Housing Society Its Non Occupancy Charges

Housing Society Its Non Occupancy Charges

• Category: Miscellaneous
• Date 12-05-2025

Housing Society Its Non Occupancy Charges

In Maharashtra, housing societies are governed by the Maharashtra Cooperative Societies Act, 1960 and related rules and circulars issued by the Maharashtra Cooperative Housing Society Federation and Registrar of Cooperative Societies. Non-Occupancy Charges (NOC) are a key area of concern for many flat owners and societies.

Here’s a detailed breakdown of what a society can and cannot do with respect to Non-Occupancy Charges (NOC):

What a Housing Society Can Do (Legally Permissible):

1. Levy Non-Occupancy Charges (NOC):

   • A society can charge non-occupancy charges if a flat is rented/leased to a third party (i.e., not used by the owner or their family).

   • These charges are meant to cover additional wear-and-tear, administrative costs, and increased usage of common services.

2. Follow the 2001 GR (Government Resolution):

   • The maximum non-occupancy charges cannot exceed 10% of the service charges (excluding municipal taxes).

   • This rule was upheld by the Bombay High Court and must be followed by all registered cooperative housing societies.

3. Define and Approve NOC Charges via General Body Meeting (GBM):

   • The rate of NOC must be approved by the General Body and be within legal limits.

   • It should be clearly mentioned in the society’s bye-laws and maintenance bill breakup.

4. Collect NOC Charges Monthly:

   • Typically, NOC charges are collected monthly along with maintenance.

What a Housing Society Cannot Do (Legally Prohibited):

1. Cannot Exceed 10% of Service Charges:

   • Charging more than 10% of the service charges as NOC is illegal and considered unfair trade practice.

2. Cannot Charge NOC if Flat is Used by Close Relatives:

   • If the flat is used by family members (parents, children, spouse, siblings), no NOC charges can be levied.

3. Cannot Refuse Permission to Rent Flat:

   • As long as the owner complies with society rules (e.g., police verification, tenant registration), the society cannot deny the right to rent.

4. Cannot Harass Owners Over Tenants:

   • Discriminatory or harassing behavior towards owners renting their flats or their tenants is illegal and can be reported.

5. Cannot Charge Arbitrary Penalties or 'Security Deposits' from Tenants:

   • The society has no right to charge separate fees from tenants (like deposits or extra membership fees). Charges must only be collected from the owner.

Additional Notes:

• Non-occupancy charges are not applicable to vacant flats.

• If the flat is given to a corporate entity who allows employees to stay, it may attract NOC depending on the usage.

• Affected members can file complaints to:

  • Cooperative Court

  • Registrar of Cooperative Societies

  • Consumer Court, if needed

===============================================================The use of a residential flat in your society by the Mira Bhayandar Municipal Corporation 

1. Conversion of Residential Property to Commercial Use:

According to the Urban Development Department's Circular No. 4398/1462/CR-231/98/UD-11 dated 21/11/2000, residential properties can be permitted for commercial use under certain conditions. These include ensuring sufficient parking arrangements, limiting commercial use to 30% of the total built-up area in R-2 zones, and obtaining necessary approvals from the Executive Engineer - Building Proposals Department. It's important to note that property tax and water charges would increase due to the change in usage from residential to commercial. 

2. Licensing Requirements:

MBMC mandates that all commercial establishments, including offices, obtain a license under Sections 313, 376, and 383 of the Maharashtra Municipal Corporation Act. This applies to any commercial activity within the jurisdiction of MBMC. 

3. Property Tax Implications:

MBMC has implemented policies to levy additional taxes on properties that are leased out for commercial purposes. As per the resolution passed in February 2018, non-residential properties that have been leased out will attract a tax of either 20% of the annual rent or ₹10 per square foot of the carpet area, whichever is higher.

4. No Objection Certificate (NOC):

While MBMC requires property owners to obtain necessary permissions for change of use, the issuance of an NOC by the housing society for such a change is not explicitly mandated. However, it's advisable for the society to be informed and, if necessary, provide consent for the change in usage of the premises.

Recommendations:

Engage with MBMC: Initiate a dialogue with MBMC to understand the nature of their occupancy and ensure that all necessary permissions and licenses have been obtained for the change in usage.

Review Society Bylaws: Examine your society's bylaws to determine if there are provisions regarding the use of residential flats for commercial purposes and the issuance of NOCs.

Consult Legal Counsel: Seek legal advice to ensure that any actions taken are in compliance with local regulations and the society's governing documents.                ===============================================================

CIRCULAR / सूचना

Subject: Guidelines regarding Non-Occupancy Charges and Commercial Use of Residential Flats

Dear Members,

This circular is issued to clarify and ensure uniform understanding regarding Non-Occupancy Charges (NOC) and the use of residential flats for commercial purposes.

1. Non-Occupancy Charges (NOC):

As per Government Resolution dated 01/08/2001 and Bombay High Court order:

• NOC can be levied if the flat is rented to a third party (not used by the owner/family).

• NOC cannot exceed 10% of the service charges (excluding municipal taxes).

• No NOC is applicable if the flat is used by close relatives (spouse, children, parents, siblings).

• NOC must be approved by the General Body and mentioned in maintenance bills.

• NOC is collected monthly with maintenance.

2. Commercial Use of Flats:

As per Urban Development Dept. Circular dated 21/11/2000 and MBMC regulations:

• Commercial use of flats is permitted only under specific conditions with approvals from MBMC.

• The society should be informed and may give NOC if needed.

• Licenses under MMC Act Sections 313, 376, 383 are mandatory.

• Commercial property tax and water charges apply.

• MBMC may charge 20% of annual rent or ₹10 per sq. ft. of carpet area, whichever is higher.

3. Recommendations:

• Inform the society in writing about any tenancy or commercial use.

• Ensure compliance with MBMC and society bye-laws.

• For disputes, approach the Registrar, Cooperative Court, or Consumer Forum.

By Order of the Managing Committee

Date: [Insert Date]

Secretary

[Housing Society Name]

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Last updated: 21-05-2025

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