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Janak (Retired)     26 March 2013

Building maintenance charges

I own a flat purchased on ownership basis in 1992 at Kolkata. There are 12 owners for 16 flats in the Ground plus 4 building with lift. The Maintenance Charges is collected by one individual an owner or his/her family member in cash each month just by entering the amount against the name of the flat owner in an exercise book and the contributor has put his/her signature after making the payment. No money receipt is issued and no Income/Expenditure Account is audited or circulated among the flat owners. There is no Flat Owners' Association or Managing Committee as the Building is not registered under West Bengal Apartment Ownership Act 1972. 

I do not stay in my flat and it lies locked, unoccupied for several years due to personal reasons and medical treatment of my wife for which I stay in a different locality. As such, I pay my dues anually in April/May every year.

Recently, I was receiving frequent phone calls and threats claiming big amounts as Rs.30000/-, Rs.20000/ etc on different accounts in name of building maintenance for which I had to serve a legal notice to one of the owners who last collected the Maintenance Charge from me for my flat in May 2012 asking for the total outstanding due amount in my name for my flat with plausible mode of payment desired by them. 

Unfortunately, there were no reply received by my lawyers till the preferred time limit of 14 days in the notice. 

Now, what should be my next step? Please note, I want to make the payment of all my outstanding dues provided the total amount due from me is demanded from me in writing with break up and also the payment is made by some mode which has legal acceptance and validity. As just paying cash to one individual against  some verbal demands made on telephone without issuance of any  money receipt has no legal acceptance or validity in Indian Law.

Should another Legal Notice be sent referring the first one or a suit filed in court of law? If so, against whom and how? Please guide.



Learning

 14 Replies

Manish Udar (www.Mehnat.IN)     27 March 2013

If they do not send you a bill you do not need to pay. Keep your served legal notice in your files for future use if they take any illegal action against you. You may further issue a legal notice to them for an explanation regarding past payments.

www.mehnat.in

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     27 March 2013

The way the maintenance charges were collected was illegal. Who gave authority to that one flat-owner, to collect amounts from other members? A flat owners association should have been formed, with byelaws, election of Managing Committee members etc. and it should have been registered under any of the laws of West Bengal. If this was not done, no court can enforce payment.

Janak (Retired)     29 March 2013

Thanks for the advice. Now, recently I received a call on my cell number from one of the owners in the building demanding Rs.2000/- for changing the existing municipal drinking water pipeline. When I said that I am not supposed to pay any such amount as I don't stay in the building since over 14 years and as such wont beconsuming any municipal drinking water, the person on the phone threatened that he along with his associates being few other flat owners have collectively approached the local councilor of the locality who has asked them to submit a complaint on receipt of which after serving due notice to me the local councilor with help of the police would break open the lock on the main door of my flat and leave the main door ajar as it is, if I continue to keep my flat locked, vacant and unoccupied. He said it would be mandatory for me to open my flat once every month else I would suffer the consequences.     

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     29 March 2013

If you dwell on your argument that you are not liable to pay the amount to whatever reason stated by you, you will lose the case. Instead, you should question the authority of the person or persons, to collect funds from members. You can send a show cause notice to the person or persons asking under the authority of which law are they collecting funds. If possible you bring a court injunction against the person or persons collecting the funds. Of course you will have to hire a lawyer and spend some money.

If the police breaks open your door, you can take action against the police.

Janak (Retired)     22 May 2013

My lawyers finally received a reply to the legal notice on 20.5.2013 from the lady to whom we had addressed our legal notice to being a flat owner in charge of collection of the building maintenance money from the flat owners and management of such funds collected towards making payment for common service/s. She states 'I am writing this letter on behalf of all the flat owners. There is only one staff for Gate Durwan Duty. The maintenance  charges of the building is being collected by the Gate Durwan and deposited with me.' The said reply letter however is signed singly by her without any designation. The letter further attaches a break-up for the total outstanding dues from me amounting to Rs.18551/- under different heads as, A) Total outstanding of common maintenance charges at old rate for last 12 months; B) Outstanding of common maintenance charges at revised rate from May 2013; C) Proportionate share for expenditure  of Rs.26775/ incurred for new filtered water connection from municipality;D) Proportionate share for expindure of Rs.258000/- incurred for thorough repair and painting of the building. None of the claims are backed by supporting documentary evidence as a)minutes of any meeting b) estimates/quotations/bills received from the vendors/service providers and c)income/Expenditure Accounts of total money collected and how it was spend with supporting money receipts for every payment made. 

