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Monday, November 12, 2012

Why,When and How to question your housing society

In my previous two blogs,i listed out some factors that one should keep in mind while rummaging for your dream home and also if you are looking at real estate as an investment option.In this post i will present some information not many property owners are aware of.A lot of information in this post is presented from an excellent article published in Economic Times earlier.

Wondering how to question your society read on

                             Search Google for property owner grievances and you can easily come across thousands of posts as :
"We've been living in this building where a handful of people, including me and my husband, have been questioning the way this building is run, and it has not gone down with the management."
                           This made me wonder whether there is a provisioning in our law that empowers the owners to question the working of the housing society and then i came across this wonderful article in Economic times that gives you in and out of such information.As a member of a housing society,you have the right to know about its functioning and call it into question if you observe any irregularities.Let me start off by presenting a statistical fact: approximately 500 crores is collected by housing societies across the country in a month from their residents.The housing societies collect money from its residents as maintenance charges and thus it is  paramount to know whether these are used for your benefit.You should ensure that the office bearers do not indulge in corrupt practices
                             Apart from financial dealings,there may be a host of other factors that may crop up from time to time.Issues such as whether residents are allowed to keep pets,levying of unreasonable charges,unreasonable penalty charges,fraudulent practices in society elections;the list just keeps growing.As a member,you should be aware of your rights and should know which forum to approach in case of any violation.Not many people have the fortitude to challenge and pick up a fight with the office bearers.After all we are mango people in a banana republic,aren't we.A lot of people would prefer to pay a few extra bucks rather than be involved in all these hassles;a few irregularities here and there,who really cares.
                            Few people who garner the courage to take the fight against the corrupt management find themselves in an unequal battle.While the individual has to use up his personal resources,management has opulent resources at its disposal.Quite ironically these funds are raised directly or indirectly from the society residents.A bit of awareness and knowledge of your constitutional rights can be your Bramhastra in such a battle.All the documents pertaining to the working of the housing society come under the provisions of Right To Information Act.As a member you have the right to demand for such information as cheques issued/received,bank account statements,tenders,contracts,share certificates,investments and so on.You can also approach the RTI officer if the society management refuses to furnish any information that you ought to know.
                            The rules that govern the housing societies vary across different states.The activities are regulated through the respective Cooperative Societies Act and Cooperative Societies Rules administered by the Registrar of Cooperative Societies appointed by the Government.These Acts lay down the basis on how the housing societies must function.That being said,individual societies are free to adopt these laws in total or modify them as per requirement.Thus,there is a level of flexibility offered to housing societies.What is inflexible is that all these modifications must be submitted to the Registrar of Societies.The society must clearly mention when and how the annual general meeting will be held every year.Further these laws mention that the society elections must be held annually and must be a fair process.All the members of the societies have the right to vote and can also nominate themselves to be elected as the chairman.
                           There are also specific regulations laid out on how the society funds shall be used.For instance,funds for maintenance and repair should be used for any repair work or alterations that are needed and if there is no such need immediately,should be used to create a corpus that can aid in future.More importantly,the society's accounts must be subjected to audits by third party,Registrar and even by the members of society on demand.An auditor can be appointed by the society from a panel of certified auditors maintained by the Registrar.The auditor is required for record keeping,compliance of the Act,rules and bye-laws, and the profitability of the society.This should be included in the annual accounts of the society and should be shared with the members during the annual general meeting.
                           Now the million dollar question is that once you observe any irregularities,what can you do about it.A list of common complaints are : Issues with the maintenance of the society funds, unreasonable fines levied on some members,issues with utilization and investment of funds,collection of unjustified charges,misuse of common areas,structural changes by residents especially by influential office bearers without any approval,no annual meetings held,denying information when required by members,proper procedure not followed in general meetings and so on.The first point of contact is the housing society itself.When a member has a problem with another member,he can lodge his grievance with the managing society.There is also a prescribed time within which the society has to reply.If the member is unsatisfied with the response, he can then take up the matter with Registrar of Societies.If the matter is still not resolved,an individual can approach a cooperative court.A Civil court can be the last option one can consider,but taking a matter to a civil court can be both time and resource consuming.Other institutions such as a Municipal Corporation can also be approached if there is any issue with the structure or construction of the building or use of resources such as water supply.It may also be very beneficial if you can involve a number of other residents before approaching any of the above mentioned institutions.A larger group of residents with a common grievance can only strengthen your case.
                          To sum it up,i feel the RTI Act when exercised properly is a great tool if you want to ensure that your housing society is free from any form of corruption.Also many of the problems can be resolved in the incipient stage if addressed properly by the society.If not you always have other authorities that you can approach with all your grievances.A bit of awareness and mettle is all that you need.


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