How To Stop Corruption In Cooperative Housing Societies

corruption in housing societies

Introduction to Corruption in Housing Societies

During the period between 1960 to 2001, the number of registered co-operative housing societies increased from roughly 5,500 to more than 1,00,000, a survey conducted by Shodhganga states. With the emergence of more and more such co-operative housing societies, it is no surprise that corruption in housing societies has also been widely rampant.

While a housing society carries out different functions pertaining to maintenance of accounts and finances, heeding to the complaints of residents, managing repairs and damages and overseeing the smooth functioning of a society, there is a lot of scope for members and the management committee (MC) to commit acts of fraud, violations, misconduct and misuse of society funds. Thus, it is the responsibility of members to be aware of their rights within a co-operative housing society

Corruption in housing societies

Common Types of Corruption in Housing Societies

Before we dive into how we can redress and solve these issues, let us understand how the absence of an online system like a society management app can bring about such problems and cause corruption in co-operative housing societies in the first place. A major cause of dispute that occurs between managing committees is the proposed redevelopment of societies. Many MCs might engage in underhand dealings with builders and redevelopers and individual MC members. This can lead to misrepresentation of matters before the residents by builders and MCs, disputes on petty matters and filing of false complaints against persons opposing redevelopment.

Management Committees are often responsible for societies with hundreds of flats, large properties and amenities like a clubhouse handling huge sums of funds amounting to lakhs and crores of rupees. In such scenarios, members can easily find ways to earn illegitimate incomes while making repairs or collecting maintenance.

In India, every co-operative housing society is laid down and governed by a set of laws and rules called Bye-laws. Bye-laws are formed and implemented differently by different state governments and they should be considered as the constitution for the functioning of every co-operative housing society. These laws constitute the redressal of different types of complaints and malpractices. In an offline system, the easiest form of corruption to identify is:

(i) Avoidance of accounts audit: This implies that a certain member is trying to hide an unapproved or illegal transaction. In some cases, auditors themselves can be corrupt by colluding with corrupt MC members.

(ii) Corruption in housing societies can also take place by producing false bills, misuse of funds and personal expenses being written off as society’s expenses. With a society management software like ADDA in place, auditing and accounting processes are completely transparent since every little transaction is duly recorded.

(iii) Rules specify that free and fair elections of the management committee must be conducted annually. However, the elections might be rigged at times when a particular member may have vested interest in acquiring a certain position in the MC. Hence, he/she may bribe some members to be elected.

corruption in housing societies

Methods of Redressal

Thankfully, there are methods and remedies for redressal of corruption in cooperative housing societies. The Maharashtra Co-operative Societies Bye-laws prescribes whom you can approach for redressal of your complaints and disputes.

An application of your complaint must be submitted to the society office bearers in writing with all the details of the complaint.

After the receipt of such a complaint, the committee shall take decision thereof, in the coming management committee meeting. Such a decision shall be communicated to the concerned member within 15 days thereafter. If the member/members are not satisfied by the decision of the committee, or does not receive any communication from the committee within the time specified above, he/they may approach the competent authorities, depending upon the nature of the complaint:

  • Registrar of Societies: The Assistant/Deputy registrar regulates the housing societies under his jurisdiction and usually handles complaints pertaining to tampering, suspension or incomplete maintenance of records, misappropriation of funds and improper auditing, disqualification of members or unfair electoral practices, etc.
  • Civil Court: If the matter is not resolved, approach a co-operative court. Some complaints must be taken to the civil court for resolution but always keep this as a last resort because it requires more time and resources. The disputes handled by civil court can pertain to substandard construction, conveyance charges, escalation of construction cost, etc.

Steps to Stop or Minimize Corruption in Society

An article by Economic Times stated that almost 90% of the residents in a housing society do not know or care about the developments as long as they get the basic facilities like water supply and electricity. This is highly problematic, as not knowing your rights can be the cause of certain issues. As residents, we need to be aware of the right recourse to take and ensure that the democratic values of a cooperative housing society are upheld.

Corruption in Cooperative Housing Societies can be minimized by regular Annual General Body Meetings where members have a chance to hold those involved in corruption, accountable. In fact, one can take advantage of technology to record meetings and keep tabs on the management committee. It is always advisable to try and build support for your cause among other residents.

A society management app like ADDA can effectively deliver all your society related issues to the residents and keep them updated through features like Community Communication. This enables members to respond to the proposals even if they miss out on any meetings. Another important tool is the Right to Information Act, through which a person can elicit information about the housing society and the workings of the management committee.

How ADDA Can Help Stop Corruption In Housing Societies?

When you operate through ADDA, the biggest advantage is visibility. One can log in and check the running transactions and balance from anywhere. The Management Committee will have a clear idea on any amount being spent. In fact, getting approvals for asset repair is easier than ever, since there is no scope for blunders or mistakes on the app.

A well drafted Bye-law should allow members to raise an issue to the management committee without much hassle. It can be tempting to get involved in any flat rent-sell commission business or accept bribes as a MC member. But playing petty politics and causing any violations will only defeat the purpose of improving living conditions of a housing society. You can learn more about how ADDA software’s usage can help eradicate corruption in cooperative housing societies by simply contacting us here.  

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