Managing Committee can not create own basis to impose charges
The guidance lies in laws; which is as follows:
The general body while framing regulations for maintenance of essential services including mandatory green area in the co-operative housing society shall have to take into account the common areas, common facilities and the services which are rendered to the members and the residents by the co-operative housing society. The regulations shall have to spell out the basis of fixing up of the charges for the maintenance of essential services specially in such complexes, where area of dwelling units and number of storey of flats differ in sizes. Further, where lifts are installed in building charges for its use and maintenance shall have to be paid by all members and residents in spite of the fact whether the particular member or resident is staying at any floor of the building. The general body may fix higher charges of essential services in respect of dwelling units which are on rent and in possession of tenants.
In recent cases you must have realized that societies had started collecting Entry Fee from new members and it had to be declared illegal by Courts. Thereafter, the Societies have started imposing Charges on 2nd Car, 3rd Car, 4th Car & 5th Car of members to generate revenue for the Society. This has also been declared illegal in a recent judgment of a Arbitrator Mr. SC Khatri. The Order is as below:
IN THE COURT OF MR. SC KHATRI, ARBITRATOR APPOINTED BY
THE REGISTRAR OF CO-OPERATIVE SOCIETIES GOVT OF NCT OF DELHI,
B-84 (G.F.) HARI NAGAR, CLOCK TOWER, NEW DELHI-110064
Arb.Case No.73/GH/DR/ARB/2012-13 Dated: 04th March, 2014
In the matter of
Sh. Anup Mittal (HUF)
Through Mr. Anup Mittal, Karta
R/O 561 Kanungo Apartment
71 IP extension, Patparganj,
(1). M/S Kanungo CGHS Ltd
Through its Hony Secretary
R/O 71 IP extension, Patparganj,
(2). Mr. JB Goel
President, M/S Kanungo CGHS Ltd
R/O 401 Kanungo Apartment
71 IP extension, Patparganj,
(3). Mr. Ramesh Aggarwal
Hony Secretary, M/S Kanungo CGHS Ltd
R/O 131 Kanungo Apartment
71 IP extension, Patparganj,
(4). Mr. KK Pandey
Treasurer, M/S Kanungo CGHS Ltd
R/O 413 Kanungo Apartment
71 IP extension, Patparganj,
AWARD UNDER SECTION 71 OF THE DCS ACT, 2003
1. The present petition has been filed by the Claimant against imposing of “Extra Car Parking Penalty” by the Defendants.
2. The Dy Registrar (Arbitration) had heard the petition U/Sec 70 of the DCS Act, 2003 and has ordered vide his orders dated 30th October, 2013 that the petition deserves to be heard by an Arbitrator and Claim of the Claimant along with reply of the Defendants were forwarded U/Sec 71 for adjudication.
3. Both the parties were issued summons for 24.12.2013. Shri Raminder Singh Sahota, Ld Counsel appeared for the Claimant and Shri. Rajiv Vig, Ld counsel appeared for the Defendants. The Defendants and also the Claimant filed their submissions before me and proceedings were concluded after hearing final arguments cum discussions on 01.03.2014.
BRIEF FACTS OF THE CASE
4. As per Claimant the Society has imposed Extra Car Parking Penalty/Charges through a resolution passed in the general meeting in September, 2005 and it continuing to demand at enhanced charges from the claimant till date in the monthly demand letters. In the last AGM held on 01.10.2012 the general meeting fixed the extra car parking charges as under:-
1st Car – No charges
2nd Car – Charges to be increased from Rs.200/- to Rs.300/- p.m.
3rd Car – Charges to be increased from Rs.700/- to Rs.2500/- p.m.
4th Car – Charges to be increased from Rs.1500/- to Rs.5000/- p.m.
5. The Defendant society in their written submission stated that DDA had allowed and approved the construction of basement in the Defendant society. The space in the basement can accommodate only 209 cars which mean one car parking space for each of 209 members of the Society. The society stated that the Claimant had been paying without any objection or protest all the charges levied by the general body meeting of the society i.e. maintenance, extra car parking charges, electricity charges since 01.10.2005 onwards. The society stated that it has not collected the money illegally. The general body is supreme body to take any decision and it is the decision of the general body meeting and therefore, it should be legally abided by everyone. The Society further stated that, the Claimant is defaulter and has not been paying any maintenance, electricity and car parking from 18.11.2012, therefore, he should not be heard in this case.
