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Renting out a flat in a housing society: intimation, police verification and non-occupancy charges

Renting out a flat in a Maharashtra housing society: no NOC needed, what to give the society, police verification, and the 10% cap on non-occupancy charges.

Updated 2026-09-23

Many members let their flats on leave and licence, and many committees are unsure what they may ask for. Some still demand an NOC fee, a “tenant deposit” or a non-occupancy charge worked out on the whole bill. Under the model bye-laws and the 2026 Rules the position is simpler, and fairer to the member.

Do I need the society’s permission to rent out my flat?

No. BL 42 of the 2014 model bye-laws says no permission of the society is required to sub-let a flat or shop, or to give it on leave and licence or caretaker basis. The member must only intimate the society, at least 8 days before the licensee moves in, and give:

  • a copy of the leave and licence agreement, and
  • a copy of the intimation to the police station about the licensee.

The draft 2026 bye-laws keep the same approach (dBL 40). They ask for a duly stamped and registered agreement, and the police intimation or verification wherever the law requires it. They are not yet final.

Older bye-laws, from before 2014, did require the society’s prior permission. If your society never adopted the 2014 model, check its registered text.

BL 62 exempts sub-letting intimations from the three-month disposal rule. That fits: there is nothing for the committee to approve.

Can the society refuse a tenant?

Under the 2014 model the committee has no power to approve or reject a licensee. So it cannot turn one away for being a bachelor, for his religion or for his diet.

What the society can do:

  • insist on the intimation and the documents
  • enforce its rules on nuisance, common areas and parking against the member, who answers for his occupants
  • take a serious breach to the Co-operative Court under section 91

A general-body resolution that goes against the registered bye-laws does not bind members.

Police verification of tenants

The bye-law requires a copy of the member’s intimation to the police about the licensee. How the intimation is made, whether online or at the police station, depends on the police in your area. It is the member’s duty, not the society’s. The society should simply keep the copy with the tenant records.

How much can a society charge as non-occupancy charges?

At most 10% of the service charges of your flat. This is not 10% of the whole bill.

  • A Government order of 1 August 2001 under section 79A capped non-occupancy charges at 10% of service charges, excluding municipal taxes.
  • The Bombay High Court upheld that order in Mont Blanc CHS v State of Maharashtra (2007). It said societies may not use their bye-law powers to make money out of members who let their flats.
  • From 22 June 2026, Rule 106C-12(4) item 8 writes the cap into the Rules: “Non-occupancy charges — 10% of service charges”. The draft 2026 bye-laws repeat it.

Service charges are defined in Rule 106C-12(2). They cover staff salaries, office costs, printing and postage, committee travel and sitting fees, federation fees, audit fees, meeting costs, legal and retainer fees, and common electricity. Property tax, water charges, the sinking fund and the repair fund are not part of the base.

Example with synthetic figures. A flat’s monthly bill is ₹4,800, and ₹2,000 of it is service charges. The non-occupancy charge can be at most ₹200 a month, not ₹480.

The charge cannot be linked to the rent you receive.

Is it payable if family lives in the flat?

No. The 2001 order exempts occupation by the member’s family. The 2014 bye-laws define “family” widely: spouse, parents, siblings, children, son-in-law, brother-in-law, sister-in-law, daughter-in-law and grandchildren (BL 3(xxv)).

In Mont Blanc (2007) the court read “family” more narrowly, under the older bye-laws then in force. Which definition applies depends on the bye-laws your society has registered.

Who pays the society if the tenant does not?

The member. The society’s relationship is with its member, whatever the leave and licence agreement says. Arrears are recovered from the member through the Registrar under section 154B-29, using Forms Y-6 and Y-7 (Rule 106C-14).

Checklist for members letting a flat

  • Sign a stamped leave and licence agreement and register it.
  • Complete the police intimation or tenant verification and keep the acknowledgement.
  • Give the Secretary written intimation with both copies at least 8 days before the licensee moves in (BL 42).
  • Check that the non-occupancy charge on your bill is no more than 10% of the service charge line.
  • Do not pay an “NOC fee” or a tenant-registration fee without asking which Rule allows it.
  • Keep paying the society’s bills yourself, or check that the licensee pays them in your name.
  • Tell the society when the licence ends so that the non-occupancy charge stops.

What the law says

  • 2014 BL 42: intimation only, no permission; 8 days’ notice; copy of the agreement and of the police intimation.
  • 2014 BL 62(e): sub-letting applications are outside the three-month disposal rule. BL 3(xxv): definition of family.
  • Rule 106C-12(2) and (4) item 8 (2026): what service charges include, and the non-occupancy charge capped at 10% of them.
  • Section 79A order of 1 August 2001: the same 10% cap, upheld in Mont Blanc CHS (Bom HC 2007).
  • Draft 2026 dBL 40: a registered agreement and police verification with the intimation. This is draft only.
  • Section 154B-29 and Rule 106C-14: recovery of arrears from the member.

If you are over-charged, complain in writing to the committee first, then to the Deputy Registrar. Excess non-occupancy charges are one of the matters the 2014 bye-laws list for the Registrar.

More on tenants and licensees: Tenants & leave-licence FAQ.

Sources

General information, not legal advice. Your society's registered bye-laws may differ; for a dispute or a decision with legal or financial consequences, consult the Registrar's office, an advocate or a chartered accountant.

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