Member of Cooperative Housing Society

According to Section 2(19)(a) of the Maharashtra Cooperative Societies Act, 1960, a โ€œmemberโ€ means a person joining in an application for the registration of a Co-operative society which is subsequently registered, or a person duly admitted to membership of a society after registration and includes a nominal, associate or sympathizer member. Thus definition of member lays down four categories of members: Original, Associate, Nominal and Sympathizer. In this article we shall discuss about member of cooperative housing society.

Member of Cooperative Housing Society

In case of Housing Cooperative societies โ€˜Memberโ€™ means a person joining in an application for the Registration of Cooperative Housing Society which is subsequently registered, or a person duly admitted to membership of a Society after Registration and includes Active Member, Associate Member, and Nominal Member.

Original member means an individual/ society, trust, company whose name is included by the society in registration case or admitted as a member of the society after registration. Only such original members name is recorded on the share certificate. In case there are other members along with the original member, the name of the original member is recorded on Sr.No.1. Other membersโ€™ name recorded thereafter serially.

  • An original member is the person whose name appears on the purchase deed of the property.
  • They are registered as shareholders and granted membership in the society.
  • The original memberโ€™s name is recorded as the primary shareholder on the share certificate.
  • To maintain active membership status, they must attend at least one general body meeting every five years and pay maintenance and other society charges on time.

According to Section 2(19)(b) of the Maharashtra Co-Operative Societies Act, 1960, a โ€œAssociate memberโ€ means a member who holds jointly a share of a society with others, but whose name does not stand first in the share certificate. In case of more than one associate members, such associate membersโ€™ names are recorded in the share certificate in the serial order number 3, 4, 5, etc.

  • Associate members are individuals who jointly own the property or shares in the society, with their name appearing after the original memberโ€™s name on the share certificate.
  • They can occupy the residence with the written consent of the original member.
  • Associate members have the right to attend general body meetings, vote, and even contest elections if they meet the ownership criteria. This right can exercised by an associate member if there is no objection from the member.
  • In case the associate member gets elected as a committee member, he becomes office bearer also.
  • In the absence of the member, the associate member can attend the meeting and vote to it.
  • Typically, associate members are spouses, parents, or children of the original member.
  • Associate membership ceases upon the death or resignation of the member but remains valid as long as they own shares or property in the society.
  • A person, who became an Associate member by paying only admission fee, shall not get any rights in voting or election behalf the original member. It is necessary for the Associate member that his share/name is included in the ownership of property for holding share jointly.

Note:

In case of Co-Operative Housing societies promoted under the authorities like MHADA, SRD and SRA, the persons whose name appears as eligible persons in annexure II only becomes the member of that society and the house provided by such Authorities given on ownership will remain in the name of original member for the period of ten years and that cannot be transferred also. Therefore, only whose name appears in Annexure II they only expected to take part in the election. Therefore, the provisions of associate members have been excluded in case of SRA/SRD and MHADA societies.

A member shall be termed as โ€˜Active Memberโ€™ if

  • He has attended at least one General Body Meeting within a consecutive period of five years. Provided that nothing in this clause shall apply to the member whose absence has been condoned by the General Body Meeting of the Society.
  • He has purchased and/or owns the flat / unit in the Society.
  • He has paid the Society maintenance and other charges regularly.

A member who is not an โ€˜Active Memberโ€™ shall be a โ€˜Non-active Memberโ€™.

Society needs to classify all the members as โ€˜Activeโ€™ or Nonactiveโ€™ members at the closing of every financial year. The Society shall communicate to every Non-active member about his/her classification, within 30 days from 31st March of every year as prescribed under the bye-laws as per Appendix 31. The communication should be sent by Registered Post Acknowledgement Due / Speed Post / Hand Delivery / Email.

A member who is classified as a Non-active member can file an appeal at the Deputy Registrar Office within 60 days from the date of communication of such classification.

The โ€˜Non-activeโ€™ member can be reclassified as an โ€˜Active member if He satisfies the conditions laid down under Byelaw no. 22(c).

According to Section 2(19)(c) of the Maharashtra Co-Operative Societies Act, 1960, a โ€œNominal memberโ€ means a person admitted to membership as such after registration in accordance with the bye-laws. Nominal members do not hold any right, title, or interest in the property individually or jointly. Usually, nominal members are subletters, tenants, or licensed caretakers. Nominal members are admitted so that necessary legal actions can be initiated u/s 91 of MCS Act, 1961.

