A common but serious problem faced by many resident welfare associations (RWAs) is the non-payment of the maintenance charges by members of the housing complex. As the name suggests, the housing society uses the money collected from member residents to pay for the common charges raised by utilities, services, and maintenance of the society. Even after regular follow-ups, many times people don’t contribute their share of the maintenance charges. This is unfair to all the other residents who pay these on time to the housing society. In this guide, we highlight what can be done if a member doesn’t pay the maintenance charges.
What are society maintenance charges?
The society maintenance charges are monthly fees that should be paid by every member of the housing society for the upkeep of the housing society’s common areas, shared utilities and amenities. These cover operational costs of maintaining common spaces in the buildings like lobbies, parking, etc., and non-tower spaces such as the podium, swimming pool, clubhouse, etc. The society maintenance charges cover utilities and necessities such as security, water supply, and electricity charges.
Why should society maintenance charges be paid on time?
A member of the cooperative housing society should necessarily pay the maintenance charges so that the complex in which he has invested can be maintained properly. Non-payment will eventually affect the upkeep of the property and hence the appreciation value of the property. Each and every resident member of a housing society should pay the maintenance charges by the deadline, failure of which will result in strict legal actions. The cooperative society has the right to refuse the issue of NOC to the defaulter till the time all arrears with penalty are paid.
See also: Society AGM meeting rules in Maharashtra in 2025
How can society maintenance charges be collected from defaulters?
It is necessary that members pay the maintenance charges regularly. However, there are steps that a cooperative housing society can take legally to make the member pay society charges. Mentioned are steps to follow:
Issue notice to the defaulter member resident
The first step is to send a notice suggesting that the society maintenance charges payment is pending and failure to pay will force the society to approach the registrar for a recovery notice, under Section 101 of MCS Act, 1960. The letter should clearly mention the maintenance charges, the bill number issued with the date, and the penalty for non-payment. The housing society should mention the principal amount and interest amount separately in the notice. The interest on non-payment of society maintenance charges can go up to a maximum of 21%.
Pass a resolution in general body meeting
In case the member does not acknowledge the notice sent by the housing society and continues to default, the next step is to pass a resolution in the managing committee meeting to file for recovery of society maintenance charges. Inform the defaulting member of this decision and check if he is ready to pay.
Complain to the registrar
The final step is to apply to the registrar’s office for recovery of non-payment of society maintenance charges from the defaulting member. Submit documents at the registrar’s office with fees ranging between Rs 15 and Rs 25 through a challan payable at Reserve Bank of India (RBI) Account 0425 Co-operation.
| Society maintenance amount to be recovered | Enquiry Fee based on claim amount | Court fee |
|---|---|---|
| Up to Rs 1,000 | 5.5% | Rs 15 |
| Rs 1,000 to Rs 2,000 | 4.5% | Rs 20 |
| Rs 2,001 to Rs 5,000 | 3.5% | Rs 20 |
| Rs 5,001 and above (subject to max Rs 1,000) | 3.0% | Rs 25 |
Investigation by registrar
Once the complaint has been filed with the registrar, he will investigate the entire case and see if what the housing society has mentioned holds true. The investigation will also go through the notices and bills issued to the defaulter. The registrar will also listen to the member resident’s side of the story to know the reason behind the default. Once the registrar is convinced that the member resident is guilty, he will issue a recovery certificate.
Notice to attach property
After getting the recovery certificate, the managing committee should approach the court where the recovery officer will issue a demand notice to the sale-officer, who will attach the member’s movable property. The sale officer will give a list of movable properties of the defaulting resident along with the demand notice to the member. He can still pay at this point. In case the member doesn’t pay then also, the movable property will be attached and handed over to the society office bearers.
Auction
The sale-officer fixes a date, time, and place for the auction of the movable property and whatever money is earned will be used for maintenance of the property. In case, even after selling the movable property, there are arrears to be paid to the society, the sale officer can attach the member’s residence and auction it to recover the balance.
What are the steps that a society can’t take to collect maintenance charges?
Note that in case of failure of payment of maintenance charges by the resident, even after repeated reminders and notices, a society should not indulge in unlawful practices such as disconnection of utilities such as water, gas, electricity, etc. Instead, the society should go to the registrar’s office and file an official complaint.
Housing.com POV
For a housing society to smoothly function, it is important that all the members pay the maintenance charges within the deadline. Non-payment affects everyone—burdens and is unfair to law-abiding members who pay before the due date, affects the operations of the housing society, and impacts its functioning in the long run.
A homebuyer clearly knows that he has to pay maintenance charges for the property that he is investing in. Thus, he has to account for this money and plan his finances properly rather than defaulting.
FAQs
Where will the society maintenance funds be used?
The society charges will be used towards property tax, water charges, electricity charges, repair and renovation of the building, maintenance and repairs of lifts, creation and contribution to sinking fund, service charges, car parking charges, repayment of loan, insurance charges, etc.
Does society maintenance charge attract GST?
According to the Central Board of Indirect Taxes and Customs (CBIC), housing societies have to pay 18% Goods and Services Tax (GST) on the entire maintenance amount if the member’s monthly contribution exceeds Rs 7,500 and the society’s annual turnover is over Rs 20 lakh.
How is the society maintenance charge calculated in Maharashtra?
A statutory order under the Maharashtra Co-operative Societies Act issued in 2000 mentioned that housing societies should charge maintenance fees on a per-unit/flat basis and not a per-square-feet basis.
| Got any questions or point of view on our article? We would love to hear from you. Write to our Editor-in-Chief Jhumur Ghosh at jhumur.ghosh1@housing.com |