Non Occupancy Charges

Non-Occupancy Charges And Everything About It

Non-occupancy charges are among the various charges listed in the bye-laws for a Co-operative Housing Society (CHS) in Maharashtra. These charges are applicable on the properties that are not occupied by the owner or his family members.

To apprise better if a buyer bought 2BHK apartment in Pune hoping to earn a regular flow of rental income through it. However, when the wonder decides to do so, the society imposed a “non-occupancy charges” on it.  There are many people in Maharashtra who are unaware of these prevailing charges.

What Are The Non-Occupancy Charges?

Non-occupancy charges are charged in case if the ownership of a property has been transferred by the developer/society to the owner, but the unit remains vacant despite being in a ready-to-move project. However, these are applicable only when the unit is sub-let. These charges are not payable if the flat is not sub-let and remains locked or if the flat is occupied by a family member such as spouse and parent.

If a property in housing complex is not self-occupied by the owner itself and the owner has a commercial gain out of it, then non-occupancy charges have to be paid by the owner to the society.

Though, in the recent times there were debates and arguments took place pertaining to the issue of non-occupancy charges. As there was absence of clear guidelines, it has often caused disputes between a society and its members.

The homeowners believe that they have been levied exorbitant charges by the society for their residential property. The society, on its part, justifies levying such charges to members for subletting their flat and earning a handsome rental income. To make matters complicated, there is ineffective enforcement by the authorities and varied interpretations by legal experts.

This is charged when a society member’s flat for sale is occupied by non-family members.

No Non-Occupancy Charge Are Applicable If:

  • The society member is staying in the flat.
  • The flat is locked, closed, vacant or non-occupied.
  • Family members occupy the flat.

Government Intervention For NOC

  • On the following June 1997, the Maharashtra government appointed a committee to inspect the entire issue of NOC in descriptive way.
  • Acting on the committee’s report in August 2001, the state government ordered that the NOC charges should not exceed 10 percent of the service charges.
  • The Bombay High Court upheld this decision of the state government in March 2007.
  • Consequently, the Supreme Court also gave its nod to the state government’s notification.

Calculations Of The Non-Occupancy Charges

Non-occupancy charges levied by society should not be more than 10 per cent of the service charges.

For example, if the service charges portion in the monthly maintenance calculation is Rs 2,710 per month, non-occupancy charges would be Rs 271 (10% of Rs 2,710) per month.

What Are The Service Charges?

According to bye-law 68 of the new model bye-laws, service charges include salaries and allowances to staff, outgoings for society office, sitting fees to committee members, printing and stationery charges and common electricity charges.

In case a home owner refuses to pay non-occupancy charges, the society shall serve a reminder notice and can declare the owner as defaulter. Further, a no-dues certificate shall not be issued by the society for the property purchased.

Read also: 5 Cent Equal to How Many Square Feet? Easy Cent to Square Feet Conversion

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