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A Chairman of a Housing Co-operative
Society called me at 10:00 p.m. just to ask whether a Society has a Right to ask a member to settle all dues before he
can be given permission to sell his ownership flat, just because the member was
sitting on his head, citing his urgency in the matter said Adv. R. P. Rathod. Actually a member in their society has
disputed a certain bill and had said that let the matter be decided by the Court of Law.
Now the chairman wanted to know the Rights of the Society not to grant a No Objection Certificate, to a member
to sell his flat.
In this connection I reiterate & intend
to elaborate a bit, what I informed the said Chairman as this may serve as guidance
to other persons in similar situation.
In this regards Section 23 of the Maharashtra
Co-operative Society Act 1960, has to be followed for admittance of a new member in the society. Under this section,
it is indicated that the Society cannot disregard the application from an
applicant without a true and good reason. If a Society does so, an appeal can
be filed with the Registrar. The Registrar would give his verdict within 15
days of receiving such an application from the member, which will have to
be accepted by the society.
Many such
questions come up in this regard. Can a Society maintain that it will not
transfer the Share Certificate on the
name of a new member provided all the dues are paid by the Old member of the
society?
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Certainly Yes. One thing is clear that in
case a member applies to sell his flat and request transfer of the Share
Certificate to the name of the purchaser, he must settle
all the dues of the society. Even if such a payment is debatable or disputable
he cannot make part payment and has to settle his accounts in full before the
Society could give his permission to transfer the Share Certificate.
Now many Societies pass a resolution in
their Managing Committee, or Annual General
Meeting or a Special General meeting,
that if a member wants to sell his flat then it should be sold only to a relative
of the member or persons referred by the other members, if the relatives of the
member do not wish to buy the flat, then only it can be sold to an outsider. Some
societies also bar a member of society by passing certain resolutions in the general meetings
stating that a flat should not be sold to bachelors or persons consuming
non-veg or a non Jain or persons from other communities. Let me make it very clear
that such kind of a resolution by any Society is absolutely illegal and cannot
be implemented. A member has full right to sell his flat to anybody and a
Society cannot prevent him from selling the flats to certain category of
persons.
Now let’s find out the other circumstances
under which a Housing Co-operative Society can stop the admittance
of a new member. Now suppose if an application to buy the flat has been made by
lady who is the sole person in the family and the Society comes to
know that she has a bad character and may start some immoral business
in the building, the Society can stop the admittance of such a member under
such circumstances. However, it should be remembered that the Society cannot
stop admittance of a member only on the basis of doubt; there should be some
conclusive evidence or history of convictions of such persons.
If
suppose the member buying the flat has a large family and the Society feels
that admittance of such a
member would mean excessive use of water and
lift facilities, can it stop the admittance on this pretext?
Certainly, not. That a member has a large family,
cannot be a reason enough to restrict the membership. This cannot be
held as a good and fair reason. In addition, if a Society is informed that the
purchaser of that flat is a smuggler and has a police
record, then can a society stop admittance of
a new member.
Again the reason is that the Society should have solid evidence, in order to
reject the application of the purchaser of the flat and the transfer of the
Share Certificate, falling which the actions of the society would be considered
as undemocratic & illegal.
Certainly, Yes. In fact, when a new member
is being admitted, he must be called and an interview should be taken.
The new member should be strictly told that he will have to follow the Bye-laws
and resolutions of the Society and he will have to pay the maintenance charges
of the society regularly.
So to conclude with Adv. R. P. Rathod says that the issue of transfer of Share
Certificate and flat is certainly not trivial, but is of a profound nature, so adequate
caution has to be adopted.
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