Dear Members,
The election of the Society were held on 23 Aug 2008 and a Notification was issued by returning officer on the same day. We requested the outgoing MC to hand over the charge to the elected members but we did not receive a proper response. On our request RCS advised the outgoing MC to immediately handover the charge, which was once again not done by the outgoing MC. We had to freeze operation of accounts and restrain the Lawyer engaged by earlier MC from appearing in cases without our consent. This finally resulted in handing over of the charge, which was reluctantly handed over on 14 Sept 2008 at 2130 hrs. Incidentally, this resulted in payment of penalty of Rs. 3500/- on electricity bill. Further, it may be noted that the accounts which were handed over had only been updated upto March 2008. Outgoing MC has not cared to provide list of payments due from the members and is to be recovered. We are in the process of scrutinizing the files and it is being noted that some files have been recreated with many important documents missing from the files.
The election of the Society were held on 23 Aug 2008 and a Notification was issued by returning officer on the same day. We requested the outgoing MC to hand over the charge to the elected members but we did not receive a proper response. On our request RCS advised the outgoing MC to immediately handover the charge, which was once again not done by the outgoing MC. We had to freeze operation of accounts and restrain the Lawyer engaged by earlier MC from appearing in cases without our consent. This finally resulted in handing over of the charge, which was reluctantly handed over on 14 Sept 2008 at 2130 hrs. Incidentally, this resulted in payment of penalty of Rs. 3500/- on electricity bill. Further, it may be noted that the accounts which were handed over had only been updated upto March 2008. Outgoing MC has not cared to provide list of payments due from the members and is to be recovered. We are in the process of scrutinizing the files and it is being noted that some files have been recreated with many important documents missing from the files.
There has been no briefing on the cases pending in the court. In fact, the lawyer Mr. Sanjeev Gupta had refused to cooperate and advice on cases handled by him (he seems to be under instruction some one in outgoing MC). The case relating to Chand Construction is an eye opener. On 17th Dec 2007, the High Court of Delhi ordered the Society to pay Rs 29, 64, 656.13 with post decretal interest @ 12 % p.a. from 01 Mar 2008 on the sum of Rs 29, 64, 656.13 till the date of payment, to Chand Construction Co. The then Management Committee concealed this fact from the members and did not disclose it even in the GBM held on 25 Dec 2007. In fact, we did not learn of the High Court order until 10th Aug 2008 when the Court of Shri BS Chumbak, ADS Judge, Tis Hazari Court, Delhi issued a ‘Show Cause Notice’ to the Society for execution of the High Court judgment and decree dated 17 Dec 2007. With 31 Oct as the deadline set by the court for the Society to pay the amount, we are left with very little time to manoeuvre ourselves into a better position However, till date, the outgoing MC did not feel fit to inform members and the incoming MC on action planned. We requested the lawyer for negotiations with M/s Chand, who did not cooperate. Finally, we contacted M/s Chand Construction and were able to start negotiations on our own.
The members may note that this is the second case, after the Society Vs Rana Construction case that we have lost due to inept and dubious handling of the cases by the previous Management Committee. The Rana Construction case is before a double Bench of the Delhi High Court and, if lost, will impose a liability of Rs 55, 000/- on each member.
It may be recalled that repeated requests to the previous Management Committee to come clean with the details and progress of these cases in the GBMs held on 12th Nov and 25 Dec 2007 had not yielded any results. As a result of the obdurate attitude of the then Management Committee, we are landed with a fait accompli in the form of court cases in terminal stages with no scope to put up a better fight and ensure a win for the Society.
In our first communication with members, we intend to apprise you of the dismal status of the Society that we have inherited and then seek your cooperation to pull the Society out of the financial mess that we are in. The current fund situation of the Society is appended below:-
(a) Cash Balance in HDFC Bank Ltd - Rs 10, 31, 357/-*
(b) Cash Balance in DSC Bank Ltd - Rs 1, 03, 660/-
(c) Cash in Hand - Rs 9, 140/-
(a) Cash Balance in HDFC Bank Ltd - Rs 10, 31, 357/-*
(b) Cash Balance in DSC Bank Ltd - Rs 1, 03, 660/-
(c) Cash in Hand - Rs 9, 140/-
(d) Fixed Deposits in DSC Bank Ltd - Rs 12, 00, 000/-
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Total - Rs 23, 44, 157/-**
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* Includes Rs 7, 50, 000/- contributed by 50 members @ Rs15, 000/- each for Rana Construction Case. These members have been provided maintenance receipts for next 15 months i.e. no maintenance is receivable from these members till Jul 2008. This amount also includes payment made by members towards electricity & maintenance till 17 Sept 2008.
** Rs 10, 00, 000/- is the Building Fund That cannot be utilized for any purpose other than emergency maintenance of the Society with only the express permission of the RCS.
Liabilities.
(a) Electricity Bill for Aug 08 - Rs 2, 40, 597/-
(b) Security Agency Bill for Aug 08 - Rs 37, 191/-
(c) Telephone Bill for Aug 08 - Rs 2, 311/-
(d) Salary of Employees for Aug 08 - Rs 24,000/-
(e) Chand Construction Co. (As per direction
of Delhi High Court) - Rs 29, 64, 656.13
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Total Liabilities - Rs 32, 68, 755.13
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The Inescapable Monthly Commitments
(a) Electricity Bill for Common Facilities
like Lifts and Security Lights - Rs 23, 000/-
(b) Salary of Society Employees - Rs 23, 340/-
(c) Security Contract - Rs 37, 000/-
(d) AMCs for Lifts, Electric Sub Station
and Generators - Rs 20, 000/-
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Total - Rs 23, 44, 157/-**
-------------------
* Includes Rs 7, 50, 000/- contributed by 50 members @ Rs15, 000/- each for Rana Construction Case. These members have been provided maintenance receipts for next 15 months i.e. no maintenance is receivable from these members till Jul 2008. This amount also includes payment made by members towards electricity & maintenance till 17 Sept 2008.
