Society Bye-Laws and Governance During Redevelopment

During a redevelopment your co-operative housing society is still run by the same rulebook that governs it every day: the Maharashtra Co-operative Societies (MCS) Act, 1960 (Mah. Act XXIV of 1961), the MCS Rules, 1961, and your society's own registered bye-laws — which most Mumbai societies have adopted in the Model Bye-Laws (2014) format. What changes is the stakes. Every major redevelopment decision must pass through a properly convened general body meeting with the special quorum and consent set out in the State's Section 79A directive dated 4 July 2019, while your managing committee holds those decisions in trust for all members. Getting the governance right is what makes a redevelopment legally safe; getting it wrong is what lets it be challenged in court for years.

What "governance" actually means in a housing society

A co-operative housing society is a self-governing body with three moving parts. The general body — every eligible member together — is the supreme authority and takes all the big decisions. The managing committee (the elected office-bearers) runs day-to-day affairs and carries out what the general body decides; it does not have independent power to sign away members' homes. And the bye-laws are the society's own constitution, registered with the Registrar, that spell out how meetings are called, who can vote, how vacancies are filled and how money is handled.

The word "governance" simply means keeping these three parts working the way the law requires — correct notice, correct quorum (the minimum number of members who must be present for a meeting to be valid), correct majority, and a written record. In an ordinary year this is routine. In a redevelopment year it is the difference between a scheme that stands and one that collapses under a legal challenge from a handful of unhappy members.

The legal framework that sits behind your bye-laws

Your bye-laws do not float free. They sit inside a hierarchy: the MCS Act, 1960 is the parent statute, the MCS Rules, 1961 add detail, the Model Bye-Laws (2014) give the standard template that individual societies adopt, and binding directives issued by the State under Section 79A of the Act sit on top for specific subjects such as redevelopment. Section 79A of the MCS Act lets the State Government issue directions that every society must follow — and the redevelopment rulebook every Mumbai society now works to is exactly such a directive.

Two other laws overlap during a project. The Maharashtra Ownership Flats Act (MOFA), 1963 governs the promoter's duty to hand over title — Section 11 obliges the promoter to convey the land and building to the society, and Section 11(3) gives the society the powerful fallback of deemed conveyance if the builder refuses. The Real Estate (Regulation and Development) Act, 2016 (RERA/MahaRERA) regulates the developer once construction starts. But the internal question — who in the society can decide, and by what majority — is answered by the MCS Act, your bye-laws and the Section 79A directive. Understanding where each law applies keeps committees from over-reaching or being misled.

The 97th Amendment and why Maharashtra still uses the MCS Act

Members sometimes hear that "the Constitution now controls societies." The story is more subtle. The Constitution (97th Amendment) Act, 2011 inserted Part IX-B (Articles 243-ZH to 243-ZT) on co-operative societies, in force from 15 February 2012, to standardise how co-operatives are run. But in Union of India v. Rajendra N. Shah (2021) the Supreme Court struck down Part IX-B in so far as it applies to State co-operative societies, because co-operation is a State subject and the amendment had not been ratified by the States under Article 368(2). It upheld Part IX-B only for multi-State co-operatives. The practical result for you: Maharashtra continues to govern housing societies through the MCS Act, 1960 and the Model Bye-Laws (2014), not through the struck-down constitutional provisions. If you want the fuller history, see our page on the 97th Constitutional Amendment and societies.

The bye-law numbers that matter in a redevelopment

Most Mumbai societies run on the Model Bye-Laws (2014) format issued by the Commissioner for Co-operation and Registrar, Co-operative Societies, Maharashtra State. Start with one fact that surprises committees: there is no bye-law that deals with redevelopment as such. The 2014 model bye-laws never mention it. That gap is exactly what the Section 79A directive dated 4 July 2019 fills. What the bye-laws do supply are the numbered rules on meetings, votes, records and money against which every redevelopment step is measured. Mark these in your society's own registered copy before the first meeting is called.

