At the rate fixed under

the by-law No. 43(2)(iii)(c)

Date: 2nd October, 2013

HEMANT AGARWAL's Analysis on:

NON-OCCUPANCY CHARGES, IN A SOCIETY:

01. CRITERIA FOR LEVY OF NON-OCCUPANCY CHARGES:
a) A person purchases a flat in a CHS for his own residential usage. He
(as Member) is bound by law to pay the Society Maintenance Charges, for
his flat when he is personally residing or even if the flat is kept locked.
This means that even if the member is keeping his flat locked at all times,
when he stays in Dubai, the member has still to pay the "FULL" Society
Maintenance Charges, without any concessions.
UNDERSTANDING IT VERY SIMPLY:
b) Members flat Closed / Locked / Vacant / not occupied for any period =
is equal to Self Occupied,
WHICH is further equal to = Regular full maintenance charges and nonoccupancy charges cannot be levied.
Criteria = Possession should remain with the Member itself. Period.
c)
Members flat occupied by non-family members, that is Rentees /
Leasees / Licensees = is equal to "non self-occupancy" which is further
equal to = compulsory levy of non-occupancy charges subject to a FIXED
10% of the consolidated Service Charges (excluding Statutory Taxes).
Criteria = Possession should remain with the "Renter / Tenant"

d) Family Member means : Group of persons which includes Husband,

Wife, Father, Mother, Sister, Brother, Son, Daughter, Son-in-Law, Brother-inLaw, Sister-in-Law, Daughter-in-Law, Grandson & Grand-Daughter.
Non-Occupancy Charges CANNOT be levied to the above family-members
of the bonafide Member. However, intermittent joint-stay of other family
members OR friends, will not attract Non-Occupancy Charges.
e) FLATS IN THE NAME OF TRUSTS /CORPORATES
In case of CHS Flats owned by Trusts or Corporates, Non-Occupancy
Charges CANNOT be levied on the Guests staying in such flats.
Guests = Bonafide Staff members (Directors, Executives, Managers and so
on)
HOWEVER, for this the Company should submit a Board of Directors
(BOD) resolution, to the Society detailing the name of person who is
authorized to stay in the flat. Besides the BOD resolution, the company
NEED NOT submit any other document (means Form-Appendix no. 27 or
Form-Appendix no. 11, or 100/- as Nominal Membership fees or Notarized
photocopy of the Leave & License (L&L, Rent) Agreement or Police
verification Report of its staff).
A Company-Owned flat cannot be used as a regular Transit / Guest house
f) Similarly a individual owner-member, may also give his Flat on rent
/lease to a Corporate, BUT subject to compliance and requirements of the
CHS bye-laws (more specifically detailed in point no. 03, below).
However, here the Corporate CANNOT use this tenanted flat, as a Transit /
Guest House, for its Staff members.

02. NON-OCCUPANCY CHARGES FIXED at 10% :

The Society is concerned only with the FIXED 10% extra charges, over the
regular service charges, as "Non-Occupancy Charges" and STRICTLY
NOTHING beyond this. There is no concept of less than 10% or greater
than 10% non-occupancy charges. Any amount (whatsoever) collected,

besides the FIXED "10% Non-Occupancy Charges", is ILLEGAL, and is

duly prosecutable under the Consumer Protection Act and also under the
Indian Penal Code (Criminal Acts)

03. JURISDICTION OF A SOCIETY:

IF a Owner-Member wants to rent /lease out his flat THEN he is obliged to
comply with the basic requirement under the CHS bye-laws. A Society is
concerned only with compliance of the Bye-Law norms, which means:
a) Prior permission of the Society vide Bye-Law form-Appendix no. 27.
b) Form-Appendix no. 11, along with cheque of Rs. 100/- as Nominal
Membership entrance fees
c) Certified Photocopy of the Leave & License (L&L, Rent) Agreement, duly
Stamped and Registered.
d) Police verification Report of the Tenant
NOTE: Even if the above Form no. 27 and Form 11, are not submitted to
the Society, it does not "illegalize" the Tenant, nor does the Tenant become
a "trespasser", as is hallucinating thought off by various ignorant MC's.
Subsequent to the above and /or irrespective of compliance of Form no. 27
and Form 11, the Society is liable and responsible to levy a FIXED "10%
Non-Occupancy Charges", on the regular Society Service /Maintenance
charges, in the society bill of its own registered primary member, but to the
exclusion of Statutory charges (e.g. BMC Property Tax, NA Tax, BMC
Water Charges). IT will be illegal on part of the Mg. Committee, to raise
CHS Maintenance bills in the name of the Renter /Tenant.
NOTE:
Levy of Non-Occupancy Charges are Mandatory and
Compulsory. IF the Mg. Committee (MC) fails to levy the Non-Occupancy
Charges to the member, THEN all the MC has to jointly compensate the
CHS, by paying the same from their own pockets, for non-compliance and
violation of bye-law nos. 43(1) & 43(2) & 20

04.

