I have a 3BHK flat in a residential township (apartment complex) in Hyderabad. There are 9 towers out of which 7 towers are handed over (with considerable delay from promised dates in AoS), but without OC yet, and owners have started residing. Several amenities are also yet to be finished like club house, swimming pool and second passenger lift for each tower. There was an association (RWA) registered initially after some people started residing, but it went defunct due to all members resigning. Since we are anyway required to re-register as a Co-operative housing society by new regulations , we planned to wait and do it after a while. The immediate problem we have is maintenance. Since the builder is not capable of doing maintenance on his own, we agreed that they will on-board a professional vendor and CBRE was brought in for the purpose. They gave a quotation and owners have a dispute on how the costs are to be shared. We have flats of sizes 1BHK, 2BHK, 2.5BHK, 3BHK and 4BHK. 1BHK and 4BHK are very small in number and not yet handled over. Of the 867 flats handled over, 339 flats are 3BHK and 528 flats are 2 & 2.5BHK. Another point is that all 3BHK are in seperate towers. The people (reps from each tower) who worked on the quotations divided the individual cost heads into categories of those that fall into uniform cost for all and those that have to be paid per sq.ft of area owned and arrived at some numbers. 3BHK onwers are willing to pay as per that, but many from the majority who make up 528 flats want it to be blindly based on flat area. This includes even costs like ApnaComplex software subscription which is a fixed rate per each flat and lift AMC's which is also a fixed cost per each lift. Some of them also proposed to have voting to decide it. This is a clear "Tyranny of the majority" situation with a conflict of interest involving monetary costs and with the knowledge that they are in majority and can have their way if voting is done. If a sq.ft based calculation is used to distribute even the uniform costs, it means that 2/2.5BHK owners reduce their own fixed costs by offloading it 3BHK owners, who end up paying more for the same services while everyone still gets equal rights to amenities. 1. What does the law say on this matter and what are the actions that I can take? As a 3BHK flat owner, I am not averse to paying fair costs as per the calculation which was already worked out to 32% more than 2BHK and 15% more than 2.5BHK, but paying uniform costs like even software platform subscriptions or lift AMC's in some flat sq.ft ratio is neither fair nor acceptable. 2. What can I do about the builder for not getting OC till now for completed towers and for not completing the amenities. There are about 650 odd families living and we have residential power as well as water connection for completed towers. I understand that living without OC is illegal, but many residents had no choice left but to move in.
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Size of flat does not determine maintenance
2) maintenance is equal for all flat owners irrespective of size of flat
3) water charges depend upon number of inlets in flat
4) insurance premiums depends upon size of flat
5) if builder not providing OC nor providing amenities complain to RERA seek orders to direct builder to obtain OC within stipulated period
The maintenance charges are always the same for different flat carpet areas only property tax charges are different different areas as per cooperative laws.
you can apply the same to municipal corporation directly for OC if builder is not doing so. You can go to consumer court if builder is not helping you for getting OC
1. Sir according to law the maintenance has to be calculated as per sq. ft. basis only but since it is not registered society the society can work out most efficient way to divide the cost.
2.Sir file a complaint before the consumer court for deficiency in service asking delay compensation in handover of the flat and amenities further direction to handover the OC in the given frame of the time.
1. I have got conflicting replies regarding maintenance calculation as one of the replies suggests that maintenance is to be calculated by sq.ft only. Please note that the jurisdiction is Hyderabad, Telangana. I would like some reference to the appropriate laws that support either case or references to any prior judgement if possible. I assume any existing law would be covered under Cooperative Societies Act for the state and I could not find any. 2. If its illegal, how can I go about challenging it. Do I need to file a consumer court case or in a civil court. What if CHS is registered and it tries to implement sq.ft based maintenance? 3. With regard to water, we wanted to have smart meters setup so that everyone can pay as per usage, but some owners are objecting to it citing the subscription costs for the meters and forcing water usage to be paid as part of maintenance. In fact, this is one of the excuses being used for sq.ft based maintenance despite it being a small cost and many of the others being uniform costs. 4. The Project is from before RERA Act came into picture and is exempted under Telangana RERA.
the cooperative societies act of your state and model bye laws would contain provision regarding recovery of maintenance
2) for instance in Maharashtra all members have to pay maintenance equally irrespective of size of flat . Only property taxes, water charges depend upon inlets in your flat , insurance premium would depend upon your flat area
3) you can file case against high maintenance in cooperative court or in consumer forum
4) water charges would depend upon number of inlets in the flat . It cannot be equal for all flat owners
1. All services have to be charged equally regardless of the flat size
2. charging maintenance on per sq.ft. basis is illegal
3. all flat owners, regardless of carpet area, enjoy all the services being offered, equally
4. its not that members of bigger carpet area enjoy more services than members of smaller carpet area
5. refuse to pay the maintenance if its charged on per sq.ft. basis
6. the agency appointed by the owners cannot compel to make the payment
7. in absence of formation of a registered society, any voting that may be done is not binding on the owners
8. it is to be remembered that only property tax and other taxes can be levied on flat area basis. Similarly water charges can be charged on basis of number of inlets supplying to the different flats. There cannot be one single charge for it. It clearly depends on total usage
9. if OC is not received then the project comes under purview of RERA. Why do you say it is exempt from RERA?
