The Nagaland Co-operative Societies Act, 2017

THE NAGALAND CO-OPERATIVE SOCIETIES ACT, 2017 
(NAGALAND ACT No. 6 OF 2017) 
Received the assent of the Governor on 9.6.17 and published in the 
Nagaland Gazette extraordinary dated 17th  July 2017. 
An 
Act 
An Act to consolidate and amend the law relating to Co-operative Societies 
within the territorial limit of the State of Nagaland, to facilitate the voluntary 
formation and democratic functioning of Co-operative Societies as people's 
institution based on Self-Help, Mutual-Aid and Sound Business Principles and, to 
enable its members to promote their economic needs so as to bring about higher 
standard of living for social betterment. 
Preamble: Whereas it is expedient further to consolidate and amend the law 
relating to Co-operative Societies in the State of Nagaland, to facilitate the 
formation and working of Co-operative Societies in accordance with the relevant 
Directive Principles of State policyenunciated in the Constitution of India. It is 
hereby enacted by the Legislative Assembly of Nagaland as per the power 
conferred upon it under entry 32 of List-11 of 7th  Schedule of the Constitution of 
India in the year of the Republic of India as follows: 
550 

GENERAL CONTENT 
Preamble 
1. Preliminary 
2. Registrar and Registration of Co-operative Societies 
3. Membership 
4. Management of Co-operative 
5. Management of Property and Funds 
6. Regulation of cooperatives-(Audit, Inquiry ,inspection &Su rcharge) 
7. Settlement of disputes 
9. Recovery of sums due 
10. Penalty 
11. jurisdiction 
12. Miscellaneous 
Schedules 
INDEX 
Preamble 
CHAPTER-1 
PRELIMINARY 
1. Short title, extent and commencement. 
2. Definitions. 
CHAPTER-11 
REGISTRAR AND REGISTRATION OF CO-OPERATIVE SOCIETIES 
3. The Registrar. 
4. Co-operative Which may be registered. 
5. Age, qualification of a member. 
6. Conditions of registration. 
7. Restriction on a acquisition of shares in a society. 
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8. power of Registrar to decide certain questions. 
9. Bye-Laws. 
10. Application for registration. 
11. Registration. 
12. Certificate of registration. 
13. Amendment of the Bye-Laws of a registered society. 
14. Power of Registrar or affiliating society or financing bank to direct 
amendmentof Bye-Laws or adoption of Rules of procedure. 
15. Division and Amalgamation of societies 
16. Location of Head Office. 
17. Fees etc. 
CHAPTER-ill 
MEMBERSHIP 
18. Eligibility of membership in Co-operative Society. 
19. Disqualification of membership. 
20. Admission on members. 
21. Withdrawal of membership. 
22. Cessation of membership. 
23. Termination of membership. 
24. Register of members. 
25. Education of member etc. 
26. Rights and liabilities of members of registered societies and exercise 
and exercise of rights thereof. 
27. Votes of members and manner of exercising vote. 
28. Liabilities of past member and his estate. 
552 

