Frequently Asked Questions (F.A.Q.)
Some other pertinent and relevant information.
Q.1What is Cooperation ?
According to Charles Guide, an economic historian, "Cooperation is self-help and each for all (mutual-aid)". Self-help here means the pride of supplying one's own needs by one's own resources, of being one's own merchant banker, money lender and employer. "Each for all" means to seek liberation, not only for oneself but for and through others".
Q.2 What is Cooperatives ?
According to International Cooperative Alliance (I.C.A. , Manchester , U.K. ), 1995, "a cooperative is an autonomous association of persons united voluntarily to meet their common, economic, social and cultural/needs and aspirations through a jointly owned and democratically - controlled enterprise"
Q.3 What is a Cooperative Society ?
An autonomous open and voluntary association of persons of the weaker section of the society, to meet their common socio-economic and cultural needs and aspiration through a jointly owned and democratic control enterprise in accordance with the cooperative values and principles.
Q.4 Requirement for forming a Cooperative Society
- Public/Society awareness of the socio-economic development potentiality of the Cooperative sector/Cooperative Movement.
- Awareness of Cooperative values and principles.
- An initial open and voluntary association of 15 individual (promoters) to promote and intended Cooperative society.
Qualification for Membership
- An adult = 18 years of age.
- Sound mind.
- A resident within the intended Area of Operation.
- Not a defaulter of another registered cooperative society (to be certified).
- Not in insolvent.
- Not convicted for mis-appropriation or moral turpitude.
- The fifteen members known as Promoters will submit their application in plain paper or in the form available in the office of the Assistant Registrar of Cooperative Societies of the respective district for registration of the proposed Cooperative Society.
Q.5 What are Cooperative Values?
Cooperative Values are based on : Self-help, Self-responsibility, Democracy, Equality, Equity and solidarity
Q.6 What are the principles of cooperation?
Cooperative Principles are set of basic guidelines by which cooperatives put their values into practice.
The seven basic corner stone of Cooperative principles are :
- Voluntary and open membership
- Democratic member Control
- Member economic participation
- Autonomy and Independence
- Education, Training and Information
- Cooperation among Cooperatives
- Concern for community
Q.7 What is the procedure for Registration of cooperative Society ?
On receiving such applications the Assistant Registrar through his subordinate will conduct an inquiry to find out the feasibility and economic viability of the proposed Cooperative Society and whether its proposed bye laws conforms to the Meghalaya Cooperative Acts and Rules. In case a proposed Cooperative Society is either a, Fishery,/ Dairy/, Poultry/, Piggery/or Handloom etc., views and comments from concerned department has to be obtained before registration of such society.
after inquiry report with views and comments from concerned Department are found favorable, Permission is given to complete the necessary formalities for Registration.
A date will be fixed for holding the inaugural general meeting of the promoter in which members will finally decide on adoption of the Bye-Laws and matters concerning with day-to-day functioning of the Society including constitution of Managing Committee, operation of Bank Account etc.
In the inaugural General Meeting, one of the Promoters presided over the meeting. An officer from the Department is deputed to attend the meeting and help the promoters in organizational matters. In this meeting they will decide what type of a Society they want to form, how many persons would join as members of the Society ,l elect the office bearers of the society and decide the authorized share capital and the share capital to be contributed by each members.
All the papers duly signed by the Promoters are to be submitted to Assistant Registrar of Cooperative Societies who after satisfying himself on all points, register the society and its Bye-laws.
The certificate of Registration in the form set forth and the schedule is issued by Asstt. Registrar of Cooperative Societies after registration of the society. A copy of registration with Bye-laws are sent to the applicant and also to concerned Departments.
Q.8 What are the origins of cooperative movement in India?
Due to the misuse and abuse of agency system for rural credit by landlords, money lenders, zamindars during British Rule in India, there were great consternation and revolt by farmers in some parts of India . This led to search for some reform models.
Nicholson, a British Officer, heading a commission suggested 'Find Raiffersen in India ', which meant Raiffersen model of German agricultural credit Cooperatives for India . There were other simultaneous recommendation for agricultural credit and the first Cooperative Society Act of 1904 was enacted to enable formation of "agricultural credit cooperatives". The 1904 Cooperative Societies Act was later repealed by 1912 Cooperative Societies Act which provided for formation of Cooperative societies other than credit. In 1919 there was Administrative Reforms and Cooperatives were made a provincial subject making each province responsible for Cooperative movement and development.
