Disputes over maintenance charges, billing practices and the powers of managing committees continue to be among the most common sources of friction in a cooperative housing society (CHS/the Society). Members are often unsure about how frequently maintenance can be collected, whether interest can be levied without issuing a bill, and whether Societies are entitled to pass on specific expenses, such as legal fees, to individual members.
This week, I shall address three such recurring issues. The first clarifies how CHS may legally decide the frequency of maintenance collection and the rules governing grace periods and interest on delayed payments. The second examines whether a Society can demand maintenance without issuing a formal bill and still penalise members for non-payment. The third looks at the legality of charging an individual member for legal advice obtained by the Society and levying interest on disputed dues.
Frequency of Maintenance Collection and Levy of Interest on Delayed Payments
Question: I would like to know whether maintenance charges should be collected monthly or quarterly. How much time should be given to members to pay regular maintenance charges and how is the due date for payment to be fixed? In the case of quarterly maintenance payments, if a member fails to deposit the maintenance charges by the due date, how should interest on delayed payment be calculated?
Answer: Whether maintenance charges of the Society are to be collected on a monthly, bi-monthly, quarterly, once-in-four-months, half-yearly or yearly basis has to be decided by the general body meeting (GBM) of the Society. In all cases, the charges are to be collected in advance.
For example, if maintenance is collected monthly, it must be collected in advance for the current month. If it is January 2026, the maintenance charges for this month may be collected either in December 2025 or, at the latest, in February 2026.
If maintenance is collected monthly, a 15-day grace period must be given to members to pay the bill. This means that for January 2026, the bill should be issued by 1 February 2026, and payment must be made on or before 15 February 2026. If payment is made between 16th February and 28 February 2026 (last day of the month), delayed payment charges are applicable at 21%pa (per annum) or 1.75% per month, on the monthly dues for the full month.
If dues are collected once every two months or at longer intervals—such as quarterly, once every four months, half-yearly, or yearly—the grace period for payment should be one month from the date of the bill. If the bill is not paid within this period, interest is to be charged for the full month.
The manner in which itemised bills are to be raised and collected is provided in Part IX of the model bye-laws, 2014, under bye-laws nos. 65 to 69. The charging of interest on delayed payments is governed by bye-law no. 71. The Society can charge a maximum of 21% simple interest per annum on outstanding dues. This interest is calculated as simple interest and accumulates over time if the Society’s dues remain unpaid. No further interest is levied on the accumulated interest amount.
Charging Maintenance and Interest without Issuing Bills
Question: I own an apartment in a housing society in Panvel. The Society collects monthly maintenance charges without issuing any maintenance bills. They are also charging interest for non-payment. When I questioned the collection of maintenance charges without raising a bill, the chairman informed me that it is legal. The Society’s accounts are also being audited, though I do not know on what basis. Could you please clarify whether it is legal for the Society’s managing committee to collect maintenance charges without issuing a maintenance bill and to levy interest penalties on members for non-payment?
Answer: A Society cannot collect dues from its members without issuing a demand notice (bill), in which the details of the charges must be shown under different heads such as common electricity charges, sweeper charges, sinking fund, building maintenance fund, water charges and municipal taxes (if applicable), as provided under bye-law nos. 65 to 70.
After issuing the bill, a grace period of 15 days must be given for payment for monthly bills and one month for bi-monthly, quarterly, half-yearly, or yearly bills. Only after expiry of this period can interest for late payment be charged.
Under bye-law no. 71, the Society can charge interest at a maximum rate of 21% simple interest per annum on unpaid dues after the due date. If your CHS is not following the above bye-laws while collecting maintenance charges or levying interest, you can make a complaint against the society to the deputy registrar of cooperative societies (DR-CS) of your area under bye-law no. 174(A)(xxii).
Can a Society Recover Legal Advice Costs from an Individual Member?
Question: There was an issue regarding parking allotment in our CHS. My father had sent a legal notice to the Society in connection with this allotment. The secretary did not respond to the legal notice. Instead, he added a ‘legal advice’ charge to our regular maintenance bill, stating that the Society had taken legal advice against the notice. He also stated that the cost of this legal advice should be paid by the member who issued the notice.
My father asked for a copy of the advocate’s bill for the legal advice, but the secretary refused to provide it. My father is, therefore, paying only the regular maintenance charges and not the legal advice amount added by the Society. He also submits a written letter every month along with the maintenance cheque, requesting a copy of the legal advice bill, but the secretary does not acknowledge the letter.
The secretary has now started adding interest on the unpaid legal advice amount. As per my understanding, legal advice taken by the Society against any notice should be paid by the Society itself and not by an individual member.
Answer: Allotment of parking spaces in a CHS must be done in accordance with bye-law nos. 78 to 84.
If the Society has taken legal advice for replying to your father’s notice regarding parking allotment, you may make a complaint against the Society to the DR-CS of your area under bye-law no. 174(A)(xii). In your complaint, state that for a straightforward issue such as parking allotment, which is clearly governed by bye-law nos. 78 to 84, the secretary unnecessarily engaged a lawyer.
Also mention that without providing any details of the legal advice obtained or a copy of the advocate’s bill, the Society has arbitrarily charged your father for legal expenses and has further levied delayed payment charges on the same. Provide a copy of this complaint to the Society for its information and necessary action.
NOTE
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Disclaimer: The guidance provided in these columns and on our Legal Helpline is on the sole basis of the facts provided by the reader/questioner and does not amount to formal legal advice in any form whatsoever.
(Shirish Shanbhag has an MSc in Organic Chemistry, a Diploma in Higher Education, and a Diploma in French and has completed his LL.B. in first class in 2021. Before his retirement, he was a junior college teacher at Patkar College from July 1980 to May 2012, teaching theoretical and practical chemistry. Post-retirement in 2012, he started providing guidance and counselling to people on several issues, specifically focusing on cooperative housing society-related matters. He has over 30 years of hands-on experience in all matters about housing societies and can provide out-of-box solutions for any practical issue.)