CHAPTER-1V 
MANAGEMENT OF CO-OPERATIVE 
29. Genaral Assembly 
30. Matters to be dealt within the Annual General Meeting. 
31. Term of the Board. 
32. General Meeting. 
33. Special General Meeting. 
34. Quorum of Meetings of General Assembly. 
35. Board. 
36. President and Vice President of Co-operative Society. 
37. Disqualification of the members of the Board and Administrative Council. 
38. Powers and functions of the Board. 
39. Annual General Meeting. 
40. Eligibility fora Director in Co-operative Society. 
41. Elections. 
42. Term of Directors. 
43. Board Meetings. 
44. Decision by majorityof votes. 
45. Minutes of proceedings of meetings. 
46. Vacancies etc. not to invalidate proceedings. 
47. Proceeding of meeting to be deemed to be good and valid. 
48. Power to depute Government servant to manage the affairs of a Co-operative 
society. 
49. Chief Executive his powers and functions and staff. 
50. Votes of members. 
51. Loan to be utilised forthe purpose forwhich advanced. 
52. Restrictions on transfer of share or interest. 
53. Validity of transferor charge of share or interest. 
54. Share or interest not liable to attachment. 
55. Nomination of transferee. 
56. Transfer or interest on death of member. 
57. Disposal of shares or interest of ceased member. 
58. Liability of member on winding up of society. 
59. Restriction on transfer of possession of land help under a society. 
60. Right of a registered societyto pay prior debts of a mortgagor. 
61. Restriction on mortgaged property. 
62. Barto certain claim. 
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CHAPTER-V 
MANAGEMENT OF PROPERTY AND FUNDS 
63. Mobilization of funds 
64. Restrictions on borrowings. 
65. Restrictions on holding of equity. 
66. Disposal of surplus. 
67. Management of deficit. 
68. Reserve and other funds. 
69. Investment of funds outside the business. 
70. Restriction on contribution to political parties or religious institutions. 
71. Contribution to Co-operative Education Funds of the Slate Federal Co-
operative Union. 
72. Restrictions of grant of loan. 
73. Restriction on transaction with non-member. 
74. Contributory Provident Fund. 
75. Power of Government to give financial assistance. 
CHAPTER-VI 
REGULATION OF CO-OPERATIVE 
(Audit, inquiry, inspection and surcharge) 
76. Audit and powers of Auditors. 
77. Power of the Registrar to have the accounts written up. 
78. Nature of Audit. 
79. Audit Report. 
80. Rectification of defects in accounts. 
81. Re-audit/Recasting of Audit Report. 
82. Inquiry. 
83. Inspection of a Co-operative. 
84. Cost of Inquiry and Inspection. 
85. Recovery of cost. 
86. Initiation of Surcharge proceeding against delinquent officers or members by 
Registrar. 
87. Prohibition of use of word Co-operative and penalty. 
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88. Offence. 
89. Powerto enforce attendance. 
CHAPTER VU 
SETTLEMENT OF DISPUTES 
90. Reference of dispute 
91. Settlements of dispute. 
CHAPTER-Vu 
DISSOLUTION OF A SOCIETY 
92. Cancellation of registration. 
93. winding up, appointment of Liquidator and his powers and function. 
94. Distribution of fund of a dissolved society. 
95. Liquidation to deposit the books and submit a final report. 
96. Disposal of surplus assets of liquidation Co-operative Societies. 
97. Bar of suits or legal proceeding. 
98. Final Accounts. 
99. Bar of suit. 
CHAPTER-IX 
RECOVERY OF SUMS DUE 
100. Recovery ofsums due enforcement ofobligations. 
101. Charge and Surcharge. 
CHAPTER-X 
PENALTY 
102. Punishment for false information, disobeying summon, order etc. 
103. Punishment for disposing property in contravention of Section 61. 
104. Penalty for certain performance of obligation. 
105. Power to enforce performance of obligation. 
106. Cognizance of Offence. 
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CHAPTER XI 
JURISDICTION 
107. Indemnity. 
108. Bar to jurisdiction-Civil. 
109. Appeal of review. 
110. Power of attachment of property. 
111. Registrar to be Civil Court for certain purpose. 
112. Recovery of Sums due. 
113. Registrar may order a Meeting of Creditors. 
CHAPTER XII 
MISCELLANEOUS 
114. Previous sanction of Reserve Bank of India or NABARD in certain matters. 
115. Society to be a Body Corporate. 
116. Register of members. 
117. Entries in books of registered society shall be received as prima fade 
evidence. 
118. Savings of existing societies. 
119. Acts of societies etc. Not to be invalidated by certain defects. 
120. Power to order recoupment of expenditure. 
121. Super-session of Board by Registrar. 
122. Power to seize record of society. 
123. Powers of the Managing Body of an Affiliating Society to enquire into the 
affairs of a member society. 
124. Limitation. 
125. Information and returns to be filed with the Registrar. 
126. Power to make Rules. 
127. Repeal. 
SCHEDULE-'A' 
CO-OPERATIVE PRINCIPLES 
SCHEDULE-'B' 
Subject matter for specific consideration when framing Bye-Laws 
SCHEDULE-'C' 
CO-operative Demand Certificate granted under Section-112(l) of the Nagaland Co-
operative Societies Act 2017. 
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CHAPTER-1 
PRELIMINARY 
	
1. 	 Short title, extent and commencement: 
(1) This Act maybe called the Nagaland Co-operative societies Act,2017. 
(2) It extends to the whole of the territorial limits of the State of Nagaland. 
(3) It shall come into force on such date as the State Government may, by 
Notification in the Official Gazette, determine and different dates for 
Enforcement of the different provisions of this Act may be determined 
bytheState Government. 
	