In 1942, the Multi-Unit Cooperative Societies Act, 1942 was enacted by the Government of India with an object to cover societies whose operations are extended to more than one state. Later, in 1984, the Government of India enacted a comprehensive Act known as Multi State Cooperative Societies Act, 1984, which also repealed the Act of 1942. On the recommendation of the Mirdha Committee and the "Model Cooperative Societies Act" the Government of India enacted the Multi State Cooperative Societies Act, 2002 which provided for democratic and autonomous working of the Cooperatives. The Multi State Cooperative Societies Act, 2002 came into force with effect from August 19, 2002.
Q.9 Which are the institutions working for the development of cooperative movement in India?
National Cooperative Development Corporation (N.C.D.C.), National Cooperative Union of India (N.C.U.I.), National Agricultural Co-operative Marketing Federation of India (N.A.F.E.D.), Tribal Co-operative marketing development federation of India Limited, Indian Farmers Fertiliser Cooperative Limited (I.F.F.C.O.), Krishak Bharati Co-operative Limited (K.R.I.B.H.C.O.), National Bank for Agriculture and Rural Development (NABARD), National Federation of State Co-operative Banks Limited (N.A.F.S.C.O.B.), Gujarat Cooperatives Milk Marketing Federation Limited (A.M.U.L.), National Dairy Development Board (N.D.D.B.) and Vaikunth Mehta National Institute of Co-operative Management are some of the important agencies working for promotion of cooperative movement in India.
Q.10 Who can become members of a cooperative society in India?
Persons who may become members of a Cooperative society at State level is as per the State Act. Generally
- an individual competent to Contract, attained majority and is of sound mind and belongs to a class of persons if any for whom the society is formed as per its bye-laws;
- a society registered or deemed to be registered under the Cooperative Societies Act;
- the Government;
No individual shall be eligible for admission as a member of a federal society
Persons who may become members of a Multi-State Cooperative Society: (As per Multi-State /cooperative Societies Act, 2002).
- an individual, competent to contract under section 11 of the Indian contract Act, 1972.
- any multi-state Cooperative society or any Cooperative society.
- the Central Government
- a State Government
- National Cooperative Development Corporation (N.C.D.C.)
- any other Corporation armed or controlled by the Government.
No individual person shall be eligible for admission as a member of a national Cooperative society or a federal Cooperative.
Q.11 What are the steps / check list for forming a cooperative society?
Important steps involved for forming a Cooperative Society:
- Prescribed application duly filled in shall be made to the Registrar of Cooperative societies;
- the application shall be accompanied by four copies of the proposed Bye-laws of the society;
- Where all the applicants are individuals, the number of applicants shall not be less than ten;
- the application shall be signed by every one of such applicants if the applicants are individuals;
- if the applicant is a society, by a member duly authorised by such society;
For a Multi-State Cooperative society,
- An application for registration of a Multi-State Cooperative society shall be made in the prescribed form;
- the application shall be signed by;
- 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 states concerned.
- In case 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;
- In case the members are other Multi-State Cooperative Societies and other Cooperative Societies, by duly authorised representatives of each of such societies;
- If the members are cooperative societies or multi-state Cooperative societies and individuals, by at least (i) fifty persons, being individuals from each of the two states or more and; (ii) 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.
- Name of the proposed multi-state cooperative society;
- Head Quarters and address to be registered;
- Area of operation;
- Main objectives
- a certificate from the Bank
- Stating credit balance there in favour of the proposed Multi-State Cooperative Society.
The relevant application forms can be obtained from the Office of Registrar of Cooperatives nearest to you.
Q.12 Which are the laws that regulate cooperative societies in India?
Laws regulating Cooperative Societies in India are:
- State Cooperative Societies Acts of individual states e.g. Meghalaya
- Multi-State Cooperative Societies Act, 2002 for the multi-state Cooperative societies with Area of operation in more than one State.
Q.13 What is Multi-state Cooperative Act ?
A multi-state Cooperative Society means a society registered or deemed to be registered under the Multi-State Cooperative Societies Act, 2002 and includes a national Cooperative society or a Federal Cooperative.
Q.14 Who will be responsible for the Executive Management of the Society ?
As per provision in the Meghalaya Cooperative Societies Acts and Bye-laws of the Society, the members of the Managing Committee elected by the General Body Meeting are responsible managing the affairs of the Society. The Managing Committee members are elected annually from among the members of the Society in the annual general assembly / General Meeting.
