How should we calculate sinking fund and repairs and maintenance fund if the builder does not provide us a break-up of the construction cost? Is the general body approval required to apply 0.25% and 0.75% of the construction cost for collecting the said funds respectively? Should the said calculation be on the basis of the carpet area or built up area?
Krishnan Menon, Kharghar
Every society is required to maintain a sinking fund and repairs and maintenance fund. The rate of the sinking fund should be decided by the general body subject to the minimum of 0.25% per annum of the construction cost of each flat. Incurred during the construction of the building and certified by the architect, excluding the proportionate cost of the land. Further, the general body must fix the rate for collecting the repair and maintenance fund to a minimum of 0.75% per annum of the construction cost of each flat, incurred during the construction of the building and certified by the architect for meeting expenses of normal recurring repairs of the society. If your builder has not given you the breakup, your society can either obtain the details from him or consult a government-approved valuer. Your society should charge its members on the basis of the carpet area for contribution toward the aforesaid funds at the rate/s approved by the general body even if it is the minimum rate provided in the Bye Laws (Section 154B-15/16,Bye Lays 13, 67).
Can NRI members attend society meetings online? Can this facility be extended to local members who do not reside in the society?
VS Singhania, Bhandup
During Covid the state cooperation department issued a circular dated February 25, 2021, allowing societies with more than 50 members to conduct AGMs by way of video conferencing or audio-visual means. The circular provided details as to how online AGM can be conducted and the compliance to be done by the society. However, this circular is specific for the Covid period when a gathering of more than 50 people was not allowed. In case you wish to conduct AGM in online/hybrid mode, you may pass a resolution in the general meeting and file the same with the deputy registrar for approval. Subsequently, the NRIs or other members not residing in the society may be able to attend the general meetings in the online/hybrid mode. In such an event your society can consider adopting the procedure mentioned in the aforesaid circular for conducting online meetings. Alternately, you may amend the provisions of the Bye Laws and have it approved by the deputy registrar.
We have received a letter from one of the joint members to cancel her nomination and add her husbands name instead on the share certificate. This woman and her son were nominated by her deceased mother in law and the society transferred the shares in their joint names in 2011 without any objection from the deceaseds son and daughter. The deceaseds son is now demanding the transfer of 50% shares in his name. Can the transfer effected in 2011 now be cancelled on the basis of such a request?
Pratape Narayan, Charni Road
The society has given effect to the nomination of the deceased member and transferred the shares to the nominees in 2011. The same was not challenged by anyone from the family of the deceased member. The transfer of shares cannot happen on the basis of any request letter from the member or on the basis of any demand by the aspiring member. The joint member seeking cancellation of nomination may be informed that the nomination can be cancelled only by the member during her lifetime and cannot be changed after her death. The joint member willing to transfer her share should execute a gift deed favouring her husband. A copy of the registered gift deed should be submitted to the society on the basis of which you can transfer 50% of the shares held by her in the name of her husband. The remaining 50% will remain in the name of their son.
The questions are answered by Sharmila Ranade, a legal expert associated with Mumbai Grahak Panchayat. The questions, in brief, may be sent to fpjchs@gmail.com