2. 	 Definitions: in this Act, unless the context otherwise requires: 
(1) "Act refers to the Nàgaland Co-operative Societies Act,2017. 
(2) "Adrninistrator(s)"refers to persons or persons appointed by Registrar 
by virtue of exercise of power conferred upon him/her and for the 
purpose. 
(3) "Affiliated Society" means the particular society which is a member of 
the affiliated society. 
(4) "Affiliated Society "means the registered society in which a particular 
society becomes a member. 
(5) "Area of Operation" means the area from which the membership is 
drawn and Includes the territorial limit up to which a co-operative can 
extend its activities as provided under Bye-Law. 
(6) "Auditor" means departmental auditors and auditors other than 
departmental auditor appointed by the Registrar. 
(7) "Board" or "Managing Committee" means the Government Body of a 
Co- operative by whatever name be called, to which the direction of the 
affairs of the Co-operative is entrusted upon by the Bye-Laws of that 
Co-operative. 
(8) "Bonus" means payment made in cash or kind out of the profits of a co-
operative to a member or to a person who is not a member, on the basis 
of his contribution (including any contribution in the form of labour or 
service) to the business of the Co-operative. 
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(9) "Bye-Laws" means Bye-Laws registered under this Act for the time 
being in force and includes registered amendments of such Bye-Laws 
and deemed amendment of Bye-Laws. 
(10) "Charge" means the lawful conferment of preferential right of 
enjoyment upon an entity over other rival claimants on the same 
entity. 
(11) "Co-operative Bank" means a society involved/engage in the business 
of banking as defined in clause(6)of sub-section(1)of section 5 of the 
Banking Regulation Act 1949 and includes any society which is 
functioning or is to function as an Agriculture and Rural Development 
Bank. 
(12) "Co-operative Tribunal" means a tribunal constituted under Nagaland 
Co-operative Societies Act or to be constituted by the Government in 
consultation with High court under this Act to decide disputes to be 
referred to under any of the provision of the Act. 
(13) "Co-operative with limited liability" means a Co-operative having the 
liability of its members limited to the extent of share capital held or 
guarantee provided by such member or as provided by its Bye-Laws. 
(14) "Co-operative with unlimited liability" means a Co-operative, the 
members of which are, in the event of it being wound up, jointly and 
severally liable for and in respect of its obligations and to contribute to 
any deficiency in the assets of the Co-operative regardless of the value 
of share capital held or extent of guarantee provided by concerned 
member. 
(15) "Co-operative Year" means the period beginning and ending on such 
date as may be fixed by the Registrar for the purpose of drawing up the 
Balance Sheet of registered societies and for all other purpose under 
this Act. 
(16) "Court" means the principal Civil Court of original jurisdiction in a 
district, and includes the high Court and Supreme Court in exercise of 
its original civil jurisdiction. 
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(17) "Decree" means a decision expressed in a suit conclusively determining 
the rights of the parties to the dispute with regard to all or any of the 
matters in controversy and such decision is given formal adjudication. 
(18) "Deemed" means the intended act, purpose, requirement, need ,gets 
its legal status on the expiry of time period or stipulation or condition 
provided for taking such action or decision ,on such act, purpose 
,requirement or need, etc. 
(19) "Deficit" means the excess of expenditure over income arrived at, at 
the end of a financial year ,after the payment of interests, if any, on 
share capital. 
(20) "Delegate" means a member nominated or authorized by a Co-
operative to represent its interests at the time of promotion of a 
Federal or Central or Secondary Co-operative, and/or to take part at 
meetings of such Federal or Central or Secondary Co-operative to 
which the Co-operative is affiliated. 
(21) "Deregistration" means the act of withdrawing or taking away the legal 
rights Conferred upon a Co-operative for the purpose. 
(22) "Director" means a member elected, nominated or co-opted in 
accordance with the Law, Rules and provisions of Bye-Laws to the Board 
of Management orthe Managing Committee 
(23) "Dividend" means the amount paid out of the net profits of Co-
operative to a member in proportion to the share capital held by him. 
(24) "Employee" means a person not being an office bearer, employed by 
the registered Co-operative society on a salary or similar form of 
remuneration other than advance, patronage, dividend or payment for 
goods sold to or, through such society. 
(25) "Expulsion" (of members) means the act of keeping away members by 
force or authority who are found or to be found dishonest by engaging 
themselves in doing acts which are detrimental or harmful to the 
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interest of the Co-operative or to its proper working or acts which 
affect or affected the image/status and good will of Co-operative. 
(26) "General Body" in relation to Co-operative" means a body consisting of 
all its members. 
(27) "General Meeting" or "General Body Meeting" means a meeting of the 
General Body called and conducted in accordance with the provision of 
this Act and the Bye-Laws of the Co-operative. 
(28) "Government" or state Government refers to the Government of 
Nagaland unless stated otherwise. 
(29) "Managing Committee or Board of Directors" as the case maybe means 
the body to which the management of the affairs of a registered society 
is directly vested. 
(30) "Member" means a person admitted to membership after registration 
in accordance with the Bye-Laws and Rules of the Society and includes 
a promoter. 
(31) "Office" means an employee of a Co-operative society employed by the 
Managing Committee of the Society/Board of Directors. 
(32) "Office Bearer" means a member duly elected by the appropriate body 
of a registered society according to its Bye-Laws to any office of such 
society, including the office of the President, Chairman, Vice President, 
Vice Chairman, Secretary, Managing Director and Treasurer provided 
that any officer appointed by Government to hold charge of any office 
of a registered society shall be deemed to be an Office Bearer unless 
specifically stated to be contrary. 
(33) "Primary Co-operative" means a Co-operative whose primary 
members are Primarily individual eligible persons. 
(34) "Promoter" means any eligible person or registered society signing the 
application for registration of a society. 
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(35) "Qualified" means possession of requisite qualification and experience 
as Provided under Law, Rules, Regulations and Bye-Laws of Co-
operative. 
(36) "Registrar" means a person appointed to perform the duties of a 
Registrar of Cooperative Societies under this Act. 
(37) "Arbitrator" means a person appointed under the provision of this Act 
to decide any dispute referred to him. 
(38) "Chief Executive" means the individual, in paid or honorary capacity, 
nominated or elected or appointed by the Board from among 
members, directors or other, in accordance with the Bye-Laws of the 
society who shall perform such functions and responsibilities and 
exercise such powers as specified in the Act, Bye-Laws and assigned by 
the Board. 
(39) "Representative General Body" in relation to a Co-operative, means all 
the Member representatives authorized as per Bye-Laws to constitute 
and discharge Such of the functions of General Body. 
(40) "Representative General Body Meeting" means a meeting of the 
representatives, Called and conducted in accordance with the 
provisions of this Act and bye- Laws of the Co-operative. 
(41) "Resolution" means a resolution of the General Body at a meeting 
called for the Purpose which has the approval of more than half of all 
the members of the Co- Operative with right to vote at the time of the 
General Meeting, or of at least Two-thirds of members or any other 
proportion with right of vote at the time of The General Meeting and 
present in the General Meeting, whichever is specified. 
(42) "Rules" means Rules made under this Act by the Government. 
(43) "Schedule" means the schedule" appended to his Act. 
(44) "Society" in this Act means a registered Co-operative Society. 
561. 

