🏢 Introduction
When buying or selling a flat in Mumbai, Thane, Pune or Navi Mumbai, one of the biggest concerns is:
- How much transfer charge can society legally demand?
- Can society refuse to give NOC?
- Is transfer premium different from transfer fee?
- Can society demand “donation”?
- What if society delays approval?
Transfer charges and NOC rules are governed under Model CHS Bye Laws (especially Bye Law 38 & 43) under the Maharashtra Cooperative Societies framework.
Misuse of these rules is very common — especially in resale transactions and redevelopment phases.
This guide explains everything clearly.
1️⃣ What Are Transfer Charges in CHS?
Transfer charges are amounts payable to society when a flat is sold (resale).
They generally include:
- Transfer fee
- Entrance fee
- Transfer premium (if applicable)
- Share transfer form charges
These charges are regulated and cannot be arbitrary.
2️⃣ Maximum Transfer Fee Limit in Maharashtra
As per Government directives:
- Transfer Fee: ₹500
- Entrance Fee: ₹100
- Transfer Premium: Maximum ₹25,000
Society cannot charge more than ₹25,000 as premium (in most municipal areas like Mumbai, Thane, Pune).
Any demand beyond this is illegal.
3️⃣ What Is Transfer Premium?
Transfer premium is:
- An amount charged to admit new member
- Paid by buyer
- Subject to upper cap
Important:
Society cannot charge a percentage of sale value.
Example of illegal practice:
Charging 1% of transaction value.
Only fixed maximum premium is allowed.
4️⃣ Documents Required for Transfer
Buyer must submit:
- Application for membership
- Copy of registered agreement
- Transfer form signed by seller
- No dues certificate
- KYC documents
- Nomination form
Society must process application within 3 months.
5️⃣ Can Society Refuse NOC?
Society can refuse NOC only if:
- Seller has outstanding dues
- Legal dispute pending
- Documents incomplete
- Flat used for illegal purpose
Society cannot refuse NOC because:
❌ They dislike buyer
❌ Buyer is tenant earlier
❌ Disagreement in redevelopment
❌ Personal bias
❌ Buyer’s profession
Refusal without valid reason can be challenged before Registrar.
6️⃣ Is NOC Compulsory for Sale?
Technically:
Under Maharashtra law, NOC is not mandatory for registering sale deed.
However:
- Many banks insist on NOC.
- Society may require compliance before transfer of membership.
Important distinction:
Registration of flat and membership transfer are separate processes.
7️⃣ Timeline for Transfer Approval
Society must:
- Approve or reject within 3 months.
- Communicate rejection in writing.
If no communication within 3 months → Deemed Membership applies.
This protects buyers.
8️⃣ Can Society Charge “Donation” or Extra Amount?
No.
Society cannot:
❌ Demand donation
❌ Demand “voluntary contribution”
❌ Demand share in sale profit
❌ Demand additional corpus
Such demands are illegal.
Members can complain to Registrar.
9️⃣ Transfer Charges During Redevelopment
In Mumbai redevelopment scenarios:
- Some societies try to restrict transfers.
- Some demand higher premium.
- Some deny NOC to force participation.
Legally:
Transfer cannot be arbitrarily stopped during redevelopment unless specific legal resolution exists.
Buyers must check:
- Redevelopment agreement
- Pending litigation
- Special conditions in society resolution
🔟 Transfer to Family Member – Are Charges Applicable?
If transfer is between:
- Husband & wife
- Parents & children
- Among family members
Transfer premium may not apply (subject to bye law provisions).
However:
Transfer fee & documentation still required.
1️⃣1️⃣ Can Society Recover Pending Dues from Buyer?
Legally:
Seller is responsible for dues till date of transfer.
However, in practice:
Society may insist buyer clears dues before transfer.
Buyer should:
- Ensure no dues certificate before payment.
- Deduct outstanding amount from seller.
1️⃣2️⃣ Share Certificate Transfer
After approval:
- Society endorses buyer’s name on share certificate.
- Old certificate cancelled.
- New share certificate issued within prescribed time.
Delay can be challenged legally.
1️⃣3️⃣ Common Transfer Disputes in Mumbai
- Charging 1–2% of sale value
- Refusing NOC due to personal dispute
- Delaying transfer for months
- Asking buyer to sign illegal undertakings
- Charging high “parking transfer fee”
- Blocking resale during redevelopment
Proper written communication is critical.
1️⃣4️⃣ What If Society Demands More Than ₹25,000?
Steps:
- Ask for written demand with bye law reference.
- Attend committee meeting.
- Raise issue in General Body.
- File complaint before Assistant Registrar.
- Approach Cooperative Court if needed.
Keep all written records.
📊 Quick Summary Table
| Component | Maximum Allowed |
|---|---|
| Entrance Fee | ₹100 |
| Transfer Fee | ₹500 |
| Transfer Premium | ₹25,000 |
| Processing Timeline | 3 months |
| Arbitrary % Based Charge | Not Allowed |
❓ Frequently Asked Questions
Can society charge 1% of flat value?
No. Illegal.
Is NOC mandatory for registration?
No, but banks may insist.
Can society delay transfer?
Only up to 3 months.
Can transfer be stopped during redevelopment?
Not without valid legal basis.
Can premium exceed ₹25,000?
No, in municipal areas like Mumbai
🏁 Conclusion
Transfer charges and NOC rules in Cooperative Housing Societies are strictly regulated in Maharashtra.
Society cannot:
- Charge arbitrary premium
- Demand percentage of sale value
- Refuse NOC without legal reason
- Delay transfer indefinitely
Understanding these limits protects both buyers and sellers — especially in high-value markets like Mumbai and Thane where resale transactions involve large sums.
Before paying any transfer premium, always verify the legal cap and ensure all demands are supported by bye laws.
Disclaimer: This is not legal advice. Kindly consult a qualified lawyer or legal professional for advice specific to your situation.