Authority: High Court of Judicature at Bombay

Order Date: 24 September 2026 (reserved on 31 August 2026)

Case Overview

  • Parties: Petitioners – Dr. Omprakash B. Soniminde and Mrs. Chandrakala Omprakash Soniminde; Respondents – Le Chateau Co‑operative Housing Society Limited (through its Board of Administrators) and Jet Speed Developers Pvt. Ltd. together with its directors Mr. Ramesh C. Mankani and Mrs. Renu R. Mankani (Respondents Nos. 4‑6).
  • Nature of proceedings: Writ Petition No. 751 of 2019 (with Interim Application No. 15802 of 2024) challenging the judgment and order dated 11 January 2018 of the Co‑operative Appellate Court, which had affirmed the Co‑operative Court’s order dated 30 January 2017 and a review order dated 13 July 2018. The petitioners sought declaration that the resolution passed on 24 July 1998 allocating flats 701 and 702 to the directors of the contractor was illegal and that they be allotted flats 801 and 802 in the Shamrock building.
  • Background: The society owned Plot 14, TPS IV, Santacruz (1,164 sq m) with a bungalow and a tenanted building “Shamrock”. The building “Le Chateau” (stilt + six floors, 12 flats) was constructed by a developer and later the flat purchasers formed the society. In 1994 the society decided to purchase TDR/FSI and construct additional floors on Shamrock and Le Chateau, to be allotted only to existing members at cost of construction and TDR. The decision was formalised at an Extraordinary General Body Meeting (EGM) on 24 April 1996. Jet Speed Developers Pvt. Ltd. was appointed as contractor on 20 June 1996 at a rate of Rs 4,000 per sq ft inclusive of construction and TDR costs.
  • Petitioners’ entitlement: The petitioners were allotted flat Nos 701 and 702 (7th floor, Le Chateau) under the EGM resolution and paid an initial Rs 5,00,000. Subsequent demands for further payment were issued (Rs 35 lakhs on 26 August 1997; Rs 43,09,000 on 18 November 1997). The petitioners alleged non‑receipt of notice for the AGM held on 24 July 1998, where the society resolved to allocate flats 701 and 702 to Mr. Ramesh C. Mankani and Mrs. Renu R. Mankani (directors of the contractor) instead of the petitioners.
  • Lower court findings: The Co‑operative Court dismissed the dispute on 30 January 2017; the Appellate Court upheld that dismissal on 11 January 2018 and rejected a review on 13 July 2018. The courts held that the petitioners had failed to pay the required contributions and that the allocation to the contractor’s directors was a legitimate remedy for unpaid dues.
  • Petitioners’ arguments (Senior Advocate Dr. Tulzapurkar): The 24 July 1998 resolution was passed without proper notice, agenda, or quorum; therefore it was ex facie illegal. The allocation deprived members of their statutory right and amounted to unjust enrichment of the contractor’s directors, who received both the construction cost (over‑payment of Rs 2.69 crore against a TDR purchase of 450 sq m) and four large flats. The petitioners offered to deposit Rs 62 lakhs (plus interest) on 6 November 2002 and now propose to pay Rs 2.5 crore for flats 801 and 802, which remain uncompleted.
  • Respondents’ arguments (Counsel Mr. Kanade): The petitioners defaulted on the agreed contributions; the EGM resolution of 24 April 1996 made payment a condition precedent. The society therefore lawfully re‑allotted flats 701 and 702 to the contractor’s directors to recover outstanding dues. The petitioners had not challenged the separate dispute concerning flats 801 and 802 (Dispute No. CC/I/210/2014), so they cannot raise that issue now. The market value of flats 801 and 802 is estimated at Rs 7.31 crore; the petitioners’ offer of Rs 2.5 crore is insufficient.
  • Court’s analysis: The judge observed that the allocation of flats 701 and 702 to the directors, while irregular, could not be disturbed as the flats have been possessed for a long period. However, the allocation of flats 801 and 802 to the same directors was arbitrary, especially since the flats are unfinished and unoccupied. The court accepted the petitioners’ calculation that the contractor had been over‑paid (approximately Rs 2.47 crore) and that the directors had obtained a windfall gain of four flats worth an estimated Rs 15 crore. The court noted that the petitioners were willing to pay Rs 2.5 crore for flats 801 and 802, which would settle the outstanding amount owed to the contractor.

Final Outcome

  • The judgment and order dated 30 January 2017 of the Co‑operative Court, the order dated 11 January 2018 of the Co‑operative Appellate Court, and the review order dated 13 July 2018 are set aside.
  • Dispute No. CC/I/179/2014 is partly decreed: petitioners are declared entitled to flats 801 and 802 in the Shamrock building and become owners, members, and occupiers of those flats.
  • The society is directed to cancel the earlier allotment of flats 801 and 802 made to Mr. Ramesh C. Mankani and Mrs. Renu R. Mankani and to enter the petitioners’ names in the membership register for those flats.
  • Petitioners must pay Rs 2,50,00,000 to Respondents 4 and 5 within six weeks.
  • Upon receipt of the payment, Respondents 4 and 5 must hand over possession of flats 801 and 802 to the petitioners.
  • If Respondents 4 and 5 refuse the payment, the amount may be deposited with the society, which will invest it in interest‑bearing deposits; the petitioners may then take possession with police assistance.
  • Petitioners will be liable for maintenance dues only from the date of possession; the society and Respondents 4 and 5 cannot claim any past maintenance.
  • If petitioners fail to pay the Rs 2.5 crore within the stipulated time, the allotment of flats 801 and 802 reverts to Respondents 4 and 5.
  • The writ petition is partly allowed; no order as to costs.

Topics: Legal Dispute, Real Estate Allocation, Cooperative Society