How does society formation work in a new residential project?

Society formation in a new residential project typically begins once a majority of units are sold and possession has commenced, involving registration under applicable cooperative or apartment ownership laws and handover of common area management from the builder to residents.

Key Steps in the Formation Process

• Builder applies for society registration once a minimum unit threshold is met.
• An interim managing committee is formed from among the residents.
• Formal registration is completed under the relevant state cooperative act.

Handover Responsibilities

• Builder transfers common area maintenance responsibility to the society.
• Sinking fund and maintenance deposits collected are handed over formally.
• Common amenities like clubhouse and security are transferred to resident control.

What Residents Should Ensure

• Proper audit of accounts before accepting the maintenance fund handover.
• Verification that all common area documentation is transferred correctly.
• Timely registration to avoid prolonged builder control over the community.

In short, timely and transparent society formation protects residents' collective interests, so buyers should ask builders about the expected formation timeline before purchase.