• TNAOA Act, rules, and new bye-laws of association

Learned Friends, 

Good Evening 

Kindly clarify the following as we are making Bye laws for TNAOA- migrating from TN Registered Societies Act to TN Apartments Act,quoting relevsnt secions,clauses of TNAOA Act/ Rules/ amendments. 

Proxy :

Voting :
2 . Can in all the meetings of members ( AGBM,GBM,Extraordinary GBMs) where normal / special resolutions are supposed to be passed , are the proxies eligible to vote ?
3. If after nominating a proxy if an owner turns up for the meeting , what happens to proxy of he had already checked and marked against owner ?
4. As per TNAOA , the voting should be on UDS basis. If so, is it for all type of meetings and resolutions.can we have 1 vote per owner per Apartment?
5.Can the same proxy vote for more thsn owner ?
6. If a owner has more than two apartments, how many votes he is eligible ? And can he nominate same proxy to attend and vote or he has to nominate a different person as proxy .
Accounts :
Some newly handed over blocks who have joined the association wants that the maintenance amount they pay are least spent for repairs and mostly for common area expenses as their blocks are new.
So they are saying to keep the balance unused amount ( afters any maintenance expenses) and this safely kept amount should only to be used for their future maintenace work and should not be used for other old blocks maintenance works.
Now I need clarifications :
1. Can this be done ,as since this project is a project approved for whole 7 blocks and they are handed over in phases and the association has been existing under TN Societies Act during these hand over of two blocks, for nearly 8 years.
The uds is for all apartments from the area pf complex and STP, Park,club house, swimming pool, badminton and tennis courts are common for all residents of the complex. The complex has common entry and exit.
I am given to understand that separate accounts and crediting excess amount to individual block accounts is against TNAOA act/ rule/ amedments..and bye laws can not be written as requested .Am I right sirs

Need clear reply so that our byelaws do not violate Act/Rules/Amendment.
Pl add concerned clauses and sections .

Kindly help me to prepare a good bylaw for my society ,as per TN AOA Act/ rules/ amendments. 

Thanks in anticipation.

Krishnan
Asked 15 days ago in Property Law
Religion: Hindu

First answer received in 30 minutes.

Lawyers are available now to answer your questions.

8 Answers

1) proxies are eligible to vote on both normal and special resolutions across all General Body meetings , provided the proxy instrument is legally drafted and submitted according to association bye-laws. 

 

2) : If an owner turns up in person after nominating a proxy, the physical presence and vote of the owner override the proxy. The proxy's right to vote is cancelled, 

 

3) Voting rights are calculated proportionally based on the percentage of Undivided Share (UDS) or carpet area, not a flat "1 vote per apartment" system. Attempting to restrict it to 1 vote per owner violates the mandated proportionality under

 

4) : unless expressly restricted in your registered bye-laws, the same person may act as a proxy for more than one owner.

5)If an owner holds multiple apartments, they hold votes equivalent to the combined UDS/carpet area of all their apartments. They may nominate a single proxy to attend on their behalf for all units, or choose different proxies. [

 

6)since your complex is registered under one single master Deed of Declaration with shared common amenities (STP, park, clubhouse, etc.), individual blocks cannot segregate their accounts or claim total financial independence

 

 

Ajay Sethi
Advocate, Mumbai
100677 Answers
8233 Consultations

You need to form concise bye laws consistent with the Act in this matter

Prashant Nayak
Advocate, Mumbai
35157 Answers
256 Consultations

Migrating from the Tamil Nadu Societies Registration Act, 1975 to the Tamil Nadu Apartment Ownership Act, 2022 (TNAOA) and its corresponding Tamil Nadu Apartment Ownership Rules, 2024 requires fundamental changes to how your association governs voting and handles financial accounts.

Under the TNAOA 2022 and the Model Bye-Laws (2024), voting rights are explicitly coupled with the Undivided Share (UDS) or the specific percentage of interest that each apartment holds in the common areas. Proxies are legally permitted to attend and vote in all general meetings, whether normal or special resolutions are being considered. However, the proxy must be appointed formally via a signed proxy form submitted to the Board of Managers within the timeframe stipulated in your Bye-Laws. This is standard practice adapted from Model Bye-Laws under Section 6 (Bye-laws) and Section 7  of the TNAOA, 2022.

If the principal (the actual apartment owner) physically turns up and marks their presence at the meeting, their proxy is automatically superseded. The owner can cast their vote directly, and the proxy is no longer authorized to vote on behalf of that unit.

Ref section 5 and 4 of modely byelaws;  For critical matters, such as amending the declaration, approving redevelopment under the 2024 Rules (which requires a two-thirds majority), or allocating major common expenses the vote must be calculated according to the UDS percentage.

The same proxy vote for more than one owner subject to restrictions if any in your Bye-Laws. The TNAOA does not explicitly restrict a proxy from representing multiple owners. 

If an owner holds three apartments, he/she hold the cumulative voting weight (the sum of the UDS percentages) of all three units. They do not get just "one vote as an individual."

The request by the owners of the newly handed-over blocks to wall off their excess maintenance funds into a separate block-centric account is a direct violation of the Tamil Nadu Apartment Ownership Act, 2022.Under the TNAOA, your entire 7-block project functions as a singular, unified "Property" or "Project" bound by a single Declaration filed under Section 4.

If you create a bye-law that isolates funds by block, it will be rejected by the Competent Authority during registration under Rule 6 (Registration of bye-laws) because the , under Section 3(2), the undivided interest of each owner in the common areas is permanent and cannot be altered or divided.

The fact that the project was completed in phases over 8 years does not split it into separate legal entities. It remains one project, one association, and one common pool. While the new blocks might require fewer immediate structural repairs than an 8-year-old block, their residents are concurrently utilizing older common assets (like an existing STP or clubhouse) whose replacement or major overhaul costs will later be shared by everyone.

When drafting your new TNAOA-compliant Bye-Laws, stick strictly to the Model Bye-Laws template provided in the Appendix of the TN Apartment Ownership Rules, 2024.

For drafting or to prepare  good bylaws, you may engage the services of an experienced lawyer in the local or can choose an advocate of this website too on the terms of chosen lawyer.

T Kalaiselvan
Advocate, Vellore
90885 Answers
2524 Consultations

Dear Sir/Madam,

Yes, proxy voting is permitted, but only by written authority. One proxy cannot represent more than one member and can only cast vote, not participate in discussions.

Voting should be as per percentage mentioned in the registered Declaration, not “one vote per owner/flat”. If one owner has multiple flats, voting value will be as per combined percentage assigned to those apartments.

If owner personally attends, his proxy should not vote and the attendance/voting record must be corrected accordingly.

For accounts, you are broadly correct. Common expenses/profits must be shared as per UDS/common interest under Sections 8 and 18 of the Tamil Nadu Apartment Ownership Act, 2022. Separate block-wise reserve for common maintenance should not be drafted if the facilities are common to all blocks.

Get the draft bye-laws vetted with the registered Declaration, sanctioned plan and handover documents before filing before the competent authority.

Advocate Saurabh Agrawal

Saurabh Agrawal
Advocate, Greater Noida
211 Answers

Based on the facts stated by you, the Tamil Nadu Apartment Ownership Act, 1994 ("TNAOA") and the Rules framed thereunder contemplate that the bye-laws of an apartment owners' association must be consistent with the Act and cannot override its statutory provisions. Therefore, while the Association has flexibility in framing bye-laws on procedural matters, such bye-laws cannot be inconsistent with the Act, the Rules, or the registered Declaration.

With respect to proxy voting, the first issue is whether the TNAOA, the Rules, or the registered bye-laws specifically permit voting by proxy. If the Act or the registered bye-laws authorize proxy voting, then a duly appointed proxy may ordinarily attend and vote in accordance with the authority conferred. However, where the owner personally attends the meeting, the proxy's authority ordinarily ceases for that meeting, and the owner alone is entitled to exercise the voting right. Any vote cast by the proxy after the owner's presence is recorded should not ordinarily be counted.

Regarding the basis of voting, the scheme of the TNAOA is founded upon the concept of "percentage of undivided interest (UDS)" in the common areas and facilities. Consequently, where the Act, Declaration or bye-laws require decisions based upon percentage interest, voting should ordinarily be proportionate to the owner's undivided interest rather than one vote per apartment. Introducing a "one apartment, one vote" system through the bye-laws, if inconsistent with the statutory scheme or the registered Declaration, may not be legally sustainable.

Where an owner owns multiple apartments, his voting rights would ordinarily correspond to the aggregate undivided interest attached to all such apartments. Likewise, the owner may authorize a proxy to represent him in respect of all such units, unless the bye-laws specifically restrict the scope of a proxy or prescribe otherwise. There is generally no legal prohibition on the same proxy representing more than one owner, provided each owner has executed a valid proxy in accordance with the bye-laws and the proxy does not violate any restriction contained therein.

Coming to the maintenance funds, your understanding is substantially correct. Since the project consists of seven blocks forming part of one approved integrated apartment complex with common infrastructure such as roads, STP, parks, clubhouse, swimming pool, badminton and tennis courts, common entry and exit, and common facilities, the Association is ordinarily expected to manage the common funds for the benefit of the entire complex. The maintenance collected from apartment owners is generally intended for the maintenance, repair and upkeep of the common areas and common facilities of the project as a whole.

While the Association may, for accounting convenience, maintain block-wise expenditure statements or internal cost centres to monitor expenses, creating separate maintenance reserves exclusively for individual blocks and restricting their utilization only to those blocks may not be consistent with the concept of common ownership and common maintenance envisaged under the TNAOA, unless such segregation is expressly authorized by the registered Declaration or the Act itself. The Association cannot, merely through its bye-laws, create rights or obligations that are inconsistent with the statutory framework governing the apartment complex.

