Query regarding offset of debit balances against credit balances in a cooperative housing society

The Maharashtra Co-operative Societies (MCS) Act, 1960, as amended in 2019, governs the functioning of cooperative housing societies in Maharashtra.

Adjustment of Credit Balances Regarding the adjustment of credit balances lying in various funds collected from members to offset against members' dues:

 1. _Section 69(2) of the MCS Act_: This section allows a society to adjust or set off any amount due to a member against any amount due from the member to the society.

2. _Rule 56 of the MCS Rules, 1961_: This rule permits a society to adjust credit balances in various funds against a member's dues, provided the member has given consent in writing.

3. _Bye-laws of the Society_: The society's bye-laws may also contain provisions for adjusting credit balances against members' dues.

Conditions for Adjustment To adjust credit balances against members' dues:

1. _Member's Consent_: Obtain written consent from the member.

 2. _Specific Resolution_: Pass a specific resolution in a general body meeting or committee meeting.

3. _Accounting Entries_: Make necessary accounting entries to reflect the adjustment.

4. _Transparency_: Ensure transparency in the adjustment process and communicate the details to the member.

Important Considerations 1. _Accounting and Auditing_: Ensure that the adjustment is properly accounted for and audited.

2. _Tax Implications_: Consider any tax implications arising from the adjustment.

3. _Member Disputes_: Address any disputes or concerns raised by members regarding the adjustment. It is recommended that the society consults with a chartered accountant or a lawyer to ensure compliance with the MCS Act, rules, and bye-laws.

A CHS can set off any sum credited or payable to a member against any debt the member owes to the society. This includes: 

Shares or contributions 

Interest in capital 

Deposits 

Dividends, bonuses, or profits 

Members can file complaints with the deputy registrar of cooperative societies if they believe a managing committee member has collected excess maintenance charges. The deputy registrar can pass an order in favor of the members if the facts are verified.

Thanks a lot for your prompt reply.

Actually our Society has received possession of the redevelopment building and we need to clean the balance sheet before admitting new members .Hence this query arose

Regards

kumar k

The provisions of law involved in this respect has been explained,  it is now your society which has to take a decision accordingly