

๐๏ธโ๏ธ Advice and Conclusions Based on the Court Orders
By CA S H Teckchandani
A housing society or its office bearers must exercise caution while circulating notices, agendas, or resolutions containing allegations against members. Unverified allegations may amount to defamation if they harm a person’s reputation.
Society resolutions proposing expulsion of a member must strictly comply with Rule 29 of the Maharashtra Co-operative Societies Rules, 1961. Failure to follow the prescribed procedure may render the action illegal.
Circulation of defamatory statements through society notices, agendas, or meeting documents constitutes publication and can attract liability under Section 500 of the Indian Penal Code.
Professional reputation and social standing of a member are legally protected. Statements affecting the dignity or professional standing of a member may be treated as causing reputational harm.
The defence of “good faith” or “public good” is not automatically available to office bearers. Such protection applies only when the statutory requirements of the exceptions to defamation are satisfied.
๐ Key Issues
Whether the circulation of AGM Agenda No.3 by society office bearers constituted defamation under Section 500 of the Indian Penal Code.
Whether the statement alleging that the complainant and her mother were filing false civil and criminal cases to harass the society was defamatory.
Whether the Trial Court was justified in extending the benefit of Exceptions 1 and 9 to Section 499 IPC to the accused.
Whether the acquittal order passed by the Metropolitan Magistrate required interference by the Appellate Court.
๐ Facts
The complainant challenged the acquittal of the accused passed by the Metropolitan Magistrate in a complaint under Sections 500 and 506 IPC.
The dispute arose from an AGM notice and agenda circulated by office bearers of a co-operative housing society proposing expulsion proceedings against the complainant’s mother.
Agenda No.3 alleged that the complainant and her mother had harassed the society and its members by filing false civil, criminal and other proceedings.
The complainant relied upon several orders passed by co-operative authorities, tribunals and courts showing that proceedings initiated by her mother had resulted in favourable decisions.
โ๏ธ Pleading For & Against
For the Complainant
The complainant contended that the allegations contained in Agenda No.3 were false, defamatory and intended to damage the reputation of both the complainant and her mother.
It was argued that several judicial and quasi-judicial authorities had granted reliefs in favour of the complainant’s mother, demonstrating that the cases filed by her were not false.
The complainant submitted that circulation of the agenda among society members amounted to publication of defamatory material.
For the Accused
The accused contended that the agenda reflected the collective will and grievances of society members.
It was argued that there was no intention to defame the complainant and that the actions were undertaken in the interest of the society.
The defence relied upon the protection available under Exceptions 1 and 9 to Section 499 IPC.
๐ฉโโ๏ธ Court Observation
The Appellate Court observed that various orders produced by the complainant demonstrated that the proceedings initiated by her mother were not false. Therefore, the allegation that false cases were filed was incorrect.
The Court held that the agenda containing the impugned statements had been circulated among society members and therefore satisfied the requirement of publication.
The Court found that the complainant and her mother were clearly identifiable from the agenda and that the allegations directly affected their reputation.
The Court held that branding a person as habitually harassing the society by filing false cases was capable of causing reputational damage, particularly when the complainant was an advocate by profession.
The Court rejected the Trial Court’s reliance on Exceptions 1 and 9 to Section 499 IPC, holding that the statements were neither made for public good nor in good faith for protection of any legitimate interest.
The Court further observed that expulsion proceedings against a society member must comply with Rule 29 of the Maharashtra Co-operative Societies Rules, 1961, which mandates due process and an opportunity of hearing.
โ Final Order
Criminal Appeal No. 334 of 2019 was allowed.
The acquittal order dated 12/03/2019 passed by the Metropolitan Magistrate was set aside.
The accused was held guilty for the offence punishable under Section 500 of the Indian Penal Code.
The accused was sentenced to pay a fine of โน10,000 within one week, failing which he was directed to undergo one month simple imprisonment.
Out of the fine amount, โน9,000 was directed to be paid to the complainant as compensation after expiry of the appeal period.
The accused was directed to surrender the bail bonds and the proceedings were closed.
๐ Citation
Ms. Shobha Venkatesh Shet v. Mr. Rajendra Kumar Jain, Criminal Appeal No. 334 of 2019, Sessions Court for Greater Mumbai, Branch at Mazgaon.
