Government order · Co-operation Department · 01.08.2001
Non-occupancy charges: 10% of service charges, and none for close relatives
The Government order of 1 August 2001 fixed the maximum non-occupancy charge a housing society may levy when a member lets the flat, and exempted flats given to close relatives.
Key points
- Non-occupancy charges may not exceed 10% of the service charges, excluding municipal taxes.
- No non-occupancy charge may be levied where the member gives the flat to close relatives — mother, father, brother, sister, son, daughter, son-in-law, daughter-in-law, grandchildren and similar relatives — or to other relatives the society approves.
- The earlier order of 09.03.1995 was cancelled.
- The order applies to residential and commercial units in every housing society, whether or not the bye-laws have been amended.
Background
A Government order of 9 March 1995 had allowed non-occupancy charges of up to one time the service charges. Several societies challenged it in the Bombay High Court (Writ Petition No. 1398 of 1996 and others). The High Court suggested that the charge should rest on a rational basis, after considering factors such as rateable value, rent and the views of experts. The Urban Development Department advised that rateable value or rent was not a suitable basis, and an expert committee constituted by the Commissioner for Co-operation made recommendations. After considering them, the Government issued this order.
What the order directs
- The order of 09.03.1995 is cancelled from the date of this order.
- Non-occupancy charges must not exceed 10% of the service charges (excluding municipal or council taxes).
- No non-occupancy charge is to be levied where a member gives the flat or unit to close relatives — mother, father, brother, sister, son, daughter, son-in-law, daughter-in-law, brother-in-law, sister-in-law, grandson, granddaughter and the like — or to other relatives approved by the society.
- The order applies to residential and commercial units in all housing societies in the State.
- Societies must amend their bye-laws; even if they do not, they cannot levy more than the limit from the date of the order.
A corrigendum of 25.02.2011 later made it clear that the charge applies to paying guests as well — see non-occupancy charges for paying guests.
What it means in practice
If the service charges for a flat are ₹2,000 a month, the non-occupancy charge cannot exceed ₹200 a month. It cannot be fixed by reference to the rent received or the area of the flat, and it cannot be levied at all when the flat is occupied by the member’s close family.
Read more: Non-occupancy charges guide
Two files, both in Marathi: a typed copy and a scan of the signed order. This page summarises the document for general information; it is not a translation and not legal advice. Read the document itself for its exact terms, and check whether it has since been amended or superseded.
Have a question about your society?
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