REGISTRATION OF KAOA ASSOCIATION-AN ERROR CARRIED FORWARD?

The Karnataka Apartment Ownership Act 1972 is in force in Karnataka from many years but  no one is able to identify the provision of law under this statute to form an association and register it. But the cases have been filed and the orders have been received to register such association. The money laundering culprits proudly use this judgement to deter those who challenge the legality. Section 2 of KAOA 1972 provides that the Act applies to property (a building or part thereof) the sole owner or all the owners of which submit the same to the provisions of the Act by duly executing the Declaration under the Act. Section 5(2) states: “Each apartment owner shall execute a Declaration that he submits his apartment to the provisions of this Act and a Deed of Apartment in relation to his apartment in the manner prescribed for the purpose.” Thus, the process to bring the property under KAOA involves the execution of a Deed of Declaration (DoD) and Deed of Apartment for each unit.

Formation of the Association of Apartment Owners

The Act itself does not explicitly detail the mechanism of formation and registration of an “association of apartment owners” (AOA) as a separate statutory entity. There is no provision of law specified under KAOA 1972 regarding ‘formation’ nor ‘register’ an owners’ association.

Key provisions: DoD, Deed of Apartment, Floor Plans Registration

Section 13 of KAOA 1972 deals with the registration of the Declaration, Deed of Apartment and floor plans:

(1) The Declaration and all amendments thereto and the Deed of Apartment in respect of each apartment and the floor plans of the buildings … shall be registered under the Registration Act, 1908.

(2) Simultaneously with the registration of the Declaration there shall be filed … a set of the floor plans … verified by an architect.

(3) In all registration offices a book called “Register of Declarations and Deeds of Apartments under the Karnataka Apartment Ownership Act, 1972” and Index relating thereto shall be kept.

These provisions ensure the building is formally “subjected” to the Act, and the units/owners with absolute ownership granted under sale deed via Transfer of Property Act 1882 become subject to it.

Competent Authority

Section 3(i) of KAOA defines “competent authority” to mean, in relation to a building not constructed by Housing Board, the Registrar of Co-operative Societies. It doesn’t state the Competent authority for what purpose. There are no specific provisions within the  KAOA 1972 Act to form an association and register it.  Another local law enacted in the same year the KOFA 1972 has it under the provision of section 10 to form an Cooperative Society which can be registered.  Strictly speaking, the Act does not contain an express provision that uses the phrase “formation and registration of the association of apartment owners under this KAOA Act.”. However, judicial decisions treat the filing/registration of the DoD, Deed of Apartment and bye-laws and submission of copies to the competent authority as “registration” of the association (or bringing into legal existence) under KAOA. The Department of Cooperative Society has clearly stated in their Circular dated 30.11.2018 that the Registration of Apartment Cooperative Societies is only possible under Karnataka Cooperative Societies Act 1959. The Department of Registration has also confirmed in writing to the Hon’ble Karnataka High Court in PIL 511 that they do not register any association and the formation of association is not in the spirit of the KAOA 1972.

Effect of non-registration, or registration under wrong Act on management/business

If the DoD/Deed of Apartment are not executed/registered, the building may not fall under KAOA at all. Then the entire AOA regime under KAOA may not be applicable. If the association is not registered as a consequence, the association may lack proper legal standing:

• It will be not competent to comply with the section 17 RERA 2016 to accept the conveyance of the property/land for the collective ownership.
• May face challenges in entering into contracts with service providers, since its capacity may be questioned.
• Bank may decline to open bank account (or KYC may become an issue) if legal status of the association is unclear.
• Developers or owners may dispute the validity of maintenance collection, corporate actions, governance.
• For redevelopment, land rights, common area rights, there could be vulnerability if the correct statutory path is not followed.

Business/contracting implications: bank accounts, KYC, signing contracts

Banks and financial institutions (under RBI KYC/AML guidelines) will insist upon the legal existence of the entity, its registration status, constitution, by-laws, etc. If the association is not properly registered (or there is ambiguity whether it is registered under the correct Act), the bank may freeze or decline to open accounts. In one report: bank account of an association was frozen because owners had not filed a declaration under KAOA.

• Without a registration the AOA can not collect maintenance amount as per the Judgement in Mr G.S.Murthy Vs State of Karnataka WP WP No. 23674 of 2021
• Without registration it will be challenge to open a valid bank account, then AOA cannot collect maintenance, pay utility/service contracts, comprehensively manage the complex.
• If the association enters into contracts (for maintenance, security, lifts etc) but its status is defective, third-party contractors may raise questions about the legal capacity of the association to bind the owners.
• For tax, GST, etc, associations often need to show registration/constitution details. Lack of clarity may jeopardise such registrations.
• When redevelopment is planned, or land is sought to be conveyed, developers (or third parties) may challenge the association’s status, delaying or derailing the process.
• Violation in the projects developed by the builder can not be challenged by the associations claiming to be formed under KAOA 1972.