๐ Date of Order
02 June 2026.
This ruling protects the autonomy of housing societies in redevelopment decisions, clearly stating that registrars cannot veto or control these processes. The focus is now on transparency, proper procedure, and majority-based decision-making within the society itself.
A high court judgment has ruled that the guidelines under Section 79A of the Maharashtra Co-operative Societies Act, 1960 are not mandatory:
Explanation
The Bombay High Court ruled that substantial compliance with the guidelines is sufficient, and that decisions made by a majority of society members are binding on the minority. The court also held that the guidelines are not mandatory because no consequences are provided for non-compliance.
Purpose
The guidelines were created to provide guidance when there were problems with re-development of societies. The court said that the guidelines are important to prove that there was no malpractices in the selection of the developer.
Exceptions
The court said that decisions made by a society cannot be interfered with unless they were made through fraud or misrepresentation.
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A High Court judgment in the case Abhanga Samata Co-op. Housing Society Ltd., Mumbai v. Parag S/o Arun Binani states that the directives under Section 79-A of the Maharashtra Co-Operative Societies Act (MCS Act) are not mandatory. The judgment also states that the directives do not bind third parties.
Here are some other points from the judgment:
The General Body is the supreme authority, and the majority’s view will bind the minority.
Decisions made in accordance with democratic principles cannot be interfered with unless it is shown that they were sanctioned by fraud or misrepresentation.
Section 79-A of the MCS Act is related to the public interest, the implementation of cooperative production, and the proper management of the society’s business.
Realm of Law a legal firm headed by Shri K. V. J Rao, along with Petition Group Foundation (an NGO) established to fight corruption in Administration are renowned for fighting against the growing number of corruption cases in redevelopment projects.
Since 2023, we started holding educational seminars to guide Citizens cheated by developers, the last seminar was conducted on 26th May 2024.
Hence, due to the requests from several members, we are organising another seminar on 4th Aug 2024 (Sunday).
Topic covered in the seminar would be:
ALONG WITH THE ABOVE SUBJECT WE’RE ALSO ADDRESSING CRITICAL SUBJECT .
We’re having an educative talk given by Shri K. V. J Rao giving guidance and information on how to fight corruption and injustice in public offices. We intend to guide common citizens on HOW to fight corruption and target corrupt public servants indulging in deficiency of duties.
The session is intended to motivate common citizens to fight against the corruption done by public servants. The seminar will educate all on methods to expose and put such public servants to shame.
The topics of interest :-
1] How to file criminal cases against public servants.
2] How best to self represent your cases before the learned Magistrate.
3] How to interpret past judgements before the learned Magistrate to get a conducive order.
4] How to prosecute culprits in your case.
5] To discuss about the success stories of individuals who fought for their own rights and achieved good, favourable orders / replies from various government authorities.
SPEAKERS:
1. Shri. K.V.J. RAO
Activist and domain expert on criminal law.
2. Shri. AMEET ISRANI
Expert on Society Matters.
Kindly note that the queries will be taken by prior submission to the organiser (9870392223) and it is the jurisdiction of the organiser to take the matter on board as per relevance to the topic.
Details:
Day, Date and Time :
Sunday, 4.08.2024
9 AM to 6 PM
Venue :
Sarvodaya – Centre for Capacity Building- FIRST FLOOR HALL.
Gate # 3, St. Pius X College Complex,
Off Virwani Industrial Estate Road,
Goregaon (East), Mumbai – 400063
Landmark: Take the IITC Road from Umiyadham Jain Mandir.
Google Map Link: https://goo.gl/maps/TGoShRXT5Tbv6pSC9
LIMITED SEATS FOR 90 PARTICIPANTS ONLY.
Fees: Rs.500 by prior online transfer via Bank Details or UPI ID or scanner barcode.
Arrangements at the Venue:-
1) Breakfast & Tea will be provided.
2) Lunch will be served in the dining hall.
3) Evening Snacks and Tea will be provided.
If interested, then kindly contact on the below mobile number for any enquiry:
Shri. Mahavir Ghongade
9870392223
Shri. Neeraj Pattath
9769767969
Bank details for payment are:
BANK NAME:
Canara Bank
ACCOUNT NAME: Mahaavir Ghongade
ACCOUNT NO:
110105879520
Account Branch:
Canara Bank, Malad East
IFSC CODE: CNRB0002695
UPI ID:
mahaavirghongade@cnrb
Please send the screenshot of the payment or details of payment to the mobile number 9870392223 for confirmation.
