Cooperative Housing Society Cannot Charge Excess Fees from Rented Flats

Mumbai: In a significant ruling, a deputy registrar of co-operative societies has informed the Chaitanya Cooperative Housing Society in Pratiksha Nagar, Sion East, Mumbai, that it is not permitted to accept excess amounts under any head from members who rent out their flats, beyond the statutory non-occupancy charges.

This directive follows a complaint from a flat owner who alleged that the society was illegally charging Rs 5,000 as a building development fund. Abhijit Deshpande, the deputy registrar of co-operative societies at Mhada Mumbai City, Eastern Suburbs, and Konkan Board, stated that it was improper for the society to accept amounts under the name of a development fund from members renting out their flats. He further directed that the society should adjust the disputed amount in the complainant's monthly maintenance bills within two months.

The society had defended its actions by claiming that the charge was imposed following a resolution passed in the Annual General Meeting (AGM). The complainant, A Shaikh, who owns a flat in the society, approached the deputy registrar's office, citing that the society was levying Rs 5,000 per year towards the 'Building Development Fund'. This levy was in addition to the statutory non-occupancy charges, as mentioned in the petition. Shaikh in his petition stated that as per Section 43 (2) (iii) (c) of the Model Bye-Laws of Cooperative Housing Society, 2014, non-occupancy charges shall be levied in accordance with the circular issued by the state Department of Co-operation.

In response, the society stated that a resolution was passed in 2014 to collect Rs 4,000 from members renting out their flats. The issue was revisited in the 2019 AGM, where a decision was made to increase the amount to Rs 5,000 as a development fund. Shaikh highlighted in his petition that a Government resolution issued by the state government in August 2001 prohibited societies from levying more than 10% of service charges towards non-occupancy charges.

Vinayak Adep, the secretary of the Chaitanya Housing Society, said, 'A resolution was passed regarding the charging of the amount in an AGM of the society. It was a majority decision, and the members had agreed to it. Besides, no amount is being charged without approval in the AGM.' However, the deputy registrar's decision has clarified that such additional charges are not permissible and must be adjusted accordingly.