Form m-20
mehul
(Querist) 19 August 2011
This query is : Resolved
It is compulsory for every committee members to submit Indemnity Bond of Form-20 in Registrar office ? If it is not done then committee can sign on re-development agreement ?, If it is signed without submitting form M-20 then that agreement stand legal or illegal ? .How to find that committee had submitted Indemnity bond.
Advocate Rajkumarlaxman
(Expert) 19 August 2011
FIle Application Under RTI and enquire
As Per Maharashtra Co-operative Society's Act Without Indemnity Bond Form No. M-20 Annual Accounts Cant be Signed by Committee Members and Chartered Accountant but Violation of This Law is Done by every Society and Chartered Accountant. Action is Never Taken By Deputy Registrars/Collector. It seems There is No Liability of Chartered Accountants and Committee Members as they feel Law or Government Wont touch them. Law has remained in Paper Only.
Advocate Rajkumarlaxman
(Expert) 19 August 2011
YOu can have clear knowledge by reading this
Housing co-operative societies want exempton from the indemnity bond, Form M-20, which their managing committees are obliged to sign within 15 days of assuming charge as office-bearers. A proposal to this effect was recently forwarded to the state government by the office of the Commissioner (co-operative societies) and Registrar of co-operative societies, based on the recommendations made by federations of housing societies across the state.
As the bond places legal responsibility on the committee members for all their actions/inactions, it had raised fears among the housing societies that the form could be used against them.
In late 2007, the Bombay high court had reiterated a provision of the Maharashtra Co-operative Societies Act, 1960, that makes it mandatory for the managing committees of co-operative societies to sign an indemnity bond within 15 days of assuming charge. The bond was criticised on the grounds that it would be a huge setback to the 10,952 registered co-operative housing societies in the city, as well as 70,000-odd co-operative housing societies in the state, as, supposedly, the very nature of the housing movement is different from the other co-operatives. There are over two lakh co-operative societies in Maharashtra, of which 70,000 are housing co-operatives.
Speaking to TOI, B B Shelke, additional commissioner and special registrar (co-operative housing), said: "The proposal is based on the representations made against the indemnity bond by federations of housing societies."
The arguments presented against the imposition of Form M-20 are as follows: the housing movement works on mutual trust and co-operation; its members work on a voluntary basis, not for salaries, and that the financial turnover of housing societies is meagre as compared to other co-operatives. They fear that the trust and goodwill that is necessary for the successful working of the committee will be destroyed and residents will not come forward to accept responsibility of office.
According to Chintamani Bapat, former president of the 1,600-member strong Pune District Federation of Housing Societies, "The co-operative sector is vast, and covers varied players, ranging from banks and credit societies to textile and sugar mills. Therefore, there is a need to formulate a separate act based on the specific needs of the housing movement."
"The financial transactions of housing societies are, by and large, restricted to the maintenance and running of the society's affairs. Those societies which earn large sums by means of trade on their premises are less than 1 per cent of the total number," Bapat added.
Those in favour of the bond, however, say that it is completely in the interest of the housing movement. According to advocate Aruna Nafadey, convenor of the Sahnivas Kruti Samiti, which guides members on matters pertaining to housing, "The committee needs to be accountable as it deals in the value of the properties it represents. They are like the de facto trustees of the land and houses of the society."
Nafadey added, "The most important power that a housing society's committee has is the power to admit or exclude members. And there are many cases where committee members have misused these powers to the detriment of other residents. For instance, residents who ask too many inconvenient questions may be harassed in various ways such as being issued notices on petty pretexts, being locked out of society meetings and so on. It is precisely because of this misuse that the indemnity bond has been introduced."
She asserts that the indemnity bond will assist in bringing corrupt committee members to book. "Take, for instance, the redevelopment of old societies. Usually, the builder approaches the chairman and the society and asks them to `convince' the other members to let him have their flats in exchange for money or space in his new construction. And if they refuse to co-operate, the builder starts to pressurise these people through the committee." She does not believe that the indemnity bond will obstruct the progress of the housing movement.
"When the Consumer Protection Act of 1986 brought doctors under its purview, the fear was that doctors would stop handling complicated cases out of fear. But that never happened. Similarly, the indemnity bond seeks to provide yet another counter-check, that's all."
FORM M-20 SAYS...
"I declare today, ie ...... that I shall be jointly and severally responsible for all the decisions taken by the committee during its term relating to the business of the society, and shall be jointly and severally responsible for all acts and omissions detrimental to the interest of the Society ..." (Section 73 of the Maharashtra Co-operative Housing Societies Act)
IF NOT SIGNED...
The indemnity bond must be signed by the managing committee within 15 days of assuming office or all actions taken by them will be deemed null and void. However, the indemnity does not automatically mean trouble for a committee member. Before fixing responsibility, the registrar of housing societies will go through every case in detail to find out whether the circumstances were beyond control of the committee. Any member of the committee who does not agree with a said resolution can express his dissent in writing within seven days to the registrar.
WHAT UPSETS THE SOCIETIES
The bond says the committee members are jointly and severally liable to make good the losses to the society. For instance, if there is a discrepancy in the funds they have collected and the actual bills, they will have to pay back the society, or face punishment handed out by the law, which includes attachment of property.
Source:The Times Of India December17th,2008.
Raj Kumar Makkad
(Expert) 19 August 2011
I do agree with Times of India Report posted by Rajkumarlaxman ji.
K.S.Srinivas
(Expert) 19 August 2011
Informative news from TOI collected by Mr.Rajkumarlaxman.
prabhakar singh
(Expert) 19 August 2011
VIGILANT IS EXPERT Advocate Rajkumarlaxman