(45) "Supersession" means the Act of removing or unseating or dissolving or 
replacing the duly and democratically elected management committee 
from its functions and operations, in the larger interest of members of 
Co-operative, public or Co-operative movement, for managing the 
affairs of Co-operative, prejudicial to the interest of members Co-
operative or detrimental to the business or general affairs and growth 
of Co-operative. 
(46) "Surcharge" means the addition or omission done in the preparation 
and maintenance of accounts for which credit should have been made 
and involve amounts in official books of accounts not approved by the 
auditor which amounts are recoverable from such of the persons 
including officials and employees of Co-operative Society responsible 
for spending or incurring such expenditure. 
(47) "Surplus" means the excess of income over expenditure, arrived at, at 
the end of the financial year after making or making provision for the 
payment of interest on share capital, tax, if any and before the payment 
of surplus refund, and allocation of reserves and other funds. 
(48) "Working Capital" means fund at the disposal of a Co-operative 
inclusive of paid-up share capital, funds built out of profits, and money 
raised by borrowing and by any other source. 
(49) "Winding up or Dissolution" means the act of enabling or allowing an 
institution activity, subject or thing coming to an end in normal course 
or bringing or forcing an end to such an institution activity, subject or 
thing in larger interest of member, public or Co-operative or Co-
operative Movement. 
(50) Works and Expressions not defined in this Act but defined in the Rules 
shall bearthe meaning as defined in the Rules. 
562 

CHAPTER II 
REGISTRAR AND REGISTRATION OF 
CO-OPERATIVE SOCIETIES 
	
3. 	 The Registrar: 
(1) The State Government may appoint a person from the State Co-
operative cadre to be a Registrar of Co-operative Societies for the State 
or any portion of it for the registration, supervision, assistance, counsel 
and for the all round development of the Co-operative Movement in 
the State with such other powers and responsibilities as may be 
provided under this Act or Rules or Bye-Laws framed there-under. 
(2) The State Government may also appoint any other person or persons to 
assist the Registrar belonging to State Co-operative cadre and may be 
general or special order in writing, delegate to any such person or 
persons or any of the powers and responsibilities of the Registrar under 
this Act. 
	
4. 	 Co-operative which maybe registered: 
(1) A society whose objective is to promote the economic interest or 
general welfare of its members or of the public in accordance with the 
Co-operative Principles laid down in Schedule A or a society 
established with the objective of facilitating the operations of any 
society may be registered underthIs Act with limited liability. 
(2) No society shall be registered if in the opinion of the Registrar, its 
declared objects are unlikely to be achieved or if it is likely to be 
economically unsound or if it may have an adverse effect upon any 
registered society or the Co-operative Movement as a whole. 
4. 	 Co-operative Bankto be eligible Co-operative Bank: 
A Co-operative Society registered as a Co-operative Bank underthis Act 
shall be eligible to be a Co-operative Bank within the meaning of clause 
(g) of Section 2 of the Deposit Insurance and Credit Guarantee 
Corporation Act, 1961 and shall be bound bythe following- 
563 

