High Court Ruling: No NOC from Registrars for CHS Redevelopment

The Bombay High Court has made a landmark ruling that district deputy registrars (DDRs) of co-operative societies can no longer insist that societies obtain their approval for redevelopment. This decision, delivered by Justice Amit Borkar, is a significant step towards curbing the corruption that has plagued the redevelopment of housing societies in Maharashtra.

The case arose from a jointly filed petition in mid-August by eight members of the Bandra Nisha Cooperative Housing Society. The redevelopment of their property had been stalled due to a lack of necessary permissions from the DDR. In response to the petition, the court ordered that all DDRs in the state must only supervise the redevelopment process and not insist on their approval.

Justice Amit Borkar noted that the Maharashtra Co-operative Societies Act and its rules do not specify that societies must obtain a No-Objection Certificate (NOC) from the DDR for the redevelopment of their properties. Despite this, the Mumbai Grahak Panchayat (MGP), a non-profit cooperative for consumer rights, highlighted that DDRs would often demand between ₹15,000 to ₹50,000 per flat for such NOCs. This practice became a public debate as many societies could not afford these sums, and developers were often forced to pay up instead, according to a press release by the MGP on Saturday.

The MGP also noted that DDRs had begun interfering with a society’s redevelopment by selecting developers of their choice, who would facilitate large financial transactions before the society’s general body met to finalize the redevelopment plans. This interference has been a significant source of corruption and has often led to unfair practices.

In its ruling, the court clarified the role of the DDR in the redevelopment of housing societies. Justice Borkar stated, “The Registrar has no authority, either under statute or under the Government Resolution, to insist upon a ‘No Objection’ before or after the society’s decision to redevelop its property.” The court further emphasized that the general body of the housing society is the “supreme authority” in matters concerning the management and affairs of the society, including its redevelopment.

The court explained that the DDR’s role is limited to ensuring that the process is transparent and that all members get a fair opportunity to participate. The DDR must nominate an authorized officer to oversee the selection of a developer, but the officer’s role is “purely supervisory.” The authorized officer is meant to observe the proceedings, confirm that the quorum (minimum number of people) is met, and ensure that the minutes, voting, and resolutions are properly recorded.

The court has also ordered the Commissioner of Cooperation to issue a circular regarding the order and upload it on the cooperative department’s website. This move is expected to help curb the widespread and institutionalized corruption in DDR offices across the state.

MGP welcomed the verdict, stating that the ruling will help curb the widespread and institutionalized corruption in DDR offices across the state. With this ruling, these corrupt practices are “expected to be buried for good.” The decision is a significant victory for consumer rights and a step towards a more transparent and fair redevelopment process for housing societies in Maharashtra.