In large residential complexes, it is common for multiple individual cooperative housing societies to exist on the same layout or land. To manage common facilities such as internal roads, gardens, drainage, lighting, security, clubhouses, or common utilities, an apex society (also known as an association of societies) is formed.
Each individual society remains independent with its own managing committee, but contributes a monthly share toward the apex society for maintenance of common amenities. These apex charges are ultimately recovered from individual flat owners through their respective societies.
What Are Service Charges Under the Bye-laws?
Bye-law 66 of the Model Bye-laws clearly defines what constitutes service charges. These include, among other components:
• common electricity
• water charges
• security and maintenance
• contribution toward an apex society or housing federation, if applicable
Importantly, when your society collects apex society charges from members, it is essentially acting as a collecting and remitting agent. The money does not belong to your society and is payable onward to the apex body.
Non-Occupancy Charges: The Legal Position
A society is permitted to levy non-occupancy charges (NOC) when a flat is not occupied by the member but is given on leave and license or otherwise used by a non-family member. As per prevailing norms and government circulars, such NOC cannot exceed 10% of the service charges of the society.
However, this right to levy NOC is restricted to the society’s own service charges—that is, charges which the society itself incurs and controls.
Can NOC Be Applied on Apex Society Charges?
The answer is not automatically.
Although apex society charges form part of service charges under Bye-law 66, they are not expenses of your society. These charges are determined, approved, and utilised by the apex society, not by your individual managing committee.
Therefore:
• your society can levy 10% NOC on its own service charges, and
• your society cannot unilaterally levy NOC on apex society charges.
When Can NOC Be Levied on Apex Charges?
Non-occupancy charges on apex society contributions can be levied only if:
• the general body of the apex society passes a specific resolution, and
• such resolution expressly permits member societies to recover NOC on apex charges from non-occupying flat owners, and
• the decision is properly recorded and communicated to all member societies.
In the absence of such an apex-level decision, any NOC charged by an individual society on apex contributions would be unauthorised and legally unsustainable.
Key Distinction Members Should Understand
The crucial distinction lies in control and ownership of expenses. Your managing committee has authority only over charges incurred by your society. Apex society charges are collective expenses governed by the apex body, and your society cannot alter, enhance, or add levies to them on its own discretion.
Conclusion
Your society is fully entitled to levy 10% non-occupancy charges on its own service charges. However, levying the same on apex society charges is not permissible unless the apex society’s general body has expressly approved such a levy by resolution. Until then, NOC must be strictly restricted to your society’s service charges, and any excess collection may be challenged by affected members.
