Multi State Cooperative Society Registration Consultant in Mumbai, Maharashtra

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Documents for the registration of a Multi state Cooperative Society -

1) Form 1: To be submitted in the format annexed with the MSCS Act 2002 along with the documents required under Form I.

2) A certificate from the bank stating credit balance there in favour of the proposed multi-state co-operative society.

3) A scheme explaining how the proposed multi state co-operative society has reasonable prospects of becoming a viable unit.

4) Four copies of bye-laws in original.

5) Proposed area of operation for registration shall initially be permitted for two contagious states only.

6) List of at least 50 members from each state. List has to be submitted in the format annexed with the MSCS Act 2002 along with the copies of ID proofs of the members duly attested by Chief promoter.

7) Certified copies of the resolutions passed by the proposed society along with the certified copy of the resolution of the promoters which shall specify the name and address of one of the applicant(s) to whom the Central Registrar may address correspondence under the rules before registration and dispatch or hand over registration documents.

8) Contact number and e-mail address of the Chief Promoter or Society on cover page.

For societies having objects related to thrift and credit and for multi-purpose societies following additional documents are required to be submitted along with documents mentioned at point [A] above:

A) No objection Certificate from the Registrar of Cooperative Societies of the States/U.T. where the area of operation of the society is proposed to be confined.

B) A certificate to the effect that the credentials of the Chief Promoter/Promoters have been verified by the Registrar of Co-operative Societies of the state where the head office is proposed to be located.

All documents to be submitted in original with the signatures of the Chief Promoter/Promoters on each page.

Note: Societies which are already registered under the MSCS Act, 2002 and are desirous of expanding their area of operations falling under the above (A) and (B) shall be required to submit an NOC as mentioned in (A)

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Model Bye-laws of National level Cooperative Society/ Federal Cooperative/Multi-State Cooperative Society

NOTE:-“The Model Bye-laws are simply a representative sample and a guide to frame bye-laws of a multi state cooperative society. The society is required to refer to the MSCS Act. 2002 and the Multi state Cooperative Societies Rules 2002 to ensure that the bye-laws framed are consistent with the MSCS Act 2002 and rules”.

Name and area of operation :

The society shall be called _;

The Society shall have a principal place of business which shall be the registered office of the society. The Headquarter of the society shall be at . (Full address). Any change in address shall be notified to the Central Registrar within 15 days of its change and also published in local newspaper and shall be made by an amendment of its bye-laws after following the procedures laid down in Sec. 11 of the Multi State Coop. Societies Act 2002.

The Society shall have a Common Seal. The Common Seal shall be kept in the safe custody of the Officer authorised by the Board and shall be used on the authority of a resolution of the Board constituted under the bye-laws of the society;

The area of operation of the society shall extend to the ---------- (Please indicate the proposed of area of operation).

The society is body corporate which shall sue and be sued in its name.

Definitions:-

The words/expressions appearing in these bye-laws shall have the following meaning unless otherwise provided :

“Act” means the Multi-State Cooperative Societies Act, 2002 as amended time to time.

“Area of Operation” means the area from which the persons can be admitted as members of the society.

“Board” means the Board of Directors of the Society.

“Bye-laws” means the Bye-laws of the society for the time being in force which have been duly registered or deemed to have been registered under the Multi State Cooperative Societies Act in force and includes amendments thereto which have been duly registered or deemed to have been registered under the Act;

“Central Registrar”, means the Central Registrar of Cooperative Societies appointed under the provisions of the MSCS Act;

“Chief Executive” means Chief Executive/Managing Director, by whatever name he may be called, of the Society;

A ‘Cooperative Bank’ means a multi state cooperative society which undertakes banking business;

“Cooperative Society” means a cooperative society registered or deemed to be registered under any law relating to cooperative societies for the time being in-force in any State or Union Territory;

“Cooperative Year” means the period from 1^st of April to 31^st March;

“Cooperative Principles” means the cooperative principles as specified in the first schedule of the Multi-State Cooperative Societies Act, 2002.

‘Deposit Insurance Corporation’ means the Deposit Insurance & Credit Guarantee Corporation established under Sec. 3 of the Deposit Insurance Corporation Act 1961;

“Defaulter” means a member who has defaulted in payment of any kind of dues payable to the society;

“Delegate” means a person who is duly appointed/elected by the members of the society or part thereof in accordance with its bye-laws as its representatives to the General Body of the society or a person who is duly authorised by the Board of the member society to represent the society in General body of the society of which the society is a member.

“Federal Cooperative” means a federation of cooperative societies registered under the MSCS Act and whose membership is available only to a cooperative society or a multi- state cooperative society;

“General Body”, means all the members of the Society and in relation to a national cooperative society or a federal cooperative means all the delegates of member cooperative societies or delegates of multi state cooperative society and includes a body constituted under the provisions of the Act;

“General Meeting” means a meeting of the general body of the society and includes special general meeting;

“Member” means a cooperative society/individual who is admitted as member of the society and continues to be so for the time being;

“Multi State Cooperative Society” means a cooperative society registered or deemed to be registered under the Multi-State Cooperative Societies Act 2002;.

“National Cooperative Society” means a Multi-State Cooperative Society specified in the second schedule to the Multi-State Cooperative Societies Act, 2002;

“Nominal’ member means a person who has been admitted as a nominal member or associate member under the bye-law of the society.

‘Officer’ means a President, Vice-President, Chairperson, Vice-chairperson, Managing Director, Secretary, Manager, Members of the Board, Treasure, Liquidator, an Administrator appointed under Sec. 123 and includes any other person empowered under

Multi State Cooperative Societies Act or the rules or the Bye-laws to give direction in regard to business of the society.

“Rules” means the Multi-State Cooperative Societies Rules, 2002 made under Multi-State Cooperative Societies Act, 2002 and as amended time to time.

“Reserve Bank’ means the Reserve Bank of India constituted under the RBI Act 1934 – 2 of 1934;

Objects, and functions:

Objects :

The principal object of the society will be to promote the interests of all its members to attain their social and economic betterment through self-help and mutual aid in accordance with the cooperative principles.

(N.B.: The statement of objects of the society should clearly show the activities carried out / proposed to be carried out in each state from where the members are drawn.)

Functions:

In furtherance of the above objects, the society may undertake any or all the following activities :-

(to be specified as per the objects of the society)

In addition to above, federal cooperative shall also undertake following functions:-

Subject to the provisions of this Act and any other law for the time being in force, a federal cooperative may discharge the functions to facilitate the voluntary formation and democratic functioning of cooperative societies as federal cooperative or multi State cooperatives based on self-help and mutual aid.

Without prejudice to the generality of the provisions contained in sub-section(1), the federal cooperative may—

ensure compliance of the cooperative principle;

make model bye-laws and policies for consideration of its member cooperative;

provide specialised training, education and data-based information;

undertake research, evaluation and assist in preparation of perspective development plans for its member cooperative;

promote harmonious relations amongst member cooperative;

help member cooperative to settle disputes among themselves;

undertake business services on behalf of its member cooperative, if specifically required by or under the resolution of the general body or the board, or bye-laws of a member co- operative;

provide management development services to a member cooperative;

evolve code of conduct for observance by a member cooperative;

evolve viability norms for a member cooperative;

provide legal aid and advice to a member cooperative;

assist member cooperative in organising self-help;

develop market information system, logo brand promotion, quality control and technology up-gradation.

Membership :

A society shall have following categories of members:-

Ordinary members

Nominal/ associate members

Who can be ordinary members :

Any person who resides within the area of operation of the society and who genuinely need the services provided by the society and whose interest does not conflict with the interest of the society;

No person shall be admitted as a member of a multi-State co-operative society except the following namely:-

An individual, competent to contract under section 11 of the Indian Contract Act, 1872;

Any multi-State co-operative society or any co-operative society;(Applies in case of federal and national society)

The Central Government;

A State Government;

The National Co-operative Development Corporation established under the National Co- operative Development Corporation Act, 1962;

Any other corporation owned or controlled by the Government

Any Government company as defined in section 617 of the Companies Act, 1956;

Such class or classes of persons or association of persons may be permitted by the Central Registrar having regard to the nature and activities of a multi-State co-operative society.

Note : This is illustrative list and society should clearly indicate the category whom they intend to make Member. Prior consent of Government or Govt. Institutions/ Company would be necessary before including them as members in the Bye-laws.

No right of membership shall be exercisable until a person has made such payments to the Society in respect of membership or acquired such interest in the society as may be prescribed by the society in its Bye-laws as per the provisions of the Act and rules.

Every member shall pay an admission fee as specified in the bye-laws of the society.

Note : No individual person shall be eligible for admission as a member of a national co-operative society or a federal cooperative.

Nominal or Associate Member

Society may, in the interest of promotion of the business of the society, admit a person as nominal member or associate member on payment of fee of Rs only.

Provided that such members will not be entitled to subscribe to the share capital of the society.

They will not be allowed to have any interest in the management of the society including right to vote, contest election as director of the board or participate in the general body meetings of the society.

Application :

The application for membership of the society shall be submitted by the applicant to the Chief Executive of the society in the prescribed form and at least ----% of the value of shares to be deposited by the applicant at the time of submission of application.

Disposal :

The applications for membership of the society found complete in all respects shall be disposed of within the period of four months from the date of receipt of the application by the society. The same shall be communicated to the applicant within fifteen days of the decision by Registered Post.

A member may, with the approval of the Board of Directors, transfer its shares to another member of the multi-State cooperative society.

A fee of Rs per share as mentioned in the Bye-laws, shall be payable to the society for each

such transfer.

The Board may, on application, by a Member:

approve conversion of shares allotted to it or a part thereof into those of other denominations subject to such conditions as the Board may decide to impose;

consolidate all or some of the partly paid shares already allotted to member.