Prior registration is compulsory. The organizers reserve the right of admission.
Kindly Note: The registration amount you pay is only for the expenses of the hall rent, tea, snacks, lunch and more importantly the speakers are not soliciting business but rendering Honorarium Services Free of Cost.
Walk-in/gate crashers will not be permitted.
Kindly forward this message to those who may be interested.
Thank You
Realm of Law & Petition Group Foundation.
The Bombay High court recently clarified that transit rent received from builders during redevelopment projects is a revenue receipt and is therefore not taxable like normal rent.
A single bench of Justice Rajesh S Patil in an order clarifying the difference betweebn transit rent and rent, observed, “The ordinary meaning of rent would an amount which the tenant pays to the landlord. The term transit rent is commonly referred as “hardship allowance, rehabilitation allowance, displacement allowance” which is paid by the developer or landlord to the tenant who suffers hardship due to dispossession. The Court further stated, “Transit Rent is not to be considered as revenue receipt and is not liable to be taxed. As a result, there is no question of Tax Deducted at Source (TDS) from the
amount payable by the Developer to the member.
The order was passed on the plea filed a resident of Saigal House in South Mumbai, in dispute with the original landlord and the builder, who took up the building’s Redevelopment Project in 2017.
The petitioner, Sharafali Furniturewalla, was already in dispute with step brother over claim to the property after their father’s death. As a result, the builder deposited the transit rent in the Small Causes Court where the claim is being fought. On the issue of who will claim the transit rent, the petitioner approached the High Court, which allowed each brother to withdraw 50% of the amount which was nearly Rs. 1,35,000. However, the one who will lose the claim would have to deposit the money back with the Court with “interest and tax”. When the developer sought the claimants’ PAN and Aadhaar details for taxation, they petitioned for a clarification, when the Court said that transit rent cannot be taxed.
Courtesy : Free Press Journal
TDS on redevelopment of societies: Generally there are exchange of services in the redevelopment transactions with the societies. Societies are transfer the FSI with the development rights to the developer and developer give them a existing area with some extra area free of cost, corpus, betterment charges, alternate accommodation, may be some maintenance charges for few years after possession etc. in the above transaction, there are lot of FAQโs and confusions regarding TDS u/s 194IA and 194IC.
Click Here – ย https://taxguru.in/income-tax/tds-transactions-redevelopment-societies.html
to read the full article
The Real Estate sector in India has been experiencing a downturn for quite some
time. Severe liquidity crunch has plagued this sector and so have policy reforms, legislations and structural changes. These issues were merely the tip of the iceberg, as the Covid โ 19 virus opened up a new front for the real estate sector.
Propelled by the burgeoning crisis,ย the Confederation of Real Estate Developers Association of India (โCREDAIโ) requested theย Ministry of Housing and Urban Affairs to include Covid -19 as a condition ofย force majeureย ย under Section 6 of the Real Estate (Regulation and Development) Act, 2016 (โRERAโ) and that loans by real estate developers should not be classified as Non-Performing Assets in case of default on interest or principal repayment.
Force Majeure under RERA
ย
Section 6 of RERA provides that if an event ofย force majeureย (i.e. a case of war, flood, drought, fire, cyclone, earthquake or any other calamity caused by nature affecting the regular development of the real estate project)ย occurs, then on an application made by the promoter, the authority after considering the facts of the particular case (including that there was no default on the part of the promoter) can extend the registration for not more than one year.
It can be argued that Covid โ 19 could possibly be included in โany other calamity caused by natureโ in the explanation to the section. It is pertinent to note that Ministry of Finance, Department of Expenditure Procurement and Policy decision vide its office memorandum dated 19thย February, 2020 clarified that the disruption of the supply chain as result of the spread of corona virus should be considered as a case of โnatural calamityโ andย force majeureย clause may be invoked.
The above section merely enjoins a delay in the performance of the contract and does not release the developer from its contractual obligations. The above section also makes it abundantly clear that facts of each case would be considered separately, and decisions taken. The period of extension in the case of Covid โ 19 could possibly be not more that 3 to 4 months.
