Significance & Formation of a Co-operative Housing Society in the State of Maharashtra

Housing Societies function as small communities, organising social and economic activities for members and affording them opportunities including higher social values

DEFINITION: The Definition of "Housing Society" under Section 2(16) of Maharashtra Co-operative Societies Act 1960 is as follows:-

"Housing Societies" means 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."

These housing societies of occupiers of tenements fall in sub-category:-

1.      Tenant Ownership Housing Society;

2.      Tenant Co-partnership Housing Society and

3.      Other Societies according to Rule 10(5) of the Maharashtra Co-operative Societies Rules, 1961.

1.           Tenant Ownership Housing Society: Housing Societies where land is held either on lease-hold or freehold basis by societies and houses are owned or to be owned by members. The houses or structures built thereupon on such land are owned by the building site from the society as a lease-holder. The lease contains conditions, prohibitory sub-letting, transfer etc.

2.           Tenant Co-partnership Housing Society: "The Society which holds both land and building either on lease-hold or free-hold and allots them to its members" The individual member contributes in first instance by purchasing shares and then pays rent for occupying the tenement allotted to him by Housing Society. It falls under Maharashtra Ownership Flats Acts, 1963.

The only difference between Tenant Ownership Housing Society and Tenant Co-partnership Housing Society is that in the latter type i.e. co-partnership tenancy, the member has only a share in the property as a whole and no claim to a particular house or tenement, while in the former though technically. A tenant of the society, the member is for all practical purposes the owner of the house or tenement.

  I.          House Mortgage Society: In mofussil town there are no of persons who do not own houses but have got individual piece of land. If house mortgage societies are formed in each town which would be open to such persons, it will help them to apply for loan for construction of houses to Maharashtra Co-operative Housing Finance Society. These House Mortgages societies may be affiliated. The members of these societies will get loans on the same terms and conditions as the members of normal housing societies obtain loans from Maharashtra Co-operative Housing Finance Society.

II.          House Construction Society: This type of Society deals in purchase and sale of constructed houses or dwelling to members or other Societies.

III.          Flat Ownership Societies: These Societies are formed under the Maharashtra Ownership Flats (Regulation and Promotion of Construction, Sale, Management and Transfer) Act, 1963.

IV.          Apartments formed under Apartments Act :
Maharashtra Housing and Area Development Act and repair cess: If a society is registered as co-operative housing society which is covered by the definition of housing society as given in section 2(16) of the Maharashtra Co-operative Societies Act, is exempted from repair cess under Section 83 (1) (g) of the MAHADA

The basic requirements for registration of co-operative society are not known to several promoters i.e members of the society. Before registration proposal of a co-operative housing society of any type of society it is necessary to elect a chief promoter who is duly authorised as such by the promoters from amongst themselves to act on behalf of them and also he is expected to formulate the registration proposal and exercise such powers and carry out such functions mentioned in the minutes of the meeting of the promoters of the proposed co-operative housing society.

No Society can be registered under the provisions of Section 6(1) of the co-operative Societies Act, unless it contains at least ten persons who are qualified to be members under the Co-operative Act and who reside in the area of operation of the society. The State Government had issued following order in connection with formation of Housing society:

FOR FORMATION OF CO-OPERATIVE HOUSING SOCIETY LESS THAN TEN MEMBERS ARE PERMITTED WITH THE CERTAIN CONDITIONS: The Government of Maharashtra had issued an order No C.H.S 1094/C R 277/14-C dt 10th March 1995, published in M.G.G Part 4-B, 1995 p.92 under the provisions of Section 6(1), that the condition to form housing society is that there should be 10 persons minimum, but this condition is relaxed if (1) The plinth area of tenement is not more than 700 sq. feet and (2) There should not be F.S.I left for further construction.

(1). Every Application for registration of a Society under Section 8 of the M.C.S Act shall be made in Form 'A' in Marathi, Hindi or English and subject to the provision of Section 8(2) and sub-rules (2) and (3) of rule 4 be signed by the applicants and shall in addition to four copies of the proposed bye-laws of the society be accompanied by-

a)          A list of persons who have contributed to the Share Capital, together with the amount contributed by each of them, and the entrance fee paid by them;

b)          A certificate from the Bank or Banks stating the credit balance therein in favour of the proposed society;

c)           A scheme showing the details explaining how the working of the society will be economically sound and where the scheme envisages the holding of immovable property by the society , the description of such property proposed to be purchased ,acquired or transferred to the society;

d)          Such other documents as may be specified in the model bye-laws if any, framed by the Registrar.

On receipt of application under Rule 4 of the Maharashtra Co-operative Societies Rules 1961, the Registrar has to enter particulars of the application in the registrar of applications to be maintained in Form 'B' and has to give serial number to the Application and should issue a receipt in acknowledgement under rules thereof.

It is the duty of the Registrar to give opportunity to the promoter to modify the proposed bye-laws before finally registering the society or rejecting the application for registration of the society.

Under the provisions of Section 9(1) of the Maharashtra Co-operative Societies Act 1960, the Registrar has to issue a certificate of registration signed by him and bearing his official seal and containing the registration number of the society with a certificate copy of the bye-laws approved and registered by him.

So long as the registration of the Society stands and as long as it was not cancelled by the Registrar, the said certificate is a conclusive evidence of the fact that the society was duly registered - Miss Rinkoo Jaiswal v/s. Ruksana Apt Co-op Housing Society Ltd, 1987 When registration is cancelled by the Registrar under Section 21, the fact can be submitted as evidence under Section 4 of the Evidence Act.

Government of Maharashtra had issued a notification No CO/HSG/.50/1092/2074 No 44/14-C dt 24-7-1992 regarding relaxation in condition of registration of Societies The percentage of promoters has been down from 90 to 60 i.e 60% promoters are enough to register a co-operative housing society

The condition of registration are laid down in Section 6 of the Maharashtra Co-operative Societies Act, Under Section 9(3) if the Registrar refuses to register a proposed society he has to communicate his decision, with the reasons to the person making application and if there be more than one then to the person who has signed first therein. If the applicants have complied with all the requirements the application for registration of Society could not be refused Dr Devendra Chimanlal Shah v/s. The State of Maharashtra 1985 CTJ 37 (Bom).

-       Adv. R. P. Rathod.