Maharashtra Cooperative Societies Act

Cooperative housing societies are part of the cooperative societies governed by the Maharashtra Cooperative Societies Act 1960, which was implemented on 26 January 1962. This act applies to the whole of the state of Maharashtra. A few amendments, like the Maharashtra Co operative Societies Act 1960 Amendment 2024, were made to this act on 13 February 2013, and it came into effect on 14 February 2013. This law is also commonly known as the Maharashtra Society Act, and it works alongside the Maharashtra Co operative Societies Rules and the Maharashtra Society Bye-laws to govern how housing societies function on a day-to-day basis. This blog will discuss the different terms used in the act, amendments made, and the key provisions of the Maharashtra Cooperative Societies Act 1960.

What Is the Co-op Housing Society Act in Maharashtra?

The co-op housing society act in Maharashtra is not a separate law. Instead, housing societies are governed primarily by the Maharashtra Co-operative Societies Act, 1960, along with the Maharashtra Co operative Societies Rules, 1961, and the registered bye-laws of the individual society.

Together, these legal provisions regulate how a co-operative housing society is registered, managed, and administered. They cover key aspects such as membership, elections to the managing committee, maintenance charges, financial management, audits, meetings, and dispute resolution.

Read also: Societies Registration Act Maharashtra

Types of Housing Societies in Maharashtra

Under the Maharashtra Co operative Societies Act 1960, housing societies in Maharashtra are classified into three main types:

1. Tenant Ownership Housing Societies

These societies distribute plots or flats on land owned by the society, allowing members to own their homes as per the Maharashtra Co operative society rules.

2. Tenant Co-partnership Housing Societies

Defined under the Maharashtra co-operative housing societies act, these societies own both the land and buildings (freehold or leasehold) and allot units to members for use and occupancy.

3. Other Housing Societies

This includes housing mortgage co-operative societies and house construction societies, which operate under the Maharashtra co-operative society rules act.

Different Terms Used in the Maharashtra Cooperative Housing Societies Act

1. Central Bank

Central banks are cooperative banks aiming to create funds to lend to other societies. However, these do not include the primary urban cooperative banks. 

2. Cooperative Bank 

Cooperative banks conduct banking business under the Banking Supervision Act 1949 guidelines.

3. Cooperative Appellate Court

The Cooperative Court of Appeal is the Maharashtra Cooperative Appellate Court set up under this act.

4. Bonus

According to the Maharashtra Co-operative housing societies act, bonus means a payment made in cash or kind. It is taken out of the profits of a society to its members, or to someone who is not a member. It, however, does not include the amount paid to society employees under the 1965 Bonus Act.

5. Managing Committee

A managing committee is a board of directors or any committee of management that manages the daily company affairs according to the law drawn up in Article 73 of the law.

6. Working Capital

Working capital refers to the funds that a society has at its disposal according to the Maharashtra co-operative society rules act. This includes paid-up share capital, profit-based funds, and money raised by borrowing and other methods.

7. Dividend

A dividend is the amount paid from a society’s profits to a member proportionate to the shares held by him.

Key Provisions of the Maharashtra Cooperative Housing Societies Act

1. Registration

Forming a society under Maharashtra co-operative housing societies act requires at least five members. Submit model bye-laws, affidavits, and site plans to the Registrar. Approval confirms legal status and enables operations.

Read More on: Housing Society Registration

2. Membership Rights and Duties

Members gain shares post full payment and receive allotment letters. They must clear dues timely to vote or contest elections. Nomination rules safeguard family interests during transfers.

Rights include:

• Access to society records.
• Participation in general meetings.
• Grievance redressal via committees.

3. General Body and Managing Committee Governance

• The General Body is the supreme decision-making authority.
• Managing Committee members are elected for a fixed tenure.
• All major financial and policy decisions require General Body approval.

Read also: Annual General Meetings (AGMs) 

4. Maintenance Charges and Funds

• Maintenance charges must be levied fairly and approved by the General Body.
• Mandatory funds include:
  
  • Repair Fund
  • Sinking Fund
  • Education and Training Fund
• Charges should follow government circulars and society bye-laws.

5. Financial Management and Audit

• Proper books of account must be maintained.
• Annual audits by authorised auditors are compulsory.
• Audit reports must be submitted to the Registrar within the prescribed timeline.