Various remedial steps taken by statutory and regulatory authorities to alleviate the difficulties of the Real Estate Sector
ย
รย Theย Maharashtra Real Estate Regulatory Authorityย vide an Order dated 2ndย April, 2020ย inter aliaย relying on section 6 of RERA, extended the period of validity for registration of MahaRERA Registered projects where completion date, revised completion date or extended completion date expires on or after 15thย March 2020 by three months. Further, the time limits of all the statutory compliances, which were due in March / April / May was also extended to June 30, 2020.
รย Theย Karnataka Real Estate Regulatory Authorityย vide a circular dated 4thย April, 2020 extended the period of validity for registration of K-RERA Registered projects where completion date (including revised completion date) expires on or after 15thย March 2020 by three months. Further, the time limits of all the statutory compliances, which were due in March / April / May was also extended to June 30, 2020.
รย Theย Uttar Pradesh Real Estate Regulatory Authorityย on 14thย April, 2020 has decided to extend by three months the date of completion of the projects where the date of completion is between March 15, 2020 and December 31, 2020.
รย Theย Reserve Bank of Indiaย (โRBIโ) vide a press release dated 27thย March, 2020 has directed all commercial banks (including regional rural banks, small finance banks and local area banks), co-operative banks, all-India Financial Institutions, and NBFCs (including housing finance companies and micro-finance institutions) to allow a moratorium of three months on payment of instalments in respect of all term loans outstanding as on March 1, 2020. Further,ย in respect of working capital facilities sanctioned in the form of cash credit/overdraft, lending institutions have been permitted to allow a deferment of three months on payment of interest in respect of all such facilities outstanding as on March 1, 2020. It has also been clarified that moratorium/deferment provided will not result in asset classification downgrade.
As per the statement of the Governor (RBI) dated 17thย April, 2020, it has been decided that in respect of all accounts for which lending institutions decide to grant moratorium or deferment, and which were standard as on March 1, 2020, the 90-day NPA norm will exclude the moratorium period. Further, the RBI allowed non-bank financial companies to extend the date for commencement of commercial operations (DCCO) for loans given to commercial real estate by additional one year,ย ย over and above the one-year extension permitted in normal course, without considering it as restructuring. Banks had been directed to provide similar relief earlier.
รย Theย Securities Exchange Board of Indiaย vide a circular dated 23rdย March, 2020 has extended the due date for regulatory filings and compliances for Real Estate Investment Trusts and Infrastructure Investment Trusts for the period ending March 31, 2020 by oneย monthย overย andย aboveย theย timelines,ย prescribedย under SEBIย (Infrastructure Investmentย Trusts)ย Regulations,ย 2014 (InvITย Regulations) andย SEBIย (Realย estate Investmentย Trusts)ย Regulations,ย 2014 (REITย Regulations) andย circularsย issued thereunder.
Relaxation on Construction activities
ย
By an Order dated 15thย April, 2020, the Ministry of Home Affairs has issued detailed guidelines for allowing certain additional activities to be undertaken from 20thย Aril, 2020 in non – containment zones (containment zones are required to be demarcated by the respective States and Union Territories) across India, subject to all preparatory arrangements with regard to social distancing being implemented. One of these additional activities include certain construction activities which are as follows:
รย Construction of roads,ย irrigationย ย ย projects,ย ย buildingsย ย andย allย kindsย of industrial projects,ย includingย ย MSMEs,ย inย ruralย areas,ย i.e.,ย ย outside the limitsย of municipal corporationsย ย and municipalities;ย ย ย andย allย kindsย of projects in industrialย estates.
รย Construction of renewable energy projects.
รย Continuation of worksย inย constructionย ย projects,ย withinย the limitsย of municipal corporations and municipalities,ย where workersย are available ย ย on site andย no workers are requiredย to be brought inย from outsideย (inย situย construction).
Each State and Union Territory in the country will decide in which areas and to what extent the above activities can be allowed. However, this may relieve some pressure from the real estate sector. It remains to be seen whether real estate hotspots like Mumbai, Delhi and Bangalore will be permitted to allow construction activities considering that they are Covid-19 hotspots as well.
As can be seen from the above discussion, the situation with respect to Covid -19ย is dynamic, and the real estate sector paradigm is bound to change as a result. Therefore, we will keep you updatedย in case of any further decisions, measures, notifications by the Government and other authorities with respect to the real estate sector.
ย
We trust that the above update is helpful for you. If you require any further clarifications, please feel free to contact us.
Zerick Dastur <zerick@zdlegal.com>