Disqualifications of membership :

No person shall be eligible for being or continuing as a member of the society if :-

His business is in conflict or competitive with the business of the society; or

He did not make annual transactions of the value of at least Rs. for continuously two years (to be specified in the bye-laws); or

He did not attend the three consecutive general meetings and such absence was not condoned by the 2/3^rd majority of the members attending the meeting; or

Has defaulted in payment of all dues including contributions, subscriptions, if any, as decided by the board of the society from time to time and has not made the payment within 30 days after receiving the notice for payment.

Cessation of membership :

The membership of the cooperative society may cease in case of :-

resignation or death of the member.

cancellation of registration of the member society;

all the shares are transferred to another person/ society;

expelled by the general body;

incurring any of the disqualifications of membership.

Withdrawal from membership :

Any member of the society may withdraw from membership of the society only after -------

years by giving at least a three months notice and duly approved by the Board of the society.

Expulsion of Members :

Members of the society may be expelled by a resolution of the general body passed by 2/3^rd majority present and voting if :

Any member has defaulted in payment of dues as per bye-laws of the society for a continuous period of one year;

Any activity of a member is found to be conflicting or competitive with the interest or activities of the society.

Provided that the member concerned shall not be expelled unless he has been given a reasonable opportunity of making representation in the matter.

No member of the society who has been expelled shall be eligible for re-admission as a member of the society for a period of one year from the date of such expulsion.

Rights of member :

Every member of the society shall have the following rights :-

One vote in the general body meetings of the society and no member shall be permitted to vote by proxy;

Provided that a multi-State co-operative society or a co-operative society or any other institution which is a member of any other multi-state cooperative society may appoint its representative by a resolution passed by its Board to vote on its behalf in the affairs of such multi-State cooperative society.

Right to receive notice of general body meetings as per bye-laws of the society;

Right to attend and take active part in the proceedings of the General Body Meetings;

Take part in elections and contest for any post as per provision of the Act, Rules and bye-laws of the society;

Inspect member registers, books of accounts or any other record and obtain certified copies of the resolutions or documents on a payment of fee as may be prescribed by the society from time to time.

Liability :

Liability of the members shall be limited to the share capital subscribed by them;

(i) In the case of a past member, on the date on which he ceased to be a member;

(ii) In the case of a deceased member, on the date of his death.

Shall continue for a period of two years from such date.

Notwithstanding anything contained in sub-section (1), where a Multi State Co-operative society is ordered to be wound up under section 86, the liability of a past member who ceased to be a member or of the estate of a deceased member who died within two years immediately preceding the date of the order of winding up, shall continue until the entire liquidation proceedings are completed, but such liability shall extend only to the debts of the society as they existed on the date of cessation of membership or death, as the case may be.

Authorised Share Capital :

The authorised share capital of the society shall be Rs. which shall comprise of shares of the face value of Rs. each.

(N.B.: Indicate details about equity holding by the Govt. of India, State Govt. or any other Govt. Undertakings if they are the members)

The society may with approval of the General Body retire shares, if any, held by the Central/State Government, Central/ State Government organizations at any time. However, retirement of such share shall be at face value. (Society to clearly specify the modalities for redemption of shares).

(i) A member shall subscribe to minimum of number of shares % of share value shall be paid at the time of application and rest in equal instalments.

(ii) Manner of allotment, transfer, redemption and/or repatriation shall be at face value and as per the provisions of the Act.

Joint Shareholders

Shares may be purchased in the names of more than one person jointly.

On death of a joint-holder, the surviving person/ persons shall be recognized as joint shareholder/holders

The joint-holder of any share shall be liable severally as well as jointly for all payments which are to be made in respect of such share or shares.

The person whose name stands first written on the share certificate shall enjoy all the rights of a member and be responsible for all the liabilities of a member. He shall be entitled to receive the annual dividend and notice of the General Meeting.

Where a share of the society is held jointly by more than one person, the person whose name stands first in the share certificate, if present, shall have the right to vote. But in his absence, the person whose name stands second and, in the absence of both, the person whose name stands next, and likewise in the absence of preceding persons the person whose name is next on the share certificate, who is present and who is not a minor, shall have right to vote.

Share Certificate

Every person admitted as member shall be entitled to receive a share certificate gratis stating the number of share/s and their distinctive number/s. The share certificates shall be signed by the Chairman, or any Director duly authorized and the Chief Executive Officer. The share certificate shall bear the Society’s seal.

Transfer of Shares

A member may transfer his share or shares after holding them for not less than one year to any person duly approved by the Board of Directors. The transfer is not complete until the name of the transferee has been duly entered in the register of members and the transfer fee of per share is paid.

If any certificate be worn out, defaced, destroyed or lost, a new share certificate’s may be issued in lieu thereof on payment of a fee of …………… per share. It shall, however, be necessary to produce evidence to the satisfaction of the Board of Directors that the share certificates were worn out, defaced, destroyed or lost, or in absence of such evidence, on such indemnity as the Board of Directors may deem sufficient.

Nomination

A member may nominate a person to receive the member’s interest in the society after his death. Nomination shall be made in the prescribed form and entered in the special register kept at the society’s registered office. Prior approval of the Board shall be necessary if the person to be nominated is an employee of the society.

Death of a Shareholder

On death of a shareholder, the society may pay to the person or persons nominated a sum representing the value of the shareholder’s interest in the society within six months from the death of the shareholder. In the absence of nomination, the society may pay to such person or persons as may appear to the Board of Directors to be entitled to receive the same as heir or legal representative of the deceased shareholder on his or their executing an appropriate deed of indemnity in favour of the society.

Lien on Shares, Dividends and Deposits

The society shall have the first and paramount lien or charge upon all the shares, dividends and deposits of any member of past member for all moneys due from him to the society from time to time. The society may at any time set off any sum credited by or payable to the member or past member towards payment of any liability of such member as past-member.

Capital and Funds :

The society may receive funds from any or all the following sources :

admission fee;

share capital;

loans and deposits;

grants-in-aid;

donations;

contributions;

subscriptions;

profit.

Maximum Borrowing Limit

The multi-State cooperative society shall be eligible to receive deposits and loans from members and other upto ten times of the sum of its subscribed share capital plus accumulated reserves minus accumulated losses, if any.

Constitution of a General Body:

The General Body of a Multi-State Cooperative Society shall consist of all the members of such society. The final authority of the Society shall vest in the General Body.

Each member-society shall be represented by one delegate elected to the general body as specified in the Bye-laws of the society;

NOTE: No individual can become member of a National Cooperative Society.

Smaller General Body (if applicable)

(A Multi State Cooperative Society with a membership exceeding 1000, may provide in its Bye-laws for the constitution of a smaller body consisting of delegates of members of the society elected or selected in accordance with such Bye-laws).

Such smaller general body may be constituted with delegates elected or selected from among the member-societies on the basis to be elaborated in the Bye-laws of a multi State cooperative society. That smaller body shall exercise such powers of the general body as may be specified in the Bye-laws of the multi-State Cooperative Society

Such delegate of the society shall be the Chairman/President or the Chief Executive of the society or a member of the Board of such cooperative society if such member is authorised by the Board of the nominating society. Where there is no Board, such society shall be represented through its administrator by whatever name called;

The delegates shall continue to be members of the General Body of the society for a period of 5 years or till their successors are elected or as specified in the nomination by the concerned member society.

The procedure for election of delegates in the General Body shall be in accordance with the election regulations framed by the Board of Directors in accordance with the provisions of the Act & Rules framed there under.

The delegate of a member society which has not been a member of the society for atleast 30 days before the date of General Body Meeting may attend the General Body Meeting but shall not be eligible either to exercise the right to vote, participate in the election or to contest election for any post;

Delegates from defaulting member societies shall not be entitled to exercise the right to vote or to seek election to any office. The delegates of defaulting society, if holding any office of the society shall forfeit their right to hold such office w.e.f. the date on which the society becomes defaulter under these bye-laws provided, due notice has been given to the defaulting society and it has failed to pay its dues within 30 days after the receipt of notice.

Annual General Meeting and Powers and functions of the General Body :

The Board of the society under a resolution shall within six months after the close of the corresponding year call the annual general meeting at the principal place of business of the society for the purpose of :

Consideration of the audited statement of accounts;

Consideration of the audit report and annual report;

Consideration of audit compliance report;

Disposal of net profits;

Approval for appointment of Auditors & fixation of remuneration;

Review of operational deficit, if any;

Creation of specific reserves and other funds;

Approval of the annual budget;

Review of actual utilisation of reserve and other funds;

Creation of specific reserves and other funds;

Approval of the long-term perspective plan and the annual operational plan;

Review of annual report and accounts of subsidiary institution, if any;

Expulsion of members;

List of employees who are relatives of members of the board or of the chief Executive;

Amendment of bye-laws, if any;

Formulation of code of conduct for the members of the board and officers;

Election & removal of members of the board, if any;

Consider the statement showing details of loans or goods on credit if any given to any director or to the spouse of the director or his/her son or daughter during the preceding year or outstanding against any of them;

Any other matter laid before it by the Board of Directors.

Amendment to Bye-laws:

The amendment to bye-laws shall only be passed by a resolution of the meeting of the general body in which a quorum is present by a vote of not less than two thirds of the members present there and not less than 15 clear days’ notice for considering of such amendment has been previously given.

Special General Meeting:

The Chief Executive, may at anytime, on the direction of the board, call a Special General Body Meeting of the Society and shall call such meeting within one month after the receipt of requisition from the Central Registrar or from (%age to be mentioned) of the total number of members of the society to transact the business as stated in notice of the meeting.

Notice for the General Meetings and Special General Meetings:

Annual General Meeting of the society may be called by giving not less than 14 days notice in writing to all the members of the society.

Special General Meeting of the society may be called by giving not less than 7 days notice in writing to all the members of the society;

The notice of the Annual General Meeting shall be accompanied by a copy of each of the audited balance-sheet, profit and loss account together with the auditors report relating to the preceding year and the report of the Board of Directors thereon.

