The Hindu : Karnataka News : Lokayukta asks Registrar to submit report on societies by June 1

Online edition of India's National Newspaper
Tuesday, May 31, 2005

Karnataka

Karnataka

Lokayukta asks Registrar to submit report on societies by June 1

Staff Reporter

Four housing cooperative societies given stamp duty exemption

BANGALORE: The Lokayukta, N. Venkatachala, has asked the Registrar of Cooperative Societies, H.K. Gopalakrishne Gowda, to submit by June 1 his comments on approving the bylaws of four housing societies in the city. The bylaws exempt the housing societies from registration of flats built by them and payment of stamp duty.

The matter came to light when the Governor, T.N. Chaturvedi, brought to the notice of the Lokayukta that the Registrar had approved the bylaws of Canara Union Cooperative Housing Society, Dattaprasad Housing Society, Chitrapur Housing Society and Paresh Housing Society in March. Such an approval had helped those housing societies to claim exemption from registering flats allotted to their members prior to 2001 and exemption from paying stamp duty concerning the flats.

Bylaws approved

Mr. Venkatachala told The Hindu that the Registrar had approved the bylaws of the four societies even as he was investigating the issue of exemption of payment of registration fees and stamp duty. In 2002 the State Government asked the Lokayukta to investigate and report to it about the housing societies, which, by forming "tenant co-partnership society," claimed exemption from payment of stamp duty and registration fees of the houses allotted to their members under Section 38 of Karnataka Cooperative Societies Act. The societies claimed the exemption by terming house allotments as transfer of "shares" of a cooperative society, which qualified for exemption. The list included 20 societies, including the four housing societies named above.

Mr. Venkatachala, in his interim report in August 2002, said the societies had misinterpreted the word "shares" in clause (a) of Section 38 of the Act and avoided registration of documents.

Mr. Venkatachala said on Monday that the Registrar's order approving the bylaws will mean nothing but allowing the four societies to not to register flats allotted prior to 2001 and not pay stamp duty. "Such a bylaw is contrary to the Karnataka Cooperative Societies Act. The order looks as if it is favouring the four societies." He said it is only the Government, not the Registrar, which can decide on granting exemption.

Regarding submission of the final report, Mr. Venkatachala said: "I would make the law clear that all transfer of interest in immovable properties needs to be compulsorily registered. I will make it clear that there is no such term as tenant copartnership housing societies in the Karnataka Cooperative Societies Act," he said.

The report on the Registrar's action and on the matter gone into in 2002 will be submitted simultaneously, he added.

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