In cooperative housing societies, share certificates are a key legal document that confirms the ownership of shares by a member. These certificates not only prove ownership but also determine a member’s rights within the society. Sometimes, share certificates are prepared during the tenure of one managing committee but are issued later when some members fulfill their documentation requirements. In such cases, a common question arises: who should sign and issue these certificates—the past office bearers or the present ones?
Let us examine the legal position and procedural clarity on this matter.
Legal Nature of the Housing Society
A cooperative housing society is an artificial juristic person registered under the Maharashtra Co-operative Societies (MCS) Act, 1960. It operates through an elected managing committee, which typically has a 5-year tenure. All activities, including the issuance of share certificates, must be carried out by the managing committee in office at the time of such issuance.
Who Is Responsible for Issuing the Share Certificates?
The responsibility to issue share certificates lies with the current managing committee, not the one that existed when the certificates were originally prepared. If certain members of the society failed to submit necessary documents such as:
- Proof of ownership (like a registered agreement for sale),
- Payment of entrance fees, or
- Outstanding dues such as property taxes,
then the earlier committee was within its rights to withhold the issuance of share certificates.
Once the member complies with all documentary requirements, the present managing committee must process and issue the share certificate accordingly.
Bye-law Provisions Related to Share Certificates
- Bye-law No. 10 states that every share certificate must bear the seal of the society and the signatures of the chairman, secretary, and one committee member, duly authorised by the managing committee.
- Bye-law No. 140 makes it the duty of the secretary to issue share certificate to members within six months from the date of allotment of shares, provided all documents are in order.
Therefore, only the currently serving chairman and secretary are empowered to sign the share certificates. The signatures of former office bearers are invalid once they cease to hold office.
Procedure to Issue Previously Prepared Share Certificates
To maintain transparency and safeguard the society’s records, the present managing committee should:
- Record a resolution in the minutes book of the committee meeting stating that the share certificates were earlier prepared but could not be issued due to non-submission of required documents.
- Mention the compliance of the concerned member(s) as of the current date.
- Proceed to issue the share certificate, signed by the current chairman, secretary, and one authorised committee member, and affix the seal of the society.
- Maintain a register of share certificate issuance and obtain the member’s acknowledgment upon delivery.
Conclusion
There is no legal requirement to obtain the signatures of past committee members, even if the certificates were physically printed during their tenure. The current office bearers must fulfill this duty in compliance with society bye-laws and maintain appropriate documentation. The key is that share certificates are not valid until they are duly signed and sealed by currently authorised officials, regardless of when they were printed.