The notice of general body meeting shall be sent to members by any of the following modes namely.

By local delivery or

Under postal certificate. Besides, notice shall also be published in the local news papers having wide circulation.

Notice of the general body meeting shall also be affixed on the notice board of the society and its branches, if any.

Quorum of the meeting:

The quorum for the general meeting shall be one fifth of the total number of members of the society or 1/5 of the total number of delegates of the smaller representative general body(as applicable);

No business shall be transacted at any general meeting unless there is a quorum at the time when the business of the meeting is due to commence;

If within half an hour from the time appointed for the meeting, quorum is not present, the meeting shall stand adjourned and would be held after half an hour at which the quorum will not be required.

If at any time during the meeting sufficient number of members are not present to form the quorum, the Chairman or the member presiding over the meeting on his own, or on his attention being drawn to this fact, shall adjourn the meeting and the business that remains to be transacted at this meeting, if any, shall be disposed off in the usual manner at the adjourned meeting;

(iv) Where a meeting is adjourned under sub-clause (iii) or (iv) the adjourned meeting shall be held either on the same day or on such date, time and place as may be decided by the Chairman or the member presiding over the meeting, but within 7 days from the date of adjourned meeting.

No business shall be transacted at any adjourned meeting other than the business on the agenda of the adjourned meeting;

The adjourned meeting will transact its regular business even without the quorum being present at the meeting.

Board of Directors:

The Board of Directors of the society shall consist of Directors (not more than

21) excluding functional directors and co-opted directors’

Directors to be elected by the General Body (number as may be specified in the Bye- laws;

Nominated Directors (number as may be specified in the Bye-laws, if applicable);

Chief Executive and Functional Directors shall be the ex-officio members of the Board.

Two eminent persons may be co-opted by the Board of Directors;

NOTE: Functional Directors are applicable in case of National Cooperative Societies only.

Two subject matter specialists may be invited by the Board in any of its meetings;

Nominees of the Central Government, if any, as per the provisions of the Act.

Where the Central Government or a State Government has subscribed to the share capital.

(The number of the Government Nominees shall be as per the equity share capital held by the Central Government in the multi-State cooperative society i.e. one person if the equity share capital is less than 26%, two persons if the equity share capital is 26% or more but less than 51%; and three persons if the equity share capital is 51% or more of the total issued share capital)

Provided that such nominated persons shall not exceed one third of the total number of members of the Board.

Where the Central Government or a State Government has guaranteed the repayment of principal and payment of interest on debentures issued by a multi-State cooperative society or has guaranteed the repayment of principal and payment of interest on loans and advances to a multi-State cooperative society or has given any assistance by way of grants or otherwise to a multi-State cooperative society, the Central Government or the State Governments in this behalf, as the case may be, or any person authorised by the Central Government, shall have the right to nominate person on the Board of such a society in the manner as may be prescribed.

A persons nominated under this section shall hold office during the pleasure of the Government by which he has been so nominated.

Meetings of the Board of Directors:

The Board of Directors shall meet at least once in every quarter;

The meetings of the Board of Directors shall normally be held at the registered office of the society. In exceptional cases, the meetings of the board may be held at any other place but within the area of operation of the society;

The meetings of the Board of Directors shall be presided over by the Chairman or in his absence by the Vice Chairman and in the absence of both Chairman & Vice-Chairman, the Directors present in the Meeting shall elect a Chairman for the meeting from among themselves;

14 days notice shall ordinarily be necessary for the meeting of the Board of Directors;

The quorum for the meeting of the Board of Directors shall be 1/3^rd of its total strength or as specified in the Bye-laws of the multi-State cooperative society.

Term of the Board of Directors:

The term of the office of the elected Members of the Board of Directors shall be -----

years from the date of election (not more than 5 years).

The term of office of the members of the Board who are nominees of the Government or institutions or federations shall be as indicated from time to time by the Government or the concerned Institutions. However, their term will be co-terminus with the term of the elected Directors/Board; and the Government/concerned institutions shall make fresh nominations for the new Board;

The elected members of the Board shall be eligible for re-election.

Powers & Functions of the Board of Directors:

To admit members;

To elect Chairman and Vice-Chairman of the society;

To authorise convening of Meetings of the General Body;

To interpret the organisational objectives and set-up specific goals to be achieved towards these objectives;

To make periodic appraisal of objectives;

To appoint, suspend or remove the Chief Executive and such other employee of the society as may be prescribed;

To make provisions for regulating the appointment of the society and the scales of pay, allowances and other conditions of service, including disciplinary action against such employees;

To place the annual report, annual financial statements, annual plan and budget for the approval of the general body;

To consider audit and compliance report and place the same before the general body;

To acquire or dispose off immovable property;

To review the membership in other cooperatives;

To approve annual and supplementary budget;

To recommend to the General Body distribution of profits;

To raise funds;

To sanction loans to the members;

To fill any vacancy/vacancies in the Board by election;

To approve the panel of auditors for placing in the General Body;

To appoint such Committees, Sub-Committees as may be necessary and delegate to them such powers as may be appropriate;

To frame regulations for the election of delegates to the General Body, Members to the Board of Directors and for the conduct of Meetings of the General Body and the Board of Directors as per the provisions of the Act;

To take such other measures or to do such other acts as may be prescribed or required under this act or the bye-laws or as may be delegated by the general body.

Disqualifications of Board of Directors:

No member of the multi state co-operative society or nominee of a member society or a National Co-operative society shall be eligible for being chosen as or for being a member of the Board of a multi state co-operative society, if such member:-

Has been adjudged by a competent Court to be insolvent or of unsound mind;

Is concerned or participates in the profits of any contract with the society;

Has been convicted for an offence involving moral turpitude;

Holds any office or place of profit under the society :-

Provided that the Chief Executive or such full-time employee of the Society as may be notified by the Central Government from time to time or a person elected by the employees of such Society to represent them on the board of such Society shall be eligible for being chosen as, or for being, a member of such board;

Has been a member of the Society for less than twelve months immediately preceding the date of such election or appointment;

Has interest in any business of the kind carried on by the Society of which he is member:

Has taken loan or goods on credit from the Society of which he is a member, or is otherwise indebted to such Society and after the receipt of a notice of default issued to him by such Society, has defaulted;-

In repayment of such loan or debt or in payment of the price of the goods taken on credit, as the case may be, within the date extended, which in no case shall exceed six months, within the date so extended, or

When such loan or debt or the price of goods taken on credit is to be paid in installments, in payment of any installment, and the amount in default or any part thereof has remained unpaid on the expiry of six months from the date of such default:

Provided that a member of the board who has ceased to hold office as such under this clause shall not be eligible, for a period of one year, from the date on which he ceased to hold office, for re-election as a member of the board of the Multi-State Cooperative Society of which he was a member or for the election to the board of any other Multi-State Co-operative Society.

Is a person against whom any amount due under a decree, decision or order is pending recovery under this Act:

Is retained or employed as a legal practitioner on behalf of or against the Society, or on behalf of or against any other Multi-State Co- operative Society.

Explanation- For the purposes of this clause, “legal practitioner” has the same meaning as in Clause (i) of sub- section (1) of section 2 of the Advocates Act, 1961(25 of 1961);

has been convicted for any offence under this Act;

is disqualified for being a member under Section 29;

has been expelled as a member under Section 30;

absents himself from three consecutive board meetings and such absence has not been condoned by the board;

absents himself from three consecutive general body meetings and such absence has not been condoned by the members in the general body.

A person shall not be eligible for being elected as member of board of the Society for a period of five years if, the Board fails:

to conduct election of the Board under section 45 of the Act: or

to call the general body meeting under Section 39 of the Act: or

to prepare the financial statement and present the same in the annual general meeting.

Removal of Elected Members of the Board by the General Body.

An elected member of a board, who has acted adversely to the interests of the Society, may on the basis of a report of the Central Registrar or otherwise be removed from the board upon a resolution of the general body passed at its meeting by a majority of not less than two-third of the members present and voting at the meeting;

Provided that the member concerned shall not be removed unless he has been given a reasonable opportunity of making a representation in the matter.

Filling up of casual Vacancies on the Board:

If any vacancy arise in the Board of Directors, it shall be filled by election by the members in the General Body for the remaining unexpired term of the Board.

Committees of the Board:

The Board of Directors shall constitute an Executive Committee and other committees or sub-committees as may be considered necessary. Provided that other committees or sub- committees, other than the Executive Committee shall not exceed 3 at a given point of time.

Executive Committee

Composition & Functions of the Executive Committee or other committee or sub-committee may be specified in the Bye-laws of the Society.

Chairman and Vice-Chairman

There shall be a Chairman and a Vice-Chairman elected by the Board of Directors from among themselves. The Chairman and in his absence, the Vice-Chairman shall preside over the Meeting of the General Body and the Board of Directors.

The terms of office of the Chairman and Vice-Chairman shall be co-terminus with the term of the elected Members of the Board unless Chairman or Vice-Chairman ceases to be a Director earlier. In case of any vacancy within this period, the Board shall fill up the vacancy through re-election for the unexpired term of the Board.

Powers and functions of the Chairman :

The Chairman shall have the following powers and functions:

He shall preside over the meeting of the general body, Board of Directors and executive committee;

The Chairman shall sign the proceedings of all the meetings presided over by him;

In the event of equality of votes on a resolution the Chairman shall have casting vote in the meeting;

To convene the meeting of the Board of Directors, Executive Committee and other committees of which he is the Chairman;

The Chairman may delegate any of his powers and functions to the Vice-Chairman;

Prohibition to hold office of Chairperson, or President or Vice- Chairperson or Vice-President in certain cases.

No member of the Board shall be eligible to be elected as Chairman or Vice- Chairman of the Society if he/ she is a Minister in the Central or State Government;

No member of the Board shall be eligible to be elected as Chairperson or President of the Society if he has held office during two consecutive terms whether full or part.

