The outgoing member has cleared all dues except the interest arrears to the society at the time of sale to new member.
Can society charge interest on the interest arrears of the old member to the new member who purchased the flat from him?
Society has transferred the flat in the name of new member but continue to show interest arrears of old member against the new member and charging interest on interest arrears every month.
Kindly give your opinion.
I C Naik
This is a case of negligence on the part of the management of the Society that a clearance was given to transferor on the basis of incorrect assessment of outstanding Society Dues recoverable from the the management committee members in terms of the Bye law No 138 reading as under:
“The members of the Committee shall be jointly and severally liable for making good any loss, which the society may suffer on account of their negligence or omission to perform any of the duties and functions cast on them under the MCS Act 1961 and MCS Rules 1961and the bye-laws of the society.”
This Bye law conforms to statutory provision U/S 73[1AB] of the MCS Act reading as under:
“(1AB) The members of the committee shall be jointly and severally responsible for all the decisions taken by the committee during its term relating to the business of the society. The members of the committee shall be jointly and severally responsible for all the acts and omissions detrimental to the interest of the society.
Provided that, before fixing any responsibility mentioned above, the Registrar shall inspect the records of the society and decide as to whether the losses incurred by the society are on account of acts or omissions on the part of the members of the committee or on account of any natural calamities, accident or any circumstances beyond the control of such members:”
But what should be the action of Mr Anil Patil?
1.First and foremost he should not worry about interest on overdue interest itself, because Bye law No 72 says that “A member shall be required to pay simple interest”
2.He need not worry about paying it to the Society as he has not incurred this liability nor has he accepted. In any case it pertains to the period during which he was not a member of the Society .
3.If he does nothing the Society will keep sending Bills of incorrect amounts. One day the Society will go for 101 recovery certificate when the Secretary will realize his mistake.
4.In the meanwhile if elections come up he will be wrongfully disqualified to contest and illegally denied a voting right though there is nothing in law saying that a defaulter can not vote.
5.So it is advisable that Anil opts for proactive measures:a. File a dispute petition in co-operative court as provided under Bye law No 175 (B)(i) preceded by steps as per Bye law No 173 and 174 read with Section 91 of the MCS Act. (Expensive as Lawyer is a must, but claim legal costs)
a.Inform the Deputy Registrar about the above action so that he may intervene as a good gesture. (No costs just a letter) Also invoking Section 73 [1AB|Proviso this letter will be handy.
b.File a Complaint in district consumer Court for deficiency in service (You can handle yourself, Lawyer is optional.you can claim compensation for causing stress. (No Costs)
c.Give a notice to the Society of about 15 days about action you are going to take.