Possession Without Membership: The MIG Bandra Redevelopment Ruling and Sale Flat Buyers
The Bombay High Court on October 27, 2026 dismissed a developer's plea for a mandatory order directing the MIG Co-operative Housing Society in Bandra East to admit 177 sale flat purchasers as members, citing disputed corpus payments and expired bank guarantees, while leaving the buyers' own remedies open. Here is what the court found and what to check before buying a redevelopment sale flat.
At Gandhinagar Layout in Bandra East, a redevelopment that began with a development agreement on October 31, 2010 is, on the developer's account, substantially complete. The occupation certificate for the rehabilitation component came on February 5, 2025. All 176 original members of the Middle Income Group Co-operative Housing Society have their new flats. The developer says it sold 601 flats and handed over 445 of them. Yet the buyers of those sale flats, the developer told the Bombay High Court, still have no share certificates and no vote in the society that runs their building.
On October 27, 2026, the court declined to order the society to admit 177 of those buyers immediately. The ruling was not against the buyers. It was about whether the developer had proved its own case strongly enough. For anyone buying a sale flat in a Mumbai redevelopment, the distinction is the whole story.
The short answer. In Commercial Arbitration Petition (L) No. 30794 of 2026, Justice Amit Borkar dismissed a petition by MIG (Bandra) Realtors and Builders Pvt. Ltd. under Section 9 of the Arbitration and Conciliation Act seeking a mandatory injunction to admit 177 flat purchasers as members. The court found that the development agreement's membership clauses support admission and that the society cannot impose conditions only because it wants a different financial arrangement. But it held that disputes over corpus payments made after possession, expired bank guarantees and an alleged revival of termination ruled out such a drastic interim order. The trade-off: the purchasers' own remedies under the cooperative societies law are expressly left open, but their membership now waits on a contractual fight they are not party to.
What is the dispute between the society and the developer?
The society entered into the development agreement in 2010 and a deed of modification followed. On May 8, 2020, the society wrote to terminate the contract. The dispute went to a sole arbitrator, and on December 27, 2021 the parties signed consent terms that became a consent award in early 2022.
Clause 20 of those consent terms, as recorded by the court, provided that the society would refuse to admit a flat purchaser as a member only if there was a default in paying the proportionate corpus for that purchaser. The developer says it has now paid that corpus at Rs 688.66 per square foot of RERA carpet area, along with share money and sinking fund, and that the society accepted more than Rs 40 crore towards corpus between March 7 and September 30, 2026.
The society's position is different. It says the developer did not complete its own obligations under the consent terms, that corpus had to be paid before possession, that the correct rate and total are disputed, that bank guarantees expired before the periods they were meant to cover, and that these defaults revive the earlier termination. It also sought an "Excess Amount" of about Rs 5.10 crore, and at one stage linked admission of buyers to their agreeing to its proposed use of money above Rs 18 crore in the corpus.
What did the Bombay High Court decide?
The court split its findings. Some went the developer's way. It said Clauses 9.5 and 9.9 of the development agreement "support the Petitioner's case that the Society must admit the purchasers as members." It said "the Society cannot impose conditions only because it wants a different financial arrangement," and that the dispute about the Excess Amount "does not give the Society a reason to refuse membership."
But the developer asked for a mandatory injunction that would, in effect, give it final relief at an interim stage. Applying Supreme Court tests for such orders, the court required a strong and clear case. It found that the corpus payments were made after possession, the amount payable remained disputed, and the bank guarantees had expired before the periods or milestones the society relied on. Those issues raised a serious question about whether termination had become effective again under the consent terms.
The court was explicit about what its dismissal does not mean. It "does not mean that the Respondent can impose any condition it wants for admitting the purchasers." The dismissal is limited to the Section 9 relief, leaves money claims open, and states that "the purchasers' right to pursue any independent remedies available to them under the MCS Act is not affected by this decision."