Provided that a member who has creased to hold the office of the Chairperson and President continuously for one full term shall again be eligible for election to the office as such.

Holding of office in co-operative society

No person shall be eligible to hold at the same time, office of the President or Chairperson or Vice- President or Vice-Chairperson on the Board of more than two Multi- State Co-operative Societies.

Functional Directors:

They shall be appointed by the Board and will be whole time employees of the Society and Members of the Board.

(Functional Directors are applicable in case of National Cooperative Societies).

Chief Executive

The Chief Executive is called (the designation to be specified) and he/she shall

be appointed by the Board and shall aid and assist the Board of Directors in its functions. He shall be member of all the committees, sub-committees of the Board of Directors as may be constituted.

Powers and functions of the Chief Executive:

Subject to overall control and general supervision of the Board of Directors, the Chief Executive /Managing Director by whatever name he is called shall have the following powers, functions and responsibilities:

To assist the Board of Directors in the formulation of policies, objectives and planning;

To implement the policies and plans duly approved by the General Body or the Board and furnish to the Board of Directors periodical information necessary for appraising the activities and progress of achievement towards implementations of the policies and programmes;

To summon meetings of various committees including the general body under the instructions of the Chairman;

To maintain proper records of the society;

To manage the funds of the society, cause proper accounts to be maintained and audited;

To attend to all correspondence of the society;

To be responsible for collection and safety of the funds;

To execute the policies/programmes and business of the society and take such action as is necessary to give effect to the resolutions of the general body, Board of Directors or any other committee constituted under bye-laws;

To sign all deposit receipts of the society with banks in accordance with the resolution of the executive committee;

To endorse and transfer promissory notes and other securities and to endorse, sign, encash cheques and negotiate instruments on behalf of the society;

To be the office of the society to sue or to be sued on behalf of the society and sign all books and arrangements in favour of the society;

To appoint such personnel in the society as may be approved by the Board of Directors;

To determine powers, functions and responsibilities of the employees of the society of all categories;

To maintain a list of members correct and up-to-date;

To exercise administrative control in respect of all officers and staff, including granting of leave, granting of annual increments and other matters relating to the service conditions of the employees;

To delegate powers to other officers of the society;

To sanction contingent expenditure in so far as the amount involved is upto Rs.

;

To sign on behalf of the society and conduct its correspondence;

To present the draft annual report and financial statements for the approval of the Board;

To record proceedings of meeting and have duly signed;

To perform all duties entrusted to him and to exercise such other powers as may be delegated to him by the Board of Directors, executive committee and Chairman from time to time.

Deposits:

Deposits may be received from Members at any time within the limits determined under the Cooperative Societies Act and Rules, on such rates of interest and subject to such rules and regulations as may be fixed by the Board of Directors and also subject to the directives issued by the Reserve Bank of India ( in case of cooperatives banks ) in this behalf from time to time.

Deposits may be received on current, savings, fixed, recurring, cumulative and under any other special scheme/s.

All the deposits of the bank shall be insured under DICGC Act 1961 and shall be governed by the various sections of the DICGC Act. ( Applies on Cooperative Banks )

Loans and Advances :

Loans, cash credits and/or overdrafts on current accounts may be granted to members on securities mentioned below or other security or securities approved by the Board of Directors or without security.

Personal security and/or surety/sureties of other member/members.

Collateral security of movable and immovable property.

Industrial, mercantile, agricultural and other marketable commodities or machinery under pledge, hypothecation or charge of the Bank.

Pledge of government, trustee securities, shares of approved companies, debentures and fixed deposits

Insurance policies assigned to the Bank within the surrender value.

Warehouse receipts

Gold and silver ornaments

Any other tangible security

The Board may frame detailed loan regulations prescribing proportion of unsecured loans to total loans and advances, proper terms and conditions and the nature of securities acceptable for loans and advances for different purposes.

Short-term loans will be for periods up to 15 months, medium-term loans for 15 months to 5 years and long-term loans over 5 years.

Linking of Shareholding with Loan Limits

A borrower should hold at least 5 per cent of his borrowings if such borrowings are on an unsecured basis, i.e. in the form of clean overdrafts, loans against one or two personal sureties and purchase/discount of clean bills and cheques.

A borrower against tangible securities should hold shares of the bank to the extent of at least 2

½ per cent of his borrowings from the Bank.

In the case of loans for small-scale industrial units, the linking of share capital might be fixed initially at one per cent of the borrowings, to be raised in the course of the next two years to 2 ½ percent. The total amount of share capital held by a member will, however, have to be within the limits laid down under the Cooperative Societies Act.

Disposal of net Profit :

Subject to the provisions of the Act and Rules framed there under, the net profits of a multi-State cooperative society shall be distributed by the General Body as follows:

transfer at least 25% of net profit to the reserve fund;

credit one per cent of its net profit to the cooperative education fund maintained by the National Cooperative Union of India;

an amount of at least 10% shall be transferred to the reserve fund for meeting unforeseen losses.

The balance of the net profit may be utilised for all or any of the following purposes :-

Payment of dividend to members on their paid up capital at the rate as specified in the Bye-laws;

Any other privileges to members; if any; as specified in the Bye-laws;

Contribution to the education fund at the rate of 5% or more and not exceeding 10%. The fund may be utilised for the education and training of members, directors and employees as approved by the Board of Directors;

Donation for the development of the cooperative movement or charitable purpose as defined in section 2 of the Charitable Endowment Act 1890 not exceeding 5%.

Payment of ex-gratia amount to employees as approved by the Board of Directors;

Investment of funds :

The society may invest or deposit its funds in :-

A cooperative bank including cooperative land development bank;

Securities specified in section 20 of the Indian Trust Act 1882;

Shares and securities of any other cooperative society/subsidiary institutions;

Any scheduled bank as defined under RBI Act;

Reserve Fund

In addition to the sum prescribed under the Co-operative Societies Act and Bye-laws , all admission fees, entrance fees, nominal membership fees, amount of forfeited shares and dividends and donations shall be carried to the Reserve Fund.

Any loss occurring as the net result of the year’s working may with the previous sanction of the Registrar, be made good from the Reserve Fund or from the profits of the next ensuing year or years.

The Reserve Fund shall be separately invested in government and trustee securities or other approved securities or in fixed deposits with the District Central Co-operative Bank or the State Co-operative Bank.

Dividend :

The dividend declared shall be paid to the person whose name stands as the registered shareholder in the books of the Society on the last day of the co-operative year to which the dividend relates.

Dividend shall be proportionate to the amount paid on shares and the period in whole months for which the amount stood to the credit of the shareholder.

Any dividend remaining undrawn for three years after having been declared shall be forfeited and shall be carried to the Reserve Fund of the society.

Unpaid dividend shall be payable on application provided the same has not been forfeited.

Accounts and Records

Accounts and records shall be maintained in forms prescribed or approved by the Registrar and the Reserve Bank of India ( in case of Cooperative banks ) with such additions as the Board of Directors consider necessary. Any member of the Bank/Society may inspect any of the registers or records during office hours in so far as they relate to his own business transaction.

1. Audit

The accounts of the society shall be audited by an auditor appointed from the panel of auditors approved by the Central Registrar or from a panel of auditors, if any, prepared by the society at least once in each year and the remuneration of auditors shall be fixed by the Central Registrar or the society as the case may be.

Audit Committee (applicable in case of cooperative banks):

Each multi state coop. bank shall constitute audit committee of their boards to look into implementation of guidelines issued by RBI from time to time in this regard.

Settlement of Disputes:

All the disputes shall be referred to Arbitration in accordance with the provisions of the Multi state Cooperative Societies Act and Rules .

Limitations:

The limitation period in disputes shall be as per the provisions of the Act.

Miscellaneous

No act of the General Body or the Board of Directors shall be deemed invalid by reason of any defect in the election of a Member thereof or by reason of any vacancy therein not having been filled in;

Service Rules :

The society shall have service rules for regulating the service conditions of its employees as formulated and amended by the Board from time to time.

The Society shall maintain a Contributory Provident Fund for the benefit of its employees in accordance with the provisions of Employees Provident Fund and Miscellaneous Provisions Act, 1952.

****

Cooperative Society Registration Services in Mumbai, Maharashtra

The Multi-State Cooperative Societies Act, 2002

Contents

Chapter I Preliminary

Short title, extent and commencement

Application

Definitions

Chapter II

Central Registrar and Registration of Multi State Cooperative Societies

Central Registrar

Multi-state cooperative societies which may be registered

Application for registration

Registration

Registration certificate

Multi-state cooperative society to be body corporate

Bye-laws of multi-state cooperative societies

Amendment of bye-laws of a multi-state cooperative society

When amendment of bye-laws comes into force

Change of name

Change of address

Publication of name by multi-state cooperative society

Liability

Amalgamation or transfer of assets and liabilities, or division of multi-state cooperative societies

Central Registrar to prepare scheme of amalgamation or reorganisation of a cooperative bank in certain cases

Promotion of subsidiary institution

Liability of a cooperative bank to Deposit Insurance and Credit Guarantee Corporation

Cancellation of registration certificate of multi-state cooperative societies in certain cases

Conversion of a cooperative society into a multi-state cooperative society

Chapter III

Registration and Functions of Federal Cooperatives

Registration of federal cooperative

Functions of federal cooperative

Chapter IV

Members of Multi-state cooperative societies and their duties, rights and liabilities

Persons who may become members

Nominal or associate member of society

Educational course for members

Members not to exercise rights till due payment made

Disqualification for member of a multi-state cooperative society

Expulsion of members

Vote of members

Manner of exercising vote

Restriction on holding of shares

Restriction on transfer of shares or interest

Redemption of shares

Transfer of interest on death of members

Liabilities of past member and estate of deceased member

Chapter V

Direction and Management of Multi-state cooperative societies

Constitution, powers and functions of general body

Annual general meeting of general body

Special general meeting of general body

Board of directors

Association of employees in management decision making process

Disqualifications for being a member of board

Prohibition to hold office of chairperson or president or vice-chairperson or vice-president in certain cases

