What Are the Charges Collected by a Cooperative Housing Society?
Every cooperative housing society is empowered under the Model Bye-laws to collect specific charges from its members to meet statutory obligations, maintenance needs, and day-to-day expenses. These charges must be levied strictly in accordance with the bye-laws and approved by the general body, ensuring fairness, transparency, and legality.
Below is a detailed explanation of the charges collected by a society and the basis of their apportionment.
Property Taxes
Property tax is collected as fixed by the local authority, based on the ratable value or built-up area per square foot of each flat or shop. If the municipal authority collects property tax directly from individual flat owners, the society must not collect it again.
Water Charges
Water charges are levied based on the total number and size of water inlets provided to each flat. Societies cannot arbitrarily divide water charges equally if inlet sizes or usage differs.
Common Electricity Charges
Expenses for lighting of common areas such as staircases, passages, compound lights, and amenities are to be equally divided among all flats, irrespective of size or usage.
Repairs and Maintenance of the Building
Contribution toward repairs and maintenance is fixed by the general body, subject to a minimum of 0.75% per annum of the construction cost of each flat. This fund is meant for normal recurring repairs and upkeep of the structure.
Lift Repairs and Running Expenses
Lift maintenance, servicing, electricity, and repairs must be shared equally by all members of the building where the lift is installed, even if some members do not use the lift.
Sinking Fund Contribution
As per Bye-law 13(c), every society must collect a sinking fund, at a rate decided by the general body, subject to a minimum of 0.25% per annum of the construction cost of each flat, including proportionate land cost. This fund is meant for major structural repairs and reconstruction.
Service Charges
Service charges cover expenses such as security, cleaning, managing committee expenses, stationery, and administration. These are to be equally divided by the total number of flats, shops, or units.
Car Parking Charges
Parking charges are levied as decided by the general body under Bye-laws 84 and 85. No member can be charged parking fees unless parking is formally allotted as per the bye-laws.
Interest on Delayed Payment
If a member defaults in payment, the society may charge simple interest not exceeding 21% per annum, as prescribed under Bye-laws 72 to 74.
Repayment of Loan and Interest
Where the society has availed loans, each member must contribute toward loan instalments and interest as fixed by the financing agency and approved by the society.
Non-Occupancy Charges
As per Bye-law 43(2)(iii)(c), non-occupancy charges can be levied when a flat is not occupied by the member. Such charges cannot exceed 10% of the service charges and must be approved by the general body.
Insurance Charges
Insurance premium is recovered based on the built-up area of each flat. If any flat is used for commercial purposes or stores hazardous goods leading to a higher premium, the additional burden must be borne by such member(s) proportionately.
Lease Rent
Lease rent, where applicable, is charged based on the built-up area of each flat, particularly in cases of leasehold land.
Non-Agricultural (NA) Tax
NA tax is recovered in proportion to the built-up area of each flat, as applicable under local land revenue laws.
Conclusion
Every charge collected by a cooperative housing society must have legal backing under the bye-laws, be approved by the general body, and be apportioned strictly as prescribed. Any deviation may be challenged before the Registrar or Cooperative Court.
