Special Issues

Part 4

Q.1   Who is responsible for evicting a licensee?

 Ans. If a member sub-lets his flat, it is the responsibility of the concerned member or legal heirs of the member concerned to evict the licensee by due process of law. The society has nothing to do in the matter.

evidences are require for giving a flat on Leave & License?

Ans. Leave & License agreement has to be prepared and proper stamp duty has to be paid and the same should be registered. A police verification from of tenant along with his photo should be submitted to the police station. The tenant should be made a nominal member of the society.

Q.6   Unauthorized user of the flat

A dispute was filed by the society for society for recovery of the flat for allowing Respondent No.2 to occupy the flat without obtaining prior permission of society. Respondent No.1 is the member and Respondent No.2 is his close relative being husband of the sister. Wife of Respondent No.2 was nominee of the Respondent No.1. The issue is whether bye-law No.12 (1) (g) r/w bye-law No.12 (1) (a) would permit the member of the family and in particular who is nominee of the member to occupy the suit flat without obtaining prior permission of the society.   

Respondent No.1 is the member and Respondent No.2 is his close relative being husband of his sister. Wife of Respondent No.2 was nominee of the Respondent No.1 Nomination by the member does not create any right in favour of the nominee, but the right is limited and which fructifies only after the death of the original member. Occupation of flat by Respondent No.2 and his family members was unauthorized use of the flat. The Petition was allowed. [Om Jai Shri Gurukrupa Co-operative Housing Society Ltd. v. Vasudha Dhavale. 2004 (4) Mh.L.J.916]

Q.7   Non Agricultural Tax

(1)  Introduction

Non Agricultural Tax is the charge payable to government for using the land for non-agricultural purpose. Non Agricultural Tax is payable every year as per the Non Agricultural Tax order issued by the collector.     

(2) Reasons for Arrears of Non Agricultural Tax

It is the normal practice of the Builders/Developers not to pay the Non Agricultural Tax for years together despite notices from the Tahsildar. The Builder/Developer also does not show any interest in payment of the tax since the land and the building constructed thereon are not conveyed in favor of the Builder/Developer. The Tahsildar continues to send notices to the original landlord, the Builder/Developer who does not take cognizance of the same. The result is that arrears of Non Agricultural Tax continue to increase.

(3)  Notice for Payment of Non Agricultural Tax

After a while the Society registrar Tahsildar suddenly wakes up to recover Non Agricultural Tax and dashes off a notice to the Society in the name of the Original landlord asking him to pay the unpaid Non Agricultural Tax. The total amount thus payable to the Revenue Department amounts to several thousands of rupees which the Tahsildar wants the Society to pay within 24 hours, which is by all means an impossibility. Since the landlord is in no way concerned with the land, the notice in question is pasted on the society’s building standing on that piece of land. Thus notice is not of an ordinary nature. It is a threatening one, and it contains demand for payment of the Non Agricultural Tax by coercive method. The office bearers of the Society are not aware of such tax, until the notice is pasted on the society’s building. It is beyond the capacity of the office bearers or the members to raise such a huge amount within a short period.

(4)    Collection/Payment of Non Agricultural Tax

The Collector of the District is responsible for recovery of land revenue, including non-agricultural tax and penalties levied under the Maharashtra land Revenue Code. Now the question arises, from whom can the Collector recover the non-agricultural tax and the penalties levied under the Maharashtra Land Revenue Codes. This is discussed hereunder:

For conversion of a land, which is assessed for the purpose of agriculture, into non-agricultural purpose without the prior permission of the Collector is necessary under Section 44 of the Maharashtra Land Revenue Code.  

Special Issues

Part 3

Q.2   Whether NOC from police is required before giving flat on leave and License?

Ans.  Yes, NOC from police is required before giving flat on leave and License.

Q.3 What documents and Q.5   Sub-letting of Flats

(i)     General

As per Bye-law No. 43 a member may, apply to the society in the prescribed form for permission to sub-let his flat and on receipt of the permission in writing from the Committee, the member may sublet or give on leave and license basis or care-taker basis his flat or part thereof or part with its possession in any other manner under the following circumstances:

(a)    Where the member is required to go out of the area or operation of the Society for a long duration on account of exigencies of service or business or on account of prolonged illness:

(b)   Where the member is unable to occupy the flat owing to absence of facilities for the education of his children or is unable to secure admission to a school in the locality for them;

(c)    Where the member’s employer, with a view to ensure efficient discharge of duties, requires the member to stay in the accommodation allotted to him by his employer;

(d)   Where a member satisfies the committee about his inability to occupy or continue to occupy the flat for any other genuine reason.