Q.15 Financial Resources for running the Society ?
- Share Capital Contributed by members.
- Monthly Contribution deposited by members.
- Borrowing from State Cooperative Banks and other financing agencies.
- Financial Assistance provided by the State Government and in some cases by the Central Government.
Q.16 How to amend a Registered Bye-law : Act. Sec.13.
From time to time a Society may amend its Bye-law by altering/rescinding/canceling or by inserting a new clause as a new Bye-law.
Rule 9 (I) : Meghalaya Cooperative Societies Rules says, No amendment of the Bye-laws (of the Registered Cooperative Society) shall be valid until such amendment has been registered under the Act [Sec. 13(3)].
Why and what to amend :
- Modification of existing provisions.
- Deletion of existing provisions.
- Inserting of new provisions.
- Complete amendment/constituting a new Bye-law.
Amendment can be made :
- At the instance of the Society :- By a resolution passed by a majority of the members of the General Meeting where not less than two third members are present.
- At the direction of the Registrar
- At the suggestion of affiliating Society.
Q.17 How to amend a Registered Bye-Laws ?
- In every case of amendment of Bye-laws the approval of the General Body Meeting is needed. The application in the form set forth in the schedule for Registration of a new or altered bye-law as for the abrogation of an existing bye-law shall be submitted to Registrar of Cooperative Societies or Asstt. Registrar of Cooperative Societies. It should be signed by the members of the Managing Committee.
- The date of the meeting of the General Assembly at which the amendment was passed.
- The number of members on the role of the society on the date of issue of the General Meeting.
- Number of members present in the meeting.
- The number of members who voted in support of the amendment.
- If the Assistant Registrar of Cooperative Societies refuses to Register an amendment of Bye-laws he should record in writing the reason for his refusal and communicate his decision to the Society.
- The application for Registration of amendment of Bye-laws should be submitted alongwith a copy of Resolutions passed by the Annual General Meeting along with four copies of the existing Bye-law. A fifth copy is required in case of an officiating society, to the Assistant Registrar of Cooperative Societies.
- When the Assistant Registrar of Cooperative Societies register an amendment of Bye-laws, he return the old Bye-laws to the Society after duly corrected and attested by him alongwith a certificate for registration of amendment of Bye-laws set forth in the schedule.
Q.18 Details of Financial Assistance provided to Cooperative Societies by the Government
In order to promote and develop the Coop. Societies in the State, the State Government provide financial assistance to Cooperative Societies in the form and nature given below :-
- Share Capital Contribution for strengthening the Share Capital base of the Society.
- Managerial Subsidy for meeting the managerial expenses of Societies.
- Assistance to Coop. Societies to utilize as margin money for borrowing from financial institutions.
- Loan and Subsidy for construction of Godown/Workshed of Primary Weavers Society.
- Working Capital Loan.
- Loan for purchase of Plant and Machineries.
- Loan for purchase of furniture and fixtures.
- Loan and subsidy for repair/renovation of Cooperative Godowns.
- Subsidy for publicity and motivational programmes.
Q.19 Organisation of the Cooperative Department in Meghalaya
In Meghalaya Department of Cooperation has been set up with a separate administrative department for promotion of the Cooperative Movement which is headed by a Cabinet Minister. In the Secretariat, the department is headed by the Commissioner and Secreatry and is supported by officers and staff. At the Directorate Level, the Office of the Registrar of Cooperative Societies is headed by the Registrar of Cooperative Societies at the top. He is assisted by J.R.C.S., A.R.C.S., S.R.C.S. and other officials and staff. At the District Level, at the present we have 7 Numbers of Districts headed by Assistant Registrar of Cooperative Societies and 3(three) Civil Sub-Division headed by Sub-Registrar of Cooperative Societies. There is 1(one Zonal Officer in the rank of D.R.C.S.) who is to look after the 3(three) Districts at Garo Hills. Then comes the Senior Cooperative Officers and Junior Cooperative Officer who will look after the welfare of the Cooperative Societies. For the smooth and speedy progress of the Cooperative Movement in the State, a separate Organizational structure in details as per Item Number 17 has been enclosed.
Q.20 Laws of Cooperatives in the State
The "Meghalaya Cooperative Societies Acts"
(Assam Act. 1 of 1950, as adopted by Meghalaya).
