Court says collector cannot insist on a co-operative housing society’s no-objection certificate unless backed by law; directs registration process to move ahead on payment of applicable transfer fee and premium.
The Bombay High Court has held that the registration of a consent decree operating as a conveyance cannot be made conditional upon obtaining a no-objection certificate from a co-operative housing society unless such a requirement is expressly mandated by law.
A division bench of Justices Suman Shyam and Advait M. Sethna delivered the ruling in a writ petition filed by Sanjay Narang and another, who sought directions against the Collector and registration authorities to process the registration of a consent decree dated 16 December 2022 without insisting on a society NOC.
The dispute concerned shop and restaurant premises in Soona Mahal Co-operative Housing Society Ltd., Marine Drive, Mumbai. The petitioners claimed title through a consent decree passed by the High Court in a prior suit, where the decree specifically stated that it would operate as a conveyance in their favour. The decree had already been stamped after the petitioners paid stamp duty of over Rs. 91.58 lakh, and the document was subsequently forwarded for registration.
However, the Sub-Registrar refused to proceed unless the petitioners first obtained a no-objection certificate from the society. The Collector also called upon the petitioners to secure such NOC, prompting them to challenge the action as arbitrary and illegal.
The High Court rejected the authorities’ stand. It observed that the consent terms had attained finality and clearly provided that the decree would operate as a conveyance in favour of the petitioners. The bench held that the revenue authorities ought to have acted in furtherance of the decree and should not have created obstacles in its implementation.
The court found no statutory basis for the Collector’s insistence on a society NOC. It noted that neither the Registration Act nor the Maharashtra Land Revenue Code supported such a pre-condition in the facts of the case. The State’s reliance on Section 37A of the Maharashtra Land Revenue Code was also rejected, as that provision concerns Government and nazul land, whereas the property in question was privately owned.
The bench further held that the petitioners had complied with the time requirements under Section 23 of the Registration Act, since the decree was drawn up and sealed only after stamp duty was paid and was then promptly forwarded for registration.
Relying on the earlier Bombay High Court ruling in Aspi Chinoy, later affirmed by the Supreme Court, the court reiterated that the State cannot demand prior approval for transactions where the law does not require it. It also referred to the Maharashtra Government Resolution dated 7 July 2017, noting that the petitioners were willing to pay the prescribed transfer fee and premium, and the Collector should accept the same rather than create further hurdles.
While the society raised objections regarding alleged encroachment and other issues, the court clarified that those questions need not be decided in the present proceedings and may be agitated separately in accordance with law. It also clarified that the society would not be held responsible by the Collector for the absence of a no-objection certificate.
Allowing the petition, the High Court directed the Collector to decide the petitioners’ application dated 22 August 2024 without insisting on a no-objection from the society, and to proceed in accordance with law upon payment of the applicable transfer fee and premium so that the consent decree can be registered.
Bottom Line :
Registration of a Consent Decree under Section 17 of the Registration Act cannot be made conditional upon obtaining a 'No-Objection' from a Co-operative Housing Society unless mandated by statutory provisions.
Statutory provision(s): Section 17, Section 23 of the Registration Act, 1908, Section 37A of the Maharashtra Land Revenue Code, 1966, Article 226 of the Constitution of India