Source: Model Bye-Laws for Co-operative Housing Societies (2014), Commissioner for Co-operation and Registrar, C.S., Maharashtra State; MCS Act, 1960. Numbering follows the 2014 model format. Check the numbers against your society's own registered bye-laws before quoting them in a notice — a society that adopted an amended or older set may number the same rules differently.

The general body is supreme: quorum and consent thresholds

No committee, developer or "society consultant" can approve a redevelopment on the members' behalf. Under the Section 79A directive dated 4 July 2019, which superseded the earlier 3 January 2009 directive, the decision belongs to the general body and must clear specific numbers. These thresholds are the single most-litigated part of any project, so know them exactly.

Read the 51% line carefully. It is 51% of the society's total membership strength, not 51% of those who happen to attend. In a society of 60 flats, that means at least 31 members must vote in favour; a member who stays away is simply not a "yes." This is why a full, verified membership register matters so much before you call the meeting. Our step-by-step walk-through of the whole sequence lives in the 79A redevelopment process guide.

The directive of 4 July 2019, written out as a timetable

The directive does not only fix percentages; it fixes deadlines. Every one of the steps below is checkable against a dated document your society either has or does not have. Put them in the society's diary and the file more or less audits itself.

Source: Government of Maharashtra directive under Section 79A of the MCS Act, 1960, dated 4 July 2019, which superseded the directive dated 3 January 2009. Section 79A(1) ends: societies "shall be bound to comply with such directions". Cite the directive by its date — that identifies it without relying on a circulated GR number.

Membership and voting rights during redevelopment

Because everything turns on membership counts, redevelopment is the moment to get the register right. The MCS Act and the Model Bye-Laws recognise more than one kind of member, and only some can vote.

Who can vote, and associate members

The member whose name stands first on the share certificate is the one entitled to vote and to be counted for quorum. An associate member — for example a spouse or child added on the same flat with the first member's consent — generally holds no independent share and can vote only in the first member's absence and with written authority, in the manner the bye-laws provide. A nominal or provisional member has still fewer rights. For a redevelopment resolution this distinction is decisive: only the recognised voting member counts toward the 2/3 quorum and the 51% consent. Committees should reconcile the share register, the "I" and "J" registers and any nomination forms well before the meeting, because a challenge often begins with the claim that non-voting members were wrongly counted, or genuine members wrongly excluded.

Two bye-law numbers decide most of these arguments. Bye-law 22 classifies as non-active any member who has not attended a single general body meeting in five consecutive years and has not used the society's minimum services; a non-active member cannot vote, yet still counts inside the total membership on which the 51% is calculated. Bye-law 104 then rules out proxies altogether — a power-of-attorney holder cannot attend or vote at a general body meeting on a member's behalf. For an NRI owner or a member in hospital, that means the vote is simply lost from the count unless they attend. A society with a dozen absentee owners should reconcile the active-member list months ahead, not the week before the meeting.

Where a flat is jointly held, or the original member has died and heirs are in dispute, resolve the entry first. Counting a contested vote can taint the whole resolution. If your society has never been formally registered or its records are patchy, start with our register your society resource before you move to a redevelopment vote.

Casual vacancy and a working committee

A redevelopment cannot be run by a committee that has fallen below strength. A casual vacancy — a seat that falls empty mid-term when a committee member resigns, ceases to be a member or passes away — should be filled in the manner the bye-laws prescribe so that the committee remains properly constituted and can lawfully convene meetings, issue notices and sign documents on the society's behalf. If too many seats are vacant and the committee cannot function, the Registrar's machinery under the MCS Act may step in. Sorting out committee strength is unglamorous but foundational: a notice issued by an improperly constituted committee is an easy target for anyone wanting to stall the scheme.

What a single member can demand — and by when

A member does not have to depend on the committee's goodwill. Each of the rights below has a name, a number and, in most cases, a clock. Ask in writing, keep the acknowledgement, and the clock starts running against the society rather than against you.