Accordingly, if the entire project has been approved as one integrated development and all apartment owners possess proportionate undivided interests in the common areas and common facilities, the better legal view is that the Association should maintain common accounts for common expenses. Separate accounting for administrative purposes may be maintained, but earmarking surplus maintenance collected from one block exclusively for that block's future repairs, thereby excluding its use for common obligations of the Association, may be open to legal challenge unless supported by the Declaration and the Act.

Therefore, while drafting the new bye-laws under the TNAOA, it is advisable to ensure that the provisions relating to proxy, voting rights, quorum, maintenance funds, reserve funds, and common expenses strictly conform to the TNAOA, the Tamil Nadu Apartment Ownership Rules, the registered Declaration and Deed of Apartments, as the bye-laws cannot curtail or enlarge statutory rights created by the Act.

Yuganshu Sharma
Advocate, Delhi
1494 Answers
5 Consultations

2. What do your bylaws say about proxy voting at AGM/EGM? If the bylaws permit, proxies can very well attend and vote at AGM/EGM.

3. The member has the prerogative. Even if the proxy has marked attendance on behalf of his/her principal, still the member can take part in further proceedings at the AGM/DGM. The proxy is automatically discharged.

4. One vote per apartment is the law.

5. Again check your bylaws on this provision. A proxy is only a mandate holder representing his/her principal. Legally, there is no bar if a proxy represents more than one member.

6. Membership is personal. Whether a member has one flat or two is immaterial. He/she can have only a single vote.

 

Swaminathan Neelakantan
Advocate, Coimbatore
3168 Answers
20 Consultations

Dear Client, Under the Tamil Nadu Apartment Ownership Act of 2022 the governance of your association must align with the single declaration filed for the entire project regarding your voting queries the ACT generally mandates that voting rights we proportionate to the undivided interest of each apartment owner as this is the foundational principle for property and voting interest in a unified project While your bylaws can detail procedural aspects they cannot override the statutory requirement that representation is based on the proportionate undivided int of each owner proxy voting is a procedural tool however the proxy must act strictly according to the owner’s written authorization If an owner arrives in person after nominating a proxy the owner’s physical presence and vote supersede any prior proxy marking a proxy can typically represent multiple owners if you’re registered by laws explicitly permit it and if the individual owners instrument of proxy authorizes it.

Regarding the financial management of your complex your undertaking is correct that is keeping separate block wise maintenance accounts for excess funds is generally contrary to the TNAOA framework for a unified project because your complex shares common undivided interest common amenities and common infrastructure it legally functions as one single project under one register deed of declaration Attempting to fence maintenance funds for specific blocks within a unified project complicates the common financial obligations and could lead to legal challenges All common expenses must be shared proportionately based on undivided interest as per the Declaration and the Act Creating block accounts would effectively fragment the unified project which the TNAOA does not support without a formal legally approved bifurcation.

To ensure that your bylaws are legally robust you need to focus on majorly these four areas Firstly that clearly defined the voting weightage based on undivided interest as specified in the deed of declaration Secondly include a transparent mechanism for common expense budgeting that covers the entire project And lastly establish a formal process for proxy authorization that prevents conflicts of interest Do not include provisions for separate block wise maintenance funds as this will likely be rejected by the competent authority during registration If different blocks have vastly different maintenance needs the solution is a transparent unified budget that allocates funds appropriately rather than creating separate legal blogs for money. I hope this answer helps, if you have any further query kindly do not hesitate to contact us. Thankyou

Anik Miu
Advocate, Bangalore
11374 Answers
126 Consultations

Based on the TNAOA 2022 and the 2024 Rules, here are the clarifications for your bye-laws:

Proxy & Voting: Proxies are eligible to vote in all General Body Meetings (AGBM, GBM, EGM) for both ordinary and special resolutions, provided the proxy instrument is valid. If an owner attends in person after appointing a proxy, the owner's personal vote overrides the proxy. The same proxy can represent multiple owners unless expressly restricted. Voting must be on UDS basis for all meetings and resolutions—a "one vote per apartment" system violates the mandated proportionality. An owner with multiple apartments holds cumulative voting weight of all units and may nominate a single proxy for all or different proxies.

Accounts & Separate Block Funds: Your understanding is correct. Since your complex has one Deed of Declaration with common UDS and shared common facilities (STP, park, clubhouse, etc.) for all seven blocks, creating separate block accounts or ring-fencing surplus maintenance funds for individual blocks is impermissible. Section 8 of the TNAOA entitles each apartment owner to an undivided interest in common areas and facilities. Common expenses must be charged based on UDS. The 2024 Rules define collective common areas and facilities as common infrastructure intended for the common use of all phases. Bifurcating a single declared project into block-wise associations is legally impermissible; such a split would require amendment of the Declaration with unanimous consent of all apartment owners.

Lalit Saxena
Advocate, Sonbhadra
329 Answers

Ask a Lawyer

Get legal answers from lawyers in 1 hour. It's quick, easy, and anonymous!
  Ask a lawyer