a) If so required by the Reserve bank in the public interest or for 
preventing the affairs of the Co-operative Bank being conducted in a 
manner detrimental to the interest of the depositors or for securing the 
proper management of the bank, an order shall be made for the 
supersession of the committee of management or other managing 
body (by whatever name called) of the Co-operative Bank and the 
appointment of an administrator therefore for such period or periods 
not exceeding five years in the aggregate as may from time to time 
specified by the Reserve Bank. 
b) An order for the winding up of the Co-operative Bank or an order 
sanctioning a scheme of compromise or arrangement or of 
amalgamation or reconstruction or an order for the supersession of the 
committee of management or other managing body (by whatever 
name called) of the Co-operative Bank and the appointment of an 
administrator therefore made with the previous sanction in writing or 
on the requisition of the Reserve Bank shall not be liable to be called in 
question in any manner. 
The Liquidator or the insured Co-operative Bank or the transferee Co-
operative Bank, as the case may be, shall be undef an obligation to 
repay the corporation in the circumstances to the extend and in the 
manner referred to in Section 21 of the Depositor Insurance and Credit 
Guarantee Corporation Act, 1961. 
5. Age, qualification of a member: 
No person may be an individual member of a registered society if he is 
less than eighteen years of age; provided that the Bye-Laws of a society may 
prescribe a higher minimum age. 
6. Conditions of registration: 
(1) A primary Co-operative may be registered with a minimum of 25 
eligible persons drawn from or belonging to different families either 
with limited or unlimited liability. 
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(2) A Co-operative, other than Primary, maybe registered with a minimum 
of five members which are already registered Co-operatives. 
(3) The word "Limited" shall be the last word in the name of every society 
with limited liability registered underthis Act. 
	
7. 	 Restriction on acquisition of shares in a society: 
(1) No member of a registered society shall hold more than such portion of 
the share capital of the society as maybe prescribed by the Rules, or the 
Bye-Laws of the society. 
(2) No member shall be allowed to acquire an additional share until he has 
paid in full the value of the whole or that portion of his share holding 
which he is required to pay in accordance with the Bye-Laws of his 
society. 
	
8. 	 Powers of Registrar to decide certain questions: 
All disputes regarding memberships for the purpose of the formation, 
registration or continuance of a society under this Act shall be decided by the 
Registrar. 
9. Bye-Laws: 
(1) A Co-operative shall frame their own Bye-Laws and the affairs of the Co-
operative Society shall be managed in accordance with the terms, 
conditions and procedure specified in the Bye-Laws. 
(2) Subject to the provisions of this Act the functioning of every Co-
operative Society shall be regulated by its Bye-Laws. 
(3) The Bye-Laws may contain such matters as decided by the General 
Assembly and shall be specific and confined only to the matters 
provided in Schedule 'B'. However, the Bye-Laws of a society shall in no 
case supersede the provisions of the Act. 
565 

10. Application for registration: 
(1) An application for registration shalt be made to the Registrar in the 
prescribed form. 
() 	 The application shall be signed- 
(a) in the case of society of which no promoter is a registered society, by at 
least twenty five eligible persons; and 
(b) in the case of a society of which at least one promoter is a registered 
society, by a duty authorized person on behalf of such registered society 
and at least one other individual promoter or one other duly authorized 
person on behalf of another registered society. 
(3) The application shall be accompanied by three copies of the proposed 
Bye-Laws of the society signed on behalf of the promoters by the 
president of the Inaugural General Meeting. Promoters by whom or on 
whose behalf such application is made shalt furnish such information in 
regard to the society asthe Registrar may require and they shall be 
liable to the full extent of the share money which they have undertaken 
to subscribe with effect from the date of registration of the society. 
11. 	 Registration: 
(1) The Registrar shall decide all questions as to whether the application 
complies with the provisions of this Act and Rules there under and 
whether the objects of the society are in accordance with Section 4. 
(2) When he is satisfied that the application is in order under sub-section 
(1) and the Society and Bye-Laws are not contrary thereto, he may 
register the Society and Bye-Laws, provided that the Registrar shall 
have powersto registerthe Bye-Laws with such modifications as he 
thinks are necessary to bring about uniformity in the main with 
provisions of the Bye-Laws of societies which have similar objects or 
functions. 
566 

(3) The Registrar shall endorse the Bye-Laws in token of registration. Each 
Society shall have a copy of its Bye-Laws so endorsed. 
(4) If the Registrar refuses to register a society or an amendment of the 
Bye-Laws of a registered society he shall record his reasons in writing 
and communicate these reasons and his decision to the promoters or 
the Secretary of a registered society by a registered letter to their office, 
The Registrar may at anytime review his orders in this respect. 
12. Certificate of registration: 
A certificate of registration signed by the Registrar shall be issued to 
the Society and shall be conclusive evidence that the Co-operative Society 
therein mentioned is a Co-operative Society duly registered under this Act 
and that its Bye-Laws are as attached to the certificate, unless it is proved 
that the registration of the Society has been cancelled or that amended Bye-
Laws have been registered or that the society's copy of the Certificate or Bye-
Laws has been tampered with. 
13. Amendment of the Bye-Laws of registered Society: 
(1) No amendment of the Bye-Laws of a registered Society, whether byway 
of addition, alteration, omission, recession or charge of name shall be 
valid until Such amendment has been registered under this Act. 
(2) Every proposal for such amendment shall have to be approved by a 
resolution at a meeting of the General Assembly in accordance with the 
Bye-Laws of the Society and be forwarded within a month from the 
date of the resolution to the Registrar and if the provisions RegVtrar is 
satisfied that the proposed amendment is not contrary to the 
provisions of this Act or Rules, he shall, unless for reasons to be 
recorded in writing he considers fit to refuse, register the 
amendment. 
(3) When the Registrar registers an amendment of the Bye-Laws of a 
registered Society, he/she shall issue to the society a copy of the 
567 

