I saw with interest the amendment which need to be made in the printed bye laws in order to comply with the amended provisions of the Maharashtra Co-operative Societies Act, as amended.
Many societies have adopted the printed bye laws as supplied by the Housing Federation. Your suggestions came to their notice afterwards. How can they now effect the amendment. Can it be done by means of an order from the Registrar of Co-op Societies published in the Government Gazettee?
What is the correction of associate member as per the amended provisions of the Act? Can he attend the general meetings in the absence of the original member and take part in the discussions OR is he allowed to simply record his vote on any resolution?
If he is not a co-owner of the property, i.e., if his name does not appear in the Agreement for purchase of the house, can he contest and become member of the managing committee?
Your early response will be highly appreciated, as I am an active member of the housing society where I have a house of my own.
I C Naik
T.P.Viswanathan has two questions.
One is how the bye-laws which are recently registered as per printed version supplied by the district housing federation be amended and other is what changes need to be made concerning the Associate member.
Associate Membership in housing societies is important. At the same time the Authorities have confused its regulations to the fullest extent. Cases of denial of a bare minimum right of participating in general body meeting where the member is absent as well as the people in Authorities aiding the Associate member grabbing the member’s wholly owned flat are also being reported these days. The housing society management must attend this issue with extreme care and ensure Bye-Law provisions are properly made.
First and foremost understand the flaws in Model Bye-Laws 2014 concerning Associate Member. A large majority of members should participate in this process. You can discuss my post.
1.For a member of CHS participation in the affairs of the society is possible by expressing his views in general body meeting unless he joins the committee. It is possible that a member may not be able to make it to each and every general body meeting. Proxy is not allowed in general body meeting like the company meetings. So the MCS Act 1960 U/S 2(19) defines an Associate member to be one whose name appears on share certificate after the main member’s name. The housing societies should provide for the same facility for every member if he so wishes to appoint an Associate member by paying entrance fees of Rs 100/- . Model Bye-Laws does not permit this facility in view of Clause (xxiv)(b) of Bye-Law No 3. This should be substituted by the exact text as per Section 2(19)(b) of the MCS Act 1960.
2.Till the amendment to the MCS Act 1960 in 1986 the Associate Members/Nominal were not allowed to have any rights of the main members U/S 27(8). Now under Section 24(2) Associates and Nominal can be conferred any rights of main member provided the registered bye-laws so permit. The members should discuss consequences/need of Associate members joining the Committee and if majority members agree Bye-Laws can be amended to empower the main member to nominate Associate to contest election or be co-opted as a member of the Committee instead of himself.
3.As per Bye-Law No 117(d) where a main member permits Associate to contest election he has to give up participation in the management of the affairs of the society by executing an undertaking in these words“I further declare that if Shri/Shrimati…………gets elected and joins as a committee member then during such term I shall not participate in any manner in general meeting of the society or in election process of the Society [Appendix 10A ]. Make sure to add a second proviso to Bye-Law No 3(xxiv)(a)(ii) reading as “Provided further that in case of a member executing the undertaking as per Appendix 10A compliance of member’s duty to attend general body meeting by the Associate member shall be deemed to be the compliance by the member”
4.Bye-Law No 25 restricts the rights of Associate members to voting in general body meeting as per Section 27(2). A proviso need to be added as under. Provided that a member shall be free to nominate his/her Associate member to Committee in accordance with Bye-Law No 117.
5.The MCS Act 1960 intends management of cooperative societies to be simple and hence the scheme of Bye-Laws to be framed by members themselves so that they can manage the affairs with ease and attain the objects to the maximum satisfaction of the maximum number of members. Transfer of membership has also been made possible to do in such a manner that the management does not get entangled in to complex succession issues and family feuds. U/S 30 read with Rules 25/26 a simple Nomination process has been prescribed which has been made complex under Model Bye-Laws 2014. Few amendments are advisable.
a.The very first sentence of Bye-Law No 32 has added complexities without making consequential changes in other Bye-Laws. This sentence reads as under “A Member and / or Associate Member of the Society may by writing under his hand, in the prescribed form, nominate a person or persons to whom the whole or part of the shares and / or interest of the Member in the capital / property of the Society shall be transferred in the event of his death” This should be substituted by “A Member and / or Associate Member of the Society may by writing under his hand, in the prescribed form, nominate a person or persons to whom the whole or part of the shares and / or interest of the Member and that of his/her Associate member if any, in the capital / property of the Society shall be transferred in the event of his death”
b.Consequent upon above amendment, in Bye-Law No 34 following phrase needs to be deleted. “and in proportion with the shares and interest held by the deceased Member, in case property is purchased by Member and associate Member jointly.”
c.Following note appended to Bye-Law No 34 should be deleted “Note:- In case of acquiring Membership on the basis of Nomination, such Member shall hold the flat / unit in ‘trust’ till all the Legal Heirs are brought on record and shall not have the right to ownership and shall not create third party interest or alienation in any way whatsoever.” The reason is it complicates the management of succession and the Committee should be free to go by nomination I,e, the wish of the member. As for law-full succession other laws should be handled by the members’ relatives themselves. In any case the Courts have also held the nominees as trustees bu this note adds to the responsibility of the managing committee not contemplated under Bye-Laws. It becomes a drag on the management resources and ultimately eating away management time which should be equitably accessible to every member.
d.For transfer of co-owned properties there is a specific provision in the Transfer of Property Act namely Section 44 reading as under:
Transfer by one co-owner
Where one of two or more co-owners of immovable property legally competent in that behalf transfers his share of such property or any interest therein, the transferee acquires, as to such share or interest, and so far as is necessary to give, effect to the transfer, the transferor’s right to joint possession or other common or part enjoyment of the property, and to enforce a partition of the same’ but subject to the conditions and liabilities affecting at the date of the transfer, the share or interest so transferred.
Where the transferee of a share of a dwelling-house belonging to an undivided family is not a member of the family, nothing in this section shall be deemed to entitle him to joint possession or other common or part enjoyment of the house.
These amendments do not entail any change in prescribed forms as they suit more to the Bye-Laws as amended as explained above.
“Associate membership” under Model Bye-Laws 2014 has been given a status at par with main member. It creates two entities to be dealt with by the managing committee in respect of one unit. The MCS Act 1960 does not intent this complexity. Managing committee has far complex responsibilities of attaining objects of housing society namely providing common amenities and services. It is better saved of complications concerning the entity the housing society.
Amedment procedure is given in Bye-Law No 166. Its clause (iii) reads as under: “(iii) the making, alteration or abrogation is Approved and Registered by the Registering Authority.”
The wording gives a false impression that making, alteration or abrogation of Bye-Laws require approval of the Registrar. A simple objective of scrutiny by the Registrar is that he must satify that the Bye-Laws are not contrary to provision of the Act or rules. It is nowhere near to approval in the sense of examining if they are good or bad for members as that is to be decided by the 2/3 majority members.
It is therefore advisable that this fact is brought in to the Bye-Laws. This clause may be substituted by the following namely
(iii) “the making, alteration or abrogation is Approved and Registered by the Registering Authority as nothing therein found to be contradictory to the applicable provisions of the Act and the rules made there under.”