Corpus fund distribution: flat-wise or carpet-area-wise split?

What is the difference between the two methods?

Under a flat-wise split, the total corpus is divided by the number of members and everyone receives the same amount, whether they hold a 300 sq.ft flat or a 700 sq.ft one. Under a carpet-area-wise split, each member receives corpus in proportion to their existing carpet area, so larger flats receive more.

Naturally, small-flat holders tend to prefer the equal split, and large-flat holders prefer the area-linked one. In older Mumbai buildings, where flat sizes vary widely on the same floor, this single choice can change a member's receipt substantially.

The two methods, on the same society

The statutory floor under Regulation 33(9) is expressed per tenement — Rs 50,000 each, funding ten years of maintenance. That is the regulation’s own unit, which is why flat-wise distribution is the easier position to defend. But a society with widely different flat sizes may still prefer carpet-weighted, and the arithmetic should be put in front of members either way.

Source: DCPR 2034 (sanctioned), Regulation 33(9) clause 17.

The defensible middle ground many societies adopt: distribute flat-wise up to the statutory floor, since that is the unit the regulation uses, and distribute anything above it on carpet. State the split explicitly in the resolution rather than leaving it to be inferred.

Which method is easier to defend?

Carpet-area-wise is the more common practice and generally the easier one to justify. The purpose of corpus is to help members meet the higher outgoings of a new building, chiefly maintenance, which societies almost always charge per sq.ft. If your future maintenance bill is area-linked, a corpus that is also area-linked keeps the arithmetic consistent. An equal split can leave large-flat holders short and small-flat holders with a surplus.

• Work out your society's corpus per sq.ft and whether the interest realistically covers maintenance using the corpus fund calculator.
• Confirm the areas you are dividing by, since carpet, built-up and super built-up are not the same. The carpet and built-up converter helps you compare like with like.

How should the society record the decision?

Decide the method before signing anything, not afterwards. The chosen basis should be stated plainly in the Special General Body Meeting resolution, held under the Section 79A framework that requires a two-thirds quorum and approval by at least 51% of total members, and then carried into the registered Development Agreement and each member's PAAA, along with the payment schedule.

A corpus promised verbally, or split by an informal understanding, is where disputes begin. If it is not in the documents, it is not settled. Our guide on possession and corpus covers the timing and safeguards in more detail.