Questions relating to ownership rights, Society funds and transfer procedures continue to generate confusion among cooperative housing society (CHS/the Society) members. Whether it is the extent of the Society’s authority over privately owned premises, concerns over the handling of maintenance corpus funds, or the documents required for the transfer of shares after the death of a member, many disputes arise from a lack of clarity on legal and procedural requirements. This week’s queries examine such situations and explain the remedies and processes available to members under the cooperative framework.
 
Can Bungalow Owners Rent Out Premises for Commercial Use?
Question: Does the Society’s power to grant permission to bungalow owners to rent out their premises for commercial use continue after handing over the common areas for development and maintenance to the municipal corporation?
 
Answer: The Society has no right to rent privately owned bungalows or the bungalow premises. It is the bungalow owners who can rent their own bungalows. The bungalow society handing over its common roads or areas to the municipality has nothing to do with members renting out their bungalow premises.
 
If a bungalow owner wants to use the bungalow for commercial purposes, then permission for a change of use from residential to commercial has to be obtained from the local municipality.
 
Can Members Seek a Refund of a Maintenance Corpus Fund?
Question: We are living in a CHS in Nagpur. At the time of purchase, ₹1 lakh was collected from each of the 127 members to create a fund for monthly maintenance, with the Society formed by the builder earning bank interest on it.
 
The Society was running smoothly on the interest earned, but persons from the builder’s side forced the managing committee to dissolve. Now a new committee has been elected, and most of the people in the committee are from the builder’s side. They are allegedly misusing the funds. Now, the breaking of FDs has started, and they are asking for more money towards monthly maintenance in cash or cheque mode.
 
Some members want the Society to return the ₹1 lakh from the joint fund and are ready to pay monthly maintenance separately in cash or cheque, whichever is common for all. Is this possible and under which bye-law? What is the process? What can we do if they deny the refund? Please advise.
 
Answer: For misappropriation of the Society’s funds by the managing committee (MC), kindly make a complaint against the Society’s MC to the deputy registrar (DR) of cooperative societies of your area under bye-law no. 174(A)(xii). In your complaint, describe how the fixed deposits are being broken and how the funds are allegedly being misused by the managing committee.
 
As regards the return of the ₹1 lakh corpus, such a refund can generally be made only if the Society members pass an appropriate resolution in a general body meeting (GBM) and the funds are legally available for refund.
 
You have to be very persistent in pursuing your complaint with the DR. After 15 days of your complaint, if no action is taken, then file an RTI application with the public information officer (PIO) of the DR, asking for information on the action taken on your complaint.
 
If the PIO states that the DR has not taken any action, then you may make a complaint against the DR to the district deputy registrar (DDR) for not acting on your complaint.
 
Simultaneously, you may file a Lokshahi Din complaint (LDC) against the DR with the district collector (DC). The DC holds hearings on such complaints on the first Monday of each month and may direct the DR to take action on your complaint. This way, you can pursue your complaint to seek appropriate action.
 
Can a Society Demand a Succession Certificate from a Nominee?
Question: I have been living in a flat owned by my father for the last 50 years. I am the legal nominee of the said flat and, after the death of my father, I submitted all required documents such as Appendix 15, Form No. 15-A, a copy of the share certificate, the death certificate of my father and the transfer fees to the Society to transfer the shares in my name.
 
After several reminders, both verbal and written, last month, I received a letter from the Society asking me to submit a succession certificate from the court, stating that mere nomination is not sufficient to transfer the shares in my name.
 
I humbly request that you advise me on whether the Society's request is fair and on the further steps I can take to have the shares transferred in my name.
 
Seeking your expert advice and guidance. Thanking you in anticipation.
 
Answer: Merely for transferring the flat in the name of the nominee, a succession certificate is not required.
 
With photocopies of all the documents submitted to your Society, under Bye-Law No. 174(A)(iii), make a written complaint against your Society to the deputy registrar (DR) of cooperative societies of your area. 
 
You have to be very persistent in pursuing your complaint with the DR. After 15 days of your complaint, if no action is taken, then file an RTI application with the public information officer (PIO) of the DR, asking for information on the action taken on your complaint.
 
If the PIO states that the DR has not taken any action, then you may make a complaint against the DR to the district deputy registrar (DDR) for not acting on your complaint.
 
Simultaneously, you may file a Lokshahi Din complaint (LDC) against the DR with the district collector (DC). The DC holds hearings on such complaints on the first Monday of each month and may direct the DR to take action on your complaint. This way, you can pursue your complaint to seek appropriate action.
 
NOTE
We will not be answering queries posted in the comments. Only questions sent through the Moneylife Foundation's Legal Helpline will be answered. If you want to seek guidance or ask questions to Mr Shanbhag, kindly send it through Moneylife Foundation's Free Legal Helpline. Here is the link: https://www.moneylife.in/lrc.html#ask-question
 
Disclaimer: The guidance provided in these columns and on our Legal Helpline is on the sole basis of the facts provided by the reader/questioner and does not amount to formal legal advice in any form whatsoever. 
 
(Shirish Shanbhag has an MSc in Organic Chemistry, a Diploma in Higher Education, and a Diploma in French and has completed his LL.B. in first class in 2021. Before his retirement, he was a junior college teacher at Patkar College from July 1980 to May 2012, teaching theoretical and practical chemistry. Post-retirement in 2012, he started providing guidance and counselling to people on several issues, specifically focusing on cooperative housing society-related matters. He has over 30 years of hands-on experience in all matters about housing societies and can provide out-of-box solutions for any practical issue.)