10. Please address a letter to the agency informing that you are willing to pay only if calculation for maintenance is done equally of for all owners (barring property and other taxes which can be done on area basis)
11. as no society is formed, no legal action can be taken against you for not paying maintenance. Even otherwise charging maintenance as described by you in your query is clearly illegal
12. when society is formed and it adopts the illegal calculation for maintenance, you can file a case against it under the state co-operative societies act
The Occupancy Certificate (OC) is a document issued by a statutory authority (such as BBMP and BDA in Bangalore) and it gives the applicant (builder) permission to “occupy” the property. It is required for commercial buildings and for residential buildings that have more than five units. OC is issued for an entire building, or a part thereof, and is not given to individual flats.
No Occupancy Certificate means that the building has not been given a “Pass Certificate”. This means that it does not have all the mandatory infrastructure/ clearances that make the building inhabitable.
Builders, without fulfilling the mandatory terms of sanction and/or promises to the buyers are eager to hand over and move on to the next project. By getting people to live in the flats, they create a shield for themselves. They also escape from the delay penalty clauses that are in the agreement.
– Buyers are eager to take possession of their homes. Many are not even aware of OC and what it means.
Make OC mandatory before registration of flats. The Hyderabad Municipality, in Dec 2013 was considering this move, which would definitely be effective in controlling unauthorised constructions.
here are usually penalty clauses in the agreement that will force the builder to pay in case the delay goes beyond the grace period specified. Delay in issue of OC is usually one of the safety walls behind which builders take refuge, but if delay is on account of violations, it is possible to make the builder liable.
After the construction of a building is completed, the builder or the buyer has to submit an OC application form to the concerned municipal or local development authority. The application form for obtaining OC should be submitted within 30 days of completing the construction.
You can even issue a legal notice to the builder to procure the OC at the earliest or to face legal consequences and even may file a consumer complaint before a consumer forum on this.
In India, the only Legislation that provides considerable guidance in this matter is from Maharashtra, approved by the Commissioner for Co-operation and Registrar, Cooperative Societies.
Most debates centre around the decision of making the charges on the basis of sq.ft. of each Flat or on a uniform basis where every flat pays equal Society Charges. This debate gets more pertinent in Societies with high variation in the area of the Flats.
According to this legislation, the Regular Society Charges are to be apportioned under the following Bill heads:
1. Expenses on Repairs and Maintenance of the Building(s): At the rate fixed by the general body from time to time, subject to the minimum of 0.75 percent per annum of the construction cost of each flat for meeting expenses of normal recurring repairs. This implies, this can be charged on a sq.ft. basis, which is an indirect indication of the construction cost of the flat.
2. Service Charges (Housekeeping, Security, Common Area Electricity, Equipments): Equally divided by Number of Flats. This implies, this can be charged on a flat fee basis, where each Flat pays the same amount irrespective of its area.
3. Expenses on Repairs and Maintenance of the Lift, including charges for running the Lift: Equally by all the members, irrespective of the fact whether they use the lift or not. This is clearly a charge on a flat fee basis.
4. Sinking Fund: At the rate decided by the General Body, subject to the minimum of 0.25 percent per annum of the construction cost of each flat. This again implies a Sq.ft. based fee., as in Item 1.
Apart from the above charges, many Societies collect following Charges as part of their Regular Bill:
5. Non-Occupancy Charges: This charge is collected for Flats which are Rented, calculated @ 10% of Service Charges
6. Parking Charges: This charge is calculated by number of Parking Slots of each Member
7. Property Tax (this is not relevant outside Maharashtra as Property Owners pay this directly to the Municipality)
8. Water Charges: As per actual Consumption of each Flat, or Number of Water Inlets
9. Interest on Defaulted Charges: This is the late payment penalty. This amount is decided by General Body. Mostly a late payment calculation method of simple interest not exceeding 21% per annum is used. However, the General body can decide otherwise based on what works best for them.
10. Insurance Charges: Expense which is spent on insurance of building and equipment can be charged to the residents and made a part of the maintenance bill. There maybe flats/shops for which you may have to pay extra premium, you can pass on that extra amount to such flats/shops.
11. Lease Rent: This is charged based on per square ft of the built up area.
12. Other Charges: These are decided by the Association / Society from time to time as per their specific requirement.
There are a few popular methods of calculating maintenance charges. They are as follows:
A. Per Square Feet Charge:
This happens to be the method which is most used for calculating maintenance charges for housing societies. As a part of this method, a fixed rate is charged per square feet of area of an apartment.
This method is seen as unfair to owners of larger apartments or villas, as there are many facilities which are used by all residents irrespective of the size of the apartment they live in like Clubhouses, Lifts, Gardens, etc.
Equal Maintenance Fee:
This is a favoured method where the size of apartments are almost the same. The total maintenance charge which is to be collected per month is arrived at and then it is divided the number of apartments.
For housing societies where apartments are of various different sizes, this is seen as unfair and are usually not accepted by the members.
C. Hybrid Method
In this method, a part of the maintenance charge is charged equally among all apartment owners. The second part includes the area based charges.
The combination of bills into different heads is usually as follows:
a) SqFt Based charges: Items 1 & 4 of Society Bill Heads mentioned in Step 1 of this article. Expenses on Repairs and Maintenance of the Building(s) AND Sinking Fund.
b) Equal Charges: Items 2 & 3 of Society Bill Heads. Service Charges AND Expenses on Repairs and Maintenance of the Lift.
It is seen as a fair method of calculating maintenance charges