Home > Article Showcase > Society Matters > Important: Can an Associate Member Be a Part of Managing Committee?

The issue of Associate Membership is the trickiest area where it is found that most of the Housing Societies are ill-driven over the issue and construe this term according to their suitability rather than lawful applicability.

Prior to the Directives bearing Ref. No.SAGRUYO-2011/PRA.KRA 360/14-SA, dated 15th October 2011 issued by the Govt. under Section 79(A) of the Maharashtra Co-operative Societies Act, 1960 (MCS Act, 1961), the rights of an Associate Member were as under:

(a) A person could make an application for membership by paying an entrance fee of Rs.100/-. On receipt of such an application, the Society could admit such a person as an Associate Member;

(b) Prior to the aforesaid Directives it was not necessary that such a person who was desirous to be an Associate Member should be a part of the Agreement for Purchase relating to the concerned flat or that such a person should have contributed towards the purchase price of the concerned flat. Hence any person could make an application to be admitted as an Associate Member in case the original member grants his/her/its consent for such a person to be admitted as an Associate Member in respect of the concerned flat;

(c) Further, an Associate Member was permitted to contest election and be elected as a member of the Managing Committee and also be appointed as one of the Office Bearers.

Pursuant to the aforesaid Directives being passed, the rights of the Associate Member have undergone a noticeable change. It may be noted that the aforesaid Directive has been passed under Section 79 (A) of the Maharashtra Co-operative Societies Act, 1960 and hence since the Directive has been passed under the statute, it is binding on all Co-operative Housing Societies. All Co-operative Housing Societies are statutorily bound to accept the aforesaid Directives and implement the same.

According to the aforesaid Directive, the rights of an Associate Member have undergone a change in the manner as following:-

(a) Only such a person shall be permitted to be admitted as an Associate Member who has contributed monetarily in purchasing the concerned flat and whose name appear in Purchase Agreement and the Share Certificate as well. In case a person who has not contributed towards purchasing the concerned flat makes an application before the Society for being admitted as an Associate Member then in that event, the Society has a right to reject such an application;

(b) It is important to note that the aforesaid Directive does not state that the rejection of an Associate Member on the aforesaid ground and shall be made applicable retrospectively. In the absence of such a provision, the Society should not take steps to cancel the membership of such Associate Members who have been admitted as members prior to the aforesaid Directives being passed and who have not contributed towards the purchase of the concerned flat.

(c) However, in case any application for membership as an Associate Member has been made after the aforesaid Directives have been passed and such a person has not contributed in the purchase of the concerned flat, then in that event, the Society can take steps to pass necessary resolutions to cancel the membership of such an Associate Member;

(d) Pursuant to the aforesaid Directives being passed, an Associate Member who has not contributed to purchase the concerned flat and has been made a member of the Managing Committee and/or is an Office Bearer should step down as a member of the Managing Committee and/or as the Office Bearer by tendering his resignation to the Society;

(e) Associate Members who have not contributed to purchase the concerned flats have been disqualified from being members of the Managing Committee and being Office Bearers.

What Housing Manual, 2012 says:

“A person, who becomes an Associate member by paying only admission fee, shall not get any rights in voting or election on behalf of the original member. It is necessary for the Associate member that his share/name is included in the ownership of property for holding share jointly. In case of Co-operative Housing Societies promoted under the Authorities like MHADA, SRD and SRA, the persons whose name appears as eligible persons in annexure II only becomes the member of that Society and the house provided by such Authorities given on ownership will remain in the name of original member for the period of ten years and that cannot be transferred. Therefore, only whose name appears in Annexure II they are expected to take part in the election. Therefore, the provisions of Associate Members have been excluded in case of SRA/SRD and MHADA Societies.”

In one of the Societies, the elections were held in the year 2010. Further, several Associate Members who had not contributed in purchasing their concerned flats were elected as members of the Managing Committee and also elected as Office Bearers.

In light of the aforesaid Directives that have been passed, such an Associate Member should resign as a Managing Committee Member and as an Office Bearer. In case such a member is not coming forward to tender his resignation, then in that event, the Society can take necessary steps by making a formal application to the Registrar of Co-operative Societies and request him to pass necessary orders directing the disqualification of such an Associate Member and ordering such an Associate Member to resign.

With regards to the rights of such an Associate Member to contest elections and to vote at the meetings that are held by the Society, the Directives clearly provide that an Associate Member will have no right to vote at the meetings held by the Society and also shall not have a right to contest the Managing Committee election.