  • Nominal members do not hold any right, title, or interest in the property individually or jointly.
  • They are admitted to membership after registration but are not given any shares in the society.
  • Admittance fee for a nominal member is also Rs 100.
  • Usually, nominal members are subletters, tenants, or licensed caretakers.
  • They have the right to occupy the residence and live in the society but do not participate in general body meetings, elections, or the Managing Committeeโ€™s workings.

Sympathizer member means a person who sympathizes with the objects of the society and is admitted to the society as such.

  • Sympathizer members hold an honorary position and share the societyโ€™s goals and objectives.
  • They do not have voting rights, nor are they allotted shares in society.
  • Sympathizer members often possess expertise in specific fields (e.g., architects, engineers, finance experts) and guide society in their area of specialization.

Besides above defined members there may be corporate members and minor members.

A firm, company or any other body corporate can become the members of a housing society to provide accommodation to their employees. However, government regulations stipulate that more than 50% of the total membership cannot be granted to a company in a housing society. It is to be noted that the Memorandum of Association (MOA) and Article of Association (AOA) of the company should include a clause allowing investment in the housing society. Corporate members have representation in the Managing Committee and the right to vote if they have invested funds in the society.

  • The company should not carry out the business which is against the objects of the society.
  • The company should nominate those who are going to take part in the working of the society behalf the concerned employee/officer
  • The managing committee of such a society should have no more than one-fourth of company members in.
  • Only if the company has invested funds in the society, they have the right to be a part of the committee and the appointed representatives have the right to vote as well.
  • The company is also responsible for informing the society the change in residence occupants and pay monthly contributions to the society.

Minor member cannot enter into any contract. Minors are eligible to become members of a society through their guardian or legal representative. They can participate in property transactions independently after reaching the adulthood i.e. attaining the age of 18 years. The society should not transfer the flats which is in the name of a minor member and the transaction of which is done through the Guardian unless and until, an order from the Competent Court is produced approving such transaction.

Notes:

  • In case shop owners do not come forward to become the members of the society, the same can be informed to the Deputy Registrar who shall inform the shop owners to become the member of the society.
  • If the benefits of common amenities created by the members of the society are taking by the shop owner/flat owner without being the member of the society, then society can take decision on its level regarding not providing such benefits/services to the shop owner/flat owner.
  • Even after giving the membership form and the Managing Committee has accepted such membership, one can be considered to be member and can exercise the rights of the membership only after paying the necessary fee towards the membership.
  • In a co-operative housing society, if a member is holding more than one flats, during election such member can cast only one vote. In spite of owning any number of flats, the person can apply for only one share and also becomes only one membership statutorily, therefore, he get right to cast only one vote.
  • In a Co-operative Housing Society there can be more than one Association/Joint member. Normally no sympathiser member is admitted.

In Rajendra Shandilal & Co. v. State of Maharashtra, AIR 1960 BOM 26 case, the Bombay High Court said that a Builder Member is only another specie of non-beneficial members being entirely creature of the Ownership Flats Act, 1963 mean for itโ€™s own requirement with liberty to hold all unsold flats for sale for contemplated limited purpose inspite of the contrary provisions of the bye-laws of any society and conception of any such society under Section 2(16).

As per recent amendment the Society cannot transfer the Flat to the Nominee unless the testamentary document like probate, succession certificate or release deed of other legal heirs is produced. The nominee will be just a โ€œProvisional Memberโ€ of the Flat until he or other legal heirs produce any testamentary documents. This is a temporary arrangement till the lawful member is taken on record by the society.

A provisional member can attend the general body meeting of the society and also exercise his right to vote in accordance with the provisions of sub section (3) Section 154B-11 of the MCS Act, 1960.

In Karan Vishnu Khandelwal Vs Chairman/Secretary, Vaikunth CHS Ltd ( Writ petition No- 12468 of 2022), the Bombay High Court clarified that a โ€˜Nominee (in whose name a Nomination Form has been validly submitted by the deceased Owner) shall be admitted, only as a provisional member, till legal heir or heirs or a person entitled to the flat and shares in accordance with Succession Law or under Will or testamentary document or admitted as member in place of such deceased member. The Nominee is thus entitled to become only a provisional member who is not eligible to sell the flat till the Society is provided with court order granting ownership to any Legal heir(s).

