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2025 Supreme(Online)(Tel) 53054

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
T. Madhavi Devi, J
Saket Bhu Sattva Phase-I Villa Owners Mutually Aided Cooperative Maintenance Society Ltd. – Appellant
Versus
District Cooperative Officer – Respondent
W.P.No.14493 of 2023 | W.P.No.14519 of 2023



The Registrar of Cooperative Societies must follow due process, including verifying all documents and inviting objections, before registering a society, especially in multi-phase real estate projects where common amenities are shared, ensuring that one group does not exclude others to the detriment of project harmony.

Headnote:(A) Telangana Mutually-Aided Cooperative Societies Act, 1995 - Section 4 - Real Estate (Regulation and Development) Act, 2016 - Section 11(4)(e) - Registration of cooperative society - Promoter/Developer obligations - Whether a single phase of a multi-phase project can form a society without developer involvement.

(B) Administrative Law - Registration of Society - Requirement of due process - Registrar must verify documents and consider objections before registration - Rule of law requires harmonious interpretation of RERA and Cooperative laws.

Facts of the case:
The petitioner, a real estate developer, challenged the registration of a cooperative society formed exclusively by residents of Phase-I of a four-phase project, arguing that common amenities were intended for all phases and that it is the promoter's responsibility to form the society upon completion.

Findings of Court:
The Court held that the Registrar failed to follow due procedure, which includes verifying documents and calling for objections. The registration was found premature and lacking proper inquiry into whether common facilities are shared across project phases.

Issues: Whether a promoter is the sole authority to initiate society registration, and if the Registrar can register a society for one phase of a multi-phase project without comprehensive verification.

Ratio Decidendi: The Registrar is duty-bound under the TMACS Act to verify that an application for registration encompasses the entire project where common amenities are shared, and must allow objections before granting registration to prevent disharmony or multiplicity of proceedings.

Result: Both Writ Petitions allowed; registration of Respondent society set aside with directions to the Registrar to reconsider the application.

Table of Content
1. summary of facts involving disputes over cooperative society formation in multi-phase projects. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7)
2. contentions regarding locus standi, rera obligations, and the right to form societies. (Para 8 , 9 , 10)
3. the registrar's duty to conduct due diligence and verify project-wide impact before registration. (Para 11 , 12 , 13)
4. court order setting aside illegal registration for non-compliance with due procedure. (Para 14 , 15 , 16)

COMMON ORDER:

1. W.P.No.14493 of 2023 has been filed by the writ petitioner/promoter of the project seeking a Writ of Mandamus declaring the action of the District Cooperative Officer, Medchal Malkajgiri District, in registering the Mutually Aided Cooperative Society under the name of “Saket Bhu Sattva Phase-I Villa Owners Mutually Aided Cooperative Maintenance Society Ltd.” bearing Registration No.TS/MLKG/ MACCS/2023-30/FOW&M, without an application being filed by the petitioner (which is the builder and promoter of the project) and at the instance of residents of a phase of the real estate project named “Saket Bhu Sattva” to the exclusion of the residents of the other phases as being without jurisdiction, and as illegal, arbitrary and contrary to the provisions of the Telangana Mutually-Aided Cooperative Societies Act, 1995 (for short, “TMACS Act”) and the Real Estate (Regulation and Development) Act, 2016 (for short, “RERA Act”) and the Apartments (Promotion of Construction and Ownership) Act and Rules 1987 and consequently to set aside the registration and to pass such other order or orders.

2. W.P.No.14519 of 2023 has been filed by writ petitioners, who are the residents of Phases-I and IV of Saketh Bhu Sattva Project, seeking a Writ of Mandamus declaring the action of respondent No.3 in conducting the elections of respondent No.4 society by fixing the date of elections on 11.06.2023 without consent of the petitioners, who are the rightful owners of the said villas in Phases-I and IV and also without considering their representation dated 02.06.2023 as illegal, arbitrary and against the principles of natural justice and consequently to set aside the Election notice dated 26.05.2023 issued by respondent No.3 and to direct the respondents No.2 and 3 not to conduct any elections until completion of the construction of the entire town namely Saketh Bhu Sattva in the interest of justice and to pass such other order or orders.

3. The writ petitioner in W.P.No.14493 of 2023 is the respondent No.5 in W.P.No.14519 of 2023.

4. Brief facts leading to the filing of the present writ petitions are noted in the interim order granted by this Court in W.P.No.14493 of 2023 dated 12.06.2023. It is observed that the petitioner in W.P.No.14493 of 2023 has developed a project by the name “Saket Bhu Sattva” comprising three phases and later, the petitioner expanded the project including 4th phase and entered into Agreement of Sale with several Villas/Plot owners. It was specifically mentioned in the agreement that the project will be in three (3) phases. It is also observed that some members of I Phase Villa/Plot owners have applied for registration of society under the provisions of the TMACS Act and that the society was registered without any information to the petitioner (promoter/builder).

5. It is the contention of the petitioner/promoter that he has an obligation to register the society after all the phases are completed and all the common amenities, including services like water supply, drainage, street lighting, parks, clubhouses, etc., are to be handed over to the Villa/Plot owners thereafter. According to the petitioner, handing over of common amenities before the completion of the project will lead to a lot of confusion and it will be difficult for the petitioner to complete the project. It is stated that after respondent No.3 has registered the society with only the members of Phase-I villa owners, the Phase-I Villa owners are trying to occup

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