** Rs 10, 00, 000/- is the Building Fund That cannot be utilized for any purpose other than emergency maintenance of the Society with only the express permission of the RCS.
Liabilities.
(a) Electricity Bill for Aug 08 - Rs 2, 40, 597/-
(b) Security Agency Bill for Aug 08 - Rs 37, 191/-
(c) Telephone Bill for Aug 08 - Rs 2, 311/-
(d) Salary of Employees for Aug 08 - Rs 24,000/-
(e) Chand Construction Co. (As per direction
of Delhi High Court) - Rs 29, 64, 656.13
------------------------
Total Liabilities - Rs 32, 68, 755.13
------------------------
The Inescapable Monthly Commitments
(a) Electricity Bill for Common Facilities
like Lifts and Security Lights - Rs 23, 000/-
(b) Salary of Society Employees - Rs 23, 340/-
(c) Security Contract - Rs 37, 000/-
(d) AMCs for Lifts, Electric Sub Station
and Generators - Rs 20, 000/-
Total of Absolute Minimum Monthly Commitments - Rs 1, 03, 340/-
.From the foregoing it may be seen that the Society is not in a position to meet the liability of M/s Chand Construction without the contribution from members. This imposes a direct liability of Rs 14, 000/- on each member, to implement the High Court order. The Managing Committee has taken the painful decision to approach the members to share this burden and make the payment in two instalments of Rs 7,000/- each with the first instalment being paid by 20 Oct 2008. In the meanwhile, we are making a sincere and concerted effort to negotiate with Chand Constructions Co. to reduce the total amount to be paid to them. The quantum and timing of the second instalment to be paid by the members will depend on the progress of our negotiations.
In view of the foregoing, the members are requested to pay the first instalment of Rs 7,000/- by 20 Oct 2008. For conclusion of negotiations with Chand Construction, we have planned as follows:
1. Making payment of Rs. 5.0 lakh from the cash available with HDFC bank. This would be required urgently as M/s Chand Construction has demanded some money before finalization of negotiations.
2. Borrowing Rs. 9.0L as loan from DSC bank against FD. Interest @ 10% will be payable.
3. First instalment of Rs. 7000/- per member to be collected by 20 Oct 2008. Since, Society will have to pay interest on loans taken and on delayed payment to Chand Construction, Members delaying instalment shall pay interest @12% per annum.
4. The decision on second instalment shall be taken after completion of Negotiation with M/s Chand construction.
This being a large expenditure we are seeking your acceptance of action 1 to 4 in the enclosed format which may please be returned by 30 Sept 2008 to enable us to proceed with negotiations. It may be noted that non receipt of response from any member shall be treated as acceptance of our proposal.
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.From the foregoing it may be seen that the Society is not in a position to meet the liability of M/s Chand Construction without the contribution from members. This imposes a direct liability of Rs 14, 000/- on each member, to implement the High Court order. The Managing Committee has taken the painful decision to approach the members to share this burden and make the payment in two instalments of Rs 7,000/- each with the first instalment being paid by 20 Oct 2008. In the meanwhile, we are making a sincere and concerted effort to negotiate with Chand Constructions Co. to reduce the total amount to be paid to them. The quantum and timing of the second instalment to be paid by the members will depend on the progress of our negotiations.
In view of the foregoing, the members are requested to pay the first instalment of Rs 7,000/- by 20 Oct 2008. For conclusion of negotiations with Chand Construction, we have planned as follows:
1. Making payment of Rs. 5.0 lakh from the cash available with HDFC bank. This would be required urgently as M/s Chand Construction has demanded some money before finalization of negotiations.
2. Borrowing Rs. 9.0L as loan from DSC bank against FD. Interest @ 10% will be payable.
3. First instalment of Rs. 7000/- per member to be collected by 20 Oct 2008. Since, Society will have to pay interest on loans taken and on delayed payment to Chand Construction, Members delaying instalment shall pay interest @12% per annum.
4. The decision on second instalment shall be taken after completion of Negotiation with M/s Chand construction.
This being a large expenditure we are seeking your acceptance of action 1 to 4 in the enclosed format which may please be returned by 30 Sept 2008 to enable us to proceed with negotiations. It may be noted that non receipt of response from any member shall be treated as acceptance of our proposal.
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To,
The Secretary
Din Cooperative Group Housing Society Limited
Plot # 7, Sector-4, Dwarka
New Delhi Sep 2008
Subject: Payment to M/s Chand Construction
Reference society’s letter no. ___ dated____
Dear Sir,
We hereby
1. accept the proposal of the Society for negotiation and settlement with M/s Chand Construction and are enclosing/ are sending by separate mail our cheque for Rs. 7000/- .
or
2. We do not accept the proposal for the reasons given below. However, we will abide by the majority decision.
Reason:
Yours faithfully
(Signature, name & membership number)
Din Cooperative Group Housing Society Limited
Plot # 7, Sector-4, Dwarka
New Delhi Sep 2008
Subject: Payment to M/s Chand Construction
Reference society’s letter no. ___ dated____
Dear Sir,
We hereby
1. accept the proposal of the Society for negotiation and settlement with M/s Chand Construction and are enclosing/ are sending by separate mail our cheque for Rs. 7000/- .
or
2. We do not accept the proposal for the reasons given below. However, we will abide by the majority decision.
Reason:
Yours faithfully
(Signature, name & membership number)
