• Maintenance charges

Our Residential complex has about 1000 flats of different sizes. The builder at the time of selling flats has charged maintenance charges for two years on flat size based on square feet at specific rates. Flats are of variable size ranging from 1300 sft to 4000sft. While all common facilities including WTP and STP are being enjoyed equally, monthly maintenance is variable from Rs. 4000 to Rs.11,000 including GST showing wide disparity. Many people are demanding equitable distribution of maintenance charges for all common facilities and not on square feet basis and demanding rationalization of maintenance charges. The present elected body is not heeding to the request and we seek your legal opinion about what can be done to redress our problem. Thanking you
Asked 4 years ago in Property Law
Religion: Hindu

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17 Answers

-  As per rule, the popular methods to calculate the maintenance fee for your apartment is 

1. Equal Fee for All, but it is common in the apartment, where all the flats are of same sized.

2. The most commonly used method is Area Wise maintenance charge, A rate is fixed for one square feet and then multiplied by the total square feet area of your flat in this method. It means that if you have a larger home, you will end up paying more.

- Further, the common areas are divided equally using a fixed rate while flats are calculated depending on the size of the apartment. 

3. Partially Equal Fee i.e A particular amount of money is charged on the area up to a predetermined square feet value, and beyond that, any increment in area is charged according to a unit decided by the apartment association. 

4.Hybrid Charges , i.e Splitting the charges into two with the first part including all the common expenses incurred on lifts, security staff salary, stationary, property taxes, conveyance, audit fees, meeting charges, common electricity etc , and the second part includes the area based charges that are specific to the apartments such as water charge and electricity usage.

- Hence, society can decide and make rule accordingly for the welfare of all the inhabitants of the society.

- If the society not paying attention towards the genuine demands, then file a compliant before the Registrar of the Housing Society. 

Mohammed Shahzad
Advocate, Delhi
14641 Answers
224 Consultations

What is provision in your bye laws

 

if bye laws provide maintenance has to be equal irrespective of size of flats then you can object to maintenance being charged on basis of size of flats 

Ajay Sethi
Advocate, Mumbai
97233 Answers
7852 Consultations

How did the builder charge an arbitrary amount from the residents. Moreover those who are enjoying the lesser amounts may not be keen to change anything.

A complaint may be filed in the RERA tribunal.

A complaint can also be filed in the consumer forum.

Rahul Mishra
Advocate, Lucknow
14107 Answers
65 Consultations

The issue should have been projected in the recently concluded meting.

A resolution should have been passed by the majority of the members attending the annual general meeting to make changes in the bylaws to facilitate the association to charge the maintenance charges equally from all the members on all the common utilities other than the water and electricity consumption charges which may be justified.

You cannot go agaisnt the association even before court of law to get it changes unless there is a resolution passed in the association's special or annual meeting to make changes in the maintenance charges on common facilities.  

You may gather like minded affected people and call for a special meeting of the association  by issuing a notice to the president/secretary of the association for discussing on the aggrieved matter  and taking a decision on the same keeping that as a main agenda for the meeting. 

If the association is not agreeing to conduct the special meeting as requested by majority members, then you can issue a legal notice to the association stating that they are not acting n the interest of the members, hence why not the elected body be removed and re-election be conducted due to the inefficiency and non-cooperation of the elected body  who are  working against  the interest of the members of association. 

 

T Kalaiselvan
Advocate, Vellore
87436 Answers
2348 Consultations

1. IRRESPECTIVE of the Flat sizes, Service & Maintenance Charges have to be levied on EQUAL charges on per Flat basis & not on per square feet basis.  This has been upheld by several HC judgments.

2. SERVICE CHARGES IN MAHARASHTRA HOUSING SOCIETY:
https://chshelpforum.com/service-charges-of-chs

 

3. ALL the expenditures aggregate totaled up should be divided EQUALLY between all Flat holders.

Hemant Agarwal
Advocate, Mumbai
5612 Answers
25 Consultations

Dear Sir,

You are suggested to give your representation in writing to the society management as well as to the registrar of the society. If nothing done, then case may be filed in the court for injunction. 

Ganesh Singh
Advocate, New Delhi
6769 Answers
16 Consultations

In case the charges exceed Rs 7,500 per month per member, the entire amount is taxable.

For example, if the maintenance charges are Rs 9,000 per month per member, GST @18 per cent shall be payable on the entire amount of Rs 9,000 and not on (Rs 9,000-Rs 7,500) = Rs 1,500.

If the turnover of housing society is above 20 lakhs, it needs to take registration under GST in terms of Section 22 of the CGST Act, 2017.

