B-14 gets attached to
    Padalkars as well. Section 154B-14 provides thus:-

    154B-14. Charge of society in respect of share and interest of
    Member.–

    A society shall have a charge upon share and interest of a Member or
    past Member or deceased Member to the extent of dues payable by
    such Member to the society.

    44) In my view, provisions of Section 154B-14, far from assisting the
    case of Padalkars, actually militates against them. Once the dues
    payable by the member forms charge of the society on the flat, with
    purchase of the Flat by Padalkars, the liability gets transferred to them.

    45) In view of the above discussion, Padalkars cannot escape the
    liability to pay maintenance dues in respect of the Flat in respect of the
    period prior to taking over possession thereof. The Assistant Registrar
    and Joint Registrar have grossly erred in not appreciating the statutory
    schemes of the MCS Act and in ignoring specific stipulations of Sale

    Page No.28 of 33
    14 July 2026
    Megha 905_WP_8034_2025_fc.odt

    Certificate as well as the provisions of Section 154B-7 of the MCS Act.

    Their orders are clearly unsustainable and are liable to be set aside.

    46) I am not impressed by the submissions of Mr. Jabbar that filing of
    a Dispute under Section 91 of the MCS Act by the Society for recovery of
    maintenance dues would disentitle it from relying on provisions of
    Section 154B-7 of the MCS Act. Even if Padalkars are not admitted as
    members of the Society, the society is entitled to recover maintenance
    dues pending in respect of the Flat. The Society has both remedies open.
    It can oppose grant of membership to Padalkars and can also initiate
    action for recovery of dues in respect of the Flat. If submissions of Mr.
    Jabbar about exercise of parallel remedies is accepted, the same would
    result in an absurd situation where the purchaser may continue to
    occupy the Flat in absence of membership but the Society would be
    prevented from taking any action for recovery of dues. As per Section
    154B
    -14 of the MCS Act, unpaid maintenance dues form a charge of the
    society on the Flat and the Society is accordingly entitled to recover the
    same by selling the Flat. For sale of the Flat, the Society can initiate
    action for adjudication of the dues either under Section 154B-29 or
    under Section 91 of the MCS Act. Merely because the Society chooses
    the remedy under Section 91 of the MCS Act, it does not mean that dues
    get converted into disputed amount thereby making the provisions of
    Section 154B-7 inapplicable.

    47) I am also not impressed by the submission of Mr. Jabbar that by
    filing a Dispute under Section 91 of the MCS Act, the Petitioner-Society
    has impliedly admitted that Padalkars have become members of the
    Society. Admission as members of the Society needs to be a conscious
    Page No.29 of 33
    14 July 2026
    Megha 905_WP_8034_2025_fc.odt

    act and the Society has specifically declined to admit Padalkars as its
    members. Admission to membership in such circumstances cannot be
    inferred merely on account of exercise of remedy under Section 91 of the
    MCS Act. Padalkars claim to be the members of the society and under
    clause (b) of Sub-section 1 of Section 91, ‘ a person who claims to be a
    member of the society’ is also included in the enumerated list against
    whom the society can file a Dispute. Therefore mere filing of Dispute
    under Section 91 of the MCS Act does not automatically confer
    membership on Padalkars. Also, in the peculiars facts of the case,
    Purohits are no longer owners of the Flat and since the Society is
    entitled to recover dues by selling the Flat occupied by Padalkars, they
    are impleaded in the Dispute. However, their impleadment as parties to
    the Dispute would not automatically elevate them to a status as
    members.

    48) I am also not inclined to dismiss the Petition only on account of
    allegation of suppression. True it is that the Petitioner-Society ought to
    have disclosed the factum of filing of Dispute under Section 91 of the
    MCS Act in the memo of the Petition. It appears that the Dispute was
    filed during pendency of the Revision before the Joint Registrar. In
    ordinary circumstances suppression of material fact by the litigant
    disqualifies such litigant from obtaining any relief. Reliance by Mr.
    Jabbar on judgment of the Apex Court in K. D. Sharma (supra) and of
    this Court in Ambada Seva Sahakari Sanstha (supra) in that regard is
    apposite. However, it is equally well settled that the suppression must be
    of a material fact. As held above, pendency of the Dispute has no
    relevance to the issue of membership and in that sense, non-disclosure
    of filing of those proceedings before the Cooperative Court is not really
    Page No.30 of 33
    14 July 2026
    Megha 905_WP_8034_2025_fc.odt

    fatal to the case of the Petitioner. It is held in S.J.S. Business
    Enterprises (P) Ltd. v. State of Bihar9
    as under:

