Questions about maharashtra co-operative housing society act

CAN A SOCIETY CHARGE COMPOUND INTEREST?
I am a member of Kailash Udyan CHS Ltd., which has been charging compound
interest @ 21% p.a. for the delayed payment of society charges.
When I enquired, they informed that it has been passed in the AGM. Can a society charge compound interest?

———- In terms of provisions of the model bye-laws, society can charge only
simple interest on the delayed payment, subject to a ceiling of 21% p. a.
within which limit the AGM may decide the rate, but in no case compound
interest can be charged.

WHY ARE NOMINEES NOT TREATED AS OWNERS?
The Bombay High Court has ruled in favour of a nominee in case of a share
demat account so why this should not hold good for the society share. In actual life the rights are transferred to the nominee in most of the CHS flats
and in case of will, many people do not obtain the probate and it is also a very
difficult task. Why a nominee should not be treated as a beneficial owner?

———– There is a provision of nomination in various types of moveable and immoveable properties, such as life insurance policy, employees provident fund, bank deposits, national saving certificates, company shares, cooperative societies in Maharashtra, mutual funds etc. and the true nature and scope of a nomination is governed by the provisions of the statutes governing these properties. It is a well settled law in case of a life insurance policy that a nominee is merely a trustee or agent on behalf of the legal heirs of the deceased. Similarly it has been held that in case of cooperative societies in Maharashtra, a nomination under Section 30 of the MCS Act is not a special rule of succession altering the mode of succession laid down under the personal law of the deceased. In case of EPF, NSC, bank deposits, different views have been taken in judicial pronouncements, but the majority view is that the nominee is not the beneficial owner. In the case of demat share account, the Bombay High Court has held in the case of Harsha N. Kokate that the nominee becomes entitled to all the rights in the shares to the exclusion of all other persons in view of the language of the provision of Section 109 of the Companies Act. If a nominee has to be made a beneficial owner of the property of the deceased, suitable provision will be required to be made in the Indian Succession Act, Hindu Succession Act and the personnel laws of the other communities and till then, the present position will hold good.

WHO IS RESPONSIBLE FOR MAINTENANCE DISPUTES?
I have given my flat on leave and license basis. The agreement is stamped and registered for a period of 3 years. I am paying the non-occupancy charges at the prescribed rate to the society. If there is a dispute with the licensee about reimbursement of maintenance charges payable to the society, please advise who has to bear the same.

—– It will depend on the terms and conditions agreed upon between both the parties and as recorded in the agreement. If the Agreement is silent on the point, the issue may become debatable. The licensee may claim that the monthly license fee has been agreed upon as inclusive of the same. The other view is that the maintenance charges consists mainly of electricity charges, water charges, wages for the sweeper, the employees of the society, watchmen etc. When a flat has been given by the owner on leave and license basis, these services are being utilized and availed of by the person actually residing in the flat i.e. the licensee and, therefore, all these charges should normally be paid by the licensee. Where these charges include property tax, the same will be required to be paid by the owner of the flat. Therefore, the Leave & License Agreement needs to be drafted carefully to make the intentions of the parties crystal clear to avoid such ambiguity.

CAN A BANK REFUSE TO TAKE OVER AN EXISTING LOAN?

I own a flat jointly with another person B and we had constructed two floors of which ground floor belonged to me and first floor to B. Since this plot is from the category of the government land (from the category of B- 1), we both had paid the required charges to Collector. I have taken a loan of Rs.40,00,000 from HSBC for my flat on the ground floor. Now we both have entered into a development agreement with a builder to demolish the existing construction and to construct a 17 storey building. I applied to a nationalized bank for takeover of the loan of HSBC, but the bank has refused for the same, though I am eligible for more than outstanding loan. Is the stand of the bank correct?

 

——– The stand of the nationalized bank is absolutely legally correct and justified. How they can take over this loan of HSBC, when the security created in favour of HSBC does not exist as on today and there will be no security for the loan with the said nationalized bank. On the contrary HSBC should initiate immediate steps for the recovery of its dues from you and proceed against the builder who demolished the portion of the building which was already mortgaged to it. Similar cases are happening in Mumbai and it seems to be a matter of system failure inasmuch as while entering into a development agreement, neither the flat owners who have already mortgaged their existing flats disclose this fact to the builders nor the society, wherever registered and issued the mortgage NOC, disclose this fact to the builders nor the municipal corporation and other authorities enquire about any such existing charge on the building or any portion thereof, before issuing the necessary approvals. In fact the banks and housing finance companies may face serious problem in case of default for the recovery of its dues in such cases. This issue was brought to the notice of RBI, NHB, IBA but it is unfortunate part of our democratic system that unless there is some pressure, nothing moves and preventive measures are not taken well in time.

CAN A SOCIETY ARBITRARILY FIX POOJA CONTRIBUTION?

I am a member of Prabhat Tower CHS, Vasai Road. In the month of January, managing committee displayed a notice asking Pooja Contribution @ Rs.250 per flat without the consent of the members of the society and as this was not acceptable to me as I own two flats having only three members and I was required to pay Rs.500. When I asked the managing committee why these charges have been included in the bills, they simply replied that it is compulsory to pay whether you are available or not for pooja function, including the meals. I gave a letter about the non-payment of these charges and requested the managing committee to amend the bills, but it did not agree and have shown the same in the bills for the month of March and April and issued instruction to pay to avoid any legal action. Is it necessary to pay such charges and whether they can include the same in the regular maintenance bill? After the said controversy I have stopped paying repair charges and the maintenance bills. What will be the consequences of non-payment?

——– Any collection towards religious ceremonies, including pooja with meals etc., cannot be made compulsory by the managing committee or even the general body meeting and the society cannot adopt coercive measures to collect the same, as such a decision is not supported by the byelaws or the Act or the Rules. In case of non-payment of these charges, society cannot take any legal action against you. However, as a matter of retaliation, you should also not stop the payment of the maintenance bills and repair fund decided by the society as per the bye-laws and in case of non-payment, the society may recover the same with interest and proceed against you as per the bye-laws. No member can also take the stand that there is no need of any repair to the outer elevation of his apartment, as the society is under obligation to maintain the building of the society including its elevation etc.

CAN BANKS DISCRIMINATE BETWEEN LOAN APPLICANTS?
I have entered into an Agreement for Sale to purchase a flat with a Widow, who has executed the agreement for self and as the natural guardian of her minor son and applied for a housing loan to a nationalized bank, which is insisting for the succession/ heirship certificate and the permission of the court for the sale of the share of the minor, whereas one of my friends has entered into a similar transaction with a Karta of a HUF, which consist of minor also, but his banker has disbursed the loan. Why this discrimination?

——— For the purchase of flat in the name of a deceased, succession or heirship certificate by his or her legal heirs is necessary and where one of the legal heirs happens to be a minor, court permission for the sale of the share of the minor is necessary as per the provisions of law, because a natural guardian, may be either father or in his absence, mother is not legally entitled to sell, transfer or mortgage the share of a minor in the property. However in case of a HUF, situation is different in the sense that a Karta of HUF can sell, assign or mortgage the property of the HUF, which may consist of a minor, either for legal necessity or for the benefit of the estate. Thus a Karta of HUF enjoys much more powers than a natural guardian, as far as the sale, transfer, mortgage of a property or a share therein of a minor is concerned.