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gopidayakar (Private service)     03 November 2012

Corpus fund is legal to collect from flat owners ?

Dear Sir,

This is inform you that I had a flat in Hyderabad having plinth area is around 2700+ sft. Now, my flat owners association is demanding Corpus Fund @ Rs.100/- SFT and asking me to pay the amount in 4 instalments equally. They had given me the time line upto 10.11.2012. Failing which they are threatening me to discontinue all the common services like power supply, water , LPG gas and garbage collection etc.  Please let me know is it legal collecting corpus fund from the flat owners by writing threatening letters or mails and blackmailing ? I am paying a monthly maintenance of Rs.5000/- regularly. Is there any right to the association to discontinue the common services when I am paying maintenance regularly. Please advice me whether I can take legal action against them. If so ? How can I file a case ? Please explain me at the earliest.

Thanking you





 9 Replies

V R SHROFF (Sr. ADVOCATE Bombay High Court Mob: 9892432152)     04 November 2012






Adv. K.S.A.Narasimha Rao ( )     27 November 2012

Dear Gopi Dayakar,

Now a days, with an intention to protect the life of the building with charm, elegance and beauty, the Developers are intending the purchasers to pay separate corpus fund so as to enable the society to be formed among the Flat purchasers, need not await of each and every one owner's permission on a later stage to make development works like immiediate change of mulfunctioning pipelines, replacement of drianage pipes, for painting the building for every 5 years to have new look always for the building.


The Corpus fund amount shall be deposited in any Nationalised Bank for an indefinite period of time, and with only the interest accured on the corpus fund will be utilised for the above works, if any time the interest amount is shortfall to complete the works, then they take out the corpus fund deposit from the bank and subsequently, the same shall be reimbursed again in equal proportions to keep the said deposit in same manner.

Legally they cant enforce any laws, however it a moral binding being a member of the society to pay the amount as the same is benefitted for your flat as well as common areas maintenance.

You are much aware that now a days people are so they dont like to pay a penny to society. So generally the society members make use of strong words to keep the residents in fever to clear the amounts to society early.

Adv k . mahesh (advocate)     30 November 2012

yes i agree with Adv K.S.A Narsimha Rao and even you have the right to make the best use by making them conduct a meeting and discuss with the members actually what and were you are depositing the amount and how much interest and in what way you want to utilize the amount because you are one of the owners and you to have the right to make your surroundings look beautiful and healthy for your health and your family members and your friends.

Rama chary Rachakonda (Secunderabad/Highcourt practice watsapp no.9989324294 )     04 April 2013

If, on a reading of the bye-laws, you believe that the withdrawal of common amenities to your flat is illegal, then, you would be entitled to sue the persons who are responsible for such withdrawal, or who are threatening to cause such withdrawal, in a competent court, for appropriate relief. However, I add again that litigation should be the last resort and not the first response.

Rupesh Srivastava (Manager)     06 October 2013

Dear Sir,

I am purchased a flat 1350 sq. ft, and there are other flat having 1000 sq. ft to 2000 sq. ft. Our association wants Corpus funds to be paid equal to all.

My argument with association is since Corpus fund are used for Maintenance of building in which I have rights for 1350 sq. ft , so corpus fund should be on sq. ft basis.

Yes I have agreed Common Area Expenses (Equal to all): Lift, DC (All AMC), Common Area Electricity ,Housekeeping, Security, Equipments, Lift, including charges for running the Lift, Officer Barer expenses) Equipments i.e bulb, tube light, notice board, etc similar expenses. As common facilities used by all.

 As Large flat holders don`t draw more benefits or facilities by virtue of the big size of the flats. Common Area are enjoyed by all the members equally.


Kindly inform me whether my argument on Corpus fund is correct ot not? My argument is corpus fund should be in Sq. Ft basis and rate should be fixed on Sq. Ft basis.

Thanking You,

Rupesh Srivastava



Subhash (Advocate)     09 October 2013

Corpus fund you should, as the proportionate share in the land is more for large flat owners and small for small share holders so preferably it should be on per sq ft basis.

It is the common practice that the maintenance charges will be on square foot basis so that bigger flats pay up more than the smaller flats. Further on Common Area expenses you are correct, same should be on equal basis.

I feel you have referred to Bombay High court ruling in your query as " Large flat holders don`t draw more benefits or facilities by virtue of the big size of the flats. Common Area are enjoyed by all the members equally." With regard to the corpus fund the same is created to take care of maintenance charges, its interest is used up to meet the maintenance costs. This means that corpus contribution also should be on square foot basis so that bigger flats contribute more towards corpus fund earning more interest meaning more contribution towards maintenance. This is in line with the common practice of charging maintenance on square foot basis.

Pursue for implement. Normally Large flats owners don`t agree, as they have to pay more. Create awareness of the advantage of sq. ft basis , no misunderstanding.

rahulmerchant   14 April 2015

I'm residing in a bungalow society in Pune. The management committee is forcing me to pay 1,00,000 as corpus fund. Is it legal?

Prasad Nerurkar   02 February 2016


I have booked a Flat In Nashik , Maharashtra. I have not taken possession so far. Till date this  property has not become NA & no completion certification has been received from Municipal authority. No society has been formed so far. Still builder is asking for entire corpus fund amount in advance from us. Also builders has made changes from the original plan. In such a situation should we pay corpus fund.   Please advice.   .  


Vijayakumar Vj   09 February 2020

Namaskara. I am vijaya kumar, Sr citizen. From Mysore. I am having a flat  with 671 sq ft  area in Bangalore.  In the apartment there are 78 flats with different sizes ranging from 632 sq ft to. 1300 sqft flat. I am paying Maintainence charges based on sq ft basis.The Association in its AGM has fixed Rs 50000 as corpus fund Flatly for all the 78 flat owners. I  requestred in the AGM to charge  corpus fund  proportionately bassed on the sq ft we own. The majority flat owners, were 2 n 3 bed room flat owners and they decided to have uniform Corpus fund for all the Flat owners. I have paid only Rs 10,000/-( out of the RS 20 K demanded as Ist instalment) and still protesting. Now  the Association is threatening to stop water and electricity to my flat. Also when any prospective tenents( now it is vacant) visits the flat, they are asking them to  pay corpus fund to them before occupying otherwise water & electriccity may be stopped. Pl guide me. 

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