Posts Tagged ‘Maharashtra Co-operative Societies Act’

Flat owners to get revenue share from cell phone towers, hoardings

For the first time ever, members of housing societies will directly earn revenue from cell phone towers and advertising hoardings in society premises. The co-operatives department has come up with a new set of by-laws for housing societies, which will make it mandatory for societies to share with members 50 per cent of the revenue generated through towers and hoardings on society premises.

The new rules also make it mandatory for the society to seek the consent of 70 per cent of flat owners to allow erecting towers or hoardings. A society is also not allowed to lease out more than five per cent of its open space.
The Co-operatives Department has also proposed comprehensive changes in housing society rules with regard to parking space to ensure equitable distribution of space among members. However, the draft is yet to be finalised with the department studying the Supreme Court directive, as well as other Acts included in the Maharashtra Ownership Of Flats Act, on the issue.

“On mobile phone towers and advertising hoardings we have already drafted rules, but those will have to be approved by the minister, and only then will we issue a directive under Section 79 of the Co-operatives Act in this regard. The new rules will ensure society members directly get benefit. This will help members, who pay various charges to the society,” said Co-operatives Department principal secretary Rajgopal Devara.

The draft rules also makes it mandatory for societies to obtain a structural audit report stating that the building would be able to withstand the weight of the cell phone tower or advertising hoarding, and present it at the general body meeting for members’ consent. Only if 70 per cent of the members agree will the society be allowed to go ahead.

More importantly, the changes in rules also make it mandatory for the society to bear the expenses for repairing any damage, such as leakages, suffered by flats on the top floor from the 50 per cent revenue generated from the lease. The society will have to take care of damages to flats both internally and externally if they are caused due to erection of towers/hoardings.

The policy on cell phone towers and proposed changes in society rules were proposed by the Urban Development Department, however, it was the Co-operatives Department that took the initiative with regard to advertising hoardings and revenue sharing proposals.

Mumbai security men working in worst of conditions

Several experts allege that security agencies and co-operative housing societies in the city exploit a majority of security guards.
A weekly off seems like a distant memory to Ram Singh. The 36-year-old security guard of a commercial establishment in an upmarket suburban area hasn’t been able to take a day off in one-and-a-half years. He is on a tight 12-hour shift, 365 days a year. But working his fingers to the bone hasn’t paid off.

“I can hardly make ends meet despite working for this big company. I get Rs5,000 a month and the firm doesn’t even pay us for working overtime,” he alleges.
A guard sitting by Singh says he will make do with this job till the time a better opportunity presents itself to him. “How else can we send our children to good schools?” he asks.

Several experts allege that security agencies and co-operative housing societies in the city exploit a majority of security guards. Worse, they get away with it because of legal loopholes.

A source from a security agency, which employs almost 7,000 guards, takes umbrage at the state of affairs. “The security sector is the second largest employer after the manufacturing industry. How can we tolerate this? Why can’t people pay them fair wages? A security guard puts his life at stake for a measly salary.”

Outfoxing lawmakers
So, how do these ‘exploiters’ work around the law? Experts point out that provisions of the Contract Labour (Regulation and Abolition) Act, 1970, do not apply to an entity if it hires less than 20 employees. “Housing societies say they do not come under the purview of the Act since they do not have as many security guards. But, the moment a housing society employs guards from a contractor or a security agency that has over 20 guards on its rolls, the law immediately applies to that agency, making it the principal employer defined in the Act,” says a source from a security agency.

He reveals that even some corporate houses pay guards just Rs4,500-Rs6,000 a month for a 12-hour shift. “Companies propose low quotes to security contractors when hiring guards. They have no choice but to agree to low quotes since they don’t want to lose out on contracts. No contractor will work with a loss. So, they try to make up for the loss from the guards’ salaries. If the company is inspected, then it resorts to ‘plausible deniability’ and puts the blame squarely on the contractor, even though the company is the principal employer and it is its responsibility to ensure that contract labourers are not exploited.”

Ideally, explains a security personnel working with a housing society, a guard should make Rs10,000 per month for eight-hour shifts. But, that perhaps happens in an alternative, utopian world. “I make only Rs6,000 and that too for a 12-hour shift, with zero benefits… Is that sufficient in these times? I have no choice, but to work two jobs for 24 hours a day. And then, the residents shout at us and sometimes even beat us up for sleeping on the job. But, how can we stay alive and support our families on such wages?” his voice trails off as he gets back to his station.

With pays ranging between Rs3,000 and Rs4,000, most such guards end up working for 24 hours a day through other security agencies. Additionally, they are forced to wash cars in housing societies and run errands for residents, complains Singh.

A resident of a co-operative housing society in Kurla confides that security guards in her building put in 12-hour shifts for Rs5,000. “We have two guards and they work 12 hours a day. Earlier, they used to live in the building. But now, they have moved elsewhere.”

Cover, huh!
Uday Bhatt, president of the Maharashtra Suraksha Rakshak Agadi, a trade union, says as per a notification on minimum wages for security guards issued by the state government on January 1 last year, a security guard should get Rs7,434, including special allowance, daily allowance/house rent allowance, conveyance and washing allowance.

Again, housing societies manage to cut themselves loose from the law. Forget amenities like leave wages, health benefits through the employees’ state insurance corporation and provident fund, “90% of the guards at housing societies are underpaid,” adds Bhatt.

Advocate Vijay Vaidya explains, “Housing societies are not establishments according to the Bombay high court and hence, the minimum wage notification doesn’t apply to them. The agencies want to increase their profit margin and therefore, pay the guards a pittance. There is no forum available to complain. Clearly, the security guard board will never push for setting up such a forum or even amend the Security Guard Board Act as the authorities are busy looking after themselves.”