(ii)  Procedure

No member shall be permitted by the Committee to sub-let, give on leave and license basis or care  taker basis  his flat or any part thereof or part with its possession in any manner unless:

(a)  He has made an application in the prescribed form;

(b)   He has furnished the application for nominal membership of the proposed sub-lettee, licensee, care-taker or possessor in the prescribed form;

(c)    His application contains the undertaking that:

(1)   He shall, by joining the society as a party to the proceedings, initiate necessary legal proceedings against the sub-letter, licensee, care-taker or possessor, on his failure to get vacant possession of the flat or part thereof on expiry of the period of sub-letting, giving on leave and license or care-taker basis the flat or part thereof or parting with its possession in any other manner and he shall meet the cost of the legal proceedings required to be incurred by the society;

(2)   He shall pay the charges of the society every month during the period of sub-letting, license etc;

(3)   He shall pay non-occupancy charges to the society. Non-occupancy charges shall be charged in accordance with the circular issued by the Government of Maharashtra/Commissioner for Co-operation from time to time and shall not be levied if the flat is occupied by the “Family” of the member as defined under these Bye-laws.

(iii)  Time Limit

Provided that while permitting sub-letting, giving on leave and license or care-taker basis the flat or part thereof or permitting parting with its possession in any other manner, the Committee shall restrict the period thereof to 11 months or more as desired by the Managing Committee which may, on the request of the member be extended for similar period or part thereof from time to time.

NOTE:  Non occupancy charges shall not be levied on the flat purchaser who is intending to become a member and who submits the documentary evidence thereof.

Special Issues

Part 2

(i)      Parking Charges

As per Bye-law No.84, every member who has been allotted the stilt or the parking space shall be required to pay the parking charges at such rate as may be decided by the general body of the society at its meeting, irrespective of whether he actually parks his motor vehicle or not. Where a member has been allotted more than one stilt/parking space, he shall pay parking charges in respect of every such stilt or parking space.

The charges for parking space should be reasonable and not extraordinarily high. It should be remembered that a society has a right to hike these charges form time to time. Such an increase can be brought by passing the relevant resolution at the General Body Meeting.

The society can also recover parking charges from a guest for parking his car in the compound and it has full authority to do so.

(ii)    Model Rules

Every Society should form rules for any problems arising from parking.

(iii)         Issues & Relies

Q.1 A member, who is allotted parking space in the compound, refuses to park his car in the open space allotted to him. What could the society do in such an event? Is there any law or act (or RTO’s rules or society’s bye-laws) which can be helpful to the society to teach him a lesson?

Ans.     The open space in the compound of the society is the common property of the society and the society can regulate its use. As some of the members of the society have vehicles, the society tries to extend facility of parking cars in the compound of the society and in order to enable all the concerned members to enjoy the facility peacefully without causing inconvenience to others, marks the parking spaces and allots them to the members. The members who have been allotted parking spaces have to park their cars in the parking lots allotted to them. If any member does not follow the discipline, the managing committee can consider his case and decide to prohibit him from parking his car in the compound of the society. No rules of the RTO operate in the case of a co-operative housing society nor is there any directive in this behalf.

Q.2 Lift Charges and Use

Ans.(i) Basis

Housing Co-operative Societies have always been worried about one major factor, viz., the recovery of lift charges and the use of the lift.

Those who reside on the ground/first floor or do not use the lift as well as shopkeepers in a society building have strenuously opposed any payment towards lift maintenance. The simple argument put forward is that they should not be expected to pay for that which they do not use. This argument however bears no weight. Under Section 69(a)(iv) of new model Bye-laws, it is clearly mentioned that all members should bear lift expenses equally. It is further clarified that payment should be made by all members whether or not they avail of the lift facility.

 (ii) Action on defaulter

If a member does not pay the full maintenance including lift maintenance, the society can serve a notice upon such a member under section 101 of Maharashtra Co-operative Societies Act.

(iii) Regulating Operation

The managing committee can lay down guidelines for

(a)    Stipulating the number of persons to be carried in the lift.

(b)   Prohibiting members from carrying heavy articles such as refrigerators, air conditioners, cupboards etc. in the lift.

(c)    Regulating hours of usage of the lift. (Refer Bye-law No. 168).

Q.3 Repairs of the terrace

It is the duty of the society to get the terrace repaired. However when the society is fails to do so the individual member of the society may of his own accord, carry out repairs to the terrace after giving proper opportunity to the society. He can claim expenses form the society.