In Indrani Wahi v. Registrar of Co-operative Societies and Others (Civil Appeal 4930/2006) (“Indrani Wahi Judgment”) case, Indrani Wahi (being a married daughter) was made a nominee member by her father Biswas Ranjan Sengupta. The Deputy Registrar of Co-operative Societies did not accept her membership on the ground that Indrani Wahi being a married daughter did not fall within the definition of ‘family’ under the West Bengal Co-operative Societies Act, 1983. This order was challenged by Indrani Wahi before the Hon’ble High Court of Calcutta and was further appealed before the Hon’ble Supreme Court by Indrani Wahi, wherein the Hon’ble Supreme Court while allowed the transfer of share and interest of her deceased father in the society in favour of Indrani Wahi as a nominee, however, the Hon’ble Supreme Court also specifically observed in this regard that such a transfer in favour of a nominee would have no relevance to the issue of title between the inheritors or successors to the property of the deceased and it would be open to the other members of the family to pursue their case of succession or inheritance, in consonance with law..

Eligibility of membership provisions is contained in Section 22(1) of the Maharashtra Co-op. Societies Act, 1960. Subject to the provisions of section 24, following person shall be admitted as a member of society

  • an individual; who is competent to contract under the Indian Contract Act, 1872. An individual completing the age of 18 years, mentally sound as well as competent to contract under Indian Contract Act 1872.
  • a firm, company or any other body corporate constituted under any law for the time being in force, or a society registered under the Societies Registration Act, 1860;
  • a Co-operative society registered, or deemed to be registered under the MCS Act, 1860;
  • the State Government or the Central Government;
  • a local authority;
  • a public trust registered under any law for the time being in force for the registration of such trusts
  • A Joint Hindu Family, an individual member can represent Joint Hindu Family. All members of such family hold one share in their joint name or in the name of Karta.

A society can admit joint members if they make a declaration in writing that the person whose name stands first in the share certificate shall have right to vote and all the liabilities will be borne jointly and severally by them as provided in the Act, rules and bye-laws.

A minor or a person of unsound mind, inheriting shares and/or interest of the deceased Member in the capital/property of the Society, or if nominated may be eligible for admission to Membership of the Society through his guardian or legal representative on an application in the prescribed form, along with undertakings / declarations, in the prescribed forms, mentioned in the application.

The number of Members in the Society shall be limited to the number of Flats/ Units constructed in the building/buildings. It shall be binding on the committee to restrict the Members to the extent of the number of Flats/Units in the Society.

  1. Applicant who wants to obtain membership should have to fulfill to norms laid down in the Act, Rule and by laws.
  2. Applicant should have fully tendered the value of at least Ten shares of the Society, along with his Application for Membership;
  3. Applicant should have paid the Entrance Fee of Rs. 100/-, along with the Application for Membership;
  4. Applicant should have submitted the application as prescribed, of the particulars in regard to any house, plot or flat owned by him or any of the Members of his family, anywhere in the area of operation of the Society;
  5. Applicant should have submitted undertaking in the prescribed form to the effect that he shall use the flat / unit for the purpose for which it was purchased by him;
  6. Applicant should have furnished an undertaking in the prescribed form, if he / she has no independent source of income;
  7. Applicant should have submitted, along with the application for Membership of the Society, a certified copy of the agreement, duly stamped and registered entered into by him / her/ them with the Promoter Builder or Transferor under Section 4 of the Maharashtra Ownership of Flats Act;
  8. Managing committeeโ€™s approval is necessary for membership application and thereafter approval of the Annual General Body Meeting.
  9. In case of companies, firms, and trusts should have to fulfill above terms and conditions. It is necessary to attach resolution regarding giving rights along with the membership application.
  10. Applicant should have furnished such other undertakings/declarations, in the prescribed forms as are required under any law for the time being in force and such other information as is required under the Bye-laws of the Society along with the application for Membership.
  11. In case of Societies registered under the jurisdiction of special planning Authority like CIDCO / MHADA / SRA / MMRDA etc. the applicant should be eligible person as per the provision of respective Act and the directives of the Govt. / the Planning Authorities, if any.

