**Bombay High Court Quashes Disqualification of Jal Ratan Deep CHS Managing Committee**
*Mumbai:* The Bombay High Court has set aside the disqualification of the managing committee of Jal Ratan Deep CHS Ltd., located in Bangur Nagar, Goregaon (West), ruling that liability under the Maharashtra Cooperative Societies (MCS) Act, 1960 cannot be imposed mechanically on the entire committee without establishing individual responsibility.
### Background
The petitioners, members of the society’s managing committee, had challenged their five-year disqualification under Section 75(5) of the MCS Act.
On April 29, the Deputy Registrar passed an order disqualifying them, holding that the committee failed to comply with several clauses under the Act related to disclosures at Annual General Meetings (AGMs). Their revision petition was dismissed on July 14, 2025.
The disqualification followed complaints from two society members who alleged that several mandatory items had not been presented before the AGM. These items included:
– The annual report of activities
– Audited profit and loss account
– Rectification reports of earlier audits
– The annual budget for the upcoming financial years (2021-22, 2022-23, and 2023-24)
### Petitioners’ Defence
The petitioners’ advocate contended there was “substantial compliance” with Section 75 and argued that minor lapses should not warrant such a “harsh punishment.” He further highlighted that, apart from the two complainants, 95 other members supported the managing committee, and no prejudice was caused to the society.
Additionally, the advocate stated that the rectification reports had been duly submitted to the Registrar within the prescribed period.
### Respondents’ Argument
In contrast, the advocate representing the complainants submitted that “partial compliance is not enough” and maintained that failure to comply with certain mandatory items renders the entire committee liable.
The Assistant Government Pleader supported this view, asserting that the Registrar had rightly exercised powers under Section 75(5).
### Court’s Findings
The court found fault with the Registrar’s approach, observing that all omissions were treated equally without distinguishing between serious and technical lapses.
Crucially, the court noted that Section 75(5) uses the phrase “whose duty it was,” implying that the authority must identify which specific office bearers—such as the secretary, treasurer, or chairman—were responsible for compliance.
“Ordinary members, who had no direct role in preparing or placing audited accounts, rectification reports, or budgets, cannot be disqualified without evidence of complicity,” the court emphasized.
### Order and Directions
Setting aside both the April and July 2025 orders, the bench remitted the matter to the Registrar for fresh consideration. The Registrar has been directed to apply the correct legal tests and complete the re-examination “within a reasonable period.”
Accordingly, the petition was disposed of.
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https://www.freepressjournal.in/mumbai/bombay-hc-quashes-disqualification-of-housing-society-committee-says-liability-cannot-be-imposed-on-all-members
