My society informed on 21stMarch 2019 of keeping a get together on 30thMarch 2019. Fifty percent of the estimated expenditure of Rs.600 was proposed to be subsidized from the society’s account. I wish to know if the BYE LAWS permits the society to spend funds for such cultural activities. Society’s Name: The Vitrag CHS Ltd; situated at Plot No.107, Jawahar Nagar, Road no.5, Goregaon (West), Mumbai – 400 104, bearing registration no.BOM/HSG 1060 DTD: 09.04.1984-85.
I C Naik
Facts and question is well laid out.
The bye laws are contracts in terse the members and the Management Committee as also the Society as a body corporate is bound to follow. If there is a violation every member is individually and collectively liable to make the loss good to the Society.
Not many cooperators are aware that the Management Committee is responsible to collect from members all Society Charges incurred by them as well as the contribution specified in bye-laws to establish specified funds. In fact almost all housing societies flout this rule to be a popular committee by collecting lower amounts. The short fall is made good by applying incorrect accounting policy of applying interest amount to Income and expenditure Account to which member collections are also credited as income. This is in a nut shell. If you are serious about understanding unintended fraud by Committees you may go through my article inCooperative Coffee Shop
You are well come to resume the debate if you are not satisfied…
Your question is good and there are people who disagree with the aforesaid rationale.