Note:

The conditions at 4, 5, 6, and 7 above shall not be applicable to the Promoter Builder, applying for Membership of the Society, in respect of the unsold flats.

The expression “member of a family” means a wife, husband, father, mother, son, or unmarried daughter.

  • As per section 23 (1) no society shall, without sufficient cause, refuse admission to membership to any person duly qualified therefore under the provisions of this Act and its bye-laws.
  • As per section 23 (1)(A), any eligible person who has been refused the membership of the society has to tender an application to the registrar together with prescribed payment Cheque.
  • There is a provision to give such application to the office of the Dy./Asstt. Registrar in form H(1) Rule 19-A.
  • Accordingly Registrar, who shall forward the application and amount if any so paid to the society concerned within thirty days from the date of receipt of such application and thereafter if the society fails to communicate any decision to the applicant within 60 days from the date of receipt of such application and if the societyโ€™s decision is not acceptable to them, then there is a provision to appeal with Dy/Asstt. Registrar of co-operative society.
  • So, Society not only receives application of registering membership but they should accept application correspondence of members without excuse and give receipts.
  • After receipts of such complaints application, the secretary of the society should have to make scrutiny of the complaints/ application within 7 days from the date of receipt of application and if there is any requirements of document he should inform in writing to applicant.
  • After receiving the documents from the applicant he should put it before the managing committee and it shall take decision thereof in the coming managing committee meeting. Such decision shall be communicated to concerned member is mandatory.
  • If possible contact with necessary correspondence to the member directly and give guidance. It will help to make decision process speedy and in future there is end to such complaint and no prospective complaint.
  • It is necessary to issue share certificate to each member by registering in the societies register book in the form of โ€˜Iโ€™ and โ€˜Jโ€™ because share certificate is a main document of the member. In such a way if the society did not issue share certificate then by making an application to the Registrar, request may be made to the Registrar to initiate proceeding as per Section 79(2).
  1. Co-operative Housing society has taken decision on membership application within 3 months from the date of receiving application of member. The decision may be affirmative or negative. If the society has not informed affirmative or negative decision regarding membership to the applicant then the applicant has right to make application u/s 22(2) to the Dy. Registrar Co-op. Housing Society for deemed membership and there is a provision of hearing to both the parties and passed legal order.
  2. If any eligible person who has been refused the membership of the society has to make an application to Dy./ Asstt. Registrar co-op. society u/s 23(2) and seek justice. The Dy./Astt. Registrar gives his decision on the said appeal by calling both the partiesโ€™ applicant and housing society.
  3. In above cases, if the decision of court is not in favour of applicant then there is a provision to approach in revision appeal to the Divisional Joint Registrar and can seek justice. Justice can be seeking by admitting writ petition in the Honโ€™ble High Court against the verdict of the Revision Appeal.
  4. It is necessary on the part of the society to take approval of the general body meeting for the challenging the decision in the above serial No. โ€˜1โ€™ and โ€˜2โ€™. Thereby the number of appeals make out of personal rivalry would be minimized.
  5. If the society has not challenged the orders issued by the Registrar, and membership also not given to the concerned member then that it is necessary that such member should have to make an application to the Registrar and the Registrar would issue directives under section 79(2) (A) on it and even there after the society did not obey the directives then by appointing Authorised officer u/s. 79(2)(B) the proceeding of giving membership would be done.

Where a person is refused admission as a member of society, the decision (with the reasons therefore) shall be communicated to that person within fifteen days of the date of the decision, or within three months from the date of receipt of the application for admission, whichever is earlier. If the society does not communicate any decision to the applicant within three months from the date of receipt of such application, the applicant shall be deemed to have been admitted as a member of the society. If any question arises whether a person has become a deemed member or otherwise, the same shall be decided by the Registrar after giving a reasonable opportunity of being heard to all the concerned parties.

It is a mandatory requirement for the Housing Society Management committee under Section 38(1) of the Maharashtra State Cooperative Society Rules 1961 is to maintain the List of Members (Form-I). It shall contain following information of the member:

  • the name, address and occupation of each member ;
  • in the case of a society having share capital, the share held by each member,
  • the date on which each person was admitted a member;
  • the date on which any person ceased to be a member; and
  • such other particulars as may be prescribed.

