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2026 Supreme(Bom) 493

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
AMIT BORKAR, J.
Vallabhnagar Co-operative Housing Society Limited – Appellant
Versus
State of Maharashtra (Through the Co-operation, Marketing and Textile Department) – Respondent
Writ Petition No. 461 of 2026
Decided On : 03-02-2026

Advocates Appeared:
For the Appellant : Mr. Venkatesh Dhond with Preteek Pai, Vinodini Shrinivas, Shashwat Rai and Aditya Shete i/b Keystone Partners
For the Respondent: Dr. Dhruti Kapdia, AGP, Mr. Surel Shah, Senior Counsel with Ms. Kausar Banatwala, i/b Tushar A. Goradia

Housing society lease premiums capped by Section 79A directions; excess demands not enforceable 'dues'; membership grantable on statutory compliance despite conditional prior consent letter.

Headnote:(A) Maharashtra Co-operative Societies Act - Sections 79A, 154B-7, 154B-1(12) - Lease clause requiring prior written consent and payment of half premium or consideration for plot transfer - Society's letter specifying documents and transfer charges at Rs.250 per sq yd is conditional, not prior consent - Directions under Section 79A fixing ceiling on transfer premium binding on societies, prevail over lease terms - Proviso to Section 154B-7 governs leasehold transfers only if consistent with Act - 'Dues' limited to demands based on Act, rules, bye-laws within statutory limits - Membership directed upon tender of entrance fees, transfer fees, permissible premium and documents. (Paras 10, 15-19, 22-24, 30-32, 40-44)

(B) Section 154B-7 - Opens with 'subject to provisions of this Act', subordinating transfer restrictions to Section 79A directions and definition of 'dues' - Societies cannot withhold membership for non-payment exceeding ceilings - Lease conditions read harmoniously with regulatory scheme preventing excessive charges. (Paras 34-39, 44)

Facts of the case:
Plot leased by housing society for 999 years with restrictions on assignment without prior consent and premium payment. Predecessors requested no-objection; society outlined formalities and charges. Assignment executed; transferees applied for membership, rejected for non-compliance. Appeal and revision allowed by authorities directing enrollment.

Findings of Court:
Transferees substantially complied with documents, bye-laws, entrance fees, transfer charges and permissible premium; excess lease premium not enforceable dues.

Issues: Whether assignment breached lease absent prior written consent and full premium; whether society can demand premium exceeding Section 79A ceiling to block membership.

Ratio Decidendi: Governmental directions under Section 79A impose binding ceilings on transfer premiums; lease clauses cannot override; transfer effective under Section 154B-7 upon payment of statutory dues and membership application; authorities correctly directed enrollment on compliance.

Result: Writ petition under Article 227 dismissed.

Table of Content
1. membership dispute arises from alleged lease breach in transfer. (Para 1 , 2 , 3 , 4 , 5)
2. lease conditions mandatory; prior consent and premium required. (Para 6 , 7)
3. society's letter grants conditional noc; 79a ceilings binding. (Para 8 , 9)
4. lease clause 14 mandates prior written consent and premium. (Para 10 , 11 , 12 , 13 , 14 , 15)
5. 2013 reply conditional on documents and charges, not waiver. (Para 16 , 17 , 18 , 19 , 20)
6. authorities found substantial compliance with formalities and dues. (Para 21 , 22 , 23 , 24)
7. section 79a directions impose binding ceilings on transfer premiums. (Para 25 , 26 , 27 , 28 , 29 , 30 , 31)
8. dues limited to statutory demands; 154b-7 subordinate to act. (Para 32 , 33 , 34 , 35 , 36 , 37 , 38)
9. lease terms consistent with act only; statutory compliance suffices. (Para 39 , 40 , 41 , 42 , 43 , 44 , 45)
10. petition dismissed; orders upheld without costs. (Para 46 , 47)

JUDGMENT :

AMIT BORKAR, J.

1. By this Petition filed under Article 227 of the Constitution of India, the petitioner Housing Society challenges the judgment and order dated 15 October 2025 passed by respondent No. 2 in Revision Application No. 192 of 2025. By the said order, respondent No. 2 confirmed the order dated 08 May 2025 passed by respondent No. 3 under Section 23(2) of the Maharashtra Cooperative Societies Act. Respondent No. 3 had allowed the Appeal preferred by respondent Nos. 4 and 5 and directed that they be granted membership of the petitioner society in respect of Plot No. 26. The present petition arises from these orders. The facts necessary for deciding the petition are set out below.

2. By an indenture of lease dated 29 July 1963 executed between the petitioner society and Shri Jayantilal Vadilal Gandhi and Smt. Pramila Jayantilal Gandhi, Plot No. 26 was leased to them for a period of 999 years. The lease contained conditions. It provided that the lessees shall not assign, underlet, or part with possession of the plot without prior written consent of the lessor. It further provided that in the event of any permitted transfer, a lease premium at the prescribed rate payable to the society would be a condition precedent for such transfer.

3. On 20 October 2012, the assignees of the original lessees addressed a letter to the petitioner seeking permission to sell the plot to a prospective purchaser. By letter dated 05 April 2013, the petitioner informed them that for processing transfer of Plot No. 26, the predecessor of respondent Nos. 4 and 5 was required to submit the necessary documents and pay transfer charges. Thereafter, on 03 July 2024, the predecessors of respondent Nos. 4 and 5 sought a No Objection Certificate to assign the plot to respondent Nos. 4 and 5 in terms of a settlement recorded in Suit No. 224 of 2021. They also requested confirmation that they were bona fide members and that the society had no objection to the proposed sale. By communication dated 12 July 2024, the society acknowledged them as bona fide members and lease holders. According to the petitioner, despite this position, a deed of assignment dated 01 August 2024 was executed in favour of respondent Nos. 4 and 5 without obtaining prior written permission of the society and without payment of lease premium as required under clause 2(14) of the lease. The petitioner contends that such assignment amounts to breach of the lease conditions.

4. On 11 October 2024, respondent Nos. 4 and 5 applied for membership of the petitioner society. The society considered their application in light of the lease conditions and rejected it. The society recorded that the assignment was in breach of clause 2.14 of the lease as no prior written No Objection Certificate had been obtained and the prescribed lease premium had not been paid.

5. After rejection of their application, respondent Nos. 4 and 5 filed Appeal No. 33 of 2024 before respondent No. 3. The petitioner opposed the appeal by filing a reply and reiterating that there was bre

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