Government order · Co-operation Department · 09.08.2001
Transfer premium: a ceiling that depends on where the society is
The Government order of 9 August 2001 lets the general body fix the premium a society charges when a member transfers a flat, but caps it — ₹25,000 in municipal corporation and authority areas, and less elsewhere.
Key points
- The transfer premium is fixed by the society’s general body, but can never exceed the ceiling for its area.
- Ceilings: ₹25,000 in municipal corporation and development authority areas; ₹20,000 in “A” class, ₹15,000 in “B” class and ₹10,000 in “C” class municipal councils; ₹5,000 in gram panchayat (rural) areas.
- The Commissioner’s earlier circular of 27.11.1989 on premium rates was cancelled.
- The order took effect immediately.
Background
The model bye-laws approved by the Commissioner for Co-operation on 02.07.2001 (bye-law 38(e)(ix)) left it to the State Government to fix the maximum premium a housing society may charge when a member transfers a flat or unit. Premium rates had earlier been fixed by the Commissioner’s circular of 27.11.1989; the Government decided to cancel that circular and issue its own order.
What the order directs
- The Commissioner’s circular of 27.11.1989 is cancelled.
- When a member transfers a flat or unit, along with the member’s shares and interest in the society’s property, the premium is to be fixed by the society’s general body — but it may not, in any circumstances, exceed these ceilings:
| Area | Maximum transfer premium |
|---|---|
| Municipal corporation and development authority areas | ₹25,000 |
| “A” class municipal councils | ₹20,000 |
| “B” class municipal councils | ₹15,000 |
| “C” class municipal councils | ₹10,000 |
| Gram panchayat (rural) areas | ₹5,000 |
The order came into force immediately and was to be published in the Government Gazette.
What it means in practice
A society in Pune or Mumbai city cannot charge more than ₹25,000; one in a smaller municipal council or a village has a lower ceiling. Within the ceiling, the figure is whatever the general body has resolved. A demand above the ceiling — including one dressed up as a “donation” or “development fund” as a condition of transfer — can be challenged before the Registrar.
Read more: Transfer premium guide
Three-page order in Marathi. 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?
Write to the office with a brief description of the matter. Meetings are by prior appointment.