In case a society has by or under this Act, permitted a member to transfer his share or interest on death to any person, the register shall also show against the member concerned the name of the person entitled to the shire or interest of the member, and the date on which the nomination was recorded.

It is very vital for the managing committee to complete Form โ€“ I in all respects and ensure that all the required forms are completed as soon as possible. This will help both member and managing committee to manage the society work smoothly and in most harmonious way.

Most of the issue of property transfer issue in absence of the nomination can be avoided if the Cooperative Housing Society Management committee members pays the attention to requirement of Form โ€“ I, which needs to be completed soon after the membership is accepted by the Managing committee and his / her shares are transferred / allotted. It is a very cumbersome job for the members and the managing committee to follow the process of transfer of shares and interest in the name of the member claiming the right in absence of the nomination. In case of dispute the members need to follow the path of providing the โ€œProbate form the competent courtโ€ in his / her favour, beside publishing the notice in the local news-papers even though the managing committee knows that the one of the claimant is a legal hire of the deceased member.

According to Section 25 of the MCS Act, 1960 a person shall cease to be a member of a society on his resignation from the membership thereof being accepted, or on the transfer of the whole of his share or interest in the society to another member, or on his death, or removal or expulsion ‘from the society, or where a firm, company, any other corporate body, society or trust is a member on its dissolution or ceasing to exist.

According to Section 25A of the MCS Act, 1960 the committee of a society shall remove from the register of its members the name of a person who has ceased to be a member or who stands disqualified by or under the provisions of this Act for being the member or continuing to be the member of a society: Provided that, if the society does not comply with the requirement of this section, the Registrar shall direct such society to remove the name of such person, and the society shall be bound to comply with such direction.

According to Section 26 of the MCS Act, 1960 no person shall exercise the right of a member of a society, until he has made such payment to the society in respect of membership, or acquired such interest in the society, as may be prescribed by the rules or the bye-laws of such society.

  • A Member may resign from Membership after giving three monthsโ€™ notice in the prescribed form to the Secretary of the Society as provided under Rule 21(1) of the Rules.
  • No resignation of a Member of the Society shall be accepted unless such Member has made payment of the charges payable to the Society in full.
  • Where any charges are found payable by the Member to the Society, the Secretary of the Society shall intimate the same giving full details and reasons of dues thereof to the Member within 15 days of the receipt of the notice of resignation, advising him to make payment thereof within 30 days of the date of intimation.
  • Where there are no charges of the Society outstanding with the Member, the Committee shall accept the resignation of the Member and the Secretary of the Society shall communicate the same to the Member within a period of 3 months from the date of the receipt of the notice of the resignation.
  • Where any resignation is rejected, the Committee shall record the reasons therefore and communicate the same to the Member concerned within three months from the date of receipt of notice of resignation

Bye-law 28 deals with the resignation of Associate Member.

  • An Associate Member may resign his Membership any time by writing the letter of resignation to the Secretary of the Society, through the Member, with whom he held the shares of the Society jointly.
  • The Secretary of the Society shall place the letter of the resignation of the Associate Member, before the meeting of the Committee, held next after the receipt of the letter of the resignation, duly recommended by the Member for acceptance by the Committee.
  • The decision of the Committee, accepting the resignation of the Associate Member shall be communicated by the Secretary of the Society to the Member and his associate Member within 15 days of the decision by the Committee.
  • If the resignation is rejected, the Committee shall record the reasons therefore in the minutes of its meeting and the Secretary shall communicate the same to the Member and his associate Member within the time specified above.
  • If there is a nominal Member, occupying the flat on behalf of a firm, company or any other body corporate, he/she may resign his nominal Membership, at any time, by writing the letter of the resignation to the Secretary of the Society through the firm, the company or any other body corporate, on whose behalf he is occupying the flat.
  • The Secretary of the Society shall place the letter of resignation, before the meeting of the committee, held next after the receipt of the letter of the resignation of the Nominal Member, duly recommended by the firm, the company or any other body corporate for acceptance by the Committee.
  • The decision of the Committee, accepting the resignation shall be communicated by the Secretary of the Society to the firm, company or the body corporate and the nominal Member, within 15 days of the decision by the Committee.
  • If the resignation is rejected, the Committee shall record reasons therefor in the minutes of its meeting and the Secretary shall communicate the same to the firm, company or the body corporate and the nominal Member within the time specified above
  • A sub-letter, licensee, caretaker or possessor of a flat or part thereof, who has been admitted as a nominal Member of the Society may resign his nominal Membership at any time, by writing the letter of the resignation to the Secretary of the Society, through the Member who has been permitted by the Committee to sub-let, give on leave and licence or caretaker basis the flat or part thereof or part with its possession in any other manner.
  • The Secretary of the Society shall place the letter of the resignation before the meeting of the Committee, held next after the receipt of the letter of the resignation duly recommended by the Member concerned for acceptance by the Committee.
  • The decision of the Committee, accepting the resignation shall be communicated by the Secretary of the Society to the Member concerned and his sub-lettee the licensee, the caretaker, or as the case may be, the possessor of the flat or part thereof, within 15 days of the decision by the Committee.
  • If the resignation is rejected, the Committee shall record reasons there for in the minutes of its meeting and the secretary of the Society shall communicate the same to the Member concerned and his sub-lettee, licensee or caretaker etc. within the time specified above.

