In a recent decision, the Bombay High Court ruled in favor of H.V. Infrastructure Pvt. Ltd., instructing a cooperative society in Mumbai to give them membership for two apartments. This case, which has been ongoing since 2001, involved a complicated dispute over property rights and society membership.
H.V. Infrastructure Pvt. Ltd. and its director wanted membership for two apartments in a society. These apartments were originally owned by Siraj Abdul Karim Mehtaji, who used them as collateral for a loan from the Union Bank of India. Because he didn't pay back the loan, the bank sold the apartments at an auction, and H.V. Infrastructure was the highest bidder.
"The Recovery Officer took control of both apartments and sold them through a public auction after following the legal process."
The apartments were auctioned in 2007, and H.V. Infrastructure paid the required amount. They took possession of the apartments, but the society refused to transfer membership, citing various technicalities.
The society, along with others, tried several times to challenge the auction in court. However, these attempts were dismissed. The society argued that the sale certificate was not registered and that only one apartment was used as collateral.
"The main reason given by the Assistant Registrar...was that the Sale Certificate was not registered."
Judge Milind N. Jadhav canceled previous orders that denied membership, emphasizing that the sale certificate, even if not registered, was valid under the law.
"Under Section 17(2)(xii) of the Registration Act 1908, Sale Certificates given by a Court...do not need to be registered."
The court instructed the society to grant membership and restore utilities to the apartments. It also ordered the society to allow necessary repairs and accept maintenance charges without penalties.
The court's decision supports the rights of auction buyers and clarifies the responsibilities of cooperative societies in recognizing legal ownership. The society's refusal to transfer membership and blocking possession on weak grounds was dismissed.
This case highlights the importance of understanding property rights and the legal processes involved in cooperative societies.