1. Free inspection of the records — Section 32(1), MCS Act, 1960, and bye-law 23. At the society's office during office hours, free of cost: a copy of the Act, the Rules and the bye-laws; the last audited balance sheet and profit and loss account; the list of committee members; the register of members; the minutes of general body meetings; the minutes of committee meetings; and those portions of the books and records in which the member's own transactions are recorded.
2. Copies within one month — Section 32(2). On a written request and payment of the prescribed fee, the society must furnish a copy of any of those documents within one month from the date the fee is paid. Diarise that one month. It is what converts "the secretary is busy" into a documented default you can put before the Registrar.
3. The redevelopment file itself. The 4 July 2019 directive requires the feasibility report, the tender comparative chart and the minutes to be placed before the general body, posted on the notice board and put on the society's website. Once created they are society records, and therefore inspectable under Section 32(1). A committee that shows the general body only a summary of the tenders is not complying.
4. A reply to a written complaint in 15 days — bye-laws 172 to 174. Hand a written complaint to any office-bearer. The committee must decide it at its next meeting and communicate the decision within 15 days. If it does not, or the member is not satisfied, bye-law 174 lets the member take the matter to the Registrar.
5. An inquiry by the Registrar — Section 83, MCS Act, 1960. On the application of 1/5th of the members, the Registrar holds an inquiry into the constitution, working and financial condition of the society. The applicants may be asked to deposit the cost of the inquiry, which is refunded if the allegations are substantially proved. Note that this is the same 1/5th that can requisition the redevelopment meeting — a group large enough to start a project is large enough to audit one.
6. Carpet area stated the RERA way. The directive requires the development agreement to express carpet area as defined in RERA, 2016. Under Section 2(k) of that Act carpet area is the net usable floor area, including the internal partition walls, and excluding external walls, service shafts and the exclusive balcony, verandah or open terrace. Insist on that wording in the PAAA; "carpet area" left undefined is negotiable in the builder's favour.
7. Two-thirds consent before the sanctioned plans change — Section 14(2), RERA, 2016. Once the project is registered, the promoter must obtain the previous consent of at least two-thirds of the allottees before altering the sanctioned plans, layout or common areas.

Source: MCS Act, 1960, Sections 32 and 83; Model Bye-Laws (2014), bye-laws 23 and 172–174; Section 79A directive dated 4 July 2019; Real Estate (Regulation and Development) Act, 2016, Sections 2(k) and 14(2).

Money and charges: keeping governance clean

Financial transparency is part of governance, and one specific cap catches many committees out. Non-occupancy charges — the extra amount a society levies when a flat is let out rather than lived in by the owner — are capped by a Government of Maharashtra order issued under Section 79A dated 1 August 2001 at 10% of the service charges (excluding municipal taxes), and near relatives are exempt from them altogether. A direction issued under Section 79A binds every society — Section 79A(1) says societies "shall be bound to comply with such directions" — so a resolution of your own general body cannot lift the cap. Societies sometimes try to raise these charges during a project to build a fund or to pressure absentee owners; charging beyond the cap is a straightforward ground for a complaint to the Registrar.

Two more numbers keep the money side clean. Non-occupancy charges appear in bye-law 65, which lists the heads of charge a society may levy at all — a committee cannot invent a "redevelopment levy" or a "consent fee" outside that list; anything extra needs a properly passed general body resolution creating a fund, minuted and banked. And bye-law 71 caps interest on defaulted charges at simple interest of 21% per annum, or a lower rate approved by the general body. A committee that loads penal interest above 21% on a member who is holding out against the scheme is itself in breach.

The same discipline applies to any corpus, hardship or "goodwill" money the developer offers. That money belongs to the members on the terms recorded in the agreement, not to the committee to spend at will. Keep every rupee minuted, banked and audited. When you compare what different developers are offering, tools like our offer comparison tool and rent comparison tool help the general body judge the numbers side by side rather than on the committee's say-so.

How to keep a redevelopment decision legally valid

Good governance is a sequence, not a single vote. Follow it in order and the resolution is hard to unseat.

