By I C Naik
MAHA-CHS a Regulatory Regime (for brevity the MCHSRR) is getting ready to welcome the family membership through HUF which has now been conferred a right to own a family flat as its original member in the name of HUF[1].
As is not well perceived that, a Cooperative Housing Society (in Maharashtra MAHA-CHS)[2] is an incorporated body of like-minded flat owners united voluntarily to operate as an autonomous association of persons, with a view to meet their common needs and aspirations through a jointly owned and democratically controlled enterprise and adhering to the co-operative principles and values with the objects namely;
(i) to provide its Members with open plots for housing, dwelling houses or flats ; or
(ii) if open plots, the dwelling houses or flats are already acquired, to provide its Members common amenities and services and
(iii) to demolish existing buildings and reconstruct or to construct additional tenements or premises by using potential of the land.
Membership of a cooperative society is acquired by a person[3] either by joining as a promoter in an application for registration of the society or by getting duly[4] admitted to the membership after the registration.
MAHA-CHS is essentially a vehicle to enable middle class families own a self contained dwelling unit also an opportunity of a community living despite huge paucity of land. Regrettably HUF has been denied this privilege perhaps because provisions of cooperative societies were common to all classes including housing societies. This anomaly is now being addressed. We examine how this is being achieved?
The Maharashtra cooperative societies Act 1960 (in short the MCS Act) has been amended by the Maharashtra Co-operative Societies (Amendment) Act, 2019 with effect from 9th March 2019 in short “the MAHA-CHS Amendment” because an exclusive “CHAPTER XIII-B CO-OPERATIVE HOUSING SOCIETIES” is inserted in the MCS Act .This Chapter consists of Section154B and Sections 154B-1 to 154B-31.
Section 154B is extremely important to refer to in most situations. It has two Sub-sections: (1) listing certain provisions of the MCS Act which shall apply mutatis mutandis to the housing societies and (2) listing certain provisions which shall not apply to the housing societies.
The term “Member” of a cooperative society[5] is now defined by two provisions of the MCS Act. Clause (19) of Section 2 in “Chapter 1: Preliminaries” has 4 sub-clauses [(a), (a-1), (b) and (c)]: where in Clause (a) defines the term “member” namely:
(a) “member” means a person joining in an application for the registration of a cooperative society which is subsequently registered, or a person duly 4 admitted to membership of a society after registration and includes a nominal, or associate member;
Clause (18) of Section 154B-1 in Chapter “Chapter XIII-B Co-Operative Housing Societies” defines three categories of members in sub-clauses [(a)(b)& (c)] besides the original member[6] of MAHA-CHS:
“Member” means a person joining in an application for the registration of a housing society which is subsequently registered, or a person duly4 admitted to Membership of a society after its registration and includes associate or joint or provisional Member
It should be very carefully noted that under both the definitions of “a member”, the common term is “person”[7]. Here lies the secret of HUF’s membership in housing societies.[8] Like the term “member” the term “person” is also defined vide two provisions of the MCS Act. Section 22 (1) has listed the entities eligible to become members of a cooperative society namely those specified in its Sub-Clauses (a) to (g). Validity of the definition of person as per General Clauses Act 1897 is made irreverent. In case of housing societies Section 154B -1 specifies (12) entities in the definition of the term Person[9] which includes HUF. Section 22 is no longer applicable to housing societies after 9th March 2019 as per Section 154B (2).
One can imagine a very large number of existing individual members in many housing societies rushing to switch over to HUF membership. The reason is membership to HUF should obviate the need to get in to nomination process and the flat will continue as a family property from generation to generation with the KARTA at all relevant times the person in charge.
Admission to membership of MAHA CHS is fortunately governed by requirements of the registered bye-laws of the concerned C H S and there is the least interference of authorities through the nuisance of adhering to bureaucratic rules and notifications. The registered bye-laws of the concerned C H S will have of course to be amended to provide for the procedure to transfer individual membership to the HUF. This is not a big hassle at all. It is a matter of procedure. A resolution in general body meeting and registration thereof with the office of the Registrar of cooperative societies in the concerned ward.