COMMON SERVICES & AMENITIES:

The Society is classified as a "Service Provider", under the Consumer

Protection Act, which is further reinforced from several Judgments of the
Consumer Court.
The Sole-Responsibility of a Coop. Society, is to provide "Common
Services & Amenities", to its members, which also lawfully means
"Common Services & Amenities" to the Tenants of its members, which is
more so specifically in lieu of the "10% Non-Occupancy Charges" that the
Society has to mandatorily collect from its original member. Under no
circumstances the Society may levy any charges, directly to the Tenant.
Under no circumstances, the Society may stop any Services /Amenities to
the said Renter /Tenant, which includes Car Parking, irrespective of an
resolution passed by the Society.

05.

RENTER /TENANT equals to "NOMINAL MEMBER":

a) A licensed Tenant of the original Society member, is classified as a

"Nominal Member", who by legal default derives rights to reside in a society
members flat. The "Nominal Membership" is to be granted to the Tenant,
by virtue of the Rs. 100/- (as nominal members Entrance Fees). However
the Tenant derives no right to have any say in the affairs of the Society.
b) IF the original member is paying the mandatory "10% Non-Occupancy
Charges", THEN the "Tenant", definitely & lawfully derives all the rights to
use the "Services and Amenities" that is available to the original member.
This includes Parking, Gym, Club-House & Swimming pool facilities. The
usual rights of "Services and Amenities", CANNOT be deprived to a
Tenant, even if such an resolution is passed by the Society General Body.
This is successfully prosecutable in the Consumer Court.
HOWEVER, the Tenant (nominal member), does NOT derive any right to
have any say in the management of the Society, more so specifically during

the Voting / Contesting Elections / Attending AGM /SGM of the Society, as

provided under the Society Bye-Law.

06.

SOCIETY NOT THE OWNER OF FLAT:

a) The Society does not own the members Flat (ownership property). The
Society cannot have a say (whatsoever) nor decide on the type of Tenant
that could be allowed to stay in the Society. It is the sole discretion of the
Flat-Owner (member) to rent his property out on rent /lease, under the
appropriate terms and conditions prescribed by the Law. ONLY the flat
owner can decide the type of tenant he wants to rent out his premises, BUT
within the parameters of Law (i.e. cannot rent out his premises for
commercial or illegal activities and so on).
b) A Society has no legal jurisdiction to refuse residing rights to a Tenant,
under any circumstances, especially in a flat owned by its member. This is
a legal fact, decided in various orders by the High Court and the Supreme
Court.
c) A Society cannot refuse a member from keeping a Tenant, even if the
member is a defaulter or whatever. The maximum a Society can do is to
inform the local Police Station, about any illegal activities being carried out
in the members flat, by the Tenant or the Member. Nothing more. Even
if the Flat-Owner (Member) has not taken permission from the Society for
keeping a Tenant, in his own Flat, it will not amount to any illegality, nor can
the Tenant be classified as a "Trespasser".
d) Some nefarious MC's have assumed the role of "investigating" the
Tenants, by conducting interviews of the Tenants. Such interviews or
assessment of the Tenants are illegal.

07. CRIMINAL LIABILITY ON THE SOCIETY MC:

Irrespective of any resolution passed in the Society:

a)

b)
c)
d)
e)

f)

It is a Criminal offence to collect any charges in the guise of "Shifting

Charges", or "Tenancy Deposit" or higher non-occupancy charges, over
and above the mandatory 10% Non-Occupancy Charges on the Society
Service /Maintenance charges.
A Society is not entitled to levy compounding rate of Interest, on any
outstanding amount.
False levy of any other amount or charges in the Members bills
Levy of any Legal Charges in the Members bills, without a judicial order.
MC's cannot restrict or restrain or intimidate any Tenant from staying in a
Housing Society, subject to compliance of minimum requirements, i.e.
Registered Leave & License agreement and Tenants Police verification
report.
MC's can be criminally prosecuted for Mischief, Cheating, Restraining,
Restricting, Intimidating, Threatening, Insulting, and so on, for restricting
/prohibiting tenants, from residing in a Society.

08. OVER-CHARGING NON-OCCUPANCY CHARGES:

IF the society is charging more than 10% non-occupancy charges THEN
the following individual and alternative remedies are available:
a) Make a written complaint to the area Ward Registrar of Cooperatives,
and pray that the CHS may be directed to refund the excess nonoccupancy charges alongwith with interest .AND. further pray that the MC
may be penalized for abuse of power and harassment.
NOTE: Only a bonafide member can file this complaint.
ADDITIONALLY ALONGWITH ABOVE:
b) Make a complaint to the local Consumer Court, alleging "deliberate
negligence and deficiency in services and over-charging" .AND. for abuse
of power and harassment by the CHS Mg. Committee and pray for
compensation for causing mental and physical trauma .AND. also for

damages to the extent of the over-charged Non-Occupancy Charges

alongwith 18% thereon.
NOTE: Tenant can file complaint, BUT only with the written consent of the
Owner-Member and subject to availability of a duly stamp-duty paid and
registered rent /lease agreement

i)
ii)
iii)
iv)
v)

