Non-occupancy Charges in Co-operative Housing Societies

February 25, 2022
By Team MyGate
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It is a common practice for homeowners to invest in a residence and sub-let it to tenants. It is a good way to come into an additional source of income but brings with it the condition of paying your dues to the housing society. On the bright side, the non-occupancy charge is a relatively smaller amount, calculated and added on your maintenance bill. All you need to know is if you are liable to pay the charge, and if so, how much.

What is non-occupancy charges?

Your housing society collects non-occupancy charges from you when your residence is occupied by someone other than you or a close family member. In other words, it is an amount you pay to your society when you rent or lease your residence to a tenant.

Under what conditions are non-occupation charges levied by the society?

A non-occupancy charge is NOT applicable if:-

  • Your apartment is occupied by your family members, including mother, father, husband, wife, son, daughter, sister, brother, grandchild/ren, son-in-law, daughter-in-law, brother-in-law, sister-in-law, or any other near relations
  • You, as a member of society, reside in it
  • The apartment is vacant/locked/occupied by no one

When you live in your own apartment/home, you are liable to pay maintenance charges to the society. If you decide to move and leave the apartment locked with no one occupying it, you are still required to pay the maintenance charge without any concessions but a non-occupancy charge is not levied on you.

In case if the residence is neither self-occupied or occupied by a family member, and if the member stands to make a commercial profit out of the property, non-occupancy charges have to be paid in compliance with the government mandate. It is the society’s way to claim some share in the financial benefit from your property while it is being rented to a non-family member. In such scenarios, the society needs to be given a copy of the lease/license agreement along with other required forms. The non-occupancy charges are added to your maintenance bill. You have the right to select any type of tenant (provided they are not destructive or criminally inclined) and your tenants have the right to avail all the services and amenities of the society as you yourself would.

How is the non-occupancy charge calculated?

In the past, the non-occupancy charges were fixed at a one-time payment of service charges. According to government directives followed currently, non-occupancy charges should not exceed 10% of the service charges billed to the member. The service charges are part of the total maintenance bill and include housekeeping fees, applicable fees paid to committee members, common electricity charges, security charges, garden maintenance, and society’s outgoing charges. Property tax, water charges, repair and maintenance expenses are not included as part of the service charge.

Let’s understand this with an example. If the total maintenance bill of your society is Rs 3000, out of which if Rs 2000 is to be considered as service charges, you’d have to pay 10% of Rs 2000 (Rs 200) as non-occupancy charges.

This directive is applicable to all residential societies and has received approval from the Supreme Court as well. The decision came about after it was highlighted that due to lack of clarity in the way non-occupancy charges were to be calculated, several housing societies’ managing committees were levying unnecessary charges on unsuspecting members at higher rates and profiting personally from such exploitation.

Why should you know about non-occupancy charges?

If you’re part of the managing committee, you’d be responsible for informing the member about non-occupancy charges, explaining how the amount was arrived at, and collecting it as part of monthly maintenance. It is vital that you first understand the mandated action on your behalf. Most members, in general, are unaware of how the non-occupancy charges are calculated or if they apply at all. If they sub-let their apartment and are levied with non-occupancy charges without prior knowledge, they might become hostile or grudgeful.

At the same time, members are sometimes asked to pay unfair amounts of money in the form of non-occupancy charges by dishonest office bearers. Several consumer complaints have been registered against managing committees charing non-occupancy wrongly (even when a member hands over their residence to a relative), an action that is illegal and fraudulent.

In such cases, members should immediately register a complaint with the Registrar of the said locality and get the necessary help from the authority if no corrective measure is taken by the society. As an active and alert member, you must do your due diligence first so that you can help not only yourself but others as well. Understanding what you owe and what you most certainly don’t owe to your housing society is the first step towards practical wisdom and citizen awareness.

How much can societies charge as non occupancy charges?

In the event that the owner of the unit fails to pay the non-occupancy fees or refuses to do so, the housing society will send a reminder notice. If the sum is not paid, it may declare the owner to be in default. Additionally, the housing society would not offer the no-dues certificate.

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22 thoughts on “Non-occupancy Charges in Co-operative Housing Societies

  1. My flat is rented since Aug 2014 and the society was not charging non occupancy charges till now. Recently, they have charged in my current bill will retrospective effect of Aug 2014…is this correct, can society now charge from a back date of Aug 2014?

  2. YES. The Society is entitled to charge Non-Occupancy Charges (and Interest thereon), from Retrospective effect, PROVIDED the Society has documentary evidence or affidavit of witnesses /neighbors, regarding Renting /Leasing of the Flat. This can be easily determined from the Registration DATE of the Rent /Lease Agreement between the Flat Owner and the Tenant.
    The Society as an Entity, CANNOT be put to any type of losses for its legitimate dues, EVEN IF the Flat Owner has failed /forgotten, to provide the Rent /Lease agreement to the Society. IT IS the mandatory & Cooperative “DUTY” and legal liability of Flat Owner, to documentraily inform the Society to levy Non Occupancy Charges, for his Rented /Leased Flat. This is EVEN IF the MC, has somehow inadvertently /deliberately failed to levy the Non Occupancy Charges.
    check out: https://chshelpforum.com/non-occupancy-charge

    Keep Smiling …. Hemant Agarwal
    VISIT: http://www.chshelpforum.com

  3. Do members have to pay non occupancy charges plus other charges to society for leasing out their flats

  4. hello, i am the secretary of payal homes chs. in our society one company has purchased three flats. staff of this company is staying in that flats. do we have to charge non occupancy charges to them.

  5. Yes non occupancy is chargeable. As employees does not hold title of the property and liable to change without providing transfer fees.

  6. My housing society is located in Kandivali W,Mumbai,which has started charging (from Jan.2020) Non Occupancy Charges of 12 % on RENT received by me. Is it legal being done by society ? If not,
    kindly inform me ,what legal steps I should take to resolve this dispute ?

    P S KULKARNI
    WhatsApp No.9821688101

  7. Hi
    I am staying in the same building but not in the flat I purchased as my family is can not accommodate in 1BHK. Do I need to pay Non-occupancy charges? As society has already charged in the maintainance bill.

  8. I have purchased a flat in 2019 and planning to shift in my flat in 2021. I have purchased it for personal use , presently I am posted at different city . Till now , my flat is locked since purchase. My society member charging full maintenance charge , is it legal?

  9. Can pagdi shops be rented without societies knowledge as these shops are paying a monthly rent of Rs 800-900/- per month to the society whereas shops received a rent of Rs 150,000/- Can we take back the pagdi shops given to them by approaching the civil court.

  10. have a flat in Pune Maharashtra of 780 sqft.
    Since 2009 i am not living there. I have relocated
    Is it mandatory to pay the maintenance to me if even i am not living there. If so what minimum can be paid and essential charges can be included
    Plz reply.

  11. Dear Sir
    Kindly confirm against which clause of bye-law , non occupancy charges are to be paid.

  12. Non occupancy charge: what are government directives related to non occupancy charges levied by societies? Is it applicable in Bangalore?

  13. I am staying vin s flat and owner. Association bis charging 2400;,,for occupied and ,,20,00 for baccant flats. They are treating flats where furniture is kept with no body staying for persons gone abroad for a period of ,3 months with notice to association as occupied flat. This has led to confrontstion. What is court ruling in that matter
    Thanks

  14. If copy of leave and licence agreement is not given to society than society can charge penalty Rs.5000.00 per month.

  15. Can housing society make bye law for charging non occupant of flat.or lending flat on rent. For eg 500 ts is collected from owners and 1000 is collect from owners of rented flat?

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