Elections of members of board

Holding of office in cooperative society

Removal of elected members by general body

Nominee of Central Government or State Government on board

Powers and functions of board

Meeting of board

Chief Executive

Powers and functions of Chief Executive

Committees of board

Securing possession of records, etc

Chapter VI

Privileges of Multi-state cooperative societies

Charge and set-off in respect of share or contribution or interest of members

Share or contribution or interest not liable to attachment

Admissibility of copy of entry as evidence

Exemption from compulsory registration of instruments

Deduction from salary to meet multi-state cooperative society’s claim in certain cases

Government aid to multi-state cooperative societies

Chapter VII

Properties and Funds of Multi-state cooperative societies

Funds not to be divided by way of profit

Disposal of net profits

Investment of funds

Restriction on contribution

Restrictions on loans

Restriction on borrowings

Restrictions on other transactions with non-members

Contributory provident fund

Chapter VIII

Audit, Enquiry, Inspection and Surcharge

Appointment and remuneration of auditors

Provision as to resolutions for appointing or removing auditors

Qualifications disqualifications of auditors

Powers and duties of auditors

Signature of audit report, etc

Reading and inspection of auditor’s report

Right of auditor to attend general meeting

Power of Central Government to direct special audit in certain cases

Inquiry by Central Registrar

Inspection of multi-state cooperative societies

Inspection of books of indebted multi-state cooperative societies

Costs of inquiry and inspection

Recovery of costs

Repayment, etc

Chapter IX Settlement of Disputes

Reference of disputes

Limitation

Chapter X

Winding up of Multi-State Cooperative Society

Winding up of multi-state cooperative societies

Winding up of cooperative bank at the direction of Reserve Bank

Reimbursement to the Deposit Insurance Corporation by liquidator

Liquidator

Powers of liquidator

Disposal of surplus assets

Priority of contributions assessed by liquidator

Power of Central Registrar to cancel registration of a multi-state cooperative society

Chapter XI

Execution of Decrees, Orders and Decisions

Execution of decisions, etc

Execution of orders of liquidator

Attachment before award

Central Registrar or arbitrator or person authorised to be civil court for certain purposes

Recovery of sums due to Government

Chapter XII Appeals and Review

Appeals

No appeal in certain cases

Review

Interlocutory orders

Chapter XIII

Societies which become Multi-state cooperative societies consequent on Reorganisation of states

Cooperatives societies functioning immediately before reorganisation of states

Chapter XIV Offences and Penalties

Offences and penalties

Cognizance of offences

Chapter XV Miscellaneous

Copies of bye-laws, etc, to be open to inspection

Place of keeping and inspection of, registers and returns

Inspection of books of account, etc of multi-state cooperative society

Annual accounts and balance-sheet

Minutes of proceedings of general meetings and of board and other meetings

Minutes to be evidence

Presumptions to be drawn where minutes duly drawn and signed

Inspection of minutes book of general meetings

Liquidator to be public servant

Notice necessary in suits

Power to amend Second Schedule

Bar of jurisdiction of courts

Indemnity

Opening of branches

Filing of returns

Certain Acts not to apply

Central Government’s power to give directions to specified multi-state cooperative societies in public interest

Super session of board of specified multi-state cooperative society in public interest

Power to make rules

Power to remove difficulties

Repeal and saving

The First Schedule: Cooperative Principles

Voluntary and Open Membership

Democratic Member Control

Member's Economic Participation

Autonomy and Independence

Education, Training and Information

Cooperation among Cooperatives

Concern for Community

The Second Schedule: List of National Cooperatives Societies

The Multi-State Cooperative Societies Act, 2002

[Act No of 39 of 2002]

[3^rd July 2002]

An Act to consolidate and amend the law relating to cooperative societies, with objects not confined to one State and serving the interests of members in more than one State, to facilitate the voluntary formation and democratic functioning of cooperatives as people’s institutions based on self-help and mutual aid and to enable them to promote their economic and social betterment and to provide functional autonomy and for matters connected therewith or incidental thereto.

Be it enacted by Parliament in the Fifty-third Year of the Republic of India as follows:-

Chapter I Preliminary

Short title, extent and commencement

This Act may be called the Multi-State Cooperative Societies Act, 2002.

It extends to the whole of India.

It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.

Application

This Act shall apply to -

all cooperative societies, with objects not confined to one State which were incorporated before the commencement of this Act

under the Cooperative Societies Act, 1912 (2 of 1912), or

under any other law relating to cooperative societies in force in any State or in pursuance of the Multi-unit Cooperative Societies Act, 1942 or the Multi-State Cooperative Societies Act, 1984.

and the registration of which has not been cancelled before such commencement; and

all multi-State cooperative societies.

Definitions

In this Act, unless the context otherwise requires, -

“area of operation” means the area from which the persons are admitted as members;

“board” means the board of directors or the governing body of a multi-state cooperative society, by whatever name called, to which the direction and control of the management of the affairs of the society is entrusted;

“bye-laws” means the bye-laws for the time being in force which have been duly registered or deemed to have been registered under this Act and includes amendments thereto which have been duly registered or deemed to have been registered under this Act;

“Central Registrar” means the Central Registrar of Cooperative Societies appointed under sub-section (1) of section 4 and includes any officer empowered to exercise the powers of the Central Registrar under sub-section (2) of that section;

“Chief Executive” means a Chief Executive of a multi-state cooperative society appointed under section 51;

“cooperative bank” means a multi-state cooperative society which undertakes banking business;

“cooperative principles” means the cooperative principles specified in the First Schedule;

“cooperative society” means a society registered or deemed to be registered under any law relating to cooperative societies for the time being in force in any State;

“cooperative year”, in relation to any multi-state cooperative society or class of such societies, means the year ending on the 31^st day of March of the year and where the accounts of such society or class of such societies are, with the previous sanction of the Central Registrar, balanced on any other day, the year ending on such day;

“Deposit Insurance Corporation” means the Deposit Insurance and Credit Guarantee Corporation established under section 3 of the Deposit Insurance Corporation Act, 1961 (47 of 1961);

“federal cooperative” means a federation of cooperative societies registered under this Act and whose membership is available only to a cooperative society or a multi-state cooperative society;

“general body”, in relation to a multi-state cooperative society, means all the members of that society and in relation to a national cooperative society or a federal cooperative means all the delegates of member of cooperative societies of delegates of multi- state cooperative societies and includes a body constituted under the first proviso to sub-section (1) of section 38;

“general meeting” means a meeting of the general body of a multi- state cooperative societies and includes special general meeting;

“member” means a person joining in the application for the

registration of a multi-state cooperative society and includes a person admitted to membership after such registration in accordance with the provisions of this Act, the rules and the bye- laws;

“member cooperative” means a cooperative society or a multi- state cooperative society which is member of a federal cooperative;

“multi-state cooperative society” means a society registered or deemed to be registered under this Act and includes a national cooperative society and a Federal cooperative;

“multi-state cooperative society with limited liability” means a society having the liability of its members limited by its bye-laws to the amount, if any, unpaid on the shares, respectively, held by them or to such amount as they may, respectively, thereby undertake to contribute to the assets of the society, in the event of its being wound up;

“national cooperative society” means a multi-state cooperative society specified in the Second Schedule;

“notification” means a notification published in the Official Gazette;

“officer” means a president, vice-president, chairperson, vice- chairperson, managing director, secretary, manager, member of a board, treasurer, liquidator, an administrator appointed under section 123 and includes any other person empowered under this Act or the rules or the bye-laws to give directions in regard to the business of a multi-state cooperative society;

“prescribed” means prescribed by rules;

“Reserve Bank” means the Reserve Bank of India constituted under the Reserve Bank of India Act, 1934 (2 of 1934);

“rules” means the rules made under this Act.

Chapter II

Central Registrar and Registration of Multi-State Cooperative Societies

Central Registrar

The Central Government may appoint a person to be the Central Registrar of Cooperative Societies and may appoint such other persons as it may think fit to assist the Central Registrar.

The Central Government may, by notification, direct that any power exercisable by the Central Registrar under this Act (other than the power of registration of a multi state cooperative society) shall, in relation to such society, and such matters as may be specified in the notification, be exercisable also by any other officer of the Central Government or of a State Government as may be authorised by the Central Government subject to such conditions as may be specified therein:

Provided that no officer of a state government shall be empowered

to exercise such power in relation to a national cooperative society.

Multi-state cooperative societies which may be registered

No multi-state cooperative society shall be registered under this Act, unless,

its main objects are to serve the interests of members in more than one state; and

its bye-laws provide for social and economic betterment of its members through self-help and mutual aid in accordance with the cooperative principles.

The word “limited” or its equivalent in any Indian language shall be suffixed to the name of every multi-state cooperative society registered under this Act with limited liability.

Application for registration

For the purposes of registration of a multi-state cooperative society under this Act, an application shall be made to the Central Registrar in such form and with such particulars as may be prescribed.

The application shall be signed

in the case of a multi-state cooperative society of which all the members are individuals, by at least fifty persons from each of the state concerned;

in the case of a multi-state cooperative society of which the members are cooperative societies, by duly authorised representatives on behalf of at least five such societies as are not registered in the same state; and

in the case of a multi-state cooperative society of which another multi-state cooperative society and other cooperative societies are members, by duly authorised representatives of each of such societies:

Provided that not less than two of the cooperative societies referred to in this clause, shall be such as are not registered in the same state;

in the case of a multi-state cooperative society of which the members are cooperative societies or multi-state cooperative societies and individuals, by at least

fifty persons, being individuals, from each of the two states or more; and

one cooperative society each from two states or more or one multi-state cooperative society.

