MUMBAI: In a bid to simplify housing society rules and reduce government interface, the state government is all set to introduce new rules for cooperative housing societies. The new draft rules propose to reduce the interest on members’ dues from 21% to 12%, enable societies to raise a loan of up to 10 times of the land cost for redevelopment, and finetune the maintenance charges.
There is also a provision for virtual participation in AGMs—however, an attendance of two-thirds or 20 members, whichever is less, has been made mandatory. A meeting dissolved for want of a quorum can be held between seven and 30 days without the quorum. The decisions at AGMs will have to be passed by 51% of the total members, including those who attend it online. A video recording has been made mandatory for a meeting called for redevelopment.
There are 1.25 lakh housing societies with over 20 million members. Around 70% of these societies are in the Mumbai Metropolitan Region.
The draft rules have added the provision of ‘premises societies’ or commercial entities and shops in societies, enabling them to be an integrated part of the society and helping them get their rightful share of area in redevelopment. Similarly, a category of ‘provisional members’ has been added, which will give nominees voting rights and membership after the demise of members until they are officially given member status.
The new rules also empower the society to give nomination and provisional membership to legal heirs after the demise of the original members. “However, he will not have any right, title or ownership of the property. The society will have to follow the procedure for transfer of the title to the legal heir,” the rules state.
The draft notification says that common service charges should be divided equally among flats and water charges based on the number of taps in the flats. “The sinking fund should be minimum 0.25% and repair and maintenance fund 0.75% of the construction cost and should be collected annually,” the draft states.
Kiran Sonawane, deputy registrar who played a key role in drafting the rules, said, “We will finalise the rules by incorporating the suggestions and objections in eight days, after which the draft will go to the principal secretary of the cooperation department. Once the rules are vetted by the law and judiciary department, they will be notified. Many clauses such as charges of sinking repair funds were in the by-laws, but by bringing them into the rules, we have given them legal sanctity. Once the rules are finalised, we will reframe the bylaws to simplify them.”
Sonawane said the fine-tuning of the rules and bylaws would weed out the ambiguities in the laws and thus minimise government intervention. “In case of ambiguities, societies approach the registrar’s office and in many such cases administrators are appointed,” he said. Another officer added that this led to inconvenience and rise in expenditure.
The officer said that the provision of raising a loan to the tune of 10 times of the land cost would facilitate the societies in hassle-free self-redevelopment or demanding more area if the redevelopment was done by a builder.
Devdatta Boralkar of Sahakar Bharati, an organisation focussing on strengthening the cooperation movement in India, said it had submitted its suggestions and expected rules to bring in more transparency and fine-tuning in the operations of housing societies.
The proposed rules received less than 100 suggestions/objections from stakeholders including housing societies, their federation, impanelled valuers and architects among others.