In the context of redevelopment of cooperative housing societies in Maharashtra, one pressing question often raised is: can a society terminate the appointed developer if no Development Agreement (DA) is executed? The answer lies in the provisions of the Model Bye-laws and the government resolutions that govern housing societies.
Role of By-law 175 in Redevelopment
By-law 175 of the Maharashtra Co-operative Housing Society Model Bye-laws provides detailed guidance on the redevelopment process. According to this by-law, societies must follow the redevelopment procedure as outlined in the Government Resolution (GR) dated July 4, 2019, which was issued under Section 79A of the Maharashtra Co-operative Societies (MCS) Act, 1960.
The redevelopment process involves several steps, one of which is the selection of a suitable developer. This selection must be made in a general body meeting held in the presence of an authorized officer from the office of the Registrar of Co-operative Societies. Once the developer is selected, the society issues a letter of appointment to the chosen developer, formally initiating the redevelopment process.
Execution of the Development Agreement (DA)
As per the guidelines in the GR and reinforced by By-law 175(b), the developer is required to execute a Development Agreement with the society within three months from the date of appointment. This agreement is a legally binding document that outlines the responsibilities, timelines, and terms of redevelopment.
However, it is often observed that despite the appointment, the Development Agreement may not be executed in time. This delay could be due to disputes, lack of interest, internal changes within the developer’s team, or other undisclosed reasons. Such inaction stalls the redevelopment process and can potentially affect the interests of society members.
Can the Society Terminate the Developer?
Yes, the society has the right to terminate the appointment of the developer if the DA is not executed within the stipulated three-month period. If the delay is unreasonable and unjustified, the general body of the society may pass a resolution to cancel the earlier resolution appointing the developer.
There are two possible routes after termination:
- Appoint a New Developer from the Panel: If the society has a panel of previously shortlisted developers, it may select a new developer from that list.
- Initiate Fresh Redevelopment Process: If no alternate developer is available, the society will need to begin the entire redevelopment procedure from scratch, following all prescribed steps under the July 2019 GR.
In either case, the society must conduct the general body meeting in the presence of the authorized registrar’s representative, as mandated by law.
Legal and Administrative Considerations
The decision to cancel the developer’s appointment must be recorded formally with valid reasons. Additionally, the society must ensure compliance with Section 79A instructions, maintaining transparency and adherence to the law. This protects the society from future disputes and ensures a fair and lawful process.
Conclusion
A cooperative housing society in Maharashtra can terminate the appointment of a developer if the Development Agreement is not executed within three months of appointment. This power is derived from By-law 175(b) and the July 4, 2019 Government Resolution. Societies should act in the best interest of their members by following the legal procedures, maintaining documentation, and ensuring the registrar’s office is kept in the loop.