The application shall be accompanied by four copies of the

proposed bye-laws of the multi-state cooperative society and the persons by whom or on whose behalf such application is made shall furnish such information in regard to the society as the Central Registrar may require.

Registration

If the Central Registrar is satisfied

that the application complies with the provisions of this Act and the rules;

that the proposed multi-state cooperative society satisfies the basic criterion that its objects are to serve the interests of members in more than one state;

that its bye-laws provide for social and economic betterment of its members through self-help and mutual aid in accordance with the cooperative principles;

that the proposed bye-laws are not contrary to the provision of this Act and the rules,

he may register the multi-state cooperative society and its bye-laws.

The application for registration shall be disposed of by the Central Registrar within a period of four months from the date of receipt thereof by him.

Where the Central Registrar refuses to register a multi-state cooperative society, he shall communicate, within a period of four month from the date of receipt of the application for registration, the order of refusal together with the reasons thereof to the applicant or applicants, as the case may be:

Provided that no order or refusal shall be made unless the applicants have been given a reasonable opportunity of being heard;

Provided further that if the application for registration is not disposed of within a period of four months specified in sub-section

(2) or the Central Registrar fails to communicate the order of refusal within that period, the application shall be deemed to have been accepted for registration and the Central Registrar shall issue the registration certificate in accordance with the provisions of this Act and the rules made thereunder.

Registration certificate

Where a multi-state cooperative society is registered under this Act, the Central Registrar shall issue a certificate of registration signed by him, which shall be conclusive evidence that the society therein mentioned is duly registered under this Act, unless it is proved that the registration of the society has been cancelled.

Multi-state cooperative society to be body corporate

The registration of a multi-state cooperative society shall render it a body corporate by the name under which it is registered having perpetual succession and a common seal, and with power to acquire, hold and dispose of property, both movable and immovable, enter into contract, institute and defend suits and other legal proceedings and to do all things necessary for the purpose for which it is constituted, and shall, by the said name, sue or be sued.

All transactions entered into in good faith prior to the registration of a multi-state cooperative society shall be deemed to be its transactions after registration for furtherance of the objects of its registration.

Bye-laws of multi-state cooperative societies

Every multi-state cooperative society may make its bye-laws consistent with the provisions of this act and the rules made thereunder.

In particular, and without prejudice to the generality of the foregoing power, such bye-laws may provide for all or any of the following matters, namely:

the name, address and area of operation of the society;

the objects of the society;

the services to be provided to its members;

the eligibility for obtaining membership;

the procedure for obtaining membership;

the conditions for continuing as member;

the procedure for withdrawal of membership;

the transfer of membership;

the procedure for expulsion from membership;

the rights and duties of the members;

the nature and amount of capital of the society;

the manner in which the maximum capital to which a single member can subscribe;

the sources from which the funds may be raised by the multi- state cooperative society;

the purpose for which the funds may be applied;

the manner of allocation or disbursement of net profits of the multi-state cooperative society;

the constitution of various reserves;

the manner of convening general meetings and quorum thereof other than those provided under this Act;

the procedure for notice and manner of voting, in general and other meetings;

the procedure for amending the bye-laws;

the number of members of the board not exceeding twenty- one;

the tenure of, directors, chairperson and other office bearers of the society, not exceeding five years;

the procedure for removal of members of the board and for filling up of vacancies;

the manner of convening board meetings, its quorum, number of meetings in a year and venue of such meetings;

the frequency of board meetings;

the powers and functions of the Chief Executive in addition to those provided under section 52;

the manner of imposing the penalty;

(za) the appointment, rights and duties of auditors and procedure for conduct of audit;

(zb) the authorisation of officers to sign documents and to institute and defend suits and other legal proceedings on behalf of the society;

(zc) the terms on which a multi-state cooperative society may deal with persons other than members;

(zd) the terms on which a multi-state cooperative society may associate with other cooperative societies;

(ze) the terms on which a multi-state cooperative society may deal with organisation other than cooperative societies;

(zf) the rights, if any, which the multi-state cooperative society may confer on any other multi-state cooperative society or federal cooperative and the circumstances under which such rights may be exercised by the federal cooperative;

(zg) the procedure and manner for transfer of shares and interest in the name of a nominee in case of death of a member;

(zh) the educational and training programmes to be conducted by the multi-state cooperative society;

(zi) the principal place and other places of business of multi-state cooperative society;

(zj) the minimum level of services, to be used by its members; (zk) any other matter which may be prescribed.

Amendment of bye-laws of a multi-state cooperative society

No amendment of any bye-law of a multi-state cooperative society shall be valid, unless such amendment has been registered under this Act.

The amendment to the bye-laws of a multi-state cooperative society shall be made by a resolution passed by a two-third majority of the members present and voting at general meeting of the society.

No such resolution shall be valid unless fifteen clear days’ notice of the proposed amendment has been given to the members.

In every case in which a multi-state cooperative society proposes to amend its bye-laws, an application to register such amendments shall be made to the Central Registrar together with-

a copy of the resolution referred to in sub-section (2);

a statement containing the particulars indicating-

the date of the general meeting at which the amendments to the bye-laws were made;

the number of days’ notice given to convene the general meeting;

the total number of members of the multi-state cooperative society;

the quorum required for such meeting;

the number of members present at the meeting;

the number of members who voted in such meeting;

the number of members who voted in favour of such amendments to bye-laws;

a copy of the relevant bye-laws in force with the amendment proposed to be made together with reasons justifying such amendments;

four copies of the text of the bye-laws incorporating therein the proposed amendments signed by the officer duly authorised in this behalf by the general body;

a copy of the notice given to the members and the proposal to amend the bye-laws;

a certificate signed by the person who presided at the general meeting certifying that the procedure specified in sub-sections

(2) and (3) and the bye-laws, had been followed;

any other particular which may be required by the Central Registrar in this behalf.

Every such application shall be made within sixty days from the date of the general meeting at which such amendment to the bye- laws was passed.

The procedure given in sub-sections (2) to (5) of this section shall apply to the amendment of the bye-laws of a cooperative society desiring to convert itself into a multi-state cooperative society as per the provisions of section 22.

If, on receipt of application under sub-section (5), the Central Registrar is satisfied that the proposed amendment-

is not contrary to the provisions of this Act or of the rules;

does not conflict with cooperative principles; and

will promote the economic interests of the members of the multi- state cooperative society,

he may register the amendment within a period of three months from the date of receipt thereof by him.

The Central Registrar shall forward to the multi-state cooperative society a copy of the registered amendment together with a certificate signed by him within a period of one month from the date of registration thereof and such certificate shall be conclusive evidence that the amendment has been duly registered.

Where the Central Registrar refuses to register an amendment of the bye-laws of a multi-state cooperative society, he shall communicate the order of refusal together with the reasons therefor to the Chief Executive of the society in the manner prescribed within fifteen days from the date of such refusal;

Provided that if the application for registration is not disposed of within a period of three months specified in sub-section (7) or the Central Registrar fails to communicate the order of refusal within that period, the application shall be deemed to have been accepted for registration and the Central Registrar shall issue registration certificate in accordance with the provisions of this Act.

When amendment of bye-laws comes into force

An amendment of the bye-laws of a multi-state cooperative society shall, unless it is expressed to come into operation on a particular day, come into force on the day on which it is registered.

Change of name

A multi-state cooperative society may, by an amendment of its bye- laws, change its name but such change shall not affect any right or obligation of the multi-state cooperative society or of any of its members or past members, and any legal proceedings which might have been continued or commenced by or against the multi-state cooperative society by its former name, may be continued or commence by or against its new name.

Where a multi-state cooperative society changes its name, the Central Registrar shall enter the new name on the register of multi- state cooperative society in place of former name and shall amend the certificate of registration accordingly.

Change of address

Every multi-state cooperative society shall have principal place of business and an address registered in the manner prescribed to which all notices and communications may be sent.

Publication of name by multi state cooperative society

Every multi-state cooperative society-

shall paint or affix its name and the address of its registered office and keep the same painted or affixed, on the outside of every office or place in which its business is carried on, in conspicuous position, in letters easily legible; and if the characters employed therefor are not those of the language, or of one of the languages in general use in that locality, also in the characters of that language or of one of those languages;

shall have its name engraven in legible characters on its seal; and

shall have its name and the address of its registered office mentioned in legible characters in all its business letters, in all its bill heads and letter paper, and in all its notices and other official publications; and also have its name so mentioned in all bills of exchange, hundies, promissory notes, endorsements, cheques and orders for money or goods purporting to be signed by or on behalf of the multi-state cooperative society, and in all bills of parcels, invoices, receipts and letters of credit of the multi-state cooperative society.

Liability

No multi-state cooperative society with unlimited liability shall be registered after the commencement of this Act:

Provided that where a multi-state cooperative society with unlimited liability was functioning before the commencement of this Act, such a society shall exercise the option within a period of one year from such commencement either to continue to function as such or to convert itself into a multi-state cooperative society with limited liability by following the procedure specified in sub-sections (2) to (4).

Subject to the provisions of this Act and the rules, a multi-state cooperative society may, by an amendment of its bye-laws, change the extent of its liability.

When a multi-state cooperative society has passed a resolution to change the extent of its liability, it shall give notice thereof in writing to all its members and creditors, and, notwithstanding anything

contained in the bye-laws or contract to the contrary, any member or creditor shall, during the period of one month from the date of service of the notice upon him, have the option of withdrawing his shares, deposits or loans, as the case may be.

Any member or creditor who does not exercise his option within the period specified in sub-section (3) shall be deemed to have assented to the change.

An amendment of a bye-law of a multi-state cooperative society changing the extent of its liability shall not be registered or shall not take effect until either-

the assent thereto of all members and creditors has been obtained; or

all claims of members and creditors who exercise the option referred to in sub-section (3) within the period specified therein have been met in full or otherwise satisfied.

