The state government on Thursday abolished a condition that requires people who volunteer as office bearers in cooperative housing societies to furnish an indemnity bond taking responsibility of all acts and omissions that may cause any loss to the society.

Cooperation secretary Rajgopal Deora told HT on Friday that the state issued a government resolution to do away with the condition – the M-20 bond, in legal parlance – on Thursday night. The decision was not published till Friday evening.

The M-20 bond is an undertaking given by each managing committee member within 15 days of his assuming office. It says, “I shall be jointly and severally responsible for all decisions taken by the managing committee during its term relating to the business of the society and shall be jointly and severally responsible for all acts and omissions detrimental to the interest of the society…”

Housing societies were brought under the ambit of this rule in 2001.

By implication, any person who signed society documents without signing an M-20 bond on assuming office was liable for prosecution for serious crimes including fraud, cheating, misrepresentation and forgery.

There are more than 90,000 cooperative societies in the state of which about 50,000 are in Mumbai and Thane. More than 30% of these are run by state appointed administrators. The state takes control of the society when the committee is dissolved on legal grounds or members resign and others are not willing to fill up vacancies.

Deora said that the decision would encourage people willing to take up the honorary job. “In absence of M-20 bonds and in case of any wrongdoing, the aggrieved parties could take up the issues with competent authorities,” he said.

The initiative was planned by CM Prithviraj Chavan and cooperative minister Harshvardan Patil after receiving feedback that people did not come forward to run societies.

But a few housing society activists were upset with the decision. “The M-20 bond was a deterrent against any wrongdoing in the society. I demand that the state now introduce a more effective mechanism to check corruption and inefficiency in housing societies,” said activist JB Patel. He said that the government would also lose revenue that it earned through stamping of bonds.

Courtsey: HT

I C Naik commented as under:

The condition of Execution of an Indemnity Bond was imposed under Section731AB of the Maharashtra Cooperative Societies ACT 1960 which was inserted in 2000 vide Section 3 of the MAH. ACT 41.The legislature was very clear about what it was doing and declared that failure of executing such a bond within specified period (specified by the Executive 15 days initially which was relaxed to 30 days) unseats the member after expiry of the specified period  Form without any further act.M20 was later specified under Rule 58 effective 2001.

Special CBI judge in Delhi has sentenced 11 accused to differentiated jail terms in the famous Rs 4000 crore Pitampura Rangmahal cooperative group housing society scam.

Mr. Narayan Diwakar former registrar cooperative societies and the mastermind of the scam would have to spend a year behind bars.

The six other govt functionaries have also been sentenced to a year in jail each.

The CBI court has also imposed a fine of Rs. 2000 on all the seven govt. employees involved in the scam. All of them have been found guilty of cheating, forgery and criminal conspiracy under the IPC and offences covered under the PCA.

Additionally, the court has sentenced 4 city residents to three years in jail each.

Sources say the Rangmahal case stands out in that it is the first case to be decided by the court. The CBI had filed scores of charge sheets already in 2005 in the scam, sources add.

The convicts had forged and doctored documents and got a huge plot fraudulently allotted from the DDA for the Rangmahal CGHS.

The Bombay High Court has ruled that a housing society cannot be forced to give a builder the rights of redevelopment if there existed no contract between them.

Gopi Gorwani who had earlier been denied redevelopment rights by a trial court had appealed the decision in the higher court.

As the builder could not marshal enough evidence to support his argument that there was a contract between him and the society, his appeal was dismissed by the High Court.

A special CBI judge in Delhi has found 11 persons guilty of cheating, forgery and criminal conspiracy under the Indian penal code and under the prevention of corruption act in an Rs 4000 crore cooperative housing scam.

Of the 11 convicted persons, seven are public servants. The latter include registrar cooperative societies, joint registrar, assistant registrar (audit) and 4 other officials.

The CBI had filed charge-sheets in the major Rangmahal cooperative group housing society scam in the year 2005. The case had attracted a great deal of media attention.

Sources say this is the first major fraud case that has finally been decided.

The department of cooperation, Maharashtra govt has begun what is called darbar (informal court) at places in Mumbai. The idea is to enable people with complaints against housing cooperative societies to get their problems solved on the spot without going from pillar to post.

Sources say the experiment has found favour with the people as three meetings of darbar altogether so far have already addressed hundreds of complaints. The exercise has begun early this year and would likely become a permanent mechanism for tackling the housing cooperative society’s related problem in the city.

Sources add most of the housing cooperative societies are mired in corruption and people have lost confidence in them.  The new experiment is expected to improve their image.

Observers   say the move is welcome as it could save the image of the housing cooperatives from being hammered beyond repair.

A CBI court in Delhi has put on trial Narayan Diwakar the mastermind of the several thousand crore cooperative group housing society scam and some others on charges of criminal conspiracy, cheating and forgery.