A Member may be expelled from the. Membership of the Society, if such a Member

  • has persistently failed to pay the charges due to the Society,
  • has willfully deceived the Society by giving false information,
  • has used his flat for immoral purposes or misused it for illegal purposes habitually,
  • has been in the habit of committing breaches of any of the provisions of the byelaws of the Society, which, in the opinion of the Committee, are of serious nature,
  • has furnished false information or omitted to furnish the material information to the Registering Authority at the time of registration of the Society.
  • A Non-Active Member who does not attend at least one meeting of the general body in next five years from the date of classification as Non Active Member.

The cases of expulsion from the Membership of the Society shall be dealt with in the manner provided under Section 35 of the Act, read with Rule 28 and 29 of MSCS Rules.

Expulsion from Membership may involve forfeiture of the shares held by the Member. Where the Committee decides that expulsions from Membership should also involve forfeiture of the shares, it shall make necessary reference to the proposed forfeiture of the shares in the notice to be issued under Rule 29 of the Rules.

The Member, duly expelled from Membership of the Society, shall cease to be the Member of the Society, with effect from the date on which the resolution of expulsion from the Membership of the Society is approved by the Registering Authority’. The forfeiture of shares may take effect simultaneously with expulsion. Handing over vacant possession of the flat by the expelled Member.

The Member, who has been duly expelled from the Membership of the Society, shall not be entitled to continue in occupation of his flat and he shall arrange to hand over peaceful and vacant possession of his flat to the Secretary of the Society, within such period as the Committee may allow. On his failure to do so, he shall be liable to be evicted from his flat. Acquisition of the Shares and interest of the expelled Member.

If the meeting of the general body of the Society has decided not to forfeit the shares, the interest of the expelled Member in the capital/property of the Society and the value thereof shall be acquired by the Society and the value thereof shall be paid to the expelled Member, within 3 months of his handing over possession of his flat or his eviction from it, after following the procedure as laid down under the bye-law No. 66 in respect of payment of the value of the shares and interest in the capital/property of the Society acquired by the Society.

No Member of the Society, who has been expelled from its Membership, shall be eligible for readmission to Membership in the Society, until expiry of the period of one year from the date of his expulsion, provided that on the recommendations of the meetings of the general body of the Society, the expelled Member may be re admitted to its Membership, as a special case before the expiry of the period of one year, with the prior permission of the Registering Authority.

In a cooperative society, the types of members can typically be classified based on their roles, responsibilities, and contributions to the organization. The cooperative society typically operates on democratic principles, with active members having the most influence through voting and decision-making rights. Other categories of members, such as nominal or patron members, provide different levels of engagement, financial contributions, or use of services. The diversity of membership types helps the cooperative maintain its flexibility and sustainability while ensuring that all members benefit fairly based on their participation.

  • Rights and Liabilities of a Member of Cooperative Housing Society
  • Nomination in Cooperative Housing Society
  • Managing Committee of Cooperative Housing Society
  • Duties and Responsibilities of Committee of Cooperative Housing Society
  • Working of Committee of Cooperative Housing Society
  • Meetings of Cooperative Housing Society
  • Elections of Cooperative Housing Society
  • Financial Aspects of Cooperative Housing Society
  • Deemed Conveyance
  • Redevelopment