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2026 Supreme(Bom) 30

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
R.I. CHAGLA, J.
Usha Sunder Premises CHS Ltd. – Appellant
Versus
Nilang Desai and Others – Respondents
Interim Application No. 1075 of 2023, Suit No. 2240 of 2011
Decided On : 14-01-2026

Advocates Appeared:
For the Appellants : Rashmin Khandekar, Pranav Nair, Manisha Virkhare, Shaheen Moghul, Trupti Gage, Divya Shah
For the Respondents: Kunal Mehta, Smruti Kanade, Shreya Bhagnari, Negandhi Shah, Himayatullah, Aspi Chinoy, Karl Tamboly, Vikrant Shetty, Gurdeep Singh Sachar, Kush M. Shah, Ishan Srivastava, Ishan Gambhir, Amisha Upadhyay

The doctrine of indoor management applies when parties rely on a validly conferred authority despite allegations of internal irregularities; issues of management are internal and not for external parties to scrutinize.

Headnote:(A) Maharashtra Co-operative Societies Act, 1960 - Authority of Managing Committee - Secretary's authority to negotiate and execute lease and modification documents challenged - Fraud and forgery alleged in execution of documents claimed to lack General Body Resolution - Defendants invoke doctrine of indoor management alleging reliance on falsely presented Managing Committee Resolution - Court finds no suspicious circumstances that would negate indoor management. (Paras 1, 60, 65, 89)

(B) General Body - Requirement for authorization - Importance of General Body ratification for significant actions of Society underscored - Court emphasizes that internal management decisions are matters for the Society to resolve and not for external parties to scrutinize. (Paras 68, 70, 73)

Facts of the case:
Plaintiff, a co-operative housing society, contended that impugned lease documents were executed without authority by the Secretary, citing insufficient internal management approval and alleging fraud through a forged resolution. Defendants maintained that documents were valid, supported by the societal management's prior knowledge and actions.

Findings of Court:
The Secretary had been authorized to act on behalf of the Society as per the alleged resolution, and no sufficient evidence was found indicating that the resolutions were forged. Required inquiries were minimal given the past authority of Defendant No. 3.

Issues: Whether the defendants could legitimately rely on the doctrine of indoor management in the context of alleged suspicious transactions.

Ratio Decidendi: The court posited that previous dealings and the lack of objection from Society members validated the Secretary's actions, maintaining that internal management issues are not for outsiders to contest.

Result: Interim application dismissed; no interim relief granted to the Plaintiff.

Table of Content
1. jurisdiction and factual basis of the case. (Para 1 , 2 , 3 , 4)
2. plaintiff asserts lack of authority and fraud. (Para 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14)
3. defendants rely on indoor management doctrine. (Para 15 , 18 , 19 , 21)
4. allegations of fraud and invalidation of documents. (Para 22 , 23 , 24 , 25 , 26 , 27 , 28)
5. authority questioned, with notes on previous conduct. (Para 30 , 31 , 32 , 33)
6. request for interim relief based on urgency and harm. (Para 35 , 36 , 37)
7. substantive discussion of legal principles and prior rulings. (Para 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45)
8. review of relevant legal precedents and arguments. (Para 46 , 47 , 48)
9. (Para 49 , 50 , 51)
10. evaluation of authority based on relevant bye-laws. (Para 62 , 63 , 64)
11. justification on applicability and observance of procedural norms. (Para 65 , 68 , 69 , 70)
12. nexus of new authority to established norms and practices. (Para 71 , 72 , 73 , 74)
13. assessment of fraud allegation and standard of evidence. (Para 75 , 76 , 77)
14. discussion of statutory compliance and authority. (Para 78 , 79)
15. dismissal of claims based on previous determinations. (Para 80 , 81)
16. impact of delay on interim requests and urgency. (Para 82 , 83 , 84)
17. final dismissal of interim application with detailed reasons. (Para 85 , 86 , 87 , 88 , 89)
18. formal conclusion and order of dismissal. (Para 90)

ORDER :

1. By this Interim Application, the Plaintiff has sought for an injunction restraining the Defendants from (i) in any manner acting upon or committing acts and omissions in furtherance of the impugned documents; (ii) in any manner carrying out any development and/or construction activity or constructing any building or structure on any part or portion of the Plaintiff’s property; (iii) dealing with, transferring, disposing of, alienating, encumbering, creating any third-party rights or parting with possession of any part and/or portion of the Plaintiff’s property and (iv) entering upon and/or remaining upon the larger property which includes the demised property and/or any part thereof.

2. The Plaintiff is a Co-operative Premises Society, consisting of 25 members (most of whom are senior citizens), registered under the Maharashtra Co-operative Societies Act, 1960 (“MCS Act”).

3. Defendant Nos. 1 and 2 are the legal heirs of the late Mrs. Usha Suresh Desai and claim to be lessees in respect of a portion of the Plaintiff’s larger property. Defendant No. 3 (now deceased) is the erstwhile Secretary of the Plaintiff – Society. Defendant No. 4 claims to have been assigned the leased property i.e. portion of the larger property belonging to the Plaintiff.

4. The relevant facts are as under:

(i) By and under a Deed of Conveyance dated 27th February, 1979, the vendor Mrs. Usha Desai sold and conveyed to the Plaintiff – Society the land described in the schedule thereto i.e. 2376.50 Sq. mtrs. bearing CTS No.1065, being portion of land or plot of land admeasuring 2658 Sq. mtrs. or thereabouts bearing plot No.30D i.e. portion of final Plot No.30 (larger property).

(ii) In an earlier Agreement for Sale, the purchasers i.e. Plaintiff – Society had agreed that simultaneously with the execution of the conveyance they would execute in favour of the Vendor Mrs. Usha Desai, a perpetual lease for 999 years at a nominal rent of Re.1/- per annum (if demanded), in respect of the said property admeasuring 1786.89 Sq. Mtrs. on which a dwelling house and outhouse structure was standing. Accordingly, the Plaintiff – Society executed lease dated 6th September, 1980 for a (perpetual) term of 999 years in respect of 1786.89 Sq. Mtrs. (lease property) at a rent of Re.1/- per year (if demanded) by the lessor in favour of Mrs. Usha Desai. It is pertinent to note that the Lease Deed provided that the lessee could demolish or reconstruct the existing structures with a built-up area limited to 5100 Sq. Feet i.e. 4100 Sq. feet being the area of the existing structures and an ad

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