India: Karnataka Apartment Association- Registration, Bylaws And Compliances

Last Updated: 23 August 2019
Article by Mariam Monaza

The Karnataka Apartment Ownership Act, 1974 ("KAOA" or "Act") was enacted to provide ownership to individual residential apartments in the State of Karnataka. The aim was to make these apartments heritable and transferable property. The apartment owners are required to submit their property to the provisions to this Act by signing a deed of declaration to that effect. Once the apartments are under the ambit of this Act, the owners, among other rights, will also obtain an undivided interest in the common areas and facilities of the apartment complex.

An apartment, under Section 3 of the Act is defined as a part of the property that is intended for independent and residential use. An apartment must have a direct exit to a public street, road or highway, or an exit to a common area that leads to such public places.

Every apartment owner has a heritable and transferable ownership of not just his apartment but also an undivided interest in the common areas and facilities. Thus, the apartment owner may transfer his apartment and his interest in the common areas and facilities in the form of sale, mortgage, lease, gift, exchange, or in any other manner as per the Transfer of Property Act, 1882.

Registration Under Competent Authority

The biggest advantage of registering an apartment complex under KAOA is the right to undivided interest that individual owners receive with regard to common areas and amenities, unlike when registered under the Karnataka Societies Registration Act, 1860. Thus, the building, common area and land are not vested with the Cooperative Society and therefore, the owners, if necessary, can easily mortgage their property.

Owners under KAOA also have a clear title to their property with a separate Khata. The deed of declaration ("DOD") contains comprehensive data about the buildings and properties, and has a separate registration number making it perfectly traceable at any given point of time.

There is a general confusion regarding the authority under which the apartment is to be registered. Though the Act does not clearly specify that the registration is to be done under a specific authority, it states under Section 3(i) of the Act that "Competent Authority" shall mean the "Registrar of Co-operative Societies as defined under the Karnataka Co-operative Societies Act". In addition with the Karnataka Apartment Ownership Rules, 1974, the term "Registrar" is defined under the model bylaws as the Registrar of Co-operative Societies. This shows that the registration is to be done with the Registrar of Karnataka Co-operative Societies.

Common Areas and Facilities

The common areas and facilities form an integral part of every apartment. They provide the right of way, right to use amenities like the elevators, parking areas, etc., and other shared facilities of the apartment.

The Act provides that each owner is entitled to a certain percentage of an undivided interest in the common areas and facilities as expressed in the DOD, which cannot be separated from the apartment that it belongs to. The percentage is to be calculated based on the value of the apartment with relation to the value of the property. Any change in this percentage can only be made with an amendment in the DOD, with the approval of all the apartment owners.

Once the apartments are submitted to the provisions of the Act, the common area and facilities cannot be divided or partitioned by the apartment owners or any other person by instituting legal proceedings for the same. Also, no encumbrance of any nature will arise or be effective on the property at large. Encumbrances may arise only on the apartment and the percentage of an undivided interest in the common area and facilities pertaining to such apartment.

As per Sections 14 and 22(d) of the Act, the owners may remove their apartment from the provisions of the Act by executing an instrument to that effect and by paying all outstanding charges pertaining to the apartment. Once the partition and sale of the common areas is completed, the net proceeds of sale and any net proceeds of the insurance of the property is to be divided among all the owners of the apartment in a percentage equal to the percentage of an undivided interest in the property. No apartment maybe partitioned if the same has encumbrances attached to itself.

This removal of the apartment from the provisions of the Act will not bar the apartment from being resubmitted to the Act once again.

The common areas and facilities are to be used in accordance with the purpose for which they are intended and their use must not hinder or infringe the lawful rights of the other apartment owners. All rights and obligations of the owners, including those related to the common areas and facilities will be stated in the bylaws along with other details such as maintenance and upkeep of the apartments.

The owners of the apartment cannot refuse to pay the charges pertaining to the use of common areas and facilities even by relinquishing their rights to use the same or by abandoning their apartment. In addition to the charges payable to the apartment association, the owners also have to pay taxes for the apartments and their appurtenant percentage in the common areas and facilities, as if they are a separate property.

Deed of Declaration

Sections 11, 12 and 13 elaborates on the DOD which is essential for the registration of the apartment under this Act.