MORE ADDITONALLY ALONGWITH ABOVE:

c) File a written police complaint .AND / OR. lodge a Private Criminal
case with the local Metropolitan Magistrates Court, against all the CHS
Mg. Committee members (jointly) for, the various criminal harassments, like
:
For Cheating u/s 418 (IPC)
For Mischief u/s 427 (IPC)
For Intimidation u/s 503 , 504, 509 (IPC)
For Extortion u/s 383 (IPC)
For Restraining (stopping) u/s 339 (IPC)
NOTE-1: All the options (a, b, c) can be filed individually and
simultaneously
NOTE-2:
IMPORTANT - Must follow due documentary procedures
alongwith relevant documentary evidences (proofs), before initiating above
legal actions.
NOTE-3: The Tenant alone can file this complaint, WITHOUT the consent
of the owner-member, but subject to availability of a duly stamp-duty paid
and registered L&L agreement.

09. PRESUMED NUISANCE, BY TENANTS:

a)
Sometimes, the Society does experience nuisance from Renters
/Tenants, in the form of Rowdiness, Alcoholism, visiting girl-friends of the
Tenants, playing of Loud Music, etc.... HOWEVER these can never ever be
a ground for restricting /prohibiting Tenants, since all these nuisances are
rampant and unchecked, amongst the Society members themselves. It is a

routine feature amongst Society Members, to bicker and fight for petty
things, which includes, Ogling, Bitching, Parking, Drunkenness, Gambling,
Spitting Pan juice, Loud music, Abuses & Dadagiri, misappropriating
members funds, egoistic power-struggle and what-not's.
b)
On the Contrary, the Tenants who being non-owners of the rented
premises, are usually more humble and subdued, keep unto themselves
and never interfere in the affairs of the Society or any of its members.

10. LEGAL BYE-PASS:

a)
b)

c)
d)

Subject to duly executing a Registered Leave & License agreement and

Tenants Police verification report, the following can ALSO be successfully
complied:
Under a typical Bye-Law, an Associate Member is not barred from Staying
in the Member's Flat
Limited to filing Bye-Law appendix no. 7, (alongwith Rs. 100/- as Associate
Member Entrance Fees) the original owner can make his "Tenant" as his
Associate member.
Note: Associate Membership can be withdrawn, by just simply instructing
the Society for withdrawing the Associate Membership. There is no legallacunae or legal-risk (whatsoever), since this type of Associate
membership, has negligible rights.
A Society CANNOT charge 10% as Non-Occupancy Charges, from an
Associate Member.
A Tenant can lawfully, be made an Associate Member.

11.

BACHELOR TENANTS CANNOT BE BANNED:

a) The inbuilt craving to formulate Laws to govern & control other

members, lead to ignorant MC's and GB General Body (GB), to pass
"illegal & invalid" resolutions, for "Prohibiting /Banning Bachelor Tenant",
from staying in a Society.
Such "selective & prohibitive" provisions /byelaws created /amended under a "bye-law" approved /passed by the GB, is

also "illegal & invalid", leading to animosity and discontent in the Society,
which also means "failure of the Cooperative Movement". AS IT IS, the
Society or the MC or the GB is a "nobody" or say "does not have the
"Capacity or Capability" to decide the legalities of such things for which
there are various Laws available. The Society MC or the GB are not "Lok
Sabha" members or Parliamentarians who are empowered to pass Laws.
b) If ignorant & nuisance GB resolutions have their whimsical ways in a
Cooperative Housing Society, then one can also expect that the ignorant
GB may pass resolutions for compulsory marriage between the members
(as is a custom in some Indian culture) .OR. "compulsory sale" of flats in
case the owner becomes a Widow. This is more so since some nefarious
MC's and their cronies, are in a way, controlling the strings in a GB
meeting.

12.

SHYING AWAY FROM COOPERATIVE SOCIETY:

Looking at the consistent nefarious attitude of few MC's and herd-mentality

GB's, Investors are avoiding investing in Housing Society properties. On
realizing the nefarious management attitude in a Housing Society, some
people have started registering their group properties, under the concept of
a "Condominium", which truncates out the nefarious management attitude
in a Housing Society. A condominium management is highly flexible and
more easily, peacefully & professionally manageable, WITHOUT the usual
bickering & bitching that is rampant in present Housing Societys.

13.
MH Govt. GR No. 20081104172832001 of 01st August,
2001:
BESIDES, the Maharashtra Governments GR No. 20081104172832001
Dated 01st August, 2001, on 10% Non Occupancy Charges, the Coop.
Dept., has made no provision for Penalty and /or Penal Action under the
Cooperative Laws, on those Society Mg. Committees, who dictatorially
collect more than 10% as Non Occupancy Charges, from the helpless

members of the Society, thus leading to discontent, resentment and gradual

failure of the Cooperative Movement.
AUTHOR: Hemant Agarwal
Email: ha21@rediffmail.com
http://hemantagarwal21.blogspot.in/?view=sidebar
Date: 2nd October, 2013