Government Empowered: Bill Passes to Set Transfer Fee Rules for Co-op Society Houses

The Gujarat State Assembly has approved a significant legislative amendment affecting all cooperative housing societies across the state, including the approximately 87,000 cooperative societies. The amendment to the Gujarat Cooperative Societies Act of 1961, proposed by Cooperative Minister Jagdish Panchal, grants the government the authority to regulate transfer fees concerning the purchase of new houses from cooperative societies. Under the current regulations, there is no fixed parameter for determining the transfer fee, leading to disparities across housing societies. 

However, with the new amendment, the state government will now have the power to define these parameters within the next six months. This measure aims to bring transparency and standardization to the process, benefiting both buyers and sellers within the housing sector. The decision underscores the government’s commitment to streamlining property transactions and ensuring fairness in cooperative housing societies across Gujarat.

New Regulations for Transfer Fees from New Homeowners; Government’s Directive on Cooperative Societies in Distress

Under current regulations, there are no specific guidelines regarding the transfer fees to be collected from new homeowners. However, in the case of cooperative societies facing financial distress, the government will ensure that creditors are paid first.

Apart from housing societies, cooperative societies facing financial difficulties will have to maintain a fund for contingencies. Previously, the authority to decide who gets paid first when a cooperative society goes into bankruptcy rested with cooperative officials. Now, the government will take charge of prioritizing payments in such situations. Additionally, the government will make decisions regarding the duration of such societies’ mandates.

Overview of Cooperative Societies in Gujarat: Strength in Numbers

Gujarat boasts a network of 87,000 cooperative societies, representing a vast community of members. Among these, cooperative housing societies constitute a significant portion, amounting to 30,000 societies. Additionally, the state hosts 214 urban cooperative banks, over 10,000 Primary Agricultural Credit Societies (PACS), more than 6,000 credit societies, and in excess of 16,000 dairy cooperatives. 

This expansive cooperative landscape underscores the strength and diversity of cooperative endeavors in Gujarat, serving various sectors including urban banking, agriculture, credit, and dairy production. The collective membership of 1.71 crore individuals within these cooperative societies reflects the widespread engagement and reliance on cooperative principles across the state.

Determining Transfer Fees Based on Infrastructure, Property Value, and Amenities

Question: What parameters will be considered for determining transfer fees within housing societies?

Answer: Under the new regulations, the state government will establish parameters for determining transfer fees within housing societies. Article 159(k) of the new legislation empowers the government to formulate rules for this purpose. The transfer fees within housing societies will be determined based on factors such as the infrastructure, property value, and amenities provided by the society.

Question: What benefits will people gain from the new changes?

Answer: Committees within societies will no longer have the authority to arbitrarily set transfer fees. Currently, transfer fees can range from Rs. 10,000 to Rs. 2 lakh. Some societies have amassed transfer fee funds totaling up to Rs. 12 crore. With the new regulations, homeowners purchasing property will be spared from unjust financial burdens, as transfer fees will be determined by law.

Question: Are there any changes in society registrations?

Answer: Yes, now societies need a minimum of 8 members instead of the previous 10 for registration. Approximately 1,500 housing societies get registered annually on average.

Question: Will the new regulations resolve disputes related to transfer fees?

Answer: Yes, the regulations will bring harmony in society dues collection for maintenance as well as for enhancing facilities. Compatible fees will be collected for maintaining standard facilities. Disputes arising due to differential fee structures in societies will be resolved as the government will oversee the approval of transfer fees. Consequently, internal disputes within societies regarding transfer fees will be minimized.

Overview of Cooperative Societies in Gujarat: A Network of 1.71 Crore Members

In Gujarat’s cooperative sector, there exists a vast network comprising 1.71 crore members. Among these cooperative societies, one-third constitutes approximately 30,000 housing societies, reflecting the significance of housing cooperatives within the state. Additionally, Gujarat hosts 214 urban cooperative banks, more than 10,000 primary agricultural credit societies (PACS), over 6,000 credit societies, and in excess of 16,000 dairy cooperatives. 

This extensive network illustrates the diverse spectrum of cooperative endeavors operating across various sectors, including banking, agriculture, credit, and dairy production, contributing significantly to Gujarat’s cooperative landscape and socio-economic development.

Government to Ensure Priority in Fund Allocation

In cooperative societies other than housing, funds will need to be maintained for housing societies. When any cooperative society faces financial challenges, the government will prioritize the allocation of funds. Previously, the authority to disburse funds to those in need rested with cooperative officials. 

However, now the government will take charge of ensuring the distribution of funds in a timely manner. Additionally, decisions regarding the tenure of funds for such societies will also be made by the state government, ensuring smoother financial operations within cooperative sectors beyond housing societies.

Akash Shrivastav

My name is Akash Shrivastav, and I am a Blogger. I have 8 years of experience in blogging for Finance, Business, Investment, Stock Market, Cryptocurreny and more. Through my writing, I aim to provide readers with insightful and informative content.