However, taking registration does not mean that the housing society has to compulsorily charge GST in the monthly maintenance bills raised on its members. 

exemption is available to housing societies for provision of carrying out any activity which is exempt from the levy of Goods and Services Tax assuming that a housing society is a non-profit registered entity; and property tax and electricity is exempt from the levy of GST. Thus, charges, collected by the society on account of property tax, electricity charges and other statutory levies would be excluded while calculating the limi.

Services provided by the Central Government, State Government, Union territory or local authority to a
person other than business entity, is exempted from GST. So, Property Tax, Water Tax, if collected by the RWA/
Co-operative Society on behalf of the MCGM from individual flat owners, then GST is not leviable.

Sinking fund, repairs & maintenance fund, car parking charges, Non occupancy charges or simple interest for late 
payment, attract GST, as these charges are collected by the RWA/Co-operative Society for supply of services
meant for its members.

You may go through the above and confirm if you are eligible for reimbursement of the GST paid  to proceed.

T Kalaiselvan
Advocate, Vellore
87436 Answers
2348 Consultations

It's not clear whether your flat is registered under any law or not. 

Under Apartment ownership Act or otherwise collection of maintenance charges on measurement of flat is most suitable and logical apart from being compulsory. 

As regards GST the breach of law can always be redressed by lodging complaint with GST Commissioner. 

If majority of flat owners are agreeable then register the association under Apartment ownership Act. 

Devajyoti Barman
Advocate, Kolkata
23280 Answers
517 Consultations

Yes the GST input is reimbursable to owners.

In normal conditions maintenance is as per sq ft area rest depends on the bylaws of the society 

Rahul Jatain
Advocate, Rohtak
5365 Answers
4 Consultations

This is law that in case the MC exceed Rs 7,500 per month per member, the entire amount is taxable.

You along with other effected members can file suit in court for direction to charge MC equally because due to disparity in MC charges, you are forced to pay GST for services equally enjoyed by all hence, violation of constitutional right and right of equality.

Yogendra Singh Rajawat
Advocate, Jaipur
23004 Answers
31 Consultations

Yes you have solution. 

Please issue legal notice to them for REDRESSAL of your grievances against discrimination and disparities in raising monthly maintenance bill.

If not then approach District Competent Authorities for excessive charges being charged by them. 

GST is chargeable on maintenance bill over INR 5000.00.

You may get reimbursed. 

Ramesh Pandey
Advocate, Mumbai
2541 Answers
8 Consultations

First what does the society bye-laws says that has to be seen first . How was it decided that amounts has to be paid as per sft it their any resolution to that effect . All has to be seen and then only it can be finalised

Mohammed Mujeeb
Advocate, Hyderabad
19326 Answers
32 Consultations

It can only be adjusted by way of incentive credit if the member is also a part of gst payer. It's better to check the maintenance and monitor that whether the maintenance charges are not exorbitant. In such big society there is always a possibility of misappropriation of funds by overcharging the funds from members by Managing committee. You need to check the same. It's better to divide the common expenses with no of flats and members to do equitable justice and common expenses is nothing to do with area of flat size. 

Prashant Nayak
Advocate, Mumbai
32660 Answers
207 Consultations

For fixed variable like construction repair fund, sinking fund, painting and repair funds are fixed. But the current maintenance like common sweeper clean, garbage cleaner, common electricity bills, Lift charges, Security Gaurd Salary, all day today expenses which will be come under common expenses and that will be divide into common maintenance charges and fixed charges per sq ft wise.

 

If you want I can prepare a maintenance record formula accordingly fixed and variable charges, I have provided services  to many co-operative housing societies.

Ganesh Kadam
Advocate, Pune
12995 Answers
262 Consultations

1. this issue is already decided by the Bombay High Court in its judgment of Veena Co-operative Housing Society Ltd.

2. the Court has held that the maintenance [except property tax and water charges] has to be charged on basis of number of flats in the building regardless of their size. That is, it is illegal to charge on basis of flat carpet area

3. if the society is paying GST on its purchases and is claiming input tax credit, then society must pass on the benefit to the society members as well, in the form of reduced maintenance charges. However please consult a chartered accountant for this as well

Yusuf Rampurawala
Advocate, Mumbai
7721 Answers
79 Consultations

Please call 

Mahesh Patel
Advocate, Warangal
9 Answers
2 Consultations

1. For that you need to raise the issue in next AGM of society where maximum of members should vote in your favour for variable calculation of maintenance.

2. This change can only be bought through change of bye laws of society through majority voting. 

 

Mohit Kapoor
Advocate, Rohtak
10687 Answers
7 Consultations

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