Note: Annual statutory audits are compulsory and must be completed by 31st July (within 4 months of financial year closure, per Section 81(1) of the Act and Rule 69). The audit must be conducted by a government-approved auditor from the panel, using Form N-2, covering all financial transactions, fund utilisation, and compliance.

6. Elections and Disqualification Rules

• Managing Committee elections must follow state election authority guidelines.
• Members defaulting on dues may be disqualified from contesting elections.
• Conflict of interest rules apply to committee members.

7. Dispute Resolution Mechanism

• Disputes related to society management, maintenance, or membership are referred to:
  
  • Registrar of Co-operative Societies
  • Co-operative Court
• Appeals can be filed as per the provisions of the Act.

8. Compliance and Record Maintenance

• Societies must maintain updated records, registers, and statutory filings.
• Non-compliance may lead to penalties, audits, or administrative action.

These key provisions ensure that co-operative housing societies in Maharashtra operate smoothly, protect member interests, and maintain legal compliance under the Maharashtra Co-operative Society Rules.

Read also: RBI Guidelines for Opening Society Account

Maharashtra Society Bye laws 

Maharashtra society bye laws are the rulebook every housing society writes for itself, within the boundaries set by the Maharashtra Cooperative Societies Act and the Maharashtra Co operative Societies Rules. While the Act and Rules apply uniformly across the state, bye-laws let each society set its own terms for parking, pets, sub-letting, and use of common amenities.

What Do Maharashtra Co-operative Housing Society Bye-laws Cover?

Maharashtra co-operative housing society bye-laws typically cover membership admission and transfer, non-occupancy charges, nomination of shares, sub-letting conditions, and the day-to-day conduct of managing committee meetings. Every registered society must adopt the model bye-laws issued by the state's Cooperation Department and may customise clauses like parking allotment or pet policies to suit its own premises.

How to Amend Maharashtra Co operative Housing Society Bye laws?

Any change to Maharashtra Co operative housing society bye laws needs approval from at least two-thirds of the members present and voting at a general body meeting, followed by registration with the Registrar of Co-operative Societies. An amendment only takes legal effect once the Registrar confirms it in writing, so societies should avoid enforcing a bye-law change before this approval comes through.

Maharashtra Co operative Societies Rules

Financial and Maintenance Obligations

Maharashtra co operative societies rules mandate repair funds, sinking funds, and annual audits. Societies prepare budgets and collect contributions quarterly. Defaults trigger penalties like interest charges.

Common funds:

• Major repair fund: 0.25% of construction cost.
• Education and welfare fund: Half of repair fund.
• Reserve fund: As per bye-laws.

Committee Elections and Governance

Elections occur every five years with secret ballots. Quorum needs 75% of members for AGMs under Maharashtra co operative societies rules. Committees handle daily affairs with joint liability.

Governance tips:

• Transparent minutes and notices.
• No proxy voting beyond limits.
• Annual reports to the Registrar.

Key Amendments and Recent Updates in Maharashtra Cooperative Societies Act

Allotment and Redevelopment Norms

Flats allotted via lottery; certificates issued after payments. Redevelopment demands 51% consent and developer MOUs. Draft rules emphasise timelines and transit rents.

Dispute Resolution Mechanisms

Minor issues resolve internally; major ones escalate to Co-operative Courts. Mediation prioritises harmony per the Act.

Maharashtra Co operative Societies Act Latest Amendment

The Maharashtra Cooperative Societies Act has been updated through a series of amendments, including changes introduced in 2023 and the Maharashtra Cooperative Societies (Amendment) Ordinance, 2024, notified on 15 January 2024.

Some of the notable changes include:

• Definition of an Active Member: Members must attend at least one general body meeting within five years or use the society's services, where applicable, to retain certain membership rights, including voting eligibility.
• Committee Elections: The amendments strengthen provisions relating to the election and functioning of managing committees.
• Online and Hybrid Meetings: Societies can conduct general body meetings through online or hybrid modes, subject to the prescribed conditions.

Since cooperative society laws are updated periodically through amendments, rules, and government circulars, managing committees should verify the latest notifications issued by the Maharashtra Cooperation Department before implementing any changes or amending their society's bye-laws.

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