amendment certified by him/her, which shall be a conclusive evidence 
that the same has been duly registered, unless it is proved that the 
registration of the society has been cancelled or that further 
amendments have been registered or that the society's copy of the 
amendments have been tampered with, the amendment shall be 
binding upon the society with effect from the date of registration. 
14. Power of Registrar or affiliating society or financing bank to direct 
amendment of Bye-Laws or adoption of Rules of Procedure: 
When it appears to the Registrar that an amendment of the Bye-Laws of 
a registered society is necessary in the interest of such society or of the 
Co-operative Movements as a whole or for the purpose of bringing 
about uniformity in the main with the provisions of the Bye-Laws of the 
societies which have similar objects or functions, he/she may, by an 
order in writing, direct the society to amend its Bye-Laws in accordance 
with the amendment drafted and forwarded to the society by him/her 
within such time as he/she may specify in the order. 
(ii) If the society fails to make such amendment within the time specified, 
the Registrar shall, after giving the society an opportunity of 
representing its case, make such amendment himself/herself and 
register the same the Registrar shall then forward a copy thereof to the 
society together with a certificate signed by him/her which shall be 
effective as prescribed in Section 13 (3). 
(iii) The Registrar shall not register any amendment of the Bye-Laws of a 
society, whether under this section or Section 13 of this Act, without 
the consent of the Government, if the effect of such amendment is to 
lessen the degree of control of the Government or of the Registrar as 
already provided for in the Bye-Laws. 
(iv) The Registrar may require any registered society to frame Rules of 
procedure under its Bye-Laws to govern any parts of its business and to 
send such Rules to him/her for prior approval. 
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(2) (i) 	 When it appears to an affiliating society or a financing bank that an 
amendment of the Bye-Laws of a registered society which is a member 
of such society or debtor of financing bank is necessary in the interest of 
the society it may suggest to the affiliated society or the debtor society, 
as the case may be, to make such amendment within such time as it 
may specify. The affiliating society, or the financing bank shall forward 
to the affiliated society, or the debtor society, as the case may be, a draft 
of the suggested amendment of the Bye-Laws. 
(ii) If the society fails to make the amendment within the time specified in 
the affiliating society or the financing bank may forward to the 
Registrar for amendment; and the Registrar, if satisfied that the 
amendment is necessary in the interest of the society and not contrary 
to the provisions of this Act or the Rules may thereupon after giving an 
opportunity of showing cause to the society concerned against the 
proposed amendment register the amendment and forward to the 
society a copy thereof together with a certificate signed by him/her. 
The certificate shall be conclusive evidence that the amendment has 
been registered and such amendment shall thereupon be binding upon 
the society and its members. 
(iii) If the Registrar considers that the amendment referred to in clause (ii) 
above is not acceptable, he/she shall submit a report to the 
Government. 
(iv) An affiliating society or a financing bank or the registered society if 
aggrieved by the decision of the Registrar may make an appeal to the 
Government. The orders of the Government on such appeal shall be 
final. 
(v) The State Government may out of its own motion or the Registrar 
subject to such direction as may be given by the Government, amend 
Bye-Laws of any society orgroup of societies in the interest of the public 
service. 
569 

