Formation of Co-operative Housing Society

Formation of Co-operative Housing Societies in Maharashtra: A Comprehensive Guide

In Maharashtra, the formation of a Co-operative Housing Society is a common practice for developers and builders. There are limited options available for managing the affairs of a building, such as Condominium, Private Limited Company, and Co-operative Society. Among these, the Co-operative Housing Society is often the most practical and widely adopted structure, especially for residential buildings.

Types of Co-operative Housing Societies

There are four main types of Co-operative Housing Societies that may be formed in relation to housing projects:

1. Open Plot Type Societies (Tenant Ownership): Members purchase or lease a plot of land and construct the building themselves. This is less common due to bureaucratic delays.
2. Flat Owners Societies (Tenant Copartnership): This type of society is formed when a builder constructs flats and sells them to flat owners.
3. Tenant Societies: A society formed by a landlord for tenants residing in the property.
4. Housing Board Societies: Societies formed by allottees of flats constructed by housing board authorities like the Pune Housing and Development Board.

Each type of society follows a distinct procedure for registration, and members are often unaware of the steps involved.

Key Steps in the Formation of a Co-operative Housing Society

1. Electing the Chief Promoter:
   • The process begins with a meeting of the promoters, during which a Chief Promoter is elected. The builder typically assumes this role under the Flat Owners Society type.
   • The meeting must provide at least a 14-day notice to all promoters.
2. Deciding on the Society’s Name:
   • The name of the society is proposed and reserved. At least 10 promoters (including the builder, flat purchasers, or family members) must sign the name reservation application.
3. Collection of Share Capital and Fees:
   • Once the name is reserved, the Chief Promoter must open a bank account for the society and deposit the share capital and entrance fees collected from the promoters.
   • The amount cannot be withdrawn until the society is registered.
4. Submission of Registration Documents:
   • The registration proposal must be submitted within 3 months of the name reservation. The required documents include:
     1. Application for registration (Form A).
     2. Information about the society (Statement B).
     3. Details of promoter members (Statement C).
     4. Statement of accounts.
     5. Model byelaws.
     6. Bank balance certificate.
     7. Payment of registration fee (Rs. 2500).
     8. Title clearance certificate.
     9. Approved building plan.
     10. Completion certificate (if applicable).
     11. Affidavit from promoter members on their residence.
     12. Affidavit from the Chief Promoter.
     13. Certified copy of the sale agreements.
     14. Authority letter from companies or firms (if applicable).
     15. List of at least 60% of flat holders.
5. Registration and Legal Entity Status:
   • Upon successful submission and verification of documents, the Registrar registers the society, giving it legal status.
   • The society then operates as a separate legal entity, managed by an elected managing committee, which handles the society’s affairs.
6. Member Rights and Voting:
   • In a Co-operative Society, each member has one vote, irrespective of the capital contribution. This ensures equal participation in decision-making.

Challenges in the Registration Process

The formation of a Co-operative Housing Society can be a complicated process, especially for those unfamiliar with the legal and bureaucratic requirements. Developers and flat purchasers often face delays due to procedural issues or incomplete documentation. To avoid these hurdles, builders often act as guides to help the members navigate through the system.

Special Considerations

• In case the number of members is less than 10, special permission from the government must be sought.
• For societies formed under specific conditions (e.g., flat owners), preference is given to forming a private limited company if a single member intends to acquire the majority of flats.

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