6. The Claimant stressed that the decisions of the AGM are bound to be within the framework of the laws of the land. The general meeting is not above the law. In the present decisions of the society, the decision is against the Main Objects stated in the Bye Laws of the Society and they are also against the DCS Act, 2003 and the DCS Rules, 2007. The Claimant has submitted that the Defendants have imposed Car Parking Penalty/Charges illegally. The Defendants have been increasing and demanding the charges every month and threatening to recover through legal means provided under the DCS Act, 2003. The claimant has alleged that the Defendants are not a legislature, executive and judiciary to frame laws and then recover from the Claimant and then also impose a penalty. The Defendants are bound by Constitution of India, the DCS Act, 2003, the DCS Rules, 2007 and Bye Laws of the Society registered with the Registrar of Co-operative Societies at New Delhi. None of these laws permit the Defendants to impose extra car parking charges penalty or charges on the claimant for parking his cars in the common space of the Society.
7. During the course of proceeding on 24.12.2013, the Claimant was directed to produce the membership certificate and Respondent was directed to submit Bye Laws of the society and break of Car Parking Penalty / Charges, month wise and expenses made by it on Car Parking and any other document they wish to file in support of their defence. The claimant filed all the documents but the Defendants did not file the directed information on 06.01.2014, 08.02.2014, 15.02.2014 and 01.03.2014 and due to this reason the Society has waived their rights to produce say anything as per Arbitration & Conciliation Act, 1996.
8. During the course of Arguments and also the submissions the Claimant produced the Bye Laws of the society in which the Defendants are to confine themselves to Sub para (vi) and (vii) of the Main objects of the Society. The claimant further argued that Defendants are to provide common maintenance & facilities charges only and that too they are required to estimate the expense in budget and then get it approved from the General Meeting. The Claimant further stressed that under Rule 89(7) of DCS Rules, 2007 the cost of maintenance, repair and replenishment in the common areas and facilities shall be apportioned amongst the members, the power of attorney holders and holders of conveyance deed whoever may be having occupancy rights of the plot or flat or garage etc. The claimant further stressed that under Rule 106 of the DCS Rules, 2007 the management of co-operative housing complex by the co-operative housing societies, the maintenance charges is one fund and one cannot divide the work of employees or security guards toward which function of security or caretaking the expense is being made. Even the Defendant Society could not file the total amount collected from the members and expenses made by them on extra car parking penalty. Secondly, the Common Parking & garages is included in the maintenance charges as specified under Sub Para (xx) of Rule 106(5) of the DCS Rules, 2007.
9. The claimant further stressed that the Defendant Society has not even replied on account of Car Parking Penalty Charges to the application of the Claimant U/Sec 139(1) and Rule 165(1) of the DCS Rules, 2007 till date.
10. The claimant further stressed that the Defendant Society is co-operative group housing society and not a business generating income society. The claimant provided a document under which one month income only from car parking has been to the tune of Rs.1 Lac and demanded to summon the records of the society to scrutinize the records. However since the Society did not provide any documents and has waived their right, it is taken that the claim of the claimant is correct in all respects.
After going through all the submissions and hearing arguments of both the parties I, hereby conclude that:
(A) The Car Parking Penalty/Charges imposed by the Society are illegal and therefore voidable. The Defendant Society is directed to revoke all the Car Parking Penalty/Charges imposed on the Claimant and they are to return the charges collected from the Claimant within 30 days or adjust these in further demands of the society.
(B) The Defendant Society is further directed to pay interest at the rate at of 9% on all extra car parking penalty/charges collected from the Claimant, within 30 days or adjust these in further demands of the Society.
(C) The Defendant Society has to pay litigation charges of Rs.11,000/- to the claimant within 30 days.
Given under my hand and seal on this 4th day of March, 2014.
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