Re-development contract with a loss making company
Our Co-op. Housing Society located on link road Goregaon West have free hold & wants to go for re-development with an individual loss making company (As per the balance sheets submitted by the developer) which is a company of a Director holding 1/3rd share in a major builder group. They have shown & submitted the details of the major group's projects but wants the agreement of re-development of our society in the said individual loss making company. Please advice is it right to do so & if any dispute arises in non-development where we stand in the court of law.
The Government of Maharashtra issued Directive for Redevelopment of Building of Co-operative Housing Society dated 3rd January 2009 under section 79A of the Maharashtra Co-operative Societies Act, 1960 with object to bring clarity and transparency in the redevelopment process of society building and for the smooth functioning of the society.
The first part of the question is answered by directive 4 which states Decisions to be taken in the Special General Body Meeting. Further in the second para it also states that On formation of quorum for the meeting, Suggestions, recommendations and objections from all the members with regard to redevelopment of the society’s building will be taken into consideration and opinions expressed by all the members will be recorded in the minutes book with names of concerned members. Therefore a preliminary decision will be taken whether to redevelop society’s building or not. Such decision must be taken with majority vote of more than ¾ of the members. On preliminary resolution about doing the work of redevelopment getting passed, following business will be transacted in the meeting.
a) To selected expert and experienced Architect / Project Management Consultant from the panel of the Government / Local Authority for work of redevelopment of the building and to finalize items of work to be done by them and terms and conditions for the same.
b) To submit an outline of the program for redevelopment of building.Directive 11(10) answers the second part of the question and states if any dispute arises in the work of redevelopment, provision should be made in the agreement to resolve the same as per provisions of Section 91 of Maharashtra Co-operative Societies Act, 1960.
Section 91 provides that if there is any dispute in the constitution, election of the committees or its officers other than elections of committees of the specified societies including its officer, conduct of general meetings, management or business of a society shall be referred by any of the parties to the dispute, or by a federal society to which the society is affiliated or by a creditor of the society, to the co-operative Court.
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