How CHS Maintenance Charges Are Calculated in Maharashtra

Maintenance charges in a Maharashtra cooperative housing society are not a single fee — they are a bundle of up to eight distinct components, each with its own legal basis, calculation method, and permissible uses. The managing committee is required by law to present a budget at the AGM each year showing how maintenance will be collected and spent.

If your maintenance bill has ever seemed unclear, or if you have wondered whether your society is charging correctly, this breakdown will give you the framework to understand — and verify — every line item.

The 8 Components of CHS Maintenance

Service Charges

Covers day-to-day operational costs: security staff salaries, housekeeping, common area electricity, lift maintenance, pest control, and administrative expenses. This is typically the largest component of the bill.

Must be split equally per flat regardless of size or carpet area, under the MCS (Amendment) Rules, 2026

Repair & Maintenance Fund

A reserve built up over time to fund routine repairs — painting, plumbing, civil work, terrace waterproofing, and equipment replacement. The AGM decides the annual contribution rate based on the society's maintenance plan.

Typically proportional to flat area (per sq ft)

Sinking Fund

A statutory long-term reserve for major capital expenditure — structural repairs, building renovation, lift replacement, or unforeseen structural emergencies. Unlike the repair fund, this cannot be used for routine maintenance.

Minimum 0.25% of construction cost per annum per flat (Bye-Law 13)

Water Charges

Covers the society's water bill from the municipal authority. Many societies charge this equally per flat. Societies with individual water meters charge based on actual consumption.

Equal split per flat, or meter-based where sub-meters are installed

Common Area Electricity

Lighting for staircases, corridors, parking areas, and common facilities. This is separate from each flat's own electricity connection with the distribution company.

Equal split per flat, or proportional to flat area

Insurance Premium

Maharashtra law requires housing societies to insure the building structure. The premium is shared among all members. This covers the common building only — contents and interiors of individual flats are not covered.

Equal split among all flats

Non-Occupancy Charges

An additional charge on flats that are rented out or left vacant — i.e., not occupied by the owner. A Maharashtra Government Circular dated 9 August 2001, issued under Section 79A of the MCS Act and upheld by the Bombay High Court in 2007, caps this at 10% of the service charges component only, not the total maintenance bill.

10% of service charges — applies only to non-owner-occupied flats

Parking Charges

Societies with designated parking spaces may levy a monthly parking charge per vehicle. The rate is decided by the general body at the AGM. Open parking and closed garage charges may differ.

Fixed amount per parking space, decided at AGM

A Note on the Sinking Fund

The sinking fund is frequently misunderstood and misused. It is a capital reserve — it can only be used for major structural repairs, renovation, or reconstruction. It cannot be used to fund day-to-day operational shortfalls or to pay staff salaries. Since June 2026, the minimum contribution (0.25% per annum of the architect-certified original construction cost) is a statutory requirement under the MCS (Amendment) Rules, 2026, not just a bye-law recommendation — societies contributing below this floor are now in statutory non-compliance.

Withdrawals from the sinking fund require approval at the general body meeting. Societies that routinely dip into the sinking fund for routine expenses are exposing their committee members to personal liability for misappropriation of funds. The 2026 Rules also give statutory recognition to a separate Major Repair Fund for large capital works (apportioned by carpet area), distinct from the routine Repair & Maintenance Fund — societies planning a major repair cycle should consider setting this up as its own line item.

Non-Occupancy Charges: The Most Disputed Component

Many societies have been calculating non-occupancy charges incorrectly — charging 10% of the total maintenance bill rather than 10% of the service charges component only.

Example: If your total maintenance bill is ₹5,000 and service charges account for ₹2,000 of that, the non-occupancy charge is ₹200 (10% of ₹2,000) — not ₹500 (10% of ₹5,000). If your society is charging the higher amount, you can raise this at the next AGM and request a correction with retrospective adjustment.

How the Annual Budget Determines Your Bill

Each year, the managing committee prepares a budget for the coming financial year (April to March). This budget is presented at the AGM and must be approved by the general body. Once approved, the monthly maintenance figure is derived by dividing the annual budget by 12 and allocating costs across all flats according to the agreed method (equal share, per sq ft, or a hybrid).