Amalgamation or transfer of assets and liabilities, or division of multi-state cooperative societies

A multi-state cooperative society may, by a resolution passed by a majority of not less than two-thirds of the members, present and voting at a general meeting of the society held for the purpose,-

transfer its assets and liabilities in whole or in part to any other multi-state cooperative society or cooperative society;

divide itself into two or more multi-state cooperative societies;

divide itself into two or more cooperative societies.

Any two or more multi-state cooperative societies may, by a resolution passed by a majority of not less than two-thirds of the members present and voting at a general meeting of each such society, amalgamate themselves and form a new multi-state cooperative society.

The resolution of a multi-state cooperative society under sub- section (1) or sub-section (2) shall contain all particulars of the transfer or division or amalgamation, as the case may be.

When a multi-state cooperative society has passed a resolution under sub-section (1) or sub-section (2), it shall give notice thereof in writing to all the members and creditors, and, notwithstanding anything contained in the bye-laws or contract to the contrary, any member or creditor shall, during the period of one month of the date of service of the notice upon him, have the option of withdrawing his share, deposits or loans, as the case may be.

Any member or creditor who does not exercise his option within the period specified in sub-section (4) shall be deemed to have assented to the proposals contained in the resolution.

(a) A resolution passed by a multi-state cooperative society under this section shall not take effect until the assent thereto of all the members and creditors has been obtained.

(b) The multi-state cooperative society shall make arrangements for meeting in full or otherwise satisfying all claims of the members and creditors who exercise the option within the period specified in sub-section (4).

On receipt of an application for the registration of new societies formed by division in accordance with the resolution passed under sub-section (1) or of a new society formed by amalgamation in accordance with the resolution passed under sub-section (2), the Central Registrar, on being satisfied that the resolution has become effective under sub-section (6) shall, unless for reasons to be recorded in writing he thinks fit to refuse so to do, Register the new society or societies, as the case may be, and the bye-laws thereof.

On the issue of an order under sub-section (7), the provisions of section 21 shall, so far as may be, apply to the multi-state cooperative society so divided or the multi-state cooperative societies so amalgamated.

Where a resolution passed by a multi-state cooperative society under this section involves the transfer of any assets and liabilities, the resolution shall, notwithstanding anything contained in any other law for the time being in force, be a sufficient conveyance to vest the assets and liabilities in the transferee without any further assurance.

Central Registrar to prepare scheme of amalgamation or reorganisation of a cooperative bank in certain cases

When an order of moratorium has been made by the Central Government under sub-section (2) of section 45 of the Banking Regulation Act, 1949 (10 of 1949) in respect of a cooperative bank, the Central Registrar, with the previous approval of the Reserve Bank in writing, may, during the period of moratorium prepare a scheme-

for the amalgamation of the cooperative bank with any other cooperative bank; or

for the reorganisation of the cooperative bank.

Promotion of subsidiary institution

Any multi-state cooperative society may, by a resolution passed at general meeting by a majority of members present and voting, promote one or more subsidiary institutions, which may be registered under any law for the time being in force, for the furtherance of its stated objects.

Any subsidiary institution promoted under sub-section (1) shall exist only as long as general body of the multi-state cooperative society deems its existence necessary.

Provided that a multi-state cooperative society while promoting such a subsidiary institution, shall not transfer or assign its substantive part of business or activities undertaken in furtherance of its stated objects.

Explanation – For the purposes of this section,-

an institution shall be deemed to be a subsidiary institution if the multi-state cooperative society,-

controls the management or board of directors or members of governing body of such institution; or

holds more than half in nominal value of equity shares of such institutions; or

if one or more members of such multi-state cooperative society, hold whether by themselves or together with subsidiary institution or their relatives, as the case may be, the majority of equity shares in this institution;

a subsidiary institution shall not include a partnership firm.

The annual reports and accounts of any such subsidiary institution shall be placed each year before general meeting of the promoting multi-state cooperative society.

Liability of a cooperative bank to deposit insurance and credit guarantee corporation

Notwithstanding anything contained in section 17 or any other provision of this Act, where a cooperative bank, being an insured bank within the meaning of the Deposit Insurance and Credit Guarantee Corporation Act, 1961, is amalgamated or reorganised and the Deposit Insurance Corporation has become liable to pay to the depositors of the insured bank under sub-section (2) of section 16 of that Act, the bank with which such insured bank is amalgamated or the new cooperative bank formed after such amalgamation, or, as the case may be, the insured bank or transferee bank shall be under an obligation to repay to the Deposit Insurance Corporation in the circumstances, to the extent and in the

manner referred to in section 21 of the Deposit Insurance and Credit Guarantee Corporation Act, 1961.

Cancellation of registration certificate of multi-state cooperative societies in certain cases

Where the whole of the assets and liabilities of a multi-state cooperative society are transferred to another multi-state cooperative society or to a cooperative society in accordance with the provisions of section 17, the registration of the first mentioned multi-state cooperative society shall stand cancelled and the society shall be deemed to have been dissolved and shall cease to exist as a corporate body.

Where two or more multi-state cooperative societies are amalgamated into a new multi-state cooperative society in accordance with the provisions of section 17, the registration of each of the amalgamating societies shall stand cancelled on the registration of the new society, and each of the amalgamating societies shall be deemed to have been dissolved and shall cease to exist as a corporate body.

Where a multi-state cooperative society divides itself into two or more multi-state cooperative societies or two or more cooperative societies in accordance with the provisions of section 17, the registration of that society shall stand cancelled on the registration of the new societies and that society shall be deemed to have been dissolved and shall cease to exist as a corporate body.

The amalgamation or division of multi-state cooperative societies shall not in any manner whatsoever affect any right or obligation of the resulting multi-state cooperative society or societies or render defective any legal proceedings by or against the multi-state cooperative society or societies, and any legal proceedings that might have been continued or commenced by or against the multi- state cooperative society or societies, as the case may be, before the amalgamation or division, may be continued or commenced by or against the resulting multi-state cooperative society or societies.

Conversion of a cooperative society into a multi-state cooperative society

A cooperative society may, by an amendment of its bye-laws, extend its jurisdiction and convert itself into a multi-state cooperative society:

Provided that no such amendment of bye-laws of a cooperative society shall be valid unless it has been registered by the Central Registrar.

(a) Every proposal for such amendment of bye-laws shall be forwarded to the Central Registrar in accordance with the provisions contained in sub-section (4) of section 11.

If the Central Registrar, after consulting the Registrars of Cooperative Societies of the States concerned, has satisfied himself that such amendment-

fulfils the requirements of the members being from more than one state:

is in accordance with the provisions contained in sub- section (4) of section 11,

he may register the amendment within a period of six months from the date of receipt thereof by him.

Provided that no cooperative society shall be deemed to have been converted into a multi-state cooperative society on any ground whatsoever unless such society is registered as a multi-state cooperative society.

The Central Registrar shall forward to the cooperative society a copy of the registered amendment together with a certificate signed by him and such certificate shall be conclusive evidence that the amendment has been registered.

Where the Central Registrar refuses to register an amendment of the bye-laws or a cooperative society, he shall communicate the order of refusal together with the reasons therefor to the society in the manner prescribed within seven days from the date of refusal.

(a) Once the amendment of bye-laws has been registered by the Central Registrar, the cooperative society shall, as from the date of registration of amendment, become a multi-state cooperative society.

The Central Registrar shall forward to the cooperative society a certificate signed by him to the effect that such society has been registered as a multi-state cooperative society under this Act and also forward a copy of the same to the Registrar of Cooperative Societies of the State concerned.

The Registrar of Cooperative Societies referred to in clause (b) shall thereupon make an order directing that the society had, as from the date of registration by the Central Registrar, ceased to be a society under the law relating to cooperative societies in force in that state.

Chapter III

Registration and Functions of Federal Cooperatives

Registration of federal cooperative

Every federal cooperative shall obtain registration certification in accordance with the provisions of this Act.

Every federal cooperative shall in its general meeting be represented by its member cooperative.

The classification of federal cooperative and other terms and conditions applicable to it shall be such as may be prescribed.

All provisions of this Act, applicable to a multi-state cooperative society shall, as far as may be, apply to a federal cooperative.

Functions of federal cooperative

Subject to the provisions of this Act and any other law for the time being in force, a federal cooperative may discharge the functions to facilitate the voluntary formation and democratic functioning of cooperative societies as federal cooperative or multi-state cooperatives based on self-help and mutual aid.

Without prejudice to the generality of the provisions contained in sub-section 2 the federal cooperative may-

ensure compliance of the cooperative principles;

make model bye-laws and policies for consideration of its member cooperative;

provide specialised training, education and data-base information;

undertake research, evaluation and assist in preparation of perspective development plans for its member cooperative;

promote harmonious relations amongst member cooperative;

help member cooperative to settle disputes among themselves;

undertake business services on behalf of its member cooperative, if specifically required by or under the resolution of the general body or the board, or bye-laws of a member of cooperative;

provide management development services to a member cooperative;

evolve code of conduct for observance by a member cooperative;

evolve viability norms for a member cooperative;

provide legal aid and advice to a member cooperative;

assist member cooperative in organising self-help;

develop market information system logo brand promotion, quality control and technology upgradation.

Chapter IV

Members of Multi-state Cooperative Societies and their duties, rights and liabilities

Persons who may become members

No person shall be admitted as a member of a multi-state cooperative society except the following, namely-

an individual, competent to contract under section 11 of the Indian Contract Act, 1872 (9 of 1872);

any multi-state cooperative society or any cooperative society;

the Central Government;

a State Government;

the National Cooperative Development Corporation established under the National Cooperative Development Corporation Act, 1962 (26 of 1962);

any other corporation owned or controlled by the Government;

any Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956);

such class or classes or persons or association of persons as may be permitted by the Central Registrar having regard to the nature and activities of a multi-state cooperative society.