15. Division and Amalgamation of societies: 
1. (i) Any registered society may, at a meeting of its General Assembly 
specially called for the purpose, resolve to divide into two or more 
societies. At least fifteen clear days' notice of such meeting with the 
agenda shall be given to its members together with a copy of the 
proposed resolution. 
(ii) Such a resolution shall contain the proposal as to how to divide the 
assets and liabilities of the society among the newly proposed 
societies, their areas of operation and the members who will constitute 
each of the newly proposed societies with draft of new Bye-Laws. 
(iii) A copy of the resolution shall be sent to the Registrar within thirty days 
of its adoption and subject to the Registrar's non-interference within 
thirty days of the dispatch to him/her of the resolution, the resolution 
shall be circulated amongthe members and creditors of the society. 
(iv) Notwithstanding any Bye-Laws to the contrary, any member of the 
society, and notwithstanding any agreement to the contrary, any 
creditor of the society may, by notice given to the society within thirty 
days of the receipt of the resolution, intimate in case of a member 
his/her intention not to become a member of any of the societies, and 
in case of a creditor his/her intention to demand a return of the amount 
due to him/her. 
(v) After the expiry of ninety days from the aforesaid resolution, a meeting 
of the General Assembly shall be convened for finally deciding the 
resolution. At least fifteen clear days' notice with the agenda of 
meeting shall be given to all members of the society. 
(vi) If the General Assembly decides by a three-fourth majority finally to 
divide the society and if the Registrar approves of the decision, the 
members, who will constitute each of the newly proposed societies 
subscribingto the new draft Bye-Laws shall apply to the Registrar under 
Section 10 for registration of the new societies and the Registrar shall 
register the society under Section 11. 
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(vii) The Registrar shall not register the new societies if the application for 
registration is not accompanied by a certificate of re-payment of share 
capital to members and certificate of satisfaction of claims to creditors 
referred to in clause (iv). 
(viii) From the date on which the new societies are registered under clause 
(vi) the registration of the old society shall be deemed to have been 
cancelled. 
(ix) The registration of the new societies shall be a sufficient conveyance to 
the vest the assets and liabilities of the original society according to the 
aforesaid resolution in the new societies. 
(2) (I) Two or more registered societies may, at a meeting of their respective 
General Assemblies specially convened for the purposed, by giving at 
least fifteen clear days' notice to the respective members of the 
societies, resolve to amalgamate into one society by adopting common 
Bye-Laws. 
(ii) A copy of such resolutions of each society shall be circulated forthwith 
among all members and creditors thereof. 
(iii) Notwithstanding any Bye-Laws to the contrary, any members of any 
such societies and notwithstanding any agreement to the contrary, any 
creditor of any such societies, may within a period of thirty days from 
the receipt of the aforesaid resolution, intimate his/her intention not to 
become a member of the new society, in the case of a member, and to 
demand a return of the amount due to him/her, in case of a creditor. 
(iv) After the expiry of ninety days from the date of the aforesaid 
resolution, a joint meeting of the members of such societies shall be 
convened to decide finallythe aforesaid resolution. 
(v) At least fifteen clear days' notice shall be given to all the members of 
the societies. If at such meeting the aforesaid resolution is confirmed by 
a majority of three-fourths of the members of each society present and 
the common Bye-Laws are accepted with or without any alterations, 
the Registrar shall be moved by an application under Section 10 for 
571 

registration and he/she shall register the new society under Section 11 
if he/she approves. 
(vi) The Registrar shall not register the new society if the application for 
registration is not accompanied by a certificate of repayment of share 
capital to members and a certificate of creditors referred to in clause 
(iii). 
(vii) From the date on which the new society is registered the registration of 
the old societies shall be deemed to have been cancelled. 
(viii) The registration of the new society shall be a sufficient conveyance to 
vest in all the assets and liabilities of the original societies. 
(3) (a) Notwithstanding anything contained in sub-sections (1) and (2) of this 
section if the Registrar is of opinion that, for reasons of ensuring 
economic liability of any registered society or societies or avoiding over 
lapping or conflict of jurisdictions of registered societies in any area or 
in order to secure proper management of any co-operative society or in 
the public interest or in the interest of the Co-operative Movement in 
the State as a whole, or in the interest of the depositors and the Co-
operative Banking System in the State as a whole, it is necessary to 
divide, amalgamate or merge fully or partially any such society or 
societies with any specified society, he/she may, by an order published 
in the Official Gazette make a scheme for Division, Amalgamation or 
Merger, with prior approval of the State Government. 
16. location of Head Office: 
(1) Every Co-operative Society shall specify the full address of its head 
office in its Bye-Laws. 
(2) The Board may subject to approval of the General Assembly change the 
address of its head at any time and shall make such amendment in its 
Bye-Laws as per provision laid down in Section 13. 
572 

17. Fees etc: 
(1) The registration fees of which the Registrar may prescribe and may be 
revised from time to time, shall have to be deposited by the purposed 
society. 
(2) Subject to the provisions of Sub section (3) of Section 76 and sub-
section (3) and (6) of Section 82 respectively, the Registrar may by an 
order prescribe a scale of fees to be paid by a Co-operative Society for 
various services rendered by him/her under this Act. 
CHAPTER III 
MEMBERSHIP 
18. 	 Eligibility of membership in Co-operative Society: 
1. Any person who needs the services of a Co-operative Society and 
expresses his/her willingness to accept the responsibilities of 
membership, meets such other conditions as may be specified in the 
Bye-Laws of the Co-operative Society and is in a position to use the 
service of the Co-operative Society may seek membership and if the Co-
operative Society is in a position to extend its service to the applicant, it 
admit as a member. 
2. Every applicant for membership and every member of a Co-operative 
Society shall keep each Co-operative Society of which the person is a 
member informed of membership in other Co-operative Society and in 
case of conflicting membership, the Board may, by resolution, refuse 
admission under Section 19 or terminate from membership under 
Section 23, as the case may be. 
Provided that no such resolution to refuse admission shall be passed 
without giving the applicant, as the case may be a reasonable 
opportunity to make representation to the board as to why he/she 
should not be refused admission. 
573 

