Transfer of Shares and Interest in The Capital/Property of The Society

Part 1

The procedure required to be followed for the transfer of shares and interest of a member in the capital/property of a society is explained below:

v     Regular case of transfer

As per Bye-law No. 38

(1)   A member designing to transfer his shares and interest in the capital/property of the society shall give 15 days Notice of his intention to do so to the Secretary of the society in the prescribed form, along with the consent of the proposed transferee in prescribe form. [Appendix-20(1)-(2)]

(2)   On receipt of such a notice, the Secretary of the society shall place the same before the meeting of the committee, held next after the receipt of the notice pointing out whether the member is prima-facie eligible to transfer his shares and interest in the capital/property of the society in view of the provisions of Section 29 (2)(a) of the Act, i.e. The transferor has to hold shares and interest in capital/ property of the society for a period of not less than one year.

(3)   In the event of ineligibility [in view of the provisions of Section 29(2) (a) (b) of the Act] of the member to transfer his shares and interest in the capital/property of the society, the committee shall direct the Secretary of the society to inform the member accordingly within 8 days of the discussion of the committee.

(4)   “No objection Certificate” of the society is not required to transfer the shares and interest of the transferor to transferee. However, in case such a certificate is required by the transferor or transferee [in case of loan taken by the transferor or to be taken by the transferee] he shall apply to the society and the committee of the society may consider such application on merit, within one month.

(5)   The Transferor/Transferee shall submit the following documents and make the compliance as under :

(a)      Application of transfer in the prescribed Form along with the original share certificate

(b)      Application for membership of the proposed transferee in the prescribed Form

(c)      Resignation of transferor in the prescribed Form

(d)     Valid reason for the proposed transfer [Normally – sale of flat]

(e)      Undertaking to discharge the liabilities to the society by transfer or Form

(f)       Payment of the transfer fees of Rs. 500/-

(g)      Remittance of entrance fees of Rs. 100/- payable by the proposed transferee.

(6)   Payment of amount of premium at the rate to be fixed by the general body meeting but within the limits as prescribed under the circular issued by the Department of Co-operation / Government of Maharashtra from time to time. [Refer order – 2, 2A, 2B].

At present, the premium amount should not exceed 2.5% of the difference between the book value of the flat [original purchase price of a flat taken as contribution towards land & building] and the price realized by the transferor, on transfer of his flat subject to the maximum limit prescribed.

It is to be noted that no additional amount towards donation or contribution to any other funds or under any other pretext shall be recovered from the transferor or transferee. In the case of transfer within the family or on nomination on his death, to member’s heir/legal representative and in case of mutual exchange of flats among the members no premium amount is payable.

(7)   Submission of No objection Certificate required under any law for the time being in force or order or sanction issued by the Government, any financing agency or any authority.

(8)   The undertaking/declaration in compliance with the provisions of any law for the time being in force in such forms as is prescribed under these Bye-laws:

(a)      A Form of declaration for not holding immovable property in any urban Agglomeration, specified under the Urban Land ( Celling and Regulation)  Act, 1976 exceeding 500 sq. meters to be given by transferor

(b)      A Form of declaration for not holding immovable property in any urban Agglomeration, specified under the Urban Land ( Celling  and Regulation)  Act, 1976 exceeding 500 sq. meters to be given by transferee

(c)      A form of undertaking about the registration of Transfer of a flat under Section 269AB of the Income Tax Act if applicable.

(d)      A form of undertaking regarding the registration of the acquisition of a flat under Section 269AB of Income Tax Act, 1961 to be given by the transferee, if applicable.