Follow the stipulated norms
A look at some of the key the compliances required by co-operative housing societies
Housing societies or apartment associations are popular in India with a group of house owners within a residential complex, usually one consisting of buildings that each have flats.
An apartment (in American English) or a flat (in British English) is a self-contained housing unit (a type of residential real estate) that occupies only part of a building.
Housing Societies are required to comply with the provisions of the applicable Acts, the rules under these acts, bye-laws and various notifications and orders issued. Co-operative Housing societies are governed by the provisions of the state co-operative societies’ acts and rules of their respective state acts. In case where there is no such act in the state, The Co-operative Societies Act, 1912 and its rules are applicable.
In the state of Maharashtra, the legal provisions for housing societies are covered under the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as MCS Act), the Maharashtra Apartment Ownership Act, 1970 (hereinafter referred to as MAO Act) and the Maharashtra Ownership Flats (regulation of the promotion of construction, sale, management and transfer) Act, 1963 (hereinafter referred to as MOFA).
The MCS Act defines a housing society to mean a society, the object of which is to provide its members with open plots for housing, dwelling houses or flats; or if open plots, the dwelling houses or flats are already acquired, to provide its members common amenities and services. (Section 2(16))
Housing Societies can be of the following types:
l Flat Owners Societies (formed by purchasers of residential flats under MOFA)
l Open Plot Society
l Tenants Society
l Housing Board Society
l Premises Society (similar to flat owners society but for commercial or industrial tenements)
Complainces Constitution, Registration and Bye-laws
Section 10 of MOFA states that as soon as a minimum number of persons required to form a society or a company have taken flats, the promoter shall register an organization of the persons who have taken the flats as a co-operative society or as a company and he shall join as a member in respect of the flats unsold.
The time limit as given under rule 8 (of MOFA Rules) is four months from the date on which such minimum number of persons have taken flats and the minimum number of members necessary to form a society as per the MCS Act (Section 6) is atleast 10 persons.
For the registration of societies the proposed bye-laws have to be submitted along with the application for registration. Rule 8 of the Maharashtra Co-operative Societies Rules 1961 (Hereinafter referred to as MCSR) states the matters that can be covered by the bye-laws.
Funds & Investments
Every society which does/ can derive profits is required to maintain reserve fund by carrying to such fund atleast one-fourth of its net profits each year (Sec 66. of MCS Act)
Every society has to contribute annually (within 3 months from close of the co-operative year) towards the education fund of the state federal society at the prescribed rates. (Sec 68. of MCS Act)
Societies shall invest/ deposit their funds in: DCCB or SCB with atleast A audit class in last 3 consecutive years, or securities u/s .20 of the Indian Trusts Act, 1882 or in the shares or security bonds, or debentures issued by another society with limited liability and having same classification to which it belongs (Sec 70. of MCS Act)
A look at some of the key the compliances required by co-operative housing societies
Housing societies or apartment associations are popular in India with a group of house owners within a residential complex, usually one consisting of buildings that each have flats.
An apartment (in American English) or a flat (in British English) is a self-contained housing unit (a type of residential real estate) that occupies only part of a building.
Housing Societies are required to comply with the provisions of the applicable Acts, the rules under these acts, bye-laws and various notifications and orders issued. Co-operative Housing societies are governed by the provisions of the state co-operative societies’ acts and rules of their respective state acts. In case where there is no such act in the state, The Co-operative Societies Act, 1912 and its rules are applicable.
In the state of Maharashtra, the legal provisions for housing societies are covered under the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as MCS Act), the Maharashtra Apartment Ownership Act, 1970 (hereinafter referred to as MAO Act) and the Maharashtra Ownership Flats (regulation of the promotion of construction, sale, management and transfer) Act, 1963 (hereinafter referred to as MOFA).
The MCS Act defines a housing society to mean a society, the object of which is to provide its members with open plots for housing, dwelling houses or flats; or if open plots, the dwelling houses or flats are already acquired, to provide its members common amenities and services. (Section 2(16))
Housing Societies can be of the following types:
l Flat Owners Societies (formed by purchasers of residential flats under MOFA)
l Open Plot Society
l Tenants Society
l Housing Board Society
l Premises Society (similar to flat owners society but for commercial or industrial tenements)
Complainces Constitution, Registration and Bye-laws
Section 10 of MOFA states that as soon as a minimum number of persons required to form a society or a company have taken flats, the promoter shall register an organization of the persons who have taken the flats as a co-operative society or as a company and he shall join as a member in respect of the flats unsold.
The time limit as given under rule 8 (of MOFA Rules) is four months from the date on which such minimum number of persons have taken flats and the minimum number of members necessary to form a society as per the MCS Act (Section 6) is atleast 10 persons.
For the registration of societies the proposed bye-laws have to be submitted along with the application for registration. Rule 8 of the Maharashtra Co-operative Societies Rules 1961 (Hereinafter referred to as MCSR) states the matters that can be covered by the bye-laws.
Funds & Investments
Every society which does/ can derive profits is required to maintain reserve fund by carrying to such fund atleast one-fourth of its net profits each year (Sec 66. of MCS Act)
Every society has to contribute annually (within 3 months from close of the co-operative year) towards the education fund of the state federal society at the prescribed rates. (Sec 68. of MCS Act)
Societies shall invest/ deposit their funds in: DCCB or SCB with atleast A audit class in last 3 consecutive years, or securities u/s .20 of the Indian Trusts Act, 1882 or in the shares or security bonds, or debentures issued by another society with limited liability and having same classification to which it belongs (Sec 70. of MCS Act)
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