The committee cannot charge more than what the approved budget permits without a fresh general body resolution. Members who believe they are being overcharged can demand to see the approved budget and the actual expenditure accounts — this is their legal right under the MCS Act.

Audited accounts must be presented at every AGM. If the society has not had its accounts audited, or if the accounts are not placed before the general body, this is a statutory default that members can report to the Registrar of Co-operative Societies.

Frequently Asked Questions

QWhat are the rules for society maintenance charges in Maharashtra?

Maintenance charges are governed by the Model Bye-Laws (2014, still the registered bye-laws for most societies pending the 2026 revision) read together with the MCS (Amendment) Rules, 2026, which came into force in June 2026 and made several of these requirements statutory. The rules require: charges must match a budget approved by the general body at the AGM, they can only cover the components legally permitted (service charges, repair fund, sinking fund, water, electricity, insurance, non-occupancy, parking), service charges must be split equally per flat regardless of size, non-occupancy charges are capped at 10% of service charges, interest on arrears cannot exceed 12% per annum simple interest, and any revision needs a fresh AGM/SGM resolution. The committee cannot invent new charges or labels outside these categories.

QCan the society charge maintenance per square foot?

Yes. Many societies allocate service charges and repair fund contributions proportionally by the built-up or carpet area of each flat. This is legally permissible under Model Bye-Laws 2014 and is considered equitable for societies where flat sizes vary significantly.

QWhat is the maximum non-occupancy charge?

A Maharashtra Government Circular dated 9 August 2001, issued under Section 79A of the MCS Act and upheld by the Bombay High Court in 2007, caps non-occupancy charges at 10% of the service charges component. Societies that were charging 10% of the total maintenance (including sinking fund, water, electricity) must revise their calculations — the 10% cap applies to service charges only.

QCan a society revise maintenance charges mid-year without an AGM?

No. Maintenance charges can only be revised at the Annual General Meeting, where the budget is approved by the general body. The managing committee cannot unilaterally increase charges outside this process. Emergency situations may allow an SGM for out-of-cycle revisions.

QWhat happens to unpaid maintenance?

Unpaid maintenance accumulates as arrears and attracts simple interest at the rate decided at the AGM — capped at a maximum of 12% per annum, simple interest, under the December 2025 MCS Act amendment and the MCS (Amendment) Rules, 2026. This replaces the older practice of many societies charging up to 21%, often compounded. After formal demand, the society can file a recovery application before the Co-operative Court under Section 91 of the MCS Act, or use the faster Section 154B-29 recovery procedure (Form Y-6) introduced by the 2026 Rules. Persistent defaulters may also be denied NOC for flat transfer.

Buying at a bank auction? A July 2026 Bombay HC ruling means you may inherit the previous owner's dues — read what to check first.

QIs the sinking fund contribution mandatory even for new buildings?

Yes. Bye-Law 13 requires all societies to maintain a sinking fund irrespective of the building's age, and since June 2026 this minimum is also fixed as a statutory requirement under the MCS (Amendment) Rules, 2026. The minimum contribution is 0.25% per annum of the flat's original construction cost, certified by the society's architect (not current market value), though the AGM may approve a higher contribution rate.

QHow is the repair fund calculated for a housing society in Maharashtra?

Unlike the sinking fund, the repair fund has no fixed statutory percentage. The managing committee proposes an annual repair fund contribution — typically calculated per square foot of built-up or carpet area — based on the society's expected repair needs for the year, such as painting, plumbing, civil work, or waterproofing. This proposed rate is included in the annual budget and must be approved by members at the AGM. A society with an older building or planned major repairs will usually set a higher repair fund rate than a newer building with minimal upkeep needs.

Your Rights as a Member

Right to inspect accounts, vouchers, and receipts at the society office
Right to a copy of the approved budget on request
Right to raise objections to the maintenance bill at the AGM
Right to a detailed breakdown of how your bill is calculated
Right to challenge overcharging before the Co-operative Court (Section 91 MCS Act)

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Educational purpose only

This article is intended for general informational and educational purposes only. It does not constitute legal advice and should not be relied upon as such. Laws, rules, and bye-laws applicable to cooperative housing societies in Maharashtra are subject to change. Before taking any action based on the information in this article, readers are strongly advised to consult a qualified legal advisor or housing society consultant familiar with the specific facts of their situation.

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