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Everything you need to know about Defaulter Members

What are the powers, functions, and duties of the Committee in the context of Society Maintenance?

As specified in the bye laws (112, 138), the following powers, functions, and duties are vested with society committee:

  • To consider and recommend to the general meeting rates of contribution – Bye-laws (13 (a) 13 (c).
  • To consider all matters relating to the creation, investment, utilization of the repairs & maintenance, reserve funds and slinky funds – Bye-laws 12 (a) (i) & (ii) 14 (a), (b) & (c).
  • With respect to every flat, it needs to fix the Society’s charges on the basis of the proportion laid down under the Bye-laws 67 (a) & 67 (b).
  • To review the position of recovery of the charges due to the Society from members and to initiate action against defaulted charges of the society. Bye-laws 70.
  • To verify the compliances to provisions related to charging of interest in case of any defaulters of the Society. Bye-laws 70.
  • To deal with cases of expulsion of Members Bye-laws 49 to 54.
  • To Prepare and issue demand notices / bills for payment to the Society’s charges. Bye-laws 69.
What constitutes a Maintenance Bill?

As mentioned in the Bye-laws 65, 66, 67, 68, 69 & 154–15, 16; a maintenance bill has the following items :

  • Composition of the charges of the Society
  • Breakup service charges of the Society.
  • Sharing of the Society’s charged by the members.
  • Repairs and maintenance to be carried out by society.
  • Payment of the society charged .
What are the rights and duties of a member with reference to Society utilities’ Maintenance?
  • No Member shall be eligible for being appointed, nominated, elected, or co-opted for being a Member of a Committee, if he is a defaulter of the society.
  • It shall be the duty of the Member of the society to pay the dues of the society within time as decided by society in its general meeting.
  • Member shall perform his duties as provided in this Act, rules and bye-laws.
  • He / She has paid the Society Maintenance Service and other charge regularly.
Who is a defaulter member?

Any Member who fails to pay off the dues of the society within three months from the date of service is a defaulter.

What is the legal procedure to collect the dues from the defaulter member of the society?

Firstly a written notice is to be served by post under a certificate of posting, informing and demanding the payment of dues. Non-adherence to this would implicate strict measures. In case of non-payment a resolution has to be passed in the general meeting for the same and the defaulter needs to be given a final warning for the same. 

If the dues are still not recovered, apply to the Office of the Registrar by submitting all the necessary documents and the prescribed legal fee. Then the case is under “Review of cases regarding default in payment of Society Charges” and is investigated by the Registrar. On the inspection and proof of the truth, a recovery certificate is then issued by the Registrar’s Office.

Defaulters also accrue interest on defaulted charges, which may go as much as 21%

Important documents to collect due payment as guided by law:

Here is a list of all the essential documents required to be approved and submitted at various stages of default dues as mentioned in Section (154-B-29) , Rule 86 (A to F) of 1961):-

  • Resolution by the society to recovers dues from the defaulter member
  • Extract of account of dues.
  • Original Challan deposited by member if any.
  • Copy of Notice given by society (162 bye-laws)
  • Copy of Notice by legal advisor appointed under bye laws [172 (f)] of the society.
  • Application for grant of certificate for recovery.
  • Original documents showing kept on safe.
  • Revision U/sec. 154
The Process thereafter:

After the submission of all the papers, here is what happens to the defaulter member:

The Procedure for attachment for sale of property is initiated (Section 156 MCS Act & Rules).

The Expulsion of members takes place (Sec. 35 of MCS 1960)

A Notice of transfer of shares and interest in the capital / property of the society is issued (bye–laws 38)

The voting powers of the member(s) are revoked.

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