Our CHS bearing reg.no. TNA/(TNA)/HSG/(TC)/29071/2016-2017 dated 06/01/2017 is utilising Maintenance Fund for Independence / Republic Day celebrations and for Annual Day and Cultural events. Please advise if this acceptable as per bye-laws of Maharashtra.
I C Naik
The answer is “No”; but it is nowhere expressly prohibited also. Controversy has started getting momentum as many District Housing Federations have started advising against collection of funds by member housing societies as a part of maintenance bill. They also suggest that such activities are to be primarily carried out of funds called for from members as voluntary contributions. The answer does not end here.
The registered bye-laws of every C H S specifically authorize its Management Committee, providing as one of its objects, namely:
“Bye-law No 5 d) To undertake and provide for, on its own account or jointly with a cooperative or Other Institution Social, Cultural or Recreational activities;”
The Controversy is because members and committees of housing societies either fail to read the registered bye-laws of their C H S or fail to understand the true provision because the Commissioner for Cooperation and Registrar of Cooperative Societies has not made absolutely clear provision in Model bye-laws. Let’s understand it patiently so that we can convince the other members of our respective housing societies.
Have a very close look at the sequence of different objects of the CHS which the Society is authorized in law to undertake. Object at clause 5© reads as
To raise funds for achieving the objects of the Society;
Let us apply our mind as to why the clause © isolates the objects clauses (a)&(b) from remaining Clauses (d), (e) (f)?
Extract from Clause 5 of Model bye-laws 2014:
Group 1
- a) To obtain conveyance from the Owner/ Promoter Builder
- b) To manage, maintain and administer the property of the Society;
Group 2
- e) To provide Co-operative Education and Training
- f) To do all things, necessary or expedient for the attainment of the objects of the Society, specified in these bye-laws.
For the funds required to attain object as per e) above the MCS Act expressly provides under Section 24A(3) as under;
“S24A.(3) Every society shall contribute annually towards the education and training fund of the State federal societies or State Apex Training Institutes, notified under sub-section (1),[Extracted below] at such rates as may be prescribed, and different rates may be prescribed for different societies or classes of societies.”.
“Section 24A. (1) Every society shall organise co-operative education and Co-operative training, for its members, officers and employees through such State federal societies or the State Apex Training Institutes, as the State Government may, by notification in the Official Gazette, specify.
Object Clause 5.f) is about activities not requiring funds.
Collection process for funds required to attain object as per 5b) namely b) To manage, maintain and administer the property of the Society; is provided at length in Chapter IX LEVY OF CHARGES OF THE SOCIETY in every Model bye-laws. Note carefully that it is strictly in respect of the defined list of various outgoings and funds and can not extend to cover any other outgoing of the CHS.
It is still not clear as to how to get funds to spend on object 5 d) To undertake and provide for, on its own account or jointly with a cooperative or Other Institution Social, Cultural or Recreational activities;”
This is where most committees falter. Read the Bye-law No. 148 carefully;
It has one clause which should give answer to this question, namely;
(b) iii. To allocate to a Common Welfare Fund, such part of the profit as the Annual Meeting of the General Body may determine, to be utilised in furtherance of the objects specified in the bye-law No. 5(d).
It is not ruled out that there may arise some doubt. Do raise them till they are clarified.