Here are some selected decisions of Karnataka High Court which specifically refer to “registration”, “registered association”, “association under KAOA”, etc.

Mr Hari Yogendra Tripathi vs State Of Karnataka

4. In the light of the Welfare Associations registered under the Act, 1960, way back in the year 2016 and payment being made by the residents of the apartment complex to the Welfare Associations, I deem it appropriate to direct the Welfare Associations to register under the Act, 1972, within two months from today.

 5. In the event, the Welfare Associations fail to register under the Act, 1972, any amount that they would collect, would be unauthorised.(Para 4 & 5)

• Mr. Praveen Prakash vs The State Of Karnataka on 15 February, 2019(VDB).

1. The judgment in this case reads as “Learned counsel for the petitioners submitted that the impugned order is perceived without jurisdiction as the Association ought to have registered under the Provisions of Karnataka Apartment Ownership Act, 1972…….”, It is learnt that the association has not been registered under KAOA 1972 till date.

Mr Arunkumara Vs State of Karnataka(Starnest DS MAX)

The judgement reads as  “ …21. Learned counsel for the respondent No.4 would submit that they will take effective steps to maintain and manage the property till the association is registered under the Act of 1972. Some of the petitioners who are before the Court would also agree that they would cooperate in arriving at a solution till the registration is completed under the Act of 1972.”

Here the Court is misled about the registration under the KAOA Act. Without this registration the apartment situation is at the mercy of the almighty.

Mrs Saraswathi Prakash vs State of Karnataka (2025)

The Court observed: “As observed by the learned Single Judge, the impugned order as well as this order will not prevent the persons who are members of the appellant Association from taking steps for formation and registration of an Association/Condominium under the provisions of the said Act of 1972 inasmuch as the sale deeds executed in favour of the apartment owners contemplate formation of such Association.”  And ….”In the instant case, the project does not include any commercial unit and as such, the KOFA has no application and since the KOFA has no application, the registration under the Act, 1959, is not permissible. It is relevant to state that respondent No.4 is the association of the owners of the flats situated in an apartment for which a specific enactment, viz., the KAO Act has been enacted and therefore, the registration of the association has to be made under the KAO Act.” There is no registration under the Act but they have been using this judgment to show the authorities about the registration.

Ramky case WP No. 27821/2024 (2025)

In this judgement the judgement reads as “Learned counsel submits that the law is well settled that for the Management of Apartment complex, the Registration of the Association has to be made under the KAO Act”. It is clear from this that the Courts are being mislead stating that it has to be registered under the provisions of KAOA when there are no such provisions.

G.S.Murthy Vs State of Karnataka WP WP No. 23674 of 2021

The Hon’ble Justice clearly stated “Therefore, the said clause shall be read as the association shall get themselves registered within an outer limit of two months from today under the 1972 Act, failing which, they would loose the power of collection of any maintenance from the hands of the residents of the apartment, until such time the present committee shall continue to function.

Contempt case CCC NO. 1296 OF 2023 (CIVIL)

In this contempt case filed against this statement of registration of KAOA association the judgement reads as “ As regards direction No.(iii) is concerned, learned advocate XXXXXX for the respondent stated that the process is already undertaken and the Association is formed and necessary registration will be obtained within ten days.” It has been two years since then, no sign of registration of the association yet even after the contempt.

These judgments cumulatively emphasize of the importance of registration of the fundamental documents under KAOA (DoD etc), association and one of the judgement clearly states that the association cannot collect maintenance without registration of such association.

The Karnataka Apartment Ownership Act, 1972 claims to provide a framework for apartment ownership of residential apartment buildings in Karnataka. While the Act does not use the phrase “registration or formation of the association of apartment owners” as explicitly as a societies-Act or any other Act does. Registration of the core documents in DOD  is erroneously considered as effective registration of the owners’ association under KAOA. It is on the false submission of some Petitioners the Courts have believed these words to be true. Proper registration has important implications: legal recognition of the association, capacity to contract, open bank accounts, collect maintenance, represent owners in legal proceedings. Conversely, failure to register (or registering under a wrong Act) can lead to a host of practical difficulties: challenges to contracts, banking/KYC issues, disputes, and even failure in redevelopment or common area conveyance. For apartment owners and associations in Bengaluru/Karnataka, it is strongly advisable to ensure that all registration formalities are properly completed and documented, and to retain certified copies of all registration filings and by-laws. One of the Judgement above is clear in stating that maintenance can not be collected without registration.