Transfer Of Shares And Interest In The Capital/Society

Part 6

      If ‘WILL’ is there then nomination is required?

A.  If there is a ‘will’ of the deceased member, no nomination is required or even if the nomination does exist, the same becomes null and void after the will is probated. It is the responsibility of the society to transfer the flat as per the letter of administration issued by the court after the will is probated.

      If the flat is owned by two persons and if one dies then is the flat automatically transferred to other person or is nomination required?

A.  The second person on the share certificate is an associate member who has got only voting rights in the General Body Meetings in the absence of the original member. The Associate member also ceases to be an associate member on the death of the first named person on the share certificate. The flat is required to be transferred to the nominee of the first named person on his death.

      One of the members of the society expired and the flat owned by him has to be transferred in the name of his wife. She is not an earning member. Can the society transfer the loan outstanding in the name of the deceased member to his wife’s name?

A.  If the society has obtained a loan from the Housing Finance Society, the society can put the claim before the Housing Finance Society under the Group Insurance, if the deceased member was covered by the said scheme, and the nominee will not be required to discharge the loan liability. If the loan is not covered by the scheme, the nominee will have to obtain a declaration from the person on whom the nominee is dependent to the effect that he will discharge all the present and future liabilities including charges of the Society on behalf of the nominee who is going to be admitted to membership of the society.

      A father and two sons B & C are jointly owners of a flat and members of a co-operative Housing society. They are following a understanding within the family, the father and son B do not wish to remain as members and want to delete their names from the membership of the society. Is it necessary to prepare any documents for the society? Is it necessary to prepare any documents for the society and to pay stamp duty and registration charges?

A.    In the present case there is withdrawal from membership by father A and son B and the corresponding enlargement of the rights of son C in the property. It is a case of renunciation of claim against another person in a specified property and it is not the case of conveyance of property. It is necessary to execute a deed of release on Rs.200 non-judicial stamp paper and get the document registered. Son C has to submit to the society the deed & the original shares certificate for deletion of names of A & B.

      There are 219 flats in the building of the Society out of which 136 purchasers have been paid the stamp duty and registered their documents and they have been admitted to the membership of the Society.  The managing committee of the society refuses the 83 promoters/purchasers admits membership of the society.  Is it correct for the society to take a step? If these 83 purchasers are admitted to membership of the society, how will this affect the conveyance of the property to the society?

A.                                                                                        There are circulars from The commissioner of co-operative societies and registrar of co-operative Societies dated 18.2.1994 &  8.7.1996 for verifying the Registration receipt of the document of Transfer but it appears that the non payment of stamp duty and registration of documents in the present case must be prior to these circulars and accordingly they are not applicable. Before these circulars were issued a Co-operative Society is under no legal obligation to insist that a purchaser pays correct stamp duty and register his agreement with the builder/developer before being made a member. A person who complies with the requirements of section 32 of MCS Act has right to be made a member. A person who complies with thus the duty of the society to make these 83 persons provided they do not have any other disqualifications.

Non-registration of their agreements by 83 persons will come in the way of conveyance of the land and building to the society. This is because stamp duty and registration fees will be calculated on the land and the building to be conveyed.  The amount unpaid by the 83 members will become payable now by the society.  The society can at this stage insist that the 83 members register their documents.

 It is to be clarified to the 83 members that it is of the utmost importance for them to register their documents because both under section 32 of the Bombay Stamps Act, 1958 and Registration Act, 1908 an unpaid stamped and unregistered document is inadmissible as evidence in a court of law.

      In a society a flat was transferred 20 years ago.  The share Certificate does not bear the signatures of any office bearers.  All the office bearers are now not the members of the Society. What can be done if it is to be transferred now?

A.    Though the Share Certificate of the Society was not endorsed by any office bearer, in the other record of the society the flat must be in the name of the member who now wants to sell the flat.  If no dues are there, present office bearers should endorse the share certificate and give correct date of the transfer. After this all the formalities of the present transfer should be complied with.

      In case no proper documents are produced about the transfer of a flat to the ex-committee, can the transfer be nullified or challenged by the new committee?

A.  The new Managing Committee can request the member to complete the formalities and if he is not complying with the requirement a complaint can be filed with the Registrar for regularizing the things or to expel the member from the society.