Your Housing Problems & Solutions Property Issues
Q: We recently formed a housing society in Mumbai and all the rules etc are being formed. There were few clauses which were passed during initial meeting which included 10 per cent non-occupancy charges for ones who have rented or kept flat vacant. This is being opposed by owners who are outside the city and rented their flats but it appears we are in minority and not physically present is a handicap in this matter. Also, the managing committee has on their own discretion passed a clause if someone sells the flat up to Rs 2.5 lakh could be charged to him/ her. Is this legal? What can we minority stakeholders do to address this? A: First of all, there are no majority or minority stakeholders in the cooperative housing society. All members share equal rights.
1. By Government of Maharashtra circular No. SAGRUYO-1094/ 15165/ case No.317/14C/dtd.1/8/2001,when a flat is given on rent by the member, the society may collect non-occupancy charges, under bye-law No.67(x). But, non-occupancy charges shall not exceed 10 per cent of service charges of thes, excluding municipal taxes.
In case the flat is given on rent, etc. to close relative of the member like father, mother, sister, brother, son, daughter, son-in-law, daughter-nlaw, brother-in-law, sister-in-law, granddaughter, grandson, etc. and to any other relatives recognised by the society, in such cases, non-occupancy charges shall not be recovered.
2. For transfer premium charges read following explanation... Under Bye-law No.38(e)(ix): "Payment of amount of premium at the rate to be fixed by the General Body Meeting, but within the limits as prescribed under the circular issued by the Department of Co-operation, Government of Maharashtra, from time to time. No additional amount towards donation or contribution to any other funds or under any other pretext shall be recovered form transferor or transferee."
As stated in first para of this bye-law, said circular of Co-operation and Textile Department of Government of Maharashtra, Mantralaya, Mumbai-400032, No. SaGruYo2001/Pra.Kra-188/14-Sa, Dated 9 August 2001. By exercising the powers conferred to the State Government under Section 79-A of the Maharashtra Co-operative Societies Act 1960, the maximum rate of premium to be charged per flat in Municipal Corporation area is Rs 25,000. The charge of Rs 2.5 lakh decided by your Society is thus ultra-virus (illegal). You can make a complaint to the Secretary of your Society, under Bye-law No.172. In your complaint, state that the decision to levy transfer premium of Rs 2.5 lakh is ultra-virus and , you would make a complaint to the concerned Deputy Registrar of Co-operative Societies, under the Bye-law No. 174(A)(vi), if this decision is not reversed. After 15 days of you making the complaint to the Secretary, if you don't receive any reply, then write a complaint to Deputy Registrar.
Maintenance Charges
Q: The Society is registered as Housing Society. Can Society levy service charges on area basis if it has been resolved in the AGM/SGM. Is it mandatory for any society to levy service charge on the basis of units? A: No. All cooperative housing societies in Maharashtra are required to follow the Byelaws. What is generally referred by members as monthly maintenance bill consists two components. One is services charges, which are same for all members, irrespective of flat size or area or facilities used or not used (like lift). Second is contribution, including sinking fund and repair and maintenance charges, which are collected on per sq ft basis. Please refer Bye Law No.67, 68, 69 and 70 to know more details.
TDS not paid Q: We entered into an agreement with a builder to purchase a row house in November 2014 for Rs 1 crore. We paid Rs 20 lakh as down payment made at the time of agreement and subsequently instalments paid till date disbursed by my bank as part of home loan till date to the extent of Rs 90 lakh. I was not aware of TDS to be deducted at 1 per cent on each payment and in addition no reference of this was mentioned either in the agreement or periodical demand notes from the builder. Recently one of the other property owners brought this up for discussion after which the builder sent a note to all property owners asking them to pay TDS and to adjust this in the final installment. Are builders no way responsible to make buyers aware of any such obligation to deduct TDS?
A: Your query is mostly related with taxation. Section 194IA of Income Tax Act requires a purchaser of immovable property in excess of Rs 50 lakh to deduct tax @1 per cent before making payment to the seller. This is a compulsory section. In you case, you have forgotten to deduct the tax. If and when the income-tax department gets information about the transaction (and they will definitely get it because the value exceeds Rs 50 lakh), they will proceed against you for recovery of the TDS. At that time, they will also levy interest on you. The better thing for you to do is to pay the TDS now along with some interest. If the builder is not co-operating then you will have to bear the TDS. That would be an additional cost for you. However, it looks like the builder is ready to deduct the TDS payments from your final instalment. So be happy and do the needful and do take help from a CA, who has proper knowledge of TDS deduction, penalties and deposit rules. But, in our opinion, and based on experiences, the cost of paying TDS with penalty and interest at this stage would be less than the cost that you will incur if, at a later date, the Income-Tax Department goes for scrutiny.