Mumbai: Residents of a seven-storey extension building in Mumbai's Matunga found themselves in a peculiar position. Each floor of the extension has one member and while they have all been issued share certificates by the housing society, their names have not been entered in Form J, the official member register.
To make matters worse, they are not included in the society’s activities. Left out of the mainstream functioning, the residents have opened a joint account to collect money among themselves for common expenses. Their troubles have intensified with the original building moving ahead with redevelopment plans, leaving them unsure of how their rights will be safeguarded.
Legal Expert Provides Solution
According to legal expert Sharmila Ranade, associated with the Mumbai Grahak Panchayat, the managing committee of a society is bound by the Maharashtra Cooperative Societies (MCS) Act, its rules and bylaws and is expected to treat all members equally. Discrimination between members of the main building and those from an extension is not legally permissible. If constructive dialogue fails, the affected members can approach the registrar of cooperative societies, who is empowered to look into cases of non-compliance and issue corrective directions.
One possible path forward is for the extension members to push for their rightful inclusion in the existing society. The managing committee is expected to update records, add their names to Form J, and give them access to meetings and decision-making. In particular, redevelopment, which has far-reaching consequences for all residents, cannot be carried out while sidelining valid members. If the managing committee refuses, a formal complaint to the registrar becomes the next logical step.
Can One Society Be Divided Into Two?
The law also provides for a more drastic alternative if harmony proves impossible. Section 17 of the MCS Act allows for the division of societies. In this case, the original building and the extension could legally be split into two separate cooperative societies. For this to happen, the managing committee must prepare a detailed application for the registrar and convene a special general meeting with 15 days’ notice.
A two-thirds majority of the members present at that meeting would be required to approve the division. The resolution would then be published in a local newspaper and displayed at the society office before being submitted to the registrar for approval. Once the procedure is completed and creditors, if any, are satisfied, the registrar has the power to cancel the registration of the old society and register two new ones.
If the managing committee resists such steps, the extension residents are not without recourse. They may directly petition the registrar to intervene. The registrar has wide powers under Sections 17 and 18 of the MCS Act to order amalgamation, division or reorganisation of societies if it is in the interest of members or the public at large.
The questions are answered by Sharmila Ranade, a legal expert associated with Mumbai Grahak Panchayat. The questions, in brief, may be sent to fpjchs@gmail.com
