A cooperative housing society cannot claim more than 0.5 per cent of the value of a flat while allowing its owner to sell it to an outsider, Calcutta High Court ruled on Monday.

The bench of Justice Bhaskar Bhattacharya and Justice R.N. Banerjee, which delivered the verdict, also directed Dover’s Housing Cooperative Society Limited to return Rs 59,500 to Parimal Chandra Sen, one of its former members, within a month.

The cooperative society had taken the amount from Sen in 1998 when he sold his flat in the estate to an outsider.

“The registrar of the state cooperation department is directed to dissolve Dover’s Housing Cooperative Society if it fails to return the money to Sen and appoint an administrator there. The administrator, after taking the charge, will pay the amount to Sen from the assets of the society,” stated the division bench.

The cooperation department had recently issued a circular declaring that since transfer of a property is the right of its owner, cooperative societies will have to permit their members to sell their flats.

After Monday’s order, members of housing cooperatives will not have to abide by the directive of their respective societies on sale of flats.

“The cooperative societies have been claiming whatever amount they want from members who sell their flats to outsiders. Today’s order will prevent the societies from asking for exorbitant sums,” said advocate Pradip Kumar Roy, who appeared for Sen in the court.

The advocate said that as his client had no other option, he had paid Rs 59,500 to his housing society while selling his flat in 1998. After selling the flat, Sen demanded his money back from the society.

“When the society refused to return the money, Sen moved the high court in 2003. In August 2005, Justice S. Sen passed an order asking the society to return the money to the former owner of the flat. Instead of obeying the order, the society challenged the order before the division bench of the high court,” said Roy.

Appearing for the society, advocate Anupam Chatterjee said the body had the right to claim money from its members while allowing them to sell their flats.

Roy argued that his client had the absolute right to sell his property and the society’s decision was bad in law.