No individual person shall be eligible for admission as a member of a national cooperative society or a federal cooperative.

Any person eligible for membership of a multi-state cooperative society may, on his application, be admitted as a member by such society.

Every application for admission as a member of a multi-state cooperative society shall be disposed of by such society within a period of four months from the date of receipt of the application, and the decision of such society on the application shall be communicated to the applicant within fifteen days from the date of such decision:

Provided that if the application is not disposed of within the period aforesaid, or the decision is not communicated within a period of fifteen days of the expiry of the aforesaid period of four months, the multi-state cooperative society shall be deemed to have made a decision, on the date of expiry of such period, refusing admission to the applicant.

It shall be the duty of every member of a multi-state cooperative society to promote and protect the interests and objects of such society.

Nominal or associate members of society

A multi-state cooperative society may, if provided in its bye-laws, admit a person as nominal or associate member:

Provided that no such nominal or associate member shall be entitled to subscribe the shares of such society or have any interest in the management thereof including right to vote, elect as a director of the board or participate in the general body meetings.

Educational course for members

Every multi-state cooperative society shall organise cooperative education programmes for its members, directors and employees.

Every multi-state cooperative society may provide funds for such cooperative education programmes.

Members not to exercise rights till due payment made

No member of a multi-state cooperative society shall exercise the rights of a member, unless he has made the payment to the society in respect of membership, or has acquired such interest in the society, as may be specified in the bye-laws.

Disqualification for member of a multi-state cooperative society

No person shall be eligible for being a member of a multi-state cooperative society if-

his business is in conflict or competitive with the business of such multi-state cooperative society; or

he used for two consecutive years the services below the minimum level specified in the bye-laws; or

he has not attended three consecutive general meetings or the multi-state cooperative society and such absence has not been condoned by the members in the general meeting; or

he has made any default in payment of any amount to be paid to the multi-state cooperative society under the bye-laws of such society.

Expulsion of members

A multi-state cooperative society may, by resolution passed by a majority of not less than two-thirds of the members present and voting at a general meeting of members held for the purpose, expel a member for acts which are detrimental to the proper working of the society:

Provided that the member concerned shall not be expelled unless he has been given a reasonable opportunity of making representation in the matter.

No member of the multi-state cooperative society, who has been expelled under sub-section (1), shall be eligible for re-admission as a member of that society, for a period of one year from the date of such expulsion.

Vote of members

Every member of a multi-state cooperative society, including a member who is an employee of such society, shall have one vote in the affairs of the society:

Provided that-

a member who is an employee of such society shall not be entitled to vote

at the election of a member of the board of such society;

in any general meeting convened for framing the bye-laws of such society or any amendments thereto:

in the case of an equality of votes, the chairperson shall have a casting vote;

where any of the authorities, multi-state cooperative society or a cooperative society referred to in clauses (b) to (g) of sub-section

(1) of section 25 is a member of a multi-state cooperative society, each person nominated by such authority or society, on the board in accordance with provisions contained in this Act and the rules shall, have one vote:

a multi-state cooperative society, the membership of which include cooperative societies or other multi-state cooperative society, may provide in its bye-laws for an equitable system of voting having regard to the membership of, and the extent of business carried on by such cooperative societies or multi-state cooperative societies.

Manner of Exercising Vote

Every member of a multi-state cooperative society shall exercise his vote in person and no member shall be permitted to vote by proxy:

Provided that a multi-state cooperative society or a cooperative society or any other institution which is a member of any other multi-state cooperative society may, subject to the provisions of sub-section (3) of section 38 and the rules, appoint its representative to vote on its behalf in the affairs of such multi-state cooperative society.

Restriction on holding of shares

No member, other than the authorities referred to in clauses (c) to (g) of sub-section (1) of section 25 of a multi-state cooperative society or a cooperative society, shall hold more than such portion of the total share capital of the society (in no case exceeding one-fifth thereof) as may be prescribed in the rules or bye-laws of such multi-state cooperative society.

Restriction on transfer of shares or interest

The transfer of share or interest of a member in the capital of a multi- state cooperative society shall be subject to such conditions as to maximum holding as specified in section 33.

Redemption of shares

Shares held in a multi-state cooperative society by any of the authorities referred to in clauses (c) to (g) of sub-section (1) of section 25 shall be redeemable in accordance with the bye-laws of such multi-state cooperative society and in a case where the bye- laws do not contain any provision in this regard, in such manner as may be agreed upon between the multi-state cooperative society and such authority.

The redemption of shares referred to in sub-section (1) shall be on the face value of the shares.

Transfer of interest on death of members

On the death of a member, a multi-state cooperative society may transfer the share or interest of the deceased member to the person nominated in accordance with the bye-law made in this behalf or, if there is no person nominated, to such person as may appear to the board to be the heir or legal representative of the deceased member, or pay to such nominee, heir or legal representative, as the case may be, a sum representing the value of such member’s share or interest as ascertained in accordance with the rules:

Provided that no such transfer or payment shall be made except with the consent of the nominee, heir or legal representative, as the case may be.

A multi-state cooperative society shall, unless within six months of the death of the member prevented by an order of a competent court, pay to such nominee, heir or legal representative, as the case may be, all other moneys due to the deceased member from the society.

All transfers and payments made by a multi-state cooperative society in accordance with the provisions of this section shall be valid and effectual against any demand made upon the society by any other person.

Liabilities of past member and estate of deceased member

Subject to the provisions of sub-section (2), the liability of a past member or of the estate of a deceased member of a multi-state cooperative society for the debts of the society as they existed-

in the case of a past member, on the date on which he ceased to be a member;

in the case of a deceased member, on the date of his death. shall continue for a period of two years from such date.

Notwithstanding anything contained in sub-section (1), where a multi-state cooperative society is ordered to be wound up under section 86, the liability of a past member who ceased to be a member or of the estate of a deceased member who died within two years immediately preceding the date of the order of winding up, shall continue until the entire liquidation proceedings are completed, but such liability shall extend only to the debts of the society as they existed on the date of cessation of membership or death, as the case may be.

Chapter V

Direction and Management of Multi-State Cooperative Societies

Constitution, powers and functions of general body

The general body of a multi-state cooperative society shall consist of all the members of such society:

Provided that where the bye-laws of a multi-state cooperative society provide for the constitution of a smaller body consisting of delegates of members of the society elected or selected in accordance with such bye-laws, that smaller body shall exercise such powers of the general body as may be prescribed or as may be specified in the bye-laws of the society.

Subject to the provisions of this Act, the rules and the bye-laws, the ultimate authority of a multi-state cooperative society shall vest in the general body of its members:

Provided that nothing contained in this sub-section shall affect the exercise by the board or any officer of a multi-state cooperative society of any power conferred on such board or such officer by this

Act or the rules or the bye-laws.

Where in any meeting of the general body or the board of a multi- state cooperative society, a cooperative society or another multi- state cooperative society is to be represented, such cooperative society or other multi-state cooperative society shall be represented in such meeting only through the Chairperson or the president or the Chief Executive or a member of the board of such cooperative society or other multi-state cooperative society, as the case may be, if such member is so authorised by the board and where there is no board of such cooperative society or other multi-state cooperative society, for whatever reasons, through the administrator, by whatever name called, of such cooperative society or other multi- state cooperative society:

Provided that where the bye-laws of a multi-state cooperative society provide for representation of other institutions in any meeting of general body or the board of such multi-state cooperative society, such institutions shall be represented through its nominee.

Annual general meeting of general body

The board of every multi-state cooperative society shall, within such period as may be prescribed, and not later than six months after the close of the corresponding year, call the annual general meeting in the manner prescribed for the purpose of-

consideration of the audited statement of accounts;

consideration of the audit report and annual report;

consideration of audit compliance report;

disposal of net profits;

review of operational deficit, if any;

creation of specific reserves and other funds;

approval of the annual budget;

review of actual utilisation of reserve and other funds;

approval of the long-term perspective plan and the annual operational plan;

review of annual report and accounts of subsidiary institution, if any;

expulsion of members;

list of employees who are relatives of members of the board or of the Chief Executive;

amendment of bye-laws, if any;

formulation of code of conduct for the members of the board and officers;

election of members of the board, if any.

Where the board of a multi-state cooperative society fails to convene the annual general meeting within the period specified in

sub-section (1), the Central Registrar or the person authorised by him in this behalf shall be competent to convene such annual general meeting within a period of ninety days from the date of expiry of the period mentioned in that sub-section and the expenditure incurred on such meeting shall be borne by the society.

At every annual general meeting of a multi-state cooperative society, the board lay before the society a statement showing the details of the loans or goods on credit, if any, given to any of the members of the board or to the spouse or a son or daughter of a member of the board during the preceding year or outstanding against him or against such spouse or son or daughter of the member of the board.

Special general meeting of general body

The Chief Executive may, at any time, on the direction of the board, call a special general meeting of the society and shall call such meeting within one month after the receipt of a requisition in writing from the Central Registrar or from such member or members or a proportion of the total number of members, as may be provided in the bye-laws.

If a special general meeting of a multi-state cooperative society is not called in accordance with the requisition referred to in sub- section (1), the Central Registrar or any person authorised by him in this behalf shall have the power to call such meeting and that meeting shall be deemed to be a meeting called by the Chief Executive in accordance with the provisions of that sub-section and the Central Registrar may order that the expenditure incurred in calling such meeting shall be paid out of the funds of the society or by such person or persons who, in the opinion of the Central Registrar, was or were responsible for the refusal or failure to convene the special general meeting.

Board of directors

Subject to the provisions of this Act and rules, there shall be a board of directors for every multi-state cooperative society consisting of such number of members as specified in sub-section (3).

The members of a multi-state cooperative society, by a resolution in a general meeting, shall elect directors who shall be members of board.

The board shall consist of such number of directors as may