Association of Apartment Owners and its Tenure under the UP Apartment Act

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Association of Apartment Owners and its Tenure under the UP Apartment Act

UP Apartment Act and Its Applicability:

The Uttar Pradesh Apartment (Promotion of Construction, Ownership & Maintenance) Act, 2010, popularly known as the UP Apartment Act, 2010, came into force on 21.07.2010. The Act extends to the entire state of Uttar Pradesh and applies to all such buildings in the state of Uttar Pradesh with four or more apartments, regardless of whether they are constructed on freehold or leasehold land.

Moreover, if there are two or more buildings in an area designated as one block, and each independent building within that block has two or more apartments, while the block collectively has four or more apartments, then the UP Apartment Act is also applicable.

However, the Apartment Act does not apply to shopping malls or multiplexes in Uttar Pradesh. Furthermore, in case of the independent houses, the UP Apartment Act is also applicable.

Association of Apartment Owners [AOA] under the UP Apartment Act

The Act provides that there shall be an Association of Apartment Owners (also referred to as Apartment Owners’ Association or AOA) to manage the affairs of a group housing society or Project. The Association of Apartment Owners or Apartment Owners Association or AOA is a group comprising all apartment owners in the project or group housing society, acting collectively in accordance with the bye-laws.

The AOA is responsible for the administration of matters related to the apartments, managing the property associated with them, and overseeing the maintenance of common areas and facilities. The UP Apartment Act makes it abundantly clear that before the formation of the AOA, the promoter or builder is responsible for maintaining the common areas and facilities. However, once the AOA is formed, it becomes the AOA’s duty to maintain these areas and facilities and to collect maintenance charges from the apartment owners.

Formation and Registration of Association of Apartment Owners [AOA] under the UP Apartment Act

The UP Apartment Act mandates that the formation of the AOA is a joint responsibility of the Promoter/Builder and the apartment owners. Once formed, the AOA must be registered with the office of the registrar, sub-registrar of societies under the Societies Registration Act, 1860, as applicable in the state of Uttar Pradesh. Though AOA is recognized as the official body for managing a group housing society’s affairs and common areas. However, to exercise these powers and take over common areas from the Promoter, the AOA must be duly registered.

The AOA can be registered when 33% of apartments have been handed over by the Promoter/Builder to the owners through sale, transfer, or possession. Previously, the threshold was 60% as per the 2016 amendment; however, this amendment was repealed by the Uttar Pradesh government and never came into force.

Board of Management of Association of Apartment Owners [AOA]

As per the Apartment Act, once the AOA is formed, the management of the apartments’ common areas and facilities is deemed to transfer from the promoter/builder to the AOA. This allows the AOA to begin maintaining common areas and facilities or take proactive steps in that direction, even if the promoter is unwilling to hand over the society’s maintenance.

The Apartment Act also mandates the formation of a Board or Board of Management of the Association of Apartment Owners to manage the affairs of the Association. This Board is elected by the members of the AOA as per the bye-laws. The Government of Uttar Pradesh has framed model bye-laws, and the same have to be adopted by the AOA at its first meeting. The bye-laws adopted by the AOA must be an exact replica of the model bye-laws framed by the Uttar Pradesh Government, with no deviations, additions, variations, or omissions allowed.

The model bye-laws provide guidelines for the formation of the AOA, the election and retirement of the Board of Management, the powers and duties of the Board, the procedure for removing Board members, the tenure of office bearers, and other related matters.

Tenure of the Board of the Apartment Owners’ Association under UP Apartment Act:

The tenure of the members of the Apartment Owners Association has long been a matter of dispute due to contradictory provisions in the model bye-laws framed by the Uttar Pradesh Government under the UP Apartment Act, 2010. On one hand, the model bye-laws state that the term of office for the Board of Management is one year, requiring annual elections for all ten posts. On the other hand, they stipulate that arrangements must be made for the annual retirement of 1/3rd of the Board members. Additionally, another provision provided in the model bye-laws restricts an individual from holding the same post for more than two years.

These conflicting provisions created loopholes that some apartment owners exploited to bypass the intent of the law. It was observed in the state of Uttar Pradesh and especially in cities like Noida, Ghaziabad, and Greater Noida that while arrangements were made for the annual retirement of 1/3rd of the Board members, certain individuals continued to occupy key positions, such as President, Secretary, and Treasurer, without contesting elections for up to two years, creating uncertainty about when they would face re-election.

The Hon’ble Allahabad High Court has clarified this position in the case titled “Windsor Park Residents Welfare Association Vs. State Of U.P. And 4 Others” (WRIT – C No. – 12380 of 2023), where the Court held that “Elections to the 10 posts in the Board of Management shall be held annually in future, and in light of this judgment and in accordance with the Apartment Act, 2010, read with Model Bye-Laws dated 16th November 2011 notified thereunder.” This judgment has made the legal position abundantly clear, ensuring annual elections for all ten posts in the Board of Management, thus promoting a more democratic and transparent governance of apartment societies in Uttar Pradesh.

Conclusion

The UP Apartment Act establishes the Association of Apartment Owners (AOA), which is responsible for maintaining common areas and facilities. Although the Act and model bye-laws provided clear guidelines, ambiguities around Board members’ tenure led to disputes. However, the recent ruling by the Allahabad High Court has resolved these issues, ensuring annual elections for all Board posts. This decision promotes transparency, accountability, and a more democratic approach to managing apartment societies, in line with the objectives of the UP Apartment Act.