Priyanka Kumar of Kalyan in Maharashtra has a query which is the issue for several readers, claims our columnist Mr I C Naik. He wishes to give it a prominent position so that others also benefit from the answer-Editor
First the query and then the answer:
Priyanka writes:
Myself Priyanka , i am staying with my husband Kumar in Kalyan in our own house. We are the owners and we rent one bedroom with attached bathroom as paying guest to single student/working professionals while we are also staying in the same house . Till now we submit to the society the copy of Agreement and Police Verification.
Recently our housing society has informed us that we are not allowed to rent out a single room of our house to anyone. They say that they will not give NOC and lodge Police complaint against us.
We do not agree with the society and we wish to keep the paying guest.
We have these queries:
1) Is keeping paying guest allowed while self occupying the house (2 rooms for self and 1 for the paying guest)?
2) Is keeping bachelors and spinsters not allowed?
3) Can Society pass resolution in AGM to prohibit a member to keep for Paying guest in his own self occupied apartment and not allowing bachelors?
Looking forward to your reply
I C Naik replies:
The issue under discussion has been considered at length as “Ghettoization of minorities in housing societies “ on which I have posted detail analysis thrice over last two months on www.indiancooperative.com In somewhat different context, it was an attempt to highlight the misplaced public outrage against such exclusions.
Shrimati Priyanka Kumar is a worried three BHK flat-owner in Kalyan-Maharashtra thanks to a recent resolution of the general body meeting banning sub-letting contracts in repect of part of the flat and with singles like students, bachelors , spinsters. In respect of one bedroom with attached bathroom she had an approved contract with a professional student. This can not be renewed any more. Is this ban legal, she wants to know, as she does not think it is.
Factually Priyanka Kumar had on earlier occasions satisfied the managing committee of her inability to use the entire flat and that one room with bathroom would have remained vacant for quite a long period of time if not allowed to let out to a suitable person preferably a single. Members satisfying their inability to occupy the flat for a long period of time, are permitted to sub-let it for 11 months at a time. This is the only Bye-Law condition she was required to comply besides undertaking certain procedures as required under Bye-Law No 43/45 as may be applicable. Plain reading of these Bye-Laws will lead to an answer that society has no power under Bye-Laws to direct the member to whom not to sub-let a flat, once he/she was permitted to sub-let as per Bye-Law provisions.
A cooperative society is born along with its registered Bye-Laws. The MCS Act 1960 lays down a basic frame of law of the land on regulating cooperative societies but the Bye-Laws provide internal rules, rights and duties of members and management procedures and they are held to be Contracts inter-se all members. [the Supreme Court in Zoroastrian co-operative housing society limited and another v. District registrar co-operative societies (urban) & ors [2005]rd-sc 253 (15 April 2005)]. Bye-Laws are not laws for third parties, but have a binding force within the membership and the management of that society.
Now the 97th Constitutional Amendment (effective 13 2 2013 for States ) has conferred a constitutional status to cooperative societies providing a constitutional frame work to all laws on cooperative societies including the registered bye-laws of all cooperative societies. Maharashtra Cooperative Societies Act is claimed to have been aligned to the new constitutional frame work by an Amendment Act. Bye-Laws have to automatically align to the amended State Law. Any Bye-Law inconsistent with 97th Constitutional Amendment is inoperative. Peculiar situation is a Bye-Law provision consistent with the Act may be held inoperative if it did not fit in to the new dispensation of cooperative society so contained in 97th Constitutional Amendment. In a recent order [(2015) 42 SCD 494 of 19 2 2015] the Supreme Court has reiterated this constitutional requirement vide Paragraph 12 in these words. “Thus, by 12.01.2013, all laws on cooperative societies were bound to be restructured in consonance with the Ninety Seventh Amendment of the Constitution of India and, in any case, any provision in the Act or Rules or Bye-laws otherwise inconsistent with the Constitution will be inoperative thereafter.”
Bye-Laws of most societies are still those registered prior to coming in to force of the 97th Constitutional Amendment. The Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra Pune, has issued new Model Bye-Laws in November 2014. It is claimed that these Bye-Laws are aligned to the latest law on cooperatives as also to the new constitutional frame work. This Model will become operative in to those housing societies which register them as their Bye-Laws replacing their registered set. Till then the registered bye-laws are valid except to the extent they are inconsistent with the provisions of MCS Act 1960 (as amended) MCS Rules 1961 (as updated) and with the Constitutional framework as aforesaid. The SC Order (Supra) at Para 44 justifies sub-version of its own previous orders: ”It may be seen that all these decisions dealt with the pre-Ninety Seventh Amendment status of the cooperative societies. The amendment providing constitutional status to the societies has brought out radical changes in the concept of cooperative societies. Democratic functioning and autonomy have now become the core constitutional values of a cooperative society. Such societies are to be registered only if they are founded on cooperative principles of democracy, equality, equity and solidarity.
In the S C Order referred to above, the Supreme Court of India has delved in to the new Constitutional framework while delivering a first historical order taking in to account the 97th Constitutional Amendment. In this order the S C has brought out true implications of several features of the new Constitutional framework . It was a case of the Apex Court upholding the ouster of the Chairman of the Asia’s largest dairy cooperative in Gujarat by its board through a no-confidence motion though neither the State Cooperative Act nor society’s Bye-Laws empowered its board to entertain such a motion in its meeting. The new Constitutional framework has the effect of giving this power to the board the Apex Court has held after a full length analysis of 97th Constitutional Amendment.
At Paragarph 48 of the order the S C lays down a new maxim “ If the Act or the Rules or the Bye-laws do not say what they should say in terms of the Constitution, it is the duty of the court to read the constitutional spirit and concept into the Acts”
It is quite pertinent to note that the latest Model Bye-Laws (assumed to be aligned to 97th Constitutional Amendment ) referred to above suggest that housing societies do away with their approval to the member parting with the possession of their flat inany manner. Bye-Law No 43(b).
In a housing society who occupies a flat is a key success factor of attaining its objects for it calls for not just the members’ coming-to-gather but all the members of all families residing therein. Where it comes to deciding as to who should occupy the flat where it has to be other than the member of the society or his or her close relatives, the rest of the members must have a say in the context of decision making on democratic principles and in the interest of proper working of the society. Let us recall the observation by S C (supra) “Democratic functioning and autonomy have now become the core constitutional values of a cooperative society.
The conclusion is it cannot be the sole discretion of the member of a housing society as to who occupies his/her flat if the member was unable to occupy. If such decisions are left to individual members what will be important matters, for the managing committee and general body meeting to take decisions on, in a democratic and autonomous manner. Model Bye-Law No 43(b) operates to interfere in the management autonomy and democratic functioning of housing society which is unconstitutional. Such Bye-Law cannot be registered. The housing societies are well advised to resist the bid of registering authorities to force this Bye-Law provision in their new Bye-Laws. They may add one more condition to Clause 2 as a second proviso that general body meeting may by 2/3 majority of members present and voting restrict the categories of persons who would not be permitted to occupy any flat or part thereof on behalf of the member.
Regular visitors to www.indiancooperative.com would recall a case of a leave licensee occupying the office of the Chairman has been reported by Datta T Redekar from Thane just a few months back. If all members were to sub-let their flats without any intervention of the managing committee, obviously the management thereof will land in to the territory of licensees only. Constitutional status of cooperative societies is not intended for persons of limited interest hijacking the management of cooperative itself.
