Housing societies are governed by the Maharashtra Cooperative Societies Act (MCS Act), 1960, and are bound to follow statutory obligations such as maintaining books of accounts and convening the Annual General Meeting (AGMs) every financial year. If the managing committee of your society has failed to do this for several consecutive years, there are legal remedies and actions that can be initiated against them.
Under Section 75(1) of the MCS Act, every cooperative housing society is required to conduct its AGM on or before September 30 each year. This meeting is crucial as it covers:
- Adoption of audited financial statements
- Budget approvals
- Review of committee reports
- Member queries and grievances
If a society fails to convene the AGM, it is a serious violation of cooperative law.
Provision for Registrar’s Intervention
On March 28, 2022, a proviso was added to Section 75(1) allowing the Registrar of Cooperative Societies to grant an extension of up to three months under extraordinary circumstances like pandemics, floods, or natural disasters. For the financial years 2019-20 and 2020-21, societies were allowed an extended period of 12 months to conduct their AGMs due to the COVID-19 pandemic.
However, if these extended periods have lapsed and the AGM was still not held, and accounts remain unaudited, the following actions can be taken:
Actions That Can Be Initiated Against the Managing Committee
- Complaint to the Registrar:
- File a written complaint to the Deputy Registrar of Cooperative Societies of your ward/region.
- Request intervention under Section 75(1) and demand the calling of an AGM and audit of accounts.
- Registrar-Convened AGM:
- The Registrar has powers to call the AGM in the prescribed manner.
- This meeting will be treated as the legally valid AGM, even if not convened by the society.
- Recovery of Costs:
- The Registrar can order the cost of conducting this AGM to be recovered from the society funds or from the persons responsible (managing committee members).
- Disqualification of Committee Members:
- If the failure to conduct the AGM is established, the Registrar may disqualify the responsible members from contesting or being elected to any society committee for a period up to five years.
- Monetary Penalty:
- If the officer responsible is an employee or servant of the society, a penalty up to ₹5,000 may be imposed after giving an opportunity to be heard.
Conclusion
The failure of a housing society to maintain accounts and hold AGMs for several years is a serious breach of cooperative governance. As a member, you are entitled to transparency and accountability. You can approach the Registrar of Cooperative Societies with a formal complaint, seeking strict action against the erring managing committee. Such legal measures help uphold the principles of cooperative housing and ensure that societies function in a democratic and transparent manner.
