Society formation charges taken by builders
Veerchandra B Shetty
(Querist) 06 April 2023
This query is : Resolved
Sir,
I booked a flat in an under-construction project in Kharghar, Navimumbai and a price was finalized except for maintenance charges. However when i received the cost sheet next day it was showing other charges as:
Legal fees - 29500/-
Society formation -100000/-
There are around 400 flats in the project. I would like to know whether the builder can charge such a huge amount in the name of society formation. Is it legally binding for me to pay this amount. There are other projects in the vicinity who are charging 10 to 15 thousand.
Can i file a complaint against such charges.
V B Shetty
kavksatyanarayana
(Expert) 06 April 2023
A Co-operative Society can be formed even if the builder does not co-operative. In such a situation a notice should be issued to the builder. The consent of a minimum of 60% of the total number of flat purchasers is required to form a Co-operative Housing Society. It is obligatory for the Promoter (Builder to submit the proposal for registration of a Co-operative Housing Society, within a period of four months from the date on which the minimum number of members required to form such a society have purchased the flats. A notice has to be sent to the Dy.Registrar / Asstt. Registrar of the concerned ward with a request to call upon the builder to explain his stand on the above matter.
Dr J C Vashista
(Expert) 07 April 2023
Whether the project is a "private" builder's, association of owners or cooperative society ?
What are the terms and conditions of agreement to sell qua legal fees and charges for formation of society ? Generally such charges are part of consideration, which have already been calculated by builder.
It is advisable to consult and engage a local prudent lawyer for better appreciation of facts / documents, professional guidance and necessary proceeding.
T. Kalaiselvan, Advocate
(Expert) 07 April 2023
You can refuse to pay the exorbitant charges demanded by the builder to form the society or association. You can ask for the break up of the expenses to form the association. If he is not willing to disclose the expenses or to reduce the charges, you can inform other members to not to pay the formation charges, because an association can be formed by members themselves without the help of the builder. You need not wait for the builder to handover the apartments to form a R W association. Once an association is formed you will be a legal entity which will enable you to demand all that which are incomplete from the builder and can even drag him to the consumer court for delay in completion of the incomplete amenities.
Veerchandra B Shetty
(Querist) 08 April 2023
Good evening everyone, Thanks for the useful advice by the experts. Since its an under construction project almost most of the buyers must have agreed to the cost sheet given to them without noticing the cost charged by the builder for society formation, as this is to be paid at the time of possession. Can i refuse to pay the same and ask the builder to go ahead with the registration of my flat? I dont think he will agree to execute the agreement unless i accept the cost sheet. So what best remedy in such a scenario ?
T. Kalaiselvan, Advocate
(Expert) 09 April 2023
You can refuse to pay and drag the builder to consumer forum or give a complaint to RERA or file a suit for specific performance of contract to get the sale deed executed
Dr J C Vashista
(Expert) 09 April 2023
Raise your objection amongst co-purchasers, get them (maximum) with you and then confront with builder for illegal charges which did not find place in the agreement to sell.
ashok kumar singh
(Expert) 09 April 2023
agreed with the earlier views of our Learned Experts. however, you may lodge Consumer Complaint before the Learned District Consumer Disputes Redressal Commission, against the Builder/ Developer and you will get relief/s, in terms of the Consumer Protection Act 2019;
