An Apartment Owner’s Association is a club where all owners / residents of the apartment (in some cases tenants too) are members. This association protects the rights of the apartment owners, maintains the common areas, amenities and facilities available within the apartment complex.
In Tamil Nadu, The Home Owner’s Association of an apartment complex may be registered under the Tamil Nadu Societies Registration Act, 1975. By default all owners are members of the association. (http://www.scribd.com/doc/43951806/The-Tamil-Nadu-Societies-Registration-Act-1975) or the Tamil Nadu Co-operative Societies Act, 1983.
Importance of registering a Home Owner’s Association
Disputes are a common phenomenon within a society. Within an apartment complex especially, disputes pertaining to common areas, maintenance costs, car parking, common assets of the apartment complex such as back-up power supplies etc. are quite common. Approaching a court to settle these petty issues would mean lot of time and money. However registered Home Owner’s Welfare Association (which has legal benefits and authority of suing or defending for issues) can mediate and resolve such issues quicker.
How to form a Home Owner’s Association for an apartment complex
- A minimum of 5 residents (members) are required for forming a Home Owner’s Association, as per the provision in the Tamil Nadu Apartment Ownership Act, 1994. They are the committee members of the association.
- A ‘Memorandum’ for the association has to be formulated in the first instance.
- Following aspects would have to be included in the memorandum:
- Name and objects of the association
- Name , Addresses, and occupation of the members of the committee
- Formulation of by-laws of the association, which includes all the rules and regulations conducting the society / apartment complex’s affairs. Advice of a legal consultant may also be sought if necessary for formulation of the memorandum. Major aspects of these by-laws include:
i. Association’s basic details such as name of Association, Address, date of its formation, jurisdiction details along with its activities and objects, working hours etc.
ii. Rights and Privileges for members.
iii. Name and related significant particulars of persons who can legally represent on behalf of the Association or against whom legal action can be taken on behalf of the Association, details of persons to be contacted regarding the Association’s business and administrative affairs etc.
iv. Restriction and enrolment of members, their qualifications, enrolment or other fee to be collected from members etc.
v. Circumstances under which a member can be removed, penalties imposed against members during instances such as delay in payments.
- It has to be ensured that the formulated memorandum is in legal accordance / accordance to the by-laws (advice of a legal consultant may be sought)
- The memorandum has to be filed with the concerned Registrar of Societies by a member of the committee
- This legally correct memorandum would have to be then typewritten and duly signed by all the members.
- Please refer to the PDF document in the below link for the legal requirements to be fulfilled by the registered socities, statutory remedies and the address of the registration offices http://www.tn.gov.in/citizen/regist_dept.pdf
- Click here for a template by-law / Model Memorandum of Association document <Apartment_Association_Byelaws_Template>
- Registrar Offices in Chennai for registering Apartment Associations:
Renewal of Registration and periodic operations of the Association
The Tamil Nadu Societies Registration Act, 1975 section 44 (3) clearly indicates the process of renewal of registered societies. A registered society would have to formally undertake significant operations such as conducting elections, filing of their tax returns, accounts statements and Minutes of their General Body meetings. Once a Home Owners Association is registered, an annual renewal of this registration is mandatory, failing which the Association is deemed defunct and can be legally condoned. Following websites can be referred for more information on how such societies are deemed defunct and condoned: http://www.hindu.com/2004/07/10/stories/2004071011570300.htm and http://www.scribd.com/doc/43951806/The-Tamil-Nadu-Societies-Registration-Act-1975.
Important information you would require
i. Chennai(South): District Registrar,9, Jeans Road,Saidapet, Chennai -600 015; Email:firstname.lastname@example.org; (044)-24323170
ii. Chennai(Central): District Registrar, 72 (Chamiers Road), PonMuthuramalingaThevar Rd, Chennai- 600 018; Email:email@example.com; (044)-24363607
iii. Chennai(North): District Registrar,1, Murthygal lane, Chennai – 600 001; Email: firstname.lastname@example.org; (044)-25266215
- Services provided by clubs or welfare associations such as Home Owner’s Associations are defined as taxable services in Section 65, Clause (105) of the Finance Act 1994 (Click here for information on Service Taxes for applicable for Apartment Associations).
- Important websites:
- http://www.hindu.com/pp/2008/07/26/stories/2008072650020200.htm. (lists basic provisions framework of the Apartment Association and Society’s Act)
- http://www.hindu.com/pp/2004/09/18/stories/2004091800040300.htm (lists practical issues and accountability of an owner’s welfare association)
- http://www.hindu.com/pp/2007/11/10/stories/2007111050030100.htm(lists basic FAQs that may arise during formation of a Home Owner’s Association in Chennai).A few of these major FAQs may be
i. Issues regarding changing name of the Association
ii. Amendments required within by-laws of the Association’s memorandum
iii. Definition and scope of the phrase, “Common areas / common facilities”.
iv. Calculation of maintenance and other charges.
v. Cutting amenities for a resident in case of non-payment of common maintenance?
vi. Forum for instituting legal proceedings for issues of the Association.
vii. Issues regarding car parking allotments
viii. Restricted access of certain facilities within the apartment complex to select owners.