Guest Article by Karan Verma and Vishal Sharma
Allahabad High Court declares Purvanchal Silver City II RWA illegal; Orders fresh elections
In a landmark judgment that will have far-reaching implications on the way gated communities are managed in Noida and Greater Noida, the Allahabad High Court has declared the RWA in Purvanchal Silver City II, Greater Noida, illegal and a non-entity. Ordering fresh elections within six weeks under the CEO, Greater Noida, Hon’ble Justice Suneet Kumar ruled, “The constitution of the petitioner-Board of Management is illegal, therefore, would not have a right or authority to manage the affairs of the RWA.”
Brief background of the Issue
While the builder was still around, a few people went and registered RWA under the Society Act, 1860. Most buyers are software people who didn’t bother much about it and carried on celebrating festivals together and there was overall bonhomie. But when it came to handover in 2013, people were rudely shaken when they realised the RWA which didn’t enjoy majority, took the builder to HC.
The builder, however, conducted a referendum and asked people if they wanted their IFMS, which was with the builder. Majority took the money. The RWA, which had never conducted any elections since its registration in 2010, showed its true colours when they insisted on taking the IFMS. People resisted and asked for a GBM to decide the issue. RWA knew they will lose, so they avoided till July 25, 2014. Finally one AGM was held where the RWA declared that they will hold elections for three posts. People objected and the RWA board unleashed hell. Bouncers beat up people and FIRs were filed. From that day onwards, the RWA got into the muscle power mode but the majority kept fighting legally.
Allahabad High Court’s observations
The court ruled that the CEO, Greater Noida, or any officer authorised by him not below the rank of Joint Secretary, NOIDA, shall call a meeting of the apartment owners and the promoters on a date, time and place to be fixed by him for the purpose of forming an association of the apartment owners. “The association so formed in the said meeting after adopting the Model Bye-laws shall make an application before the concerned Registrar for registration and the association so formed, with the elected office bearers, shall be registered along with bye-laws adopted.
After the association is registered, the CEO shall proceed to consider granting recognition to said association,” the court ruled. The court also said that the competent authority, as well as, the District Authorities shall ensure that no outsider or external bodies, including associations shall be permitted to interfere in the election of the Association. “The Senior Superintendent of Police, Gautam Budh Nagar, shall provide requisite police force, if necessary, on the request of the CEO, Greater NOIDA,” the Hon’ble judge said. “It is provided that the entire exercise as directed herein above shall be concluded within six weeks from the date of service of certified copy of this order,” he said.
The RWA, which was incorporated on September 28, 2010, under the Act 1860, never adopted the prescribed Model Bye-laws of UP Apartment Act, 2010. The court observed that no meeting of the general body of RWA was ever convened to adopt the Model Bye-laws. Instead, the RWA Board, which never conducted any elections all these years, made 28 amendments to the Model Bye-laws without 2/3rd majority of the members and approval of the competent authority.
The court also noted that cancellation of the registration and the bye-laws of the petitioner-society by the Deputy Registrar Societies earlier, made the petitioner society a non-entity. The court held that mere issuance of registration certificate by the Deputy Registrar without registering the bye-laws, which in the present case has been cancelled, cannot lead to the conclusion that the petitioner-society is registered under the provisions of the Act. Highlighting the important function of the competent authority assigned under Act 2010, the court said, “In the present case, due to the ongoing dispute the use of common area and facilities by the members have suffered as the petitioner has cut/stalled access to several amenities available to the members. The competent authority is bound to ensure better administration of the property which, inter alia, would require constitution of Board of Management as per Model Bye-laws.” Quoting various judgments, the Court ruled that electoral roll has to be prepared strictly in accordance with the provision of Act 2010, Rule 2011 and Model Bye-laws.
Copy of the order can be found here: SIlver City II – Residents Welfare Association Order