Simplifying Flat Ownership Transfers: Maharashtra's New Family Arrangement Law

Mumbai: In a bid to simplify flat ownership transfers upon a member's death, Maharashtra has introduced the concept of "Family Arrangement" under the Maharashtra State Co-operative Societies (MSCS) Act, 2019. This provision offers a quicker, more efficient alternative to the lengthy court processes typically required when a member passes away intestate (without a will). The process will help transfer the deceased's share, rights, title, and interest in the property.

Housing experts have recommended incorporating the family arrangement process in the MSCS Rules and bylaws to streamline this procedure. Previously, the practice involved approaching the court to claim testamentary rights, often taking months or even years. Advocate Shreeprasad Parab, Director at Maharashtra State Housing Federation, explained that prior to the 2019 amendments, the nominee member—identified in the deceased member’s nomination form—was considered a "Trustee" until all legal heirs were identified through testamentary or court-issued legal documents.

The new amendments now offer a clear and simpler approach for transferring rights. "Family Arrangement" refers to a mutual agreement made within a family to distribute property in a manner different from the existing law. It applies when there are multiple legal heirs and is considered an agreement made between family members.

In cases where a nominee exists, they must apply for provisional membership within six months of the member’s death. If there are multiple nominees, they must indicate the person to be enrolled as the provisional member. If no nominee exists, a provisional member will still be enrolled. However, if there's a sole legal heir, the deceased's legal documents will still be required to proceed with ownership transfer.

For the process to be legally valid, Family Arrangement deeds must be executed and registered under the Registration Act, 1908.

A landmark Bombay High Court ruling further cemented this by clarifying that a Release deed between legal heirs, as per Section 154B-13 of the MSCS Act, qualifies as a "Family Arrangement."

This move promises to significantly reduce bureaucracy and expedite flat ownership transfers in Maharashtra's co-operative housing societies.