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Co-operative society flats

Querist : Anonymous (Querist) 27 November 2021 This query is : Resolved 
Flats in co-operative housing societies in Maharashtra were not immovable property for the purpose of stamp duty and registration before 1980 or so. Transfers were effected by the simple expedient of endorsement of the name of new owner in the share certificate. Can anyone let me know whether during those days transfer to heir of the flat on the death of the testator was subject to probate (in Mumbai) and stamp duty? This is a question of facts and history and not of legal opinion.
kavksatyanarayana (Expert) 27 November 2021
To my best, since the year, 1960 cooperative housing societies were functioning in Maharashtra. On the death of the flat owner, it shall have been transferred to the nominee.
Dr J C Vashista (Expert) 28 November 2021
Well advised by expert Mr. Kavksatyananryana I endorse and appreciate.
Maharashtra Cooperative Societies Act is operative since 1960.
It is better to consult a local prudent lawyer for proper appreciation of facts / documents and professional advise.
Querist : Anonymous (Querist) 28 November 2021
In recent years, there have been judgments stating that legal heirs and not necessarily nominees, would have absolute rights over the flat and they only will have the right to alienate the property. In fact the Maharashtra Co-op Soc. Act has also been amended in 2019. What will then be the status of flats transferred to nominees, say, 60 years ago and still held by them.
SHIRISH PAWAR, 7738990900 (Expert) 29 November 2021
Hello,

The new amendment is not applicable to transfer in your case. Property transferred 60 years ago to the nominee is the valid transfer. After transfer nominee became the owner of the property.
Querist : Anonymous (Querist) 30 November 2021
Thank you Mr. Shirish Pawar. I presume that a member to whom the flat was transferred 60 years ago, as nominee of a deceased member, will have all the rights of a flat-owner including the right to sell the flat or otherwise alienate the property in any other manner. As this is an important issue I would like to see more opinions of learned experts.
P. Venu (Expert) 30 November 2021
It is true that such a system was prevailing in respect of transfer of property in flats in cooperative society. However, it is very much mystery as to the legal basis for the said system. It has always been the law that transfer of property required to be registered in terms of the provisions of the Registration Act, 1908. And to my knowledge, there was never any exception made in respect of the flats in cooperative societies in Mumbai.

Inputs from other experts would, certainly, be enlightening.
Querist : Anonymous (Querist) 02 December 2021
Section 41(a) of the Maharashtra Co-operative Societies Act, 1960 exempted transfer of shares of Co-operative Societies and related immovable property, if any, from the provisions of the Registration Act, 1908 at least as before 1980. The bill introduced in the Maharashtra legislature for the amendment of the Bombay Stamp Act, 1958, just included flats in co-operative housing societies in the list for stamp duty. It specifically says the purpose was to bring revenue for the State and nothing more(my words). Hence my original question still remains.
Querist : Anonymous (Querist) 02 December 2021
My question was "Besides transfer to nominees, there also would have been transfers to heirs on the basis of Wills. In the metropolitan cities of Mumbai, Kolkata and Chennai in order to transfer immovable property to an heir on the basis of a will, a probate has to be obtained from a competent court. My question was whether CHS flats were considered as immovable property 60 years back for the purpose of probate on a Will and whether experts have any knowledge of any such cases." This is not a legal question on the validity or otherwise of a transfer to a nominee.
P. Venu (Expert) 02 December 2021
Section 41(a) reads as follows -
41. Nothing in clauses (b) and (c) of sub-section (1) of section 17 of the
Indian Registration Act, 1908, shall apply—
(a) to any instrument relating to shares in a society, notwithstanding that the assets of the society consist in whole or in part of immovable
property;
It stands unamended till date.

As regards to the question of probate, provisions of Indian Succession Act applies. the Stamp Act or the Cooperative Societies Act, in my understanding, are of no relevance.


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