[1] Under Hindu Law, an HUF is a family which consists of all persons lineally descended from a common ancestor and includes their wives and unmarried daughters. An HUF cannot be created under a contract it is created automatically in a Hindu Family. Jain and Sikh families even though are not governed by the Hindu Law, but they are treated as HUF under the Act. There should be a joint family property which consists of ancestral property, property acquired with the aid of ancestral property and property transferred by its members. The expression “Hindu Undivided Family” has not defined under the Income Tax Act or in any other statute. When we dissect – essentials are (1) One should be Hindu, Jain, Sikh and Buddhist-considered as Hindus but not Muslims nor Christians; (ii) There should be a family i.e group of persons – more than one and (iii) They should be undivided i.e. living jointly (not necessarily under one roof) and having commonness amongst them. All these three essentials are cumulative. It is a body consisting of persons lineally descended from a common ancestor and include their wives and unmarried daughters, who are living together, joint in food, estate and, worship (not now necessary). The daughter, on her marriage, ceases to be a member of her father’s HUF and becomes a member of her husband’s HUF. However, after 1-9-2005, daughter married or unmarried, is a co-parcener like a son.
[2] This definition is configured with the appropriate contents of Clauses [i) (17) [ii] (27) of Section 2 and (iii) Clause (17) of Section 154B-1 of the Cooperative societies Act 1961 reproduced below.
(i) Clause (17) of Section 2 of MCS Act 1961: “housing society” means a society, the object of which is to provide its Members with open plots for housing, dwelling houses or flats ; or if open plots, the dwelling houses or flats are already acquired, to provide its Members common amenities and services;
(ii) Clause (27) of MCS Act 1961: “society” means a co-operative society registered, or deemed to be registered, under this Act {*which is an autonomous association of persons, united voluntarily to meet their common needs and aspirations through a jointly owned and democratically controlled enterprise and adhering to the co-operative principles and values}*[Part in the bracket added post 97CAA]
(iii) Clause (17) of Section 154B-1: “housing society” means a society, the object of which is to provide its Members with open plots for housing, dwelling houses or flats ; or if open plots, the dwelling houses or flats are already acquired, to provide its Members common amenities and services {and to demolish existing buildings and reconstruct or to construct additional tenements or premises by using potential of the land ;} *[Part in the bracket added under cooperative societies (Amendment) Act 2019.]
[3] The term “Person “has not been defined under the MCS Act and the term as defined under the General Clauses Act, 1897 applies. The General Clauses Act provides that a “Person” shall include any company or association or body of individuals, whether incorporated or not. This means HUF is included in the term “person”. As such HUF can seek the membership of a Cooperative Housing Society. Clause 1 of Section 22 of the MCS Act which provides that “no person shall be admitted as a member of a society except those listed under Clause (a) to (g) thereof in which HUF is not there.
[4] Duly means “in accordance with what is required or appropriate; or following proper procedure or arrangement. The registered bye-laws of the concerned MAHA -C H S provides contractually agreed terms and procedure to admit a person as a member of MAHA CHS.
[5] This provision namely Clause 19 of Section 2 in “Chapter 1 Preliminaries” after 9th March 2019 does not apply to MAHA-CHS as expressly provided under Section 154B(2) in Chapter XIII-B Co-Operative Housing Societies.
[6] This term Original Member has not been defined in the MCS Act, but the legislature has used this term in Section 154B-10 (7) namely “Any action contemplated against the original Member in the Act shall be applicable to such an Associate Member.”[This is an example of legislative incompetence].
[7] The term “Person “has not been defined under the MCS Act and in that case the term as defined under the General Clauses Act, 1897 applies. The General Clauses Act provides that a “Person” shall include any company or association or body of individuals, whether incorporated or not. This means HUF is included in the term “person”. As such HUF can seek the membership of a Cooperative Housing Society.
[8] Clause 1 of Section 22 of the MCS Act which provides that “no person shall be admitted as a member of a society except those listed under Clause (a) to (g) thereof in which HUF does not appear. This Section 22 is declared in-operative to housing societies vide Section 154B(2) in Chapter XIII-B Co-Operative Housing Societies
[9] Clause (20)“person” includes,—
(i) an individual, who is competent to contract under the Indian Contract Act, 1872,
(ii) the State Government,
(iii) the Central Government,
(iv) a Hindu Undivided Family,
(v) a company registered under the law for the time being in force
(vi) a firm registered under the Indian Partnership Act, 1932 or the Limited Liability Partnership Act, 2008,
(vii) local authority,
(viii) an association of persons or body of individuals whether incorporated or not,
(ix) a co-operative society registered under any law relating to co-operatives,
(x) a public trust or family trust formed in accordance with a relevant provisions of law,
(xi) any legal body which can hold the immovable property, and
(xii) any entity as may be notified by the State Government, from time to time ;
