The society must establish a lawful basis for keeping the amount, the Co-operative Court has ruled while directing RNA Regency Park Tower Co-operative Housing Society in Kandivali West to refund ₹ 50,000 to its members, Jignesh Khiraiya and Kusum K Khiraiya, with 6% simple interest per annum. MUMBAI: A housing society cannot retain money collected as a ‘non-refundable’ parking deposit merely by labelling it so.
The amount had been collected in connection with the transfer of membership, but the society could not justify the levy through its registered bye-laws, an independent agreement or evidence of any service provided in return. The court, on September 22, also directed the society to pay the couple’s legal costs. The interest will be calculated from January 30, 2022, when the society receives their written demand for repayment, until the amount is fully recovered. After examining receipts, the general body resolution and correspondence between the parties, the court found that the society had failed to establish a lawful basis for retaining the ₹ 50,000. It held that unauthorised collections must be refunded under Section 72 of the Indian Contract Act, 1872.
The court also referred to earlier judgements holding that a general body resolution cannot authorise a housing society to collect amounts beyond what the law permits.