Mr Diwakar a former registrar of the Avas Deep Cooperative Group Housing Society and his associates had revived the dead cooperative housing societies using forged papers and documents.

There are allegations that they made a representation to the DDA on the basis of forged papers and got    a huge amount of land allotted to their fake housing society.

According to the CBI judge, a prima facie case is made out against them.

A source familiar with the housing scene in the cooperative sector says such frauds are legion and there is a need to remove the abominable filth.

Karnataka Cooperative official S P Mahantesh who had been tasked with auditing the cooperative societies in Bangalore died in the hospital. He had been earlier brutally attacked.

Gossip is rife that he had been a victim of the cooperative mafia and the police would not do an effective job as they are subject to undesirable influences.

Mahantesh had exposed several scams involving irregular allotments made by the cooperative housing societies.

Karnataka Chief Minister has assured that the police would soon nab the criminals responsible for Mahantesh’s murder and all possible steps would be taken to ensure the security of those who expose scandals.

Sources say most of the cooperative societies are synonymous with graft and fraudulent activities. The Mafiosi controlling them are so powerful that they can go to any extent to get rid of the people who are exposing them.

Mahantesh has recently been involved in exposing scandals in several cooperative societies including the BEML Employees Cooperative Society.

There have recently been reports that several housing cooperative societies have been indulging in serious irregularities and corrupt practices. The murderous attack on auditor Mahantesh needs to be viewed against this background.

The directorate of co-operative audit, where Mahantesh worked, looks beyond routine audit of societies and probes administrative lapses, deviation from bylaws and discharge of responsibilities by boards. Mahantesh is in charge of auditing documents of several housing co-operative societies which have allegedly broken rules in site allotments.

In another incident a director of a cooperative bank was killed by unidentified men in Chakra village in Western Uttar Pradesh, according to the police.  Police is investigating the matter and is at work trying to nab the criminals.

Members of Tarapore Towers in suburban Oshiwara, built to provide affordable housing to serving and retired defence personnel, want Maharashtra Government’s intervention to check alleged irregularities, including purported violation of lease deed norms.

Members of the society, including some retired Army officers, in a memorandum to Minister for Cooperatives and Parliamentary Affairs, Harshwardhan Patil, sought action from the government to check “criminalities, illegalities and financial irregularities” since the present Managing Committee assumed office in 2007.

“This society was formed by the Army Welfare Housing Organisation to provide dwelling units to serving or retired defence personnel and their widows at low cost,” a member said. It was a welfare scheme with MHADA leasing the land for construction, he added.

The Delhi High Court has issued summons to the Registrar, Co-operative Societies for not clearing names of eligible members, who have been waiting to occupy flats in various group housing societies. Directing the Registrar of the Co-operative Group Housing Societies to appear in person , a bench of justices Pradeep Nandrajog and S P Garg asked him to explain the delay in clearing names of members in various societies in Dwaraka.

“We direct the personal presence of Registrar Co-operative Societies in the court along with the relevant record, in the company of the sub-ordinate officers who have dealt with the relevant files,” the bench noted.
The High Court also pulled up the senior most officer for not complying with its previous orders to clear the names of eligible members as they have taken loans from various banks but did not get the possession.
“Enough is enough, you cannot hold the court to ransom. We will make him to do his home work here by making him sit in a corner of the court and finish his work,” the court said.
The court’s order came after an application filed by a group of members of ‘Vasudhara Society’ alleging that the office of Registrar has not cleared the names for 67 flats despite the fact that they are eligible.
According to them, the construction of the society was done six years ago and CBI has also given clearance to it after investigating a Rs 4,000 crore housing scam following which the court had directed the registrar office to allot the flats but nothing has been done so far.
More than 100 housing societies had come under the scanner of CBI, probing a housing scam unearthed in 2005, but after a few years the agency had given clearance to majority of the societies, following which the court had directed the registrar’s office to allot the flats to genuine members.
In an FIR in March 2005, CBI had named some officials of the registrar office accusing them of having misused their official position to have fraudulently revived a group housing society registered in 1983 and taking a plot from the government, causing loss to the exchequer.
The CBI had registered a case following the High Court directive.

Karnataka Government has ordered a probe into the affairs of 112 private housing cooperative societies in the wake of complaints of alleged irregularities committed by them, Minister for Cooperation, Laxman Savadi, said on Wednesday.

The government has received complaints on 81 societies in Bangalore city and 31 in Mysore over alleged irregularities in allotment of sites and also financial management, he told reporters in Banglore.

The Registrar of Cooperative Societies has been asked to submit a report within three months on these societies, the minister said.

Notices have been issued to Minister for Cooperation, Laxman Savadi, and Legislature Employees Housing Cooperative society in view of the complaints received against them, Savadi said.