19. Disqualification of membership: 
No person shall be eligible for admission as a member and a member 
shall cease to be a member of a Co-operative Society if he/she incurs 
disqualification of Membership prescribed in the Bye-Laws. 
20. Admission on members: 
1. The Board may admit a person for membership in accordance with the 
procedure laid down in the Bye-Laws within sixty days from the date of 
receipt of application for membership if he/she is eligible for 
membership under Section 18 or refuse admission to the applicant if 
he/she is not eligible for membership under Section 19 and 
communicate the same to the applicant by post or by hand. 
2. Where admission for membership is refuse under sub-section (1), the 
decision with the reason thereof shall be communicated to such 
applicant within ninety days from the date of application. If nothing is 
communicated within the period of ninety days specified above the 
admission shall be deemed to have been accepted bythe Board. 
3. where an application has been refused by the Board the applicant may 
appeal to the General Assembly within a period of sixty days from the 
date of receipt of the order of the refusal. The decision of the General 
Assembly shall be final and binding on all concerned parties. 
Provided that no decision of refusal of admission shall betaken by the General 
Assembly without givingthe applicant an opportunityof being heard. 
21. 	 Withdrawal of membership: 
1. 	 Subject to the provisions of sub-section (2) of Section 67, a member 
may, at any time after expiry of one year from the date of accepting 
membership, withdraw from membership in a Co-operative Society in 
accordance with the procedure laid down in Bye-Laws. 
574 

2. 	 The withdrawal from membership shall not require the person to fulfil 
such obligations as were undertaken or assumed as a member, under 
the provisions of the Act the Bye-Laws or any Agreement. 
	
22. 	 Cessation of membership: 
1. if any person having been admitted as a member of a Co-operative 
Society dies or Subsequently becomes subject to any of the 
disqualification specified in the Bye- Laws shall cease to be a member of 
the Co-operative Society. 
2. Every Co-operative Society shall inform in the event of receipt of 
information of The death of the member, the nominee of the member 
and in every other instance.. The member, about the cessation of 
membership, for the settlement of accounts. 
	
23. 	 Termination of membership: 
1. The Board may, by  resolution passed by the three fourth majority of the 
Directors present and voting at a meeting held for the purpose, 
terminate the membership o a member if he/she:- 
a) Intentionally does any act likely to injure the credit ability of the Co-
operative Society or bring it to disrepute, or 
b) wilfully deceives the Co-operative Society; or 
c) Has acted adversely to the objects or his/her act is detrimental to the 
interest of the Co-operative Society; or 
d) persistently makes default in payment of his/her dues or fails tc comply 
with the provisions of the Bye-Laws; or 
e) Having been admitted as a member subsequently becomes a member of 
any other society having common objective Co-operative functioning 
within the jurisdiction of the Co-operative Society of which he/she is a 
member; or 
f) Does not use the service of the Co-operative Society or he/she ceases 
to be a resident of the Area of Operation of the Society. 
575 

Provided that no such resolution shall be passed without giving the 
member concern a Reasonable opportunity to make representation at 
the Board Meeting. 
2. Any member aggrieved by the resolution passed under sub-section (1) 
may appeal To the General Assembly within thirty days of the receipt of 
such resolution. 
3. No member of a Co-operative Society whose membership has been 
terminated Under sub-section (1) shall be eligible for readmission as a 
member of the Co-Operative Society for a period as may be specified in 
the resolution but not Exceeding five years, subject to the condition 
that his/her conduct during the Period of expulsion sufficiently justified 
his/herfair conduct in the event of his/her enrolling membership again. 
24. 	 Register of members: 
1. Every Co-operative Society shall maintain a register of members. The 
name of every person admitted as a member of the Co-operative 
Society shall be entered in the register along with such particulars as 
may be deemed necessary bythe Board. 
2. The name of a person- 
I) 	 whose admission is refused under sub-section (2) of Section 20; or 
ii) who has withdrawn from membership under Section 21; or 
iii) who ceased to be a member under Section 22; or 
iv) whose membership has been terminated under Section 23 shall be 
deleted from the register of members. 
Provided that the name of the name of the person referred to in clause 
(i) or clause (iv) shall not be deleted from the register of members till 
expiry of 30 days from the date of the decisions of the Board or Annual 
General Meeting, as the case may be, and in case an appeal is preferred 
under sub-section (2) of Section 23 as the case may be. 
576 

The register maintained under sub-section (1) shall be prima fade 
evidence of the date on which any person was admitted to the Co-
operative Society as a member and of the date on which he/she ceased 
to be a member. 
25. Education of member etc: 
Every Co-operative Society shall include a certain amount in its budget 
annually, as provision for expenses on education of member and potential 
member, education and training of staff and directors for the development 
of their Co-operative Societies in accordance with the Co-operative 
Principles specified in Schedule 'A' and practises of co-operation, besides 
contributing at least 1% of profit or an amount specified by the Registrar in 
case of societies earning net profit, to State Co-operative Union for Co-
operative Education and Training. 
26. Rights and liabilities of members of registered societies and exercise of 
rights thereof: 
1) Every member of a registered society and every ex-officio member of 
the Administration Council or Managing Body of such society, unless 
under some temporary disqualification shall have the right to attend 
any Genera Meeting of the society and to exercise vote at such. 
meeting. 
2) No member of a Co-oper

Excerpt shown. Open the full act in Lexace.

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