A Comprehensive Guide on How to Dissolve a Housing Society Managing Committee
Dissolving the managing committee of the housing society is a complicated process. It involves conducting special body meetings, discussing the purpose of dissolution, and making a count of final votes. Managing committee plays an important role to set the rules for community living and maintain the welfare of the members.
If the phases of dissolution become inevitable, one must understand the reasons behind it. It could happen because of non-compliant activities in the community or when the object clauses have not been met.
In this comprehensive guide, we will cover details of how to dissolve a housing society managing committee.
Step-by-Step Guidelines on How to Dissolve Society Committee
If the dissolution of the housing society or removing the chairperson is the only viable option, one can follow these steps:
Conduct a general body meeting
The general body meeting before the dissolution is a crucial step. Here, the intent of dissolving the managing society needs to be presented. Minimum members of the society need to agree and support the decision to make it valid.
Take the vote
To dissolve the managing committee, a majority of votes are required. Thus, the housing society is responsible to present a resolution where the reasons behind dissolution will be furnished clearly.
The role of the liquidator
The liquidators are responsible for carrying out the dissolution process and distributing the assets once the dissolution process is over. Now, the members who have agreed upon dissolving can select liquidators among themselves. The board of liquidators only requires three to five members. In case the dissolution process is involuntary, the court can intervene in this process and appoint the liquidator.
Inform the authoritative bodies
This is important to convey information to the Registrar of the Cooperative Society and the local municipal corporation. They will cancel the society’s registration. This only happens when the registrar receives applications from three-fourths of members of the society. Also, when the society holds special authorisation to dissolve a committee, the registrar takes the cancellation process further.
Debt clearance
Before dissolution, said committee needs to settle all debts and claims. If any society has insufficient funds, they can sell their assets to pay liabilities. Failing to settle debts before dissolution can lead to legal complications further. Any housing society has been fraught by legal obligations with vendors, service providers, and financial institutions. Hence, they need to check their debts and claims thoroughly before going ahead with the dissolution process.
Asset distribution
The next stage after debt settlement is asset distribution. Once debts are cleared, distribute assets among the society members as per the bylaws. By-laws are the set of rules that society members set to govern any specific housing society.
Create the final report
Once the dissolution process begins, send a final report to the Registrar with the details of the process, and the asset distribution.
Legal Aspects of How to Dissolve a Housing Society Managing Committee
Dissolving the managing committee of the housing society has far-reaching legal complications. There are few acts involved in the dissolution process in India. The following are the specific acts associated with this process:
Cooperative Societies Act
This is an act that provides the legal framework for the cooperative society. This act is widely known as the Co-operative Societies Act, of 1912. This act ensures the dissolution of the society. It is possible when the Registrar and one-third of society members are of the same opinion and members cast a vote in their favour. The registrar, then, cancels the registration of the society.
State-Specific Laws
Different states come with their set of rules governing the Cooperative Societies. It could add some provisions and clauses as per their rules. Hence, the dissolution process could vary based on the states and their governing bodies.
Bylaws of the Society
This by-law determines the governing structure of the society. It comprises a set of rules through which decisions are taken for business operations and other regulations. This law might include the rights of the board of directors and the members of the society. Board’s chairman has the maximum power to make decisions and influence others. However, the members have their rights to vote and inspect the necessary documents related to the society. Such a law helps in the dissolution process in many ways.
Legal consequences of the society’s dissolution can impact committee members enormously. These members need to clear their debts before such a process takes place to ignore any further legal complications. Such a process can affect the property ownership of the members. In some cases, the rights of such disputed properties can be seized by the Government. Also, members can face tax-related issues as well for such a dissolution process.
The Implications of How to Dissolve a Housing Society Managing Committee
The dissolution process is a far more complex process than one could imagine. Before any housing society decides to dissolve the housing society managing committee, they should consider the following aspects:
Legal implications
Dissolving of the housing society managing committee can involve legal aspects. If there are major liabilities involved, the members of the society can face legal implications.
Financial losses
The dissolution process is expensive. It involves several charges for legal process and administration. Members of the society can face huge losses as well.
Service disruption
The committee dissolution can impact the members in many ways. The services such as maintenance, security, and waste management can be disrupted.
Reduction in property value
Such committee dissolution can affect the property value as well. Such a process puts a question on the credibility of the management. This is the reason the property value gets reduced if such disputes ever occur.
Understanding the Alternative to How ro Dissolve a Housing Society Managing Committee
Before considering such an immensely critical dissolution process, the committee members should reconsider their decisions. Any housing society going through such disputes can consider following alternatives:
Identify the incompetent members
If the dissolution of the housing society committee is only because of a few incompetent members, it can be reversed. Such a society needs to eliminate those members. The other competent residents need to play a crucial part in saving their committee and take stringent action against those corrupted ones.
Follow by-laws of the cooperative society
Housing societies are bound by Bylaws. If any society fails to comply with rules, they may have to begin the dissolution process. So, a meeting with the head of the committee is necessary here to understand loopholes in the process. Dissolution is the last resort for such a committee.
The assistance of the third party
Seek advice from any neutral third party before taking such a drastic decision. If the chairman’s or any members’ activities are questioned, a committee can remove such people from the administration. As per Bylaws of the Cooperative Society, three members can run a housing committee.
Take legal action
Consider taking legal action against those who have violated rules of the society. If governing bodies have any issues with a housing committee, try to pacify them to save a committee from dissolving. Members need to take responsibility to prevent their committee from dissolving.
Conclusion
This guide on how to dissolve a housing society managing committee has covered crucial steps. This is a challenging process involving far-reaching legal consequences. If any society members face such disputes in their committee, try to seek advice from the professionals and look for alternatives before finalising the dissolution process.
Frequently Asked Questions
How to Remove Chairman of Housing Society?
Following are the ways to remove the chairman of the housing committee if such eviction is inevitable:
- Conduct a ‘Motion of No Confidence’ in a special committee meeting.
- One-third of the committee members need to showcase notice in the meeting.
- Two-thirds of the members should cast a vote against the chairman.
- Forward the copy of the resolution to the Registrar of the Cooperative Society.
- The registrar’s validation is essential in such an aspect to carry on the removal process.
How to remove committee members of housing society?
The process of removing any committee members involves a crucial process. Committee needs to conduct a special meeting, pass resolution, and get validation from the authorised body. Members can also be evicted if they do not attend three consecutive meetings, have been imprisoned for more than three years, or fail to qualify according to the provisions of the Act, 1961.
How to remove administrator from housing society?
Process of removing the administrator from the housing committee is like the Chairman and Members of the committee. But one thing needs to be kept in mind is that the administrator’s role is for only six months. It can be extended up to three months more with valid reasons.
What happens to the property after dissolution?
If the dissolution is only for a Housing Society managing committee, members can pay their debts and liabilities and save property. In case of debts, property may revert to the government or can be distributed among other society members.
Is it possible to dissolve a Housing Society managing committee without the Government’s consent?
The Government’s consent is mandatory, to begin with the dissolution process. Society members should inform the Registrar of the Cooperative Society and authoritative bodies. Validation is important to take the process to the next level.