It should be noted that the aforesaid provision of an Associate Member not having a right to vote or contest elections are applicable only in respect of those Associate Members who have not contributed in purchasing their concerned flats. Such provision shall not be applicable to such Associate Members who have made contributions in purchasing their concerned flats and their names appear in Purchase Agreement and the Share Certificate as well.

There is prevalent lack of knowledge among the members of Co-operative Housing Society all across the State when it comes to the issue of Associate Members contesting Managing Committee elections. To set the record right, an article appeared in Times of India on 2nd August, 2014 with a caption “An Associate Member is not eligible to be part of a Managing Committee”. The full text of the said article is given hereunder:

http://epaperbeta.timesofindia.com/Article.aspx?eid=31804&articlexml=Associate-member-cannot-be-mangaging-committee-member-02082014308035

Given below are the situations in which an Associate Member may not be a part of the Managing Committee. The detailed conditions on nomination of candidate for Housing Society’s election under the Maharashtra Co-operative Societies Rules, 1961 (MCS Rules, 1961), Rule 56-M is given hereunder:

Rule 56-M. Nomination of candidates:- (1) Any person may be nominated as the candidate for election to fill a seat if he is qualified to be chosen to fill that seat under the provision of the Act, these rules and the Bye-Laws and if his name is entered in the list of voters.

Provided that in case of Joint or Associate Members, only the member whose name stands first in the Share Certificate shall be eligible to be nominated as candidate for the election. Where the seats are reserved on the Committee of any notified Society as provided under Section 73-B of the Act, any individual belonging to the categories provided under Sub-Section (3) of Section 73-B shall be eligible for being nominated as candidate even if his name does not appear in the list of voters.

(2) Every nomination paper presented under Rule 56-N shall be completed in Form M-4: 

Provided that, a failure to complete or defect in completing the declaration as to symbols in a nomination paper shall not be deemed to be a defect of a substantial character within the meaning of these rules.

(3) Any person whose name is entered in the list of voters may be a proposer or seconder for nominating a candidate for election:

Provided that, in the case of election from constituency of Societies, the proposer and the seconder shall be from the same constituency.

(4) A nomination paper shall be supplied by the Returning Officer to any voter on demand and on payment of such fees as determined by the District Election Officer:

Provided that, such nomination paper shall be supplied by the Returning Officer to any person desirous of contesting from the constituency under Section 73-B even if his name is not included in the list of voters

Now, the law is relaxed when it comes to individuals belonging to categories provided under Sub-Section 3 of Section 73-B of the Maharashtra Co-operative Societies Act. Where the seats are reserved on the Committee as provided under Section 73-B of the Maharashtra Co-operative Societies Act, any individual belonging to the categories provided under Sub-Section (3) of Section 73-B shall be eligible for being nominated as candidate even if his name does not appear on the voters’ list.

The provisions in the Maharashtra Co-operative Societies Act and Maharashtra Co-operative Societies Rules clearly state that the nomination of an Associate Member for election gets disqualified if his name does not appear first in the share certificate and such member cannot contest an election. Maharashtra Co-operative Societies Act’s Section 2 (19) (b) clearly defines that the Associate Member, as a member who holds jointly a share of a Society with others, but whose name “does not stand first in the Share Certificate”.

As per the Rule 56-M of Maharashtra Co-operative Societies Rules, 1961 and Section 2 (19) (b) of Maharashtra Co-operative Societies Act, 1960, an Associate Member can only cast his votes and participate in the election process but never become an office bearer in the Society, where his name appears as an Associate Member in the Society Register.

This further renders the Appendix – 10 (A) of the Model Bye-Law of Co-operative Housing Societies redundant as Section 56-M prohibits such Associate Members from being nominated for election. Provision of Appendix – 10 (A) is in direct conflict with Section 56 M of the Maharashtra Co-operative Societies Rules, 1961 which renders the said appendix ineffective.

As per Section 56-M, any joint holder whose name appears after the first holder in the share certificate – whether he has paid for the flat or not - also stands disqualified to be appointed as an Office Bearer.

Under the circumstances, it is a vital question whether all Joint Owners, Co-Owners, Associate Members or Nominal Members whose names do not appear first in the Share Certificate cannot be appointed as members of the Managing Committee or Office Bearers.

*************************