How did the main arguments fare?
| Issue | Developer's position | Court's view at this stage |
|---|---|---|
| Do the agreement clauses require admission of purchasers? | Yes, under Clauses 9.5 and 9.9 read with Clause 20 | The clauses support the developer's case |
| Can the society add new conditions for admission? | No, conditions must come from the agreed terms | Society cannot impose conditions only to get a different financial arrangement |
| Is the Excess Amount dispute a ground to refuse membership? | No, and it offered a Rs 5.10 crore demand draft as security | Not a reason to refuse membership |
| Was corpus paid as Clause 20 required? | Yes, at Rs 688.66 per sq ft, with over Rs 40 crore accepted | Payments came after possession and the amount remains disputed |
| Do expired bank guarantees matter? | Fresh guarantees offered | Not a mere technicality; revival of termination is a serious open question |
Why does society membership matter to a sale flat buyer?
Membership is what this dispute is really about for buyers. The developer's own submission, recorded by the court, was that the buyers "have not received share certificates, voting rights or a voice in the Society's affairs," even though their corpus and other amounts are with the society and earning interest. The court called the complaint one that "deserves serious consideration" and said "the difficulties faced by the purchasers cannot be ignored."
The court also flagged a numbers problem. The petition named 177 purchasers, while arguments referred to 445 purchasers in possession and 217 membership forms. It said these figures "relate to different matters" and do not show that every purchaser has met the conditions for admission. Any buyer in a similar project should know exactly which list they are on and which documents have been submitted in their name.
PropNewz explained how sale flats in redevelopment are treated under the RERA Act in our guide to the redevelopment exemption and sale flats. For how corpus and sinking funds work at handover, see our explainer on maintenance corpus and sinking funds.
Were the purchasers' rights decided?
No. The purchasers were not parties to the petition. The society objected to that, and the court held that their absence did not by itself make the petition unmaintainable, because the dispute was between the developer and the society. The court also rejected, on the material before it, the society's argument that Section 163 of the Maharashtra Co-operative Societies Act barred the petition.
Because the buyers were not parties and the court did not decide their claims, the judgment leaves their own route open. It specifically preserves any independent remedies available to them under the MCS Act. What those remedies are in a given case, and how to use them, is a question for a lawyer who has read the agreement for sale, the society's bye-laws and the consent terms that bind the developer.
What should you check before buying a sale flat in a redevelopment?
This case shows that a sale flat buyer's membership can depend on promises between two other parties: the developer and the society. Those promises sit in documents a buyer may not be shown unless they ask.
- Ask the developer for the clauses in the development agreement that deal with admitting sale flat buyers as members.
- Ask whether there is any arbitration, consent award or termination notice between the developer and the society.
- Find out what corpus, share money and sinking fund are payable for your flat, at what rate, and when.
- Get written proof that your share of corpus and fees has been paid to the society, not just collected from you.
- Ask the society directly whether it has any pending objection to admitting sale flat buyers.
- Check whether membership applications are being submitted in your name and keep copies.
- Have a lawyer read your agreement for sale for how the developer will secure your membership and what happens if it does not.
What happens next for this project?
The judgment leaves the core disputes, the amounts under Clauses 10 and 20 of the consent terms and the alleged breaches, to "appropriate proceedings according to law." The society's money claims are open. The developer's offers of fresh guarantees and a Rs 5.10 crore demand draft remain on record but did not carry the day. The court made no order as to costs. For the buyers already living in the building, membership remains pending until the developer and the society resolve their dispute or the buyers pursue their own remedies.
Frequently asked questions
What did the Bombay High Court decide in the MIG Bandra case?
On October 27, 2026 it dismissed the developer's Section 9 petition seeking a mandatory injunction to admit 177 flat purchasers as society members. It found the agreement clauses support admission, but unresolved disputes over corpus payments, expired bank guarantees and revival of termination ruled out a drastic interim order.
Can the society refuse membership for any reason it chooses?
The court said the society cannot impose conditions only because it wants a different financial arrangement, and that the Excess Amount dispute is not a reason to refuse membership. It added that its dismissal does not mean the society can impose any condition it wants for admitting the purchasers.
Were the flat buyers' own rights decided?
No. The purchasers were not parties to the petition, and the dismissal is limited to the Section 9 relief. The court stated that the purchasers' right to pursue any independent remedies available to them under the Maharashtra Co-operative Societies Act is not affected by its decision.
What corpus rate was in dispute?
The developer said it paid corpus at Rs 688.66 per square foot of RERA carpet area, in line with the society's May 24, 2026 resolution, and that the society accepted more than Rs 40 crore. The society disputed the rate and total, and said corpus had to be paid before possession.
Last updated 2026-11-01. PropNewz Team.
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