Management of Co-Operatives

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Management ofCo-operatives


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INTRODUCTION

The problem of housing is becoming more andmore critical due to increasing population

One can satisfy these needs of shelter by forminghousing societies in minimum cost and investment.

These are legally established association ofpersons and are democratically controlled by the

members


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HISTORY OF CO-OPERATIVE HOUSING

SOCIETY The co-op housing is of recent origin. The first housing society was

registered in Bombay in 1915. In madras though the society wasregistered in 1914 it became active only in 1923 when governmentstarted financing it.

Economic depression of the thirties and 2nd world war had a greateffect on the growth of the housing movement.

Due to acute shortage of building materials and labour and policy ofrestriction followed by government in financing these societies was

not much progress.

The housing co-op movement made a progress during the 1st twofive year plans although the progress has not been uniform in allstates.


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DEFINITION OF CO-OPERATIVEHOUSING SOCIETY

According to Maharashtra co-operativesSocieties act 1960,a housing society is definedas ,A society ,the object of which is to

provide its members with open plots forhousing, dwelling houses or flats or if open

plots, the dwelling houses or flats are

already acquired to provide its memberscommon amenities and services.


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TYPES OF CO-OPERATIVE

HOUSING SOCIETYTENANT OWNERSHIP

SOCIETIES

TENANT CO-PARTNERSHIP

HOUSING SOCIETIES

BUILDERS SOCIETIES

FLAT OWNERSHIP CO-

OPERATIVE


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CASE STUDYMAY-2006

Sai krupa housing society is located at Mahim Road,PALGHAR DISTRICT, THANE. The society comprises ofseven buildings and has a registered co-operating housing

society. There are certain irregularities in the payment ofmaintenance charges and N.O.C. the members of the societyhas called for an emergency meeting to sort out the problemand difficulties. The secretary in the meantime calls for anemergency meeting.

The members of the society put forth the following problemsbefore the managing committee:


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CASE STUDYMAY-2006

Society levies 100 per cent of monthly outgoing as

non-occupation charges. The plea of members thatnon-occupational charges cannot exceed 10 percent of service charges has been ignored.

Mr. RAKESH KUMAR, a member, of our society

has not paid his maintenance for a long time andhis arrears have ballooned into a huge amount.What to do?


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Case facts

Sai krupa housing society is located atMahim road, which is a registered co-ophousing society.

It consists of 7 building.

The managing committee consists ofchairman, secretary, treasurer and 7

other members.

Due to inefficient management thesociety is facing various problems suchas non occupational charges and

overdue maintenance.


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Case facts

Mr. Kumar member of society has not paid hismaintenance for a long time and his arrears haveballooned into a huge amount.

Under section 70 A of Maharashtra cooperative societiesact, 1960 o society can charge N.O.C at a rate higher than10% of service charges (excluding MunicipalCorporation/Municipality charges) but Sai krupa societylevies 100% of monthly out goings as N.O.C.

In spite of several complaints from the membersmanaging committee regarding excess N.O.C., themanaging committee is not responding regarding thisissue.

In order to solve the above problem EGM is conducted bymanaging committee.


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Assumptions

It is assumed that Sai Krupa housingsociety is well established housingcooperative.

It is also assumed that it is a buildercooperative.

It is assumed that EGM is conducted in

order to take immediate actions to solvethe problems which the society is currentlyfacing.


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It is assumed that a committee member has lack ofknowledge regarding laws and regulations of Maharashtra

co-operative housing.

There is lack of co-operation among the members.

There is a possibility that the members of society bycharging them with extra non-occupation charges

Assumptions


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SWOT ANALYSIS


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STRENGTH

Sai Krupa society is aregistered co- operativehousing society. It consists of 59members.

All the members are honestand loyal to the society as they

attend all meetings of thesociety.

There is cooperation among

the members of the society.


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WEAKNESS

Committee members have lackof knowledge regarding laws and

regulations of co-operativesociety.

Managing committee face torecover the dues from themembers of the society whichleads to financial problem.


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OPPURTUNITIES

If the society succeedsincollecting themaintenance charges

from its members thenthe society wont face afinancial problem and theavailable fund can be

utilized for the benefits ofits members.


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THREATS

Irresponsibility ofmanagement about nonoccupational charges.

Carelessness of membersregarding payment of

maintenance charges.


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QUESTIONS

1. The society maintains that it has sent a letter tothe registrar, co-operative societies and is

awaiting a reply. In the mean while it sends

inflated bills and even charges interest. What are

members to do?


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Solutions In the view of the government notification dated August 1, 2002, nosociety can charge N.O.C. at a rate higher than 10 per cent of servicecharges (excluding Municipal Corporation/ Municipality Charges). Itis illegal for any society to charge in excess of ten per cent, AGovernment notification issued under section 70 A of theMaharashtra cooperative societies act 1960 has the force of law andhas to be obeyed.

The members of the society can approach to the registrar to confirmwhether the society has filed a complain regarding N.O.C .Thenotification is as much binding on the registrar any of us and of hetakes a contrary stand, such a stand sill have to be stuck down as

being illegal, then the members has a right to file a case against thesociety in a court of law.


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Contd

No member of the society is under any

obligation to comply with an illegaldemand. Thus you can safely ignore theinflated bills raised by the society and canrefuse to pay the excess N.O.C. leviedand any interest on such excess. If anyamount has already been paid over andabove what is legally payable, a memberhas the right to adopt appropriateproceedings to recover it from the society.


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2.Can the society withdraw the water connection of

Mr. Rakesh Kumar till he pays his dues? Give your

opinion.


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Solutions Section 12 A of the Maharashtra ownershipflats (regulation of the promotion ofconstruction, sale, management and

transfer) Act, 1963 (MOFA for short) statesthat no person who is a promoter, manager,member of the managing committee,director, secretary, or otherwise of a block

or building of flats shall, without just andsufficient cause, cut off, withhold, or in anymanner curtail or reduce an y essentialsupply or service enjoyed by the person who

has taken a flat.


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Contd

Withholding an essential supply includesacts or omissions on the part of thosemanaging the blocks of flats. An essentialsupply or services includes water,electricity, lights in passages and onstaircases, lifts and conservancy or sanitaryservices. An affected flat purchaser has theright to approach the small causes court foran order to have the water supply resorted.Persons responsible for withholding anyessential supply or services withoutsufficient or just case are also liable for

criminal prosecution It is thus clear that no

Management of Co-Operatives

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