The Karnataka Societies Registration Act, 1960
With population rising at a quick pace in Karnataka, mostly in urban agglomerations like Bangalore, the demand for apartments, as against independent houses, is on the rise. Following this trend are the numerous apartment builders in the state, who are sometimes disingenuous in making a sale.
When you’re making the purchase, you’ll find several builders add a clause to the legal document saying the builder will form the apartment owners’ association. When you’re the apartment owner, you’re asked for sums of money in the name of maintenance of the apartment complex. The reality, however, is that this money remains unaccounted for.
To save yourself from such troubles, it’s most suitable for you to form an apartment owners’ association with fellow apartment owners. This enables your association to take charge and assume responsibility and accountability for your apartment complex.
In Karnataka, there are two legislations that enable you to form an association of apartment owners, Karnataka Apartment Ownership Act (KAOA), 1972 and Karnataka Societies Registration Act (KSRA), 1960. KAOA, 1972 is a special legislation that exclusively covers residential apartments, and is already discussed in the article The Karnataka apartment ownership Act 1972. In this article however, we learn exclusively about the Karnataka Societies Registration Act, 1960.
Understanding the terms used in the Act
The Member
The member of an association is one who is an owner of the apartment that is a part of the apartment complex. In case of joint ownership, the person whose name comes first is typically considered a member.
Memorandum of Association
Memorandum Of Association contains the name and objective of the society, the address of the registered office of the society, names, occupations, and addresses of the governing body, as well as the names, addresses, and signatures of people subscribing to the Memorandum of Association.
Balance Sheet
A snapshot of the association’s financial condition, balance sheet is a summary of the financial balances of the association. The assets, liabilities, and equities, which are also considered liabilities, are summarized as on a single date.
The Key Features of the Act
Registering the association requires minimum 7 members.
To form an association, all you’ll need is a group of 7 members, all of whom should be above the age of 18 years, to come together and complete the formalities of registration.
You need to submit following Documents
- The application form.
- Memorandum of Association.
- Proceedings of the first meeting.
- A list containing the name, age, address, occupation, and signature of all the members comprising the Executive Committee.
- The association’s bye-laws.
You have to report to the Registrar-Officer
Registrar-Officer is an officer appointed by the state government. If the state hasn’t appointed such an authority, you’d have to report to the Inspector General of Registration in Karnataka.
A General Meeting needs to be held annually and accountability ensured
Every year after the registration, the association needs to have a general meeting. In this meeting, the previous years’ report on the society’s management, the auditor’s report, and the audited copy of income and expenditure account and the balance sheet need to be presented.
There is also a stipulation of time for holding the first and second annual general meetings. As per the Act, the first general meeting needs to be held within 18 months of registering the association. The second general meeting needs to occur within 9 months of completing the first general meeting.
The List of the Governing Body Members and Balance Sheet to be filed with the Registrar
You should submit to the Registrar a list of the same details as were submitted during registration, of the members of the governing body now responsible for managing the society and a copy of the audited report of the income and expenditure account and balance sheet on or before the 14th day after the completion of the annual general meeting.
You have to pay Stamp Duty/Fee based on where the society is situated
In case your society is located within the limits of the Bangalore Metropolitan Regional Development Authority, you have to pay Rs. 1000. Otherwise, you’d have to pay a stamp duty/fee of Rs. 500.
What the Act means for the people involved?
A majority of the apartment residents who have registered their associations in Bangalore, Karnataka have done it through the Karnataka Societies Registration Act, 1960. This is because of the simplicity of the procedure outlined under the Act, especially in comparison with Karnataka Apartment Ownership Act, 1972.
The members will also find it easier to complete the documentation process. This is because the documents can be made ready without waiting for approval from authorities. The documentation can be completed internally within the group of members.