The letter further states 'We are not keeping any paid staff as care taker or to maintain the accounts. Your advice regarding getting registered under relevant provisions of west bengal apartment ownership act 1972 was discussed and all of the owners didn't want to get registered as they are not willing to bear extra cost of additional staff. We now request you to pay outstanding by cash.'

Ii is beyond my knowledge under which section of WB Apartment Ownership Act 1972 it is mandatory for the owners to bear extra cost for appointing additional paid staff for which the proposal of getting registered under the act to form an association of owners could be rejected.

Finally, although the claims made under various heads can be contested for lack of transparency and not backed with documentary evidences and accounts the instruction to pay the outstanding amount Rs.18551/- by cash to the Gate Durwan sounds bizarre and illegal.

Please advise me as to what should be next step. Should I move court praying to get the accounts and procedures practiced in the handling the building maintenance funds to be audited by a court appointed auditor and make the payment only through the court of law? Such big amount cannot be paid in cash to any individual who is not authorised in law to be custodian of such fund in law. As there is no owners association, there is no bank account. So the outstanding amount can neither be paid by a demand draft as no one could be named as the payee of the bank draft as nobody is in charge of the common facilities under law and any contribution in cash could well get diverted from building maintenance to personal use. 

Under the given context please advise me my next move as appropriate in law to protect my interest and my property.

Manish Udar (www.Mehnat.IN)     23 May 2013

this is a very small amount.

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     23 May 2013

 @Mr. Manish Udar:

What is a small amount? What is the relevance whether the amount collected is big or small?

@ Mr. Janak

The answers to your questions are obvious.

For any person to collect any amount by cash or cheque from any other person is illegal unless he or she is vested with authority under the law of the land. Now you ask your lawyers to file a case against the lady and other individuals involved, any, by name questioning their authority to collect funds from flat owners and more importantly bringing a "stop collections" injunction against them barring them from collecting any amount from anybody without the authority under any law of the land. Once the injunction is ordered,  the ball will be in their court. If you dwell on the justification for the payments the case will get mired in litigation indefinitely.

Manish Udar (www.Mehnat.IN)     23 May 2013

I think the size of the amount is very relevant when deciding whether or not to litigate. I don't think this needs to be explained.

Janak (Retired)     23 May 2013

Thanks Dr. Ramani for your valued advise. I agree with you completely that the amount of money claimed, whether small/meagre/insignificant or big is not the point that my learned friend Mr.Udar eluded to.

The question is whether the person/s and/or group of persons being owner/s of flat/s in the ownership building are authorised under law to claim/demand and collect/receive such money in cash for years together from all the flat owners in the name of building maintenance and common service charges? That was the reason behind my proposal forwarded to them in my legal notice to register the building under the West Bengal Apartment Ownership Act, 1972 to form a Owners' Association with a Bank Account. But in replying, the lady with whom the money is deposited after collection from flat owners by the Gate Darwan has stated that ' all of the owners don't want to get registered as they are not willing to bear extra cost for additional staff'.'

I concede dwelling in justification for the claims/payments would end up in unending litigation. I also appreciate your advise to move court for filing a suit against the lady/others to obtain a 'Stop Collection' inujunction order barring anyone to collect any amount from anybody unless authorised under law.

I would definitely convey the same to my lawyers.

Meanwhile, out of the way, just seeking a friendly advise, I would like to know, without going into a legal battle dragging all flat owners into a court of law, if I make the payment just for this time with a notice that no further claim/demand would be entertained/paid in future unless raised under law, then what mode of payment and procedure should I insist on? What sort of documents, like Money Receipts, No Outstanding Cetificates, etc. should I obtain and from whom that would stand valid and acceptable in law? Can a Affidavit signed jointly by all the flat owners to the Magistrate suffice as a legal document for me which would state ' Mr........had made the full payment and that no outstanding is due from him as of date towards building maintenance and common service charges and no claims/demands on any account made/raised in future for this period by any should in no way be binding on him and the same, if any, should be treated as null and void and should have no value whatsoever in law.'