"The Meghalaya Cooperative Societies Act" is supported by "The Meghalaya Cooperative Societies Rules" (The Assam Rules, 1953 as adopted by Meghalaya).
Rules : Rules are framed to support the Act. Rules are procedures to implement the Act
Bye-Laws : Framed as sub-laws to suit the various types of Society within the purview of the Act and Rules. (The Bye-law cannot over ride/over rule and provisions within the State Cooperative societies Act and Rules).
Q.21 Cooperative Societies that can be form in Meghalaya
Any type of Cooperative Society which has as its chief objective, the promotion of the economic interest and general welfare of the members in accordance with Cooperative Principles, or a Society established with the object of facilitating the operation of such a Society including a Society formed by the division of an existing registered Cooperative Society or amalgamation of existing two or more Societies may be registered under the "Meghalaya Cooperative Societies Act" (Assam Act 1 of 1950, as adopted by Meghalaya) with or without limited liabilities.
Q.22 Categorisation By Status And Operation Cooperative Societies
- State/Apex Level.
- District Level.
- Primary/Grass Root Level.
- Meghalaya Cooperative Apex Bank Limited (M.C.A.B.)
- Meghalaya State Housing Financing Cooperative Society Limited (M.S.H.F.C.S.)
- Meghalaya Apex Handloom Weaving and Handicrafts Cooperative Federation Limited (M.A.H.W.H.C.F.)
- Meghalaya State Cooperative and Consumers Federation Limited (M.E.C.O.F.E.D.)
- Meghalaya State Cadre Management Cooperative Societies (M.S.C.M.C.S.)
- Meghalaya State Cooperative Union Limited (M.S.C.U.)
District Level : Nil.
Primary / Grass Root Level :
A. Credit Societies :
Primary Agricultural Credit Societies: P.A.C.S. Employees Credit/Thrift Cooperatives (E.C.S.).
B. Non-Credit Societies :
- Joint/Collective Farming
Poultry and Piggery.
Audit Classification of Cooperative Societies. (Cooperative Audit, Financial and Administrative Audit).
- Financially Strong.
- Avail no external Finance/Supervision.
- Uphold Cooperative Principles adequately.
- No over dues.
- Profit Making.
B Class :
- Financially strong.
- Require external financial assistance and Supervision.
- Overdues = 25% of Total Outstanding.
C Class :
- Financially weak.
- Require external financial assistance and Supervision.
- Overdues = 25% 50% of Total Outstanding.
D Class :
- Management has collapse.
- Overdues = 50%.
Q.24 How does a multi-state cooperative society differ from a company?
|Serial Number||Item||Co-operative Society||Company|
|Object||Interest of members and community paramount. Basic principle of cooperation||Self interest either of management or the share holders; profit as motive|
|1||Management||Chairperson is elected by the Board of Directors from among members. The Managing Director / Chief executive is appointed by the Board of Directors||Usually, Chairperson / Managing Director are persons with maximum number of shares in the company|
|2||Number of members||In case societies
are members of a Multi State Cooperative Society, two societies from different states should sign the application of registration of the society. If a Multi State Cooperative Society is a member then the multi state cooperative and a society should sign the application of registration. Minimum number of members should be 50 for a multi state cooperative society from each state in case of individual membership.
|In a public limited company, minimum number of members should be 7 and in a private limited company minimum number of members should be 2|
|3||Share Capital||The shares of cooperative society are not issued to general public by advertisement and can be issued any time. Shares can be withdrawn member/ society as prescribed by rules in their byelaws.||Shares are issued to general public or by invitation. In a company shares cannot be withdrawn by a share holder.|
|4||Share Types||Only equity shares are available||Equity and preferential shares may be issued|
|5||Voting Rights||Member of a cooperative society have right of only one vote, irrespective of the number of shares held of any denomination.||Voting rights depend directly on the holding of shares|
|6||Control||The Central registrar of Cooperatives advises in the affairs of a multi state society||Companies are governed by the Company Registrar of the states where its registered office is located|
|7||Profit Distribution||Minimum 25% of net profits should be transferred to the General reserve and the maximum dividend cannot exceed 20%||No restrictions on a company|
|8||M.R.T.P. Act||Not applicable to Multi State Societies||Applicable|
|9||Participation of Workers||Provision for workers participation in the management through a representative exists.||No such provision for workers|
|10||Taxes||Cooperatives are exempt from few taxes in some states like stamp duty. Tax rates also vary||No exemptions provided|