The Act applies to people who work as security guards in any factory or commercial establishment through agencies but it does not cover direct and regular employees.

Bhatt says only 24,000 guards who have registered themselves with the security guard board are covered under the Act. “But, there are over 2 lakh guards in the city who are working illegally with no benefits. The government machinery is not interested in curbing this problem despite a number of high court rulings.”

Those guards employed by private security agencies who fail to register themselves with the security guard board have to fill a form to seek exemption from the Maharashtra Private Security Guards (Regulation of Employment and Welfare) Scheme, 2002, which covers the entire state, with the exception of a few districts, says Bhatt. “The main aim of the Act is to do away with middlemen who take advantage of the guards.”

A top official confirms that employees of housing societies are not able to take advantage of the provisions of the Act. “We can’t entertain their complaints and they will have to approach the labour commissioner. Of course, we require an amendment to help resolve this issue. Essentially, the Security Guard Board Act applies only to factories and commercial establishments. It does not cover housing societies.”

No word on the numbers
Gurcharan Singh, president of the Security Association of India, claims that there are over 2 lakh registered security guards in Mumbai and Thane districts and that 80% of them are employed in factories and commercial establishments where they receive a minimum wage of Rs7,200. “Five percent to 10% of the guards are employed in small-scale industries and 20% are employed in co-operative housing societies. Seventy percent of those employed at housing societies are exploited and are not paid minimum wages. Some of these are also deployed by fly-by-night agencies which bend the rules at will.”

But, the association doesn’t seem to have a finger on the pulse of the situation. If one were to take it at its word, only 40,000 guards are reportedly hired by housing societies. So, assuming that there are two guards to a society — one for the day and another at night — what the association seems to be suggesting is that there are only 20,000 housing societies in Mumbai and Thane. Clearly, that is not the case, which means that the association, the government and the Maharashtra security guards board have not yet even begun to enumerate the number of guards in Mumbai and Thane, let alone in the entire state.


A member can conduct audit of his own society

Unlike under the provisions of the Companies Act, 1956, there is no such restriction under the provisions of Maharashtra Co-operative Societies Act, 1960 that a shareholder or a member cannot conduct audit of a cooperative society.
In Mumbai, is it possible for a member to do statutory audit of his own society?
Unlike under the provisions of the Companies Act, 1956, there is no such restriction under the provisions of Maharashtra Co-operative Societies Act, 1960 that a shareholder or a member cannot conduct audit of a cooperative society. Therefore, in the absence of any such bar, a member of a co-operative housing society can conduct internal or statutory audit of the society in which he is a member, but he should not be a part of its managing committee or sub-committee because in that case he would be reporting inter alia on his own actions and inactions.
Can a society allow a flat to be used for commercial purposes by charging extra amounts?
Use of a flat for particular purposes and change of use is allowed by local authorities, primarily the municipal authorities. A cooperative housing society has no power to allow change of use and charging extra amounts for allowing such change would be illegal. However, while permitting change of user, the municipal authorities may require you to obtain no-objection from the society.

During the year, I sold two flats and am contemplating investing the capital gains in purchase of flat(s) by adding my wife’s name in one purchase. Out of the sale proceeds, some amounts have been used by me in repayment of loans and therefore I will be using my savings in acquisition of new flats.
Capital gains resulting from sale of a residential house, if utilised for purchase or construction of another residential house, would entitle you to avail exemption u/s 54 of the Income Tax Act, 1961 if the flat transferred by way of sale was held by you for more than 36 months on the date of transfer thereof and acquisition of new house is within specified time limits and subject to specified conditions.

Section 54 does not contain any condition as to how many houses one may transfer during a year and therefore, your selling two houses and acquiring separately two houses against each sale would be within the provisions of section 54. As far as in one purchase you want to add the name of your wife as a co-purchaser, the same can be done provided only your funds are invested. Further, source of funds for investment in new houses may not be only the amount of sale proceeds but can be from anywhere including your accumulated savings.

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Amendment to Maharashtra Co-operative Societies Act approved

The Act is applicable to 2.47 lakh co-operative bodies all over Maharashtra with an annual turnover of Rs6 lakh crore and a total member strength of 5.50 lakh.

The Maharashtra cabinet has approved amending the Maharashtra Co-operative Societies Act, 1960, state minister for co-operation Harshvardhan Patil said in Mumbai on Thursday.

The Act is applicable to 2.47 lakh co-operative bodies all over Maharashtra with an annual turnover of Rs6 lakh crore and a total member strength of 5.50 lakh.

The amendments, necessitated due to the 97th constitutional amendment, were discussed at a cabinet meeting here yesterday, the minister told reporters.

The state government will issue an ordinance and the new measure would become effective from February 16.

As per new norms, co-operatives having an ‘A’ audit class for three consecutive years would be able to park their funds in nationalised, scheduled and urban co-operative banks.

To enable elected co-operative bodies to complete their five-year terms, it has been decided that their elections will be conducted only after completion of their terms, through a proposed State Co-operative Election Authority, Patil said.

The strength of the board of directors will be fixed at 21, of which five seats will be reserved, he said. Out of these five reserved seats, two seats would be for women, one for scheduled caste / scheduled tribe, one for other backward class, as well as one for ‘Vimukta Jati’ and notified tribes, he said.

Co-operative housing societies would be able to initiate recovery of dues from defaulting members by instituting measures which could include seizure or disposal of flats of concerned members, he said. 

Under new norms, it would be mandatory for an annual general meeting to appoint an auditor. Audits of co-operative bodies would be carried out by certified government auditors, he said.

Co-operative bodies would be required to prepare lists of active and non-active members annually. Active members would be eligible to vote in elections to these co-operative bodies.

Be the first to comment - What do you think?  Posted by admin - August 5, 2013 at 12:18 pm

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