1. Clean the register — bye-law 22. Reconcile members, associate members and nominations. Reclassify non-active members first: they cannot vote, but they still sit inside the "total membership" figure the 51% is measured against.
2. Constitute the committee — bye-law 128. Fill every casual vacancy by nominating an active member of the same class, so notices and documents are issued by a valid committee.
3. Act on a proper requisition — bye-law 96 and the directive. Get the written application signed by at least 1/5th of total members. Acknowledge it within 8 days; convene the meeting within 2 months.
4. Issue correct notice. Circulate the SGBM agenda to every member 14 days in advance and keep the acknowledgements. Members may file written suggestions up to 8 days before.
5. Record the quorum — bye-law 100 does not govern here. Confirm and minute by name that at least 2/3rd of total membership is present. The "or 20, whichever is less" concession does not apply to a redevelopment meeting.
6. Pass the resolution properly — bye-law 104. Secure in-favour votes of at least 51% of total membership, rounding any fraction up. No proxies and no power-of-attorney holders. Hold the developer-selection meeting with the Registrar's Authorised Officer present and the proceedings video-recorded at the society's cost.
7. Circulate and file the minutes. To members within 7 days; to the Registrar within 15 days. Record votes for, against and absent as three separate numbers.
8. Register the documents. Execute the development agreement within 3 months, take the 20% bank guarantee, and register the development agreement and every member's Permanent Alternate Accommodation Agreement (PAAA) under Section 17 of the Registration Act, 1908.

When governance breaks down: Section 91 disputes

Even a careful society can face a dispute — over who was counted, whether notice was proper, or whether the committee exceeded its authority. Most such disputes between a society and its members, or between members, fall under Section 91 of the MCS Act, 1960, which routes them to the Co-operative Court rather than a civil court. Section 91 is both a shield and a warning: it gives an aggrieved member a forum, and it reminds committees that shortcuts in quorum or consent can be litigated. The best defence is a clean paper trail — notices, attendance sheets, the video recording and signed minutes — that proves each threshold in the table above was met.

Where to go, what to cite, and by when

Different failures go to different forums, and picking the wrong one costs months. This is the map.

Source: MCS Act, 1960, Sections 78, 79A, 83, 88, 91 and 92; Model Bye-Laws (2014), bye-laws 173 and 174; MOFA, 1963, Section 11; RERA, 2016, Sections 14(2), 18 and 31.

What the society must minute, and when

Nearly every challenge is won or lost on the minute book, so minute more than committees think they need to. Record the quorum by name and count before any vote is taken, not merely "quorum present". Record the votes for, against and absent as three numbers — never "passed unanimously" when 15 members were not in the room. Record that the Registrar's Authorised Officer attended the developer-selection meeting and that the proceedings were video-recorded, and note where the recording is kept. Record the exact wording of the resolution, because that wording is what a court will read. Then circulate the minutes within 7 days and send a copy to the Registrar within 15 days, as the 4 July 2019 directive requires; bye-law 108 separately allows any member to file observations within 15 days of circulation, and requires the minutes to be finalised within three months. A minute book that records the arithmetic is what defeats a challenge brought five years later inside the six-year window under Section 92(1)(b).

What this means for your society

Four things are worth doing this month, before any developer is spoken to. One: pull your society's registered bye-laws out of the file and write your own membership number against bye-laws 22, 100, 104 and 109, so the committee is arguing from the actual text rather than from memory. Two: print the active-member list and the register of members, count the total membership, and work out your three numbers on paper — the 1/5th, the 2/3rd and the 51%, each rounded up. Three: ask in writing under Section 32(1) for the last three years of general body and committee minutes, and note the date you paid any copying fee, because the society then has one month under Section 32(2). Four: put the deadlines from the 4 July 2019 timetable above into a single sheet the committee reviews at every meeting — 8 days to acknowledge, 2 months to convene, 14 days' agenda, 7 days for minutes, 15 days to the Registrar. None of this requires a lawyer. It is simply the evidence that, six years later, decides whether the scheme stands.