Tardev Air-condition Market Building C.H.S Ltd. v. Kishinchand 1986 C.T.J. 599 (BOM . H.C.)  

Q.4 Exchange of Flats

As per Bye-law No.41 the members desiring to exchange their flats, shall make a joint application to the Secretary of the society. The application must have the following details:

(i)            The names of the members concerned

(ii)                The distinctive numbers of their respective flats

(iii)               The carpet area (in sq. meters) of their respective flats

(iv)              The building number/numbers or name/names of the building/buildings in which the respective flats are situatedThe reasons for exchange of flats.  

Special Issues

Part 1

v     Parking Problems And Charges

(i)     General

In almost every society the maximum numbers of fights are over car parking and over charges for car parking.

Where any stilts have been built or where open space in the society’s compound is available for the parking of cars or any other vehicles, the society should allot the stilts or the open space in such a way that no inconvenience would be caused to any of the members of the society. It is the duty of the committee to observe that the space is used by the members for the purpose for which it is allotted to them.

The entire parking space belongs to the society and the society will have the right of allotment of these spaces. A member has no ‘transferable’ interest but only a ‘restricted’ interest in the parking space allotted to him.

The society has a right to take back the parking space from a member and a member cannot establish his permanent right once the space allotted to him. The Bombay Rent Act is not applicable to a society.

A member who owns a car or is given one by his employer, firm or company is allotted one stilt or parking space. As per Bye-law No.81, a member may become eligible for a second/third stilt/parking space in the event of any stilt/parking space remaining unallotted for want of application for the same. Such allotment of 2^nd or 3^rd stilts/parking space shall be made on a year to year basis provided the same is not required by another member, who has not been allotted even a single stilt/parking space.

Further, as per Bye-law No.82, in case the members of vehicles of eligible members are in excess of the available parking space/stilts, the managing committee shall allot such parking space/stilts by “lot” on a yearly basis.

(ii)         Garage A member has a right to park any number of cars in a closed garage. As such the society cannot recover higher charges from the member by writing to him that more than one car has been parked in his closed garage.

A garage can be used only for parking a car other vehicles like a bicycle, motorcycle, tempo etc. and it cannot be used as a godown to store various items. If a society raises an objection, about using the garage as a godown, the society can take steps against that member and prevent him from using it as a godown.

If the owner of the garage makes an application to the society requesting that he be allowed to open a shop, or an office or a dispensary, then the society may give thought to such an application and if the member secures permission from the Municipal Corporation/local body then the society may allow such garage to be used for business purposes. But it should be remembered that by giving such permission if the ratable value of the society goes up, the additional amount which a society has to bear can be recovered from the garage owner.

A society has full right to give shares to garage owners and the garage owner may also participate in the discussion by attending the meetings. Not only that, he may also vote at the annual general meeting or at the special general meeting.

Division of A Co-operative Housing Society

(a)    Resolution

The resolution of division of the society containing the purpose behind division of the society, how the scheme is beneficial to the members, full details of the scheme of division of assets and liabilities etc. will have to be passed by 2/3^rd majority of the members present and voting at the general body meeting.

(b)   Public Notice

After the resolution of bifurcation presupposing two divisions only is passed as above, the society has to give notice in form ‘G’ attached to the Maharashtra Co-operative Societies Rules, 1961, to all members, creditors and other persons, who are likely to be affected by the scheme and has to publish it in one of the newspapers. A copy of the notice has also to be exhibited on the notice board of the society and on the notice board of the Registrar’s office. The publication of the notice in form ‘G’ in a newspaper is very costly. A Co-operative housing society generally has no outside creditors. The expenditure could be avoided by securing exemption from the Government as provided under Rule 16(3) (provision) of the Maharashtra Co-operative Societies, Rules, 1961.

(c)    Satisfaction of Creditors

The members, creditors or persons likely to be affected by the scheme, have to exercise an option within one month of the publication of the notice, as to which of the new societies they want to join or they may demand repayment of their share money, or interest in the capital/property of the society or dues. If the option is not exercised within the stipulated period, the society could assume that the member, creditors or the persons likely to be affected by the scheme have assented to the scheme. If the option is exercised, the society will satisfy the claims as per the options exercised.

