Interest waiver in housing society

Yes it is possible if by laws permits to do that then board should passes a resolution regarding to  waive interest charges

Any suggestion depends upon the law under which the Socity is registered as well the byelaws of the Society. However, nothing prevents the Society from collecting the outstanding amount leaving the question of interest to be decided in the due course and in accordance with law and the procedure, as laid down.

Waiving interest charges on outstanding dues in a cooperative housing society is possible, but it requires careful consideration and adherence to the society's bye-laws and applicable laws.

 Factors to Consider 1. *Society's Bye-Laws*: Review the society's bye-laws to determine if they permit waiver of interest charges.

2. *Majority Approval*: Typically, a majority approval from the society's general body or managing committee is required to waive interest charges. .

3. *Reasons for Waiver*: The member's reasons for requesting a waiver should be considered. Are they facing financial hardship or is it a genuine error?

4. *Precedent*: Consider whether granting a waiver would set a precedent for future cases.

Possible Approaches 1. *Partial Waiver*: The society could consider a partial waiver of interest charges, rather than a full waiver.

2. *Payment Plan*: Offer a payment plan to the member, allowing them to clear the outstanding dues in installments.

3. *Conditional Waiver*: Grant a waiver conditional upon the member clearing the outstanding principal amount within a specified timeframe.

Legal Considerations

1. *Cooperative Societies Act*: Familiarize yourself with the relevant provisions of the Cooperative Societies Act, which governs the functioning of cooperative housing societies.

2. *Bye-Laws*: Ensure that any decision to waive interest charges is in accordance with the society's bye-laws.

 Recommendation

1. *Consult a Lawyer*: Seek the advice of a lawyer specializing in cooperative housing society laws to ensure that the decision is legally sound.

 2. *Document the Decision*: Properly document the decision to waive interest charges, including the reasons and conditions (if any).

 3. *Transparency*: Maintain transparency in the decision-making process to avoid any potential disputes or allegations of favoritism.

Housing societies in India can charge interest on overdue maintenance payments, up to a maximum of 21% per year. The exact rate is usually determined by the society's bye-laws.

It's recommended to adjust society charges before adjusting interest, as the bye-laws usually require members to pay simple interest

Various states provide by-laws containing the provisions regarding payment of maintenance charges by housing societies.

The Supreme Court of India, in the case of Rasila S Mehta vs Custodian, Nariman Bhavan, Mumbai, had dealt with the question of responsibility for maintenance and repair charges on attached properties under the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992. 

• The Court held that the Custodian is responsible for paying the maintenance and repair charges to the housing society for attached properties.

• The responsibility of paying the maintenance charges arises from the requirements to keep the values of the attached property intact.

• The Court recognised that the notified parties, being the owners of the attached properties, have a liability to pay the maintenance charges as per the rules governing cooperative housing societies.

• However, the Court stayed recovery of interest and penal charges on arrears of maintenance and repair charges against the appellants during pendency of litigation and appeals challenging the actions of the Custodian.

Now it is the association which has to take a decision as per bylaws especially keeping in view of the supreme court judgments in this regard