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Legal action against housing society for false billing

Shivendra Pratap Singh

Advocate (Lucknow)

Online advising since Oct. 2014

Property

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Question: Can I take legal action against the housing society for false billing? Housing society issues wrong charges on bills. Non cooperation from MC. Dear sir, my society MC had mentioned wrong charges under property tax in the bill January 2020 and prior all bills with wrong charges under property tax. I asked them to rectify the mistake they have made in the bill, and also generate a new bill for Jan 2020 with the correct amount. 

Refund the extra amount they have collected which is around 40k so that I will clear my further dues. But since jan 2020 they just ignore to rectify their mistake. They keep adding interest on all bills after jan 2020. Done compliments to registrar also with various other issues for non cooperation and mismanagement by MC. Now my pending dues reached to amount around 2 lacs including interest. Sir please advise what shall I do to solve this issue immediately?

Asked from: Maharashtra

When the MC has dishonestly sent false bills it has committed the offence of cheating. Cheating is punishable under Section 420 of the Indian Penal Code. Therefore, you can lodge a first information report (FIR) against the society management committee under Section 420 IPC.

It is the responsibility of the Management Committee of society to collect fees and taxes from the residents. It has the right to collect society charges like property tax, water charges, service charges and maintenance charges etc. Hence, the MC of society has to perform its duty honestly.

If the management committee had dishonest or fraudulent intention behind issuing false bills then it has indeed committed the offence of cheating. Therefore, resident can initiate legal action against housing society. In V. P. Shrivastava v. Indian Explosives Ltd. & Ors AIR 2011 SC (Cri.) 2073; the Supreme Court has held that:

For the offence of cheating the dishonest or fraudulent intention should be in existence at time when alleged inducement was made by the accused.

You have requested the MC to rectify the mistakes on bills but it has refused. Hence, the MC has admitted the charges bearing on the bills. Therefore, you can take legal action against the MC for cheating. 

You have to prove that by issuing false bills the MC had the dishonest intention to induce the flat owners to pay extra charges. This fact is sufficient to launch criminal action against the MC. 

But you should collect evidence regarding the correct rate of property tax and charges. Because you have to prove in court what were the correct charges. 

No need to send a legal notice to the MC before lodging an FIR. You have already requested to correct the bills. Thus you have brought this fact to the notice of MC. 

Hence, lodge FIR as soon as possible. Don’t waste time in moving complaints or applications to the society registrar for taking legal action towards false billing.

shivendra pratap singh advocate

Shivendra Pratap Singh

Advocate (Lucknow)

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