    13. As a general rule, suppression of a material fact by a litigant
    disqualifies such litigant from obtaining any relief. This rule has been
    evolved out of the need of the courts to deter a litigant from abusing
    the process of court by deceiving it. But the suppressed fact must be a
    material one in the sense that had it not been suppressed it would have
    had an effect on the merits of the case. It must be a matter which was
    material for the consideration of the court, whatever view the court
    may have taken [R. v. General Commrs. for the purposes of the Income
    Tax Act
    for the District of Kensington, (1917) 1 KB 486 : 86 LJKB 257 :

    116 LT 136 (CA)] ….

    (emphasis added)

    49) In State (NCT of Delhi) v. BSK Realtors LLP 10, the Apex Court has
    held that the fact suppressed must be material which would have effect
    on the merits of the case. It is held that the principle is not intended to
    arm one party with a weapon of technicality over its adversary but rather
    serves as a crucial safeguard against the abuse of the judicial process. It
    is held thus:

    37. Law is well settled that the fact suppressed must be material in the
    sense that it would have an effect on the merits of the case. The
    concept of suppression or non-disclosure of facts transcends mere
    concealment; it necessitates the deliberate withholding of material
    facts–those of such critical import that their absence would render any
    decision unjust. Material facts, in this context, refer to those facts that
    possess the potential to significantly influence the decision-making
    process or alter its trajectory. This principle is not intended to arm one
    party with a weapon of technicality over its adversary but rather serves
    as a crucial safeguard against the abuse of the judicial process.

    50) In the facts and circumstances of the present case, I am not
    inclined to decline exercise of jurisdiction under Article 227 of the
    Constitution of India only on account of omission on the part of the
    Petitioner-Society in disclosing filing of Dispute under Section 91 of the
    MCS Act before the Co-operative Court.

    9 (2004) 7 SCC 166
    10 (2024) 7 SCC 370
                                           Page No.31 of 33
                                             14 July 2026
     Megha                                                905_WP_8034_2025_fc.odt
    
    
    
    
    51)     Reliance by Mr. Jabbar on the judgment of the Apex Court in
    

    Garment Craft (supra) is also inapposite. This Court is not satisfied with
    the ultimate conclusions reached by the Assistant Registrar and Joint
    Registrar and therefore error of fact and law committed by them in the
    impugned orders cannot be ignored. On the contrary, this Court has
    arrived at a conclusion that Padalkars are not entitled to be admitted as
    members of the Society without first clearing the past maintenance
    dues. Therefore, exercise of jurisdiction under Article 227 of the
    Constitution of India in the present case is clearly warranted.

    52) Before parting, it would be necessary to take note of a fair stand
    taken by the Society where it has offered to waive off interest on
    maintenance dues payable upto the date of purchase of the flat by
    Padalkars and has offered to accept only the principal amount of dues
    upto the date of purchase. This is on account of offer made in the letter
    dated 19 March 2023 (for partial waiver of interest). However the society
    has suggested that it would charge interest on that principal amount of
    maintenance dues from the date of purchase. Accordingly a statement
    has been submitted by the Society towards the offer which indicates that
    the dues before purchase along with interest comes to Rs. 7,22,079/-, but
    the society is willing of waive interest amount of Rs. 3,30,837/-. This
    proposal, when put across by the Court to Padalkars during the course of
    hearing, was however declined by them. Though the Petition is being
    allowed, in my view, it would be in interest of justice to keep this offer of
    the society open for being opted by Padalkars. It is for Padalkars to take
    a call on the offer.

    
    
    
                                    Page No.32 of 33
                                      14 July 2026
                               Megha                                                        905_WP_8034_2025_fc.odt
    
                              53)         Conspectus of the above discussion is that the impugned orders
    

    passed are indefensible and are liable to be set aside. Petition
    accordingly succeeds and I proceed to pass the following order:-

    (i) Impugned order dated 4 January 2024 passed by the
    Assistant Registrar and order dated 7 April 2025 passed by
    the Joint Registrar are set aside.

    (ii) In view of the readiness expressed by the Petitioner-

    Society, if Padalkars pay the principal amount of past dues
    without interest upto the date of purchase, but with
    interest post the date of purchase, within 6 weeks, the
    Society shall admit Padalkars as its members.

    (iii) The proceedings for recovery of society dues shall be
    decided uninfluenced by the observations made in the
    judgment.

    54) Writ Petition is allowed in above terms. Rule is made absolute.
    There shall be no orders as to costs. In view of the disposal of the Writ
    Petition, Interim Applications do not survive and stand disposed of.

    
    
    
    
                                                                                       [SANDEEP V. MARNE, J.]
    
    
    
    
    Signed by: Megha S. Parab                                       Page No.33 of 33
    Designation: PA To Honourable Judge                               14 July 2026
    Date: 14/07/2026 15:27:40
     



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