Is there a better documentation for my record and future reference that would be valid and acceptable in law if such a occasion arise for settlement of the dues this time?

Please suggest and advise.

 

Janak (Retired)     24 May 2013

Mr. Udar I fully understand and appreciate your point. It is not the question of litigating. As of date the outstanding is small i.e. only Rs.18,551/- but it will jump slowly as the rate of monthly charge is Rs.880/-, i.e. 10,460/- per year add to this exigency costs as building repairing, plumbing, drainage, boring a new deep tube well or purchasing a new pump and major repair of the lift or payment to the electric supply for restoration of a disconnection for default. All these amounts and proportionate share would inflate the outstanding figure to a very big amount.

The question is not whether to litigate or not but how to make payments to any flat owner/s acting on their iindividual capacity having no authority under any law whatsoever as there is no owners' association. So whom to pay and who will issue the money receipt and a No Outstanding Certificate? Any receipt or certificate issued by any flat owner/s will not be valid and acceptable in law. There being no managing committee in charge authorised under law payment in such circumstances my oustanding monies and all future payments in cash to a gate durwam would put me in trouble and I would have no legal document in my hand which would prove my payment if that individual cease to be flat owner by selling off his flat or denies such transaction anytime in future.

So what sort of documents and procedure for making the payment should I insist on?

Awaiting your advise.

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     24 May 2013

There was a  case similar to yours in Cnennai, Tamilnadu. In Tamilnadu there is a Tamilnadu Ownership Flats Act, 1997. There also flat-owners in a building continued to collect funds from members without registering under the Act. But they were better than your case. They formed an Association with office bearers like Chairman, Secretary and Treasurer, opened a bank account in the name of the unregistered Association and sent demand notices to Flat Owners. Also though not registered, they followed the byelaws given in the Tamilnadu Act. All members paid their dues without any hitch for some time. One of the flat owners was a resident of Mumbai. He also paid the dues regularly. As the member was not in Chennai, he let out his flat on rent and everything was going smoothly. Then the tenant vacated the flat and there was a gap of a few months when the flat was vacant. Then the owner member refused to pay maintenance charges stating that his flat was vacant and neither  he nor anyone else with respect to the Flat was availing the services rendered by the Association. Under the byelaws in the Act he was liable to pay. But as the Association was not registerred, it could not enforce that byelaw. In the meantime the Mumbai member got a tenant and the tenant continued to pay the dues from the date of his occupation. But the arrears of the Mumbai member remained for the unoccupied period.

As he flatly refused to pay, the Office Bearers cut the water supply to the flat. The tenant frantically asked the Office Bearers to resume water supply. He also contacted the flat owner in Mumbai, who in turn requested the Association to restore the water supply.

The Office Bearers did not budge. Though I am not a lawyer the Mumbai member sought my advice. He went to Chennai, met a lawyer and filed a case against all flat owners individually by name. On the first hearing itself the judge sent notice to all those named as the Opponents. He also ordered restoration of water supply until the Opponents gave their version before the court and justified their action. The water supply was restored the same evening.

Now the flat owners have to send reply to the notice and defend the case. They could not do it because no one was willing spend money on the litigation. The matter of payment of arrears by the Mumbai member is now dead-locked. He will no more receive notices for payments. But his tenants continue to pay their current dues to the Association. 

If you want to pay now, offer to pay by Account Payee cheque or by NEFT and ask them the name of the Association and their bank account  particulars.

The criterion to decide whether one should go to court or not is not whether the current dues are big or small, but in whose favour is now the balance of convenience and how to shift it to your advantage.

Kawaljeet Singh (General Manager)     18 October 2015

Dear Sir,

Can builder ask for maintenace charges if the project is partially complete. Any code of law or judgement exist as on date on this point. Please advise

Hope to hear from you 

Warm regards

Kawaljeet Singh

(Mohali Punjab)

 

Kawaljeet Singh (General Manager)     23 November 2015

Please advise wether a builder can charge for maintenance or servises being provided before the final completion certificate obtained from relavent authorites. It is learnt that builder have partial completion certificate and out of 184 appartment 65 are occupied.Hope to hear at earliest please.

Regards

Kawaljeet Singh (Mohali)

 

 

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     23 November 2015

This appears to be a new query. You open a new post and give all details.


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