Procedure for transfer of ownership in Society flat post death of owner Where Nomination made by deceased owner: Bombay High Court

ownership

The Bombay High Court has clarified the procedure for transfer of ownership in any Society flat post death of any owner wherein there is a nomination made by the deceased owner.

Facts

The deceased, Mannalal Surajmal Khandelwal was owner of a flat and by virtue thereof, was entitled to share certificate No. 7 bearing share distinctive numbers 37-35 issued by the Vaikuntha (Andheri) Co-operative Housing Society Ltd. The deceased during his lifetime registered a nomination in the name of the petitioner, his grandson. The nomination was acknowledged by the managing committee of the society in its meeting held on 14th March, 2004 and made an entry in the nomination register. Mannalal Khandelwal died intestate.

Upon the demise of Mannalal Surajmal Khandelwal, Rajendra M. Khandelwal, made an application to the society, inter alia, seeking transfer of membership and the share certificate in his name. Along with the application, he submitted a ‘No Objection cum Declaration’ and indemnity bond made and executed by Krishnakumar Mannalal Khandelwal. This way, the Respondent claimed 2/3rd share and interest in the flat and sought transfer of proportionate interest in flat and claimed membership. 

The application was rejected by the society on 8th August, 2018. Whereafter, the Respondent preferred an appeal under section 23 (2) of the Maharashtra Societies Act before the Deputy Registrar. The Petitioner sought intervention in the appeal. The Intervention was allowed. 

The Deputy Registrar allowed the appeal and held that since the Respondent has acquired 2/3rd right in flat to that extent, his interest be noted in the society record. In consequence, the Deputy Registrar acknowledged 2/3rd undivided right of the Respondent and 1/3rd undivided right of the Petitioner in the flat and directed to make entry in the society records. In revision, the Divisional Joint Registrar, upheld the order of Deputy Registrar and dismissed the revision application of the Petitioner.

Court’s Observation

A single bench of Justice Sanjeev K. Shinde ruled that the cooperative society was bound by nomination made by the deceased and it was bound to transfer the shares to the nominee. However, clarified that, it is open to other members of the family to pursue their case of succession or inheritance, in consonance with law. As such, held though , the Cooperative Society is bound by a valid nomination; however, it does not mean that nominee becomes owner of the property, but that he holds the property in trust for the legal heirs. 

“As such, legal heirs of the deceased can always approach appropriate Court to stake their claim to their share of the deceased property including the flat. Once they obtain the relevant order from the Court, the society is bound to transfer the flat/ shares in their name,” the court stated.

The court said that petitioner is a person duly nominated in accordance with Rules. The nomination was duly acknowledged by the society and recorded in the register. In that view of the matter, the society shall admit the petitioner as a provisional member of the society in terms of Clause (c) of Section 154-B-1 (18) of the MCS Act, as amended and may call upon the Respondent to produce succession certificate or a legal heir-ship certificate or testamentary document as the case may, be for claiming the right in the flat and membership of the deceased but till then the Petitioner shall be a provisional member of the Society.

Case: Karan Vishnu Khandelwal Versus Chairman

Citation: Writ petition no. 12468 of 2022

Date of Decision: 09.11.2022

Click here to read the Order/Judgment

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