The DOD must contain the following:

  1. Description of the land on which the entire apartment complex is located, and whether the land is freehold or leasehold.
  2. Description of the building including the number of storeys, basement, number of apartments and the details about the apartments, materials used, etc.
  3. Description of normal and limited common areas and facilities.
  4. Value of the property, percentage of an undivided interest in the property and a statement to the effect that the property or any apartment has no encumbrances attached to it.
  5. Voting rights of the owners.
  6. Rights and obligation of the owners.
  7. Name and details of the person who is to receive service of process.
  8. Method of amendment of the DOD.
  9. Any other details in connection with the property.

A true copy of the DOD along with the apartment bylaws and a true copy of every deed of apartments are to be filed with the registrar of Cooperative society. The DOD, deeds of apartments and the floor plans of the building are to be recorded under the Registration Act, 1908.

The details of the apartment and a certificate of an architect stating that the details produced are accurate must be filed with the authorities,. along with the registered deeds and declaration.

The managing board of the apartment association must ensure that a certified copy of the of DOD, deeds of apartments and the memorandum containing the particulars of the property is submitted with the jurisdictional sub-registrar, or in the absence of the authority, with the registrar of the district.

Deed of Apartments

The deed of apartments which is to be submitted along with the DOD and the bylaws must contain the following particulars:

  1. Description of the land on which the entire apartment complex is located, and whether the land is freehold or leasehold. Or if the DOD has been registered already, one may submit the details of the same with the post office address of the property.
  2. The details of the particular apartment including the apartment number and any other identification
  3. Statement of use of the apartment and any restriction on the apartment
  4. Percentage of an undivided interest in the common area and facilities, pertaining to the apartment
  5. Any other detail which is consistent with the Act

Bylaws:

The bylaws form the cornerstone of every apartment. They are a set of detailed rules that will govern the apartment's owners, inhabitants, and staff. Thus, it is necessary to compile a set of bylaws that ensure that the residents of the apartments are not unfairly or rigidly regulated, but also that the safety and quality of the apartment are maintained. The bylaws must also comply with the provisions of the Act as given below;

  1. The bylaws must provide for the election and constitution of a board of managers, their term of office, powers and duties, method of removal from office and whether or not the board may engage the services of a Secretary, a Manager or Managing Agent.
  2. Method of calling meetings of the apartment owners and the quorum of such meetings
  3. Election, powers and duties of the president, secretary and treasurer as per the Act
  4. Maintenance, repairs and replacement of the common areas and facilities and payments therefor;
  5. Designation and removal of persons employed by the association
  6. The method of adopting and amending administrative rules and regulations governing the details of the operation and use of the common areas and facilities;
  7. Restriction and maintenance of the apartment premises and common areas and facilities, upon the owners and residents of the apartment;
  8. The percentage of votes required to amend the bylaws;
  9. Procedure for transfer or partition of apartments and undivided interest in the common areas and facilities, in accordance with the provisions of this Act.
  10. Procedure to lease out certain portions of the property to non-residents, for commercial purposes, and the manner of use of proceeds from such transactions
  11. Any other provisions including but not limited to, audit, accounts, administration of property, general meetings, annual reports, etc.
  12. Any amendment to the bylaws must be duly recorded and a copy of it must be filed with the competent authority.

The KAOA, the DOD and the bylaws formed under the Act apply not only to apartment owners but also to all temporary and permanent residents of the apartments and the employees of the residents of the owners. Thus, every owner and any other persons having access to the apartments must strictly comply with the bylaws and subsequent rules and regulations that are implemented by the administrators of the bylaws. This is necessary for the maintenance, security and smooth coordination of the apartments. As the bylaws are enforceable by law, all owners must ensure that they are fully aware of the rules and restrictions applicable to them, mentioned in the bylaws, before agreeing to the same. Any agreements, decisions and determinations legitimately made by the Association of Apartment Owners in accordance with the voting percentages established under the Act, Declaration or bylaws, are also binding on all the apartment owners. The Act also specifies that the owners are not to undertake any work in their apartments that will threaten the structure or safety of the property or in any way lower the quality of life of the other apartment owners.

Conclusion:

Apartment owners generally choose not to register under the KAOA due to the tiresome process of assembling all the owners while executing the DOD. But this may be avoided by obtaining a power of attorney from owners in the favour of one individual. Though this is a relatively new legislation, KAOA is the right law for the registration and governing of apartments, ensuring the smooth functioning of apartments on democratic grounds.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions