Forced donations sought by housing societies illegal
In a setback to housing societies who get members to make a ‘voluntary donation’ at the time of sale of flat, the Bombay high court has ruled such payments are illegal. A housing society cannot recover excessive transfer fee from a member under the guise of ‘voluntary donation’, the court has ruled.
Thirteen years after a Pune resident had claimed he was pressured to pay around Rs 5 lakh as voluntary donation if he wanted to sell his bungalow property, justice MridulaBhatkar ordered the housing society to refund the amount with interest.
A cooperative housing society…is not expected to indulge in profiteering from members and, if such amount is earned, then it is taxable under the law.
There is no bar on any member to pay a donation to the society but it should be voluntary,” said Justice Bhatkar.