20 years on, court rejects former hsg society members’ refund claims over lease violations

The court dismissed their plea, saying they were not entitled to any monetary refunds or benefits from the society as they had failed to adhere to lease conditions and society regulations

Mumbai: More than 20 years after five former members of a cooperative housing society in Juhu Vile Parle Development (JVPD) Scheme moved court seeking a refund of ₹31 lakh plus interest from the housing society, a co-operative court dismissed their plea, saying they were not entitled to any monetary refunds or benefits from the society as they had failed to adhere to lease conditions and society regulations.

20 years on, court rejects former hsg society members’ refund claims over lease violations

In the petition filed on December 26, 2005, five former members of Hatkesh Co-operative Housing Limited sought ₹31.07 lakh plus interest from the society, towards recovery of performance deposit, annual benefits, transfer premium difference, flood relief fund and three gold coins weighing 50 grams each. The claims were related to their erstwhile membership of the society and related property dealings.

The housing society refuted these claims, contending that the petitioners violated the conditions of the lease deed and society undertakings. According to the society, the petitioners had breached clauses restricting usage of the property solely for residential purposes by allegedly intending to start a school on the leased premises. They had also transferred leasehold rights to a third party without obtaining the society’s prior written permission, contravening lease terms. These breaches formed the basis for forfeiting the performance deposit paid by the petitioners, and the same had been communicated to them via official letters, the society said.

The court considered the fact that the disputants, although having resigned from the society in 2005, remained within the court’s jurisdiction as past members under section 91 of the Maharashtra Cooperative Societies Act, 1960.

Evidence submitted before the court, including lease deeds, letters, affidavits and admissions during cross examination, supported the society’s stance that the deposit forfeiture was justified. The petitioners also failed to provide documentary proof related to a lower amount of transfer premium, weakening their claim for refund, the court noted.

Cooperative judge JA Zari dismissed the petitioners’ claims for annual benefits and flood relief payments after examining the society’s records and resolutions, as he accepted the society’s argument that such benefits were only payable to resident members actively occupying the property, a status the disputants did not hold at relevant times.

The petitioners’ claim for gold coins as part of society distributions was disallowed due to insufficient supporting evidence and contradictory testimony from the society’s representatives. Notably, the court pointed out that the petitioners did not cross examine key witnesses from the society, which led to acceptance of the opponent’s evidence under established legal principles.

Accordingly, on October 15, the court rejected the entire claim of ₹31.07 lakh, stating that the petitioners were not entitled to any monetary refunds or benefits from the society.