(d)   Registration Proposal of new societies

The chief Promoters named in the proposal should prepare registration proposals of the respective societies.

v     Final Submission

The society will then submit the proposal to the Registrar for final approval as under:

(i)                 A report indicating how the society has complied with the provisions, regarding bifurcation presupposing two divisions only of the society

(ii)               A copy of the notice and agenda of the general body meeting of the society

(iii)             A copy of the scheme, along with the consolidated balance sheet and divided balance sheet and divided balance sheet and schedules

(iv)             A copy of the resolution of the general body of the society

(v)               A copy of the notice in form ‘G’

(vi)             A cutting of the paper, in which the notice in form ‘G’ was published

(vii)           Registration proposals of the new societies

Division of A Co-operative Housing Society

v     Steps After Preliminary approval

(i)                 The Registrar usually signifies his preliminary accord to the proposed division of the society and asks the society to submit a proposal for final approved of the scheme, if he is fully convinced that there is no alternative other than to divide the society.

(ii)               On getting preliminary approved of the scheme, the Hon. Secretary of the society has to prepare the statement of division of assets and liabilities as on the last day of the preceding Co-operative year on the basis of the scheme of division adopted while submitting proposals for preliminary approval of the scheme. On the basis of the statement referred to above, he should prepare two or three balance sheets, according to the number of units into which a Society is proposed to be divided. Although the Act and the Rules thereunder do not provide for submission of audited balance sheets, it is advisable to get the balance sheets (consolidated) and the divided balance sheets audited. The balance sheets should be accompanied by supporting schedules.

(iii)             The Hon. Secretary should then call a managing committee meeting and place before it the letter from the Registrar communicating the preliminary approval of the scheme of division and the consolidated balance sheet, the assets and liabilities which are proposed to be divided, the divided balance sheets with schedules in support of the items in the balance sheets.

(iv)             The managing committee should then consider the proposal put up by the Hon. Secretary and decide the time, date and place of the general body meeting at which the proposal for final bifurcation of the Society is to be considered.

(v)               The agenda of the general body meeting should include as an item, consideration of the proposal of division of the Society for securing final approval thereto of the Registrar.

(a)    The notice and agenda of the general body meeting should accompany

(1)      A copy of the letter received from the Registrar, communicating the preliminary approval of the scheme of division of the society

(2)      Copy of the consolidated balance sheet and divide balance sheets with supporting schedules

(3)      A copy of the statement, indicating how the scheme of division will be beneficial to the society

(4)      A copy of the statement indicating how the assets and liabilities of the society are divided

(5)      Names of the Chief Promoters, who will formally act as Chief Promoters of the proposed new societies to come up as a result of division of the society.

(6)      The names for the proposed new societies.

Division of A Co-operative Housing Society

v     General

The Maharashtra Co-operative Societies Act, 1960 (Section 17) and the Maharashtra Co-operative Societies Rules, 1961, provide for division of a Co-operative Society. The procedural details are given in the Act and the Rules. They are summarized here.

v     Grounds for division

Division of a society is not permissible unless the Registrar is convinced that there is no alternative other than to divide a society into one or more subdivisions. The Registrar may consider division of a Co-operative housing society on the following grounds:

(a)                The membership is so large that the affairs of the society are unmanageable.

(b)               The units (building) are located plots which are far away from each other, rendering the management of the society difficult.

   

(c)                There are factions in the society.

v     The prerequisite for bifurcation

The plots on which the buildings are constructed should be independent of each other in the Municipal records. If the buildings are constructed on the same plot, the plot should be divisible. If the plot is not divisible, bifurcation is not possible.

v     Scheme

The Secretary of a society should first prepare a scheme for two or more units and place the same before the meeting of the managing committee of the society. The scheme should include

(i)                  Reasons for bifurcation

(ii)                Details of the land and buildings to be divided

(iii)               The basis on which the assets and liabilities are proposed to be divided

Preliminary approval of the proposed scheme of division of the society by the Registrar is necessary before the scheme is finally approved by him.

v     Procedure of preliminary Approval

(i)            A general body meeting, with due notice as provided in the Bye-laws of the society, should be convened. A proposal for division of the society should be included in the agenda of the general body meeting. Copies of the proposed scheme of division of the society should accompany the notice and both should be field with the Registrar. 

(ii)          A resolution, deciding to divide the society on the basis indicated above has to be passed at the general body meeting with a simple majority. Thereafter, the society should make an application (for which no form is prescribed) to the Registrar, together with a copy of the notice convening the general body meeting, a copy of the proposed scheme of division of the Society and a copy of the resolution of the general body meeting of the Society deciding to divide the society. This is necessary to obtain the Registrar’s preliminary approved of the scheme.