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The Gujarat High Court has dismissed contempt petitions by dissenting members of Swami Vivekanandnagar Cooperative Housing Society in Vejalpur, imposing a INR 10,000 fine for filing frivolous claims aimed at obstructing redevelopment. The court ruled that allegations of inducement and misrepresentation lacked merit, reaffirming earlier decisions favoring redevelopment. With 93% of residents supporting the project, the court directed the dissenting members to vacate their flats. Citing legal precedents, the ruling reinforces that majority-backed redevelopment cannot be stalled without proving fraud. This decision removes the final legal hurdle, allowing the project to proceed for the society's collective benefit.
The Gujarat High Court has rejected contempt petitions by dissenting members of Swami Vivekanandnagar Cooperative Housing Society in Vejalpur, imposing a fine of INR 10,000 on the petitioners. The court held that the petitions were frivolous and were only intended to hinder the current redevelopment process. Advertisement
A division bench of Justices A S Supehia and Gita Gopi said allegations of inducement in the society and developer obtaining court orders were unsubstantiated. The bench noted that the petitions were "misconceived and misdirected," filed to stall the redevelopment process. The court also commented that the applicants had wasted judicial time and sought to taint the integrity of the court.
The conflict goes back to 2019 when the housing society, initially constructed in 1969, opted for redevelopment in partnership with Excel Life Space LLP. The decision had massive backing, as 93% of flat owners signed a Memorandum of Understanding (MoU). Yet, four members were against the project, prompting a long court battle. In June 2022, a single-judge bench declared in favor of redevelopment, a verdict subsequently confirmed by a division bench.
The newest challenge was filed by the legal successors of Saroj Shah, one of the objecting members, who complained that the developer and society had failed to honor their financial obligations in terms of the MoU. They also charged them with misrepresenting facts to secure favorable orders. The High Court, however, could not find any basis for such allegations and reaffirmed that earlier orders were not based on misrepresentation.
Responding to the issue, the court pointed out that the applicants had not signed the MoU nor consented to its Clause 28, which provides that any objections, disputes, or claims regarding the redevelopment shall be settled internally among the society members. The clause further provides that objecting members shall pay any financial losses occasioned to the opposing party.
Citing a 2022 Supreme Court judgment in The Bengal Secretariat Cooperative Land Mortgage Bank and Housing Society Ltd vs Aloke Kumar & Anr., the High Court again held that a dissenting member cannot override a general body decision unless fraud or misrepresentation is established. The court also clarified that the redevelopment scheme fulfilled the criteria under Section 41A of the Gujarat Ownership Flats Act, which ensured that every member got bigger houses without any personal expense.
Having no grounds in law to interfere in the internal affairs of the society, the court gave a go-ahead to the redevelopment and directed the dissenting members to vacate their flats.
The Gujarat High Court ruling upholds the doctrine that redevelopment schemes cannot be derailed by a few opposing members without strong legal reasons. By dismissing the contempt petitions and levying fines, the court has sent a clear message against frivolous litigation that undermines collective advancement. The judgment is in line with earlier judicial precedents, holding that unless fraud is established, majority-supported redevelopment schemes should go ahead unimpeded. For the Swami Vivekanandnagar Cooperative Housing Society, this ruling represents the last legal obstacle, paving way for redevelopment that holds the promise of improved dwelling for its members.
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