Cooperative Society Registration

THE CO- OPERATIVE SOCIETIES ACT, 1912

ACT NO. 2 OF 1912 1 [ 1st March, 1912.] WH

The Act to amend the Law relating to Co- operative Societies.
1. Short title and extent.
(1) This Act may be called the Co- operative Societies Act, 1912 ; and
1. This Act has been declared to be in force in the Sonthal Parganas by notification under s. 3 of the Sonthal Parganas Settlement Regulation, 1872 (3 of 1872 ), see B. and O. Gazette, 1913, Pt. II, p. 105. It has been repealed in its application to-- (1) the Bombay Presidency by the Bombay Co- operative Societies Act, 1925 (Bom. 7 of 1925 ); (2) the Madras Presidency by the Madras Co- operative Societies Act, 1932 (Mad. 6 of 1932 ); (3) Bihar and Orissa by the B. and O. Co- operative Societies Act, 1935 (B. and O. 6 of 1935 ); (4) Orissa, separately, by the Orissa Laws Regulation, 1936 (1 of 1936 ); (5) Coorg by the Coorg Co- operative Societies Act, 1936 (Coorg 2 of 1936 ); (6) Bengal, with certain exceptions, by the Bengal Co- operative Societies Act, 1940 (Ben, 21 of 1940 ). (7) Vidarbha region of Bombay by Bombay Act 20 of 1960. (8) Mahakoshal region by M. P. Act 17 of 1961. It has been amended in-- (1) the U. P. by the Co- operative Societies (Amendment) Act, 1919 (U. P. 3 of 1919 ) and the Co- operative Societies (U. P. Amendment) Act, 1944 (U. P. 1 of 1944 ) as continued in force by the U. P. Expiring Laws Continuance Act, 1948 (U. P. 13 of 1948 ); U. P. Act 10 of 1957; (2) the C. P. by the Co- operative Societies (Central Provinces Amendment) Act, 1930 (C. P. 7 of 1930 ) and in C. P. and Berar by the following Acts as continued in force by the C. P. and Berar Expiring Laws Continuance and Amending Act, 1947 (C. P. and B. 48 of 1947 ):-- (i) the C. P. and Berar Co- operative Societies (Amendment) Act, 1940 (C. P. and B. 5 of 1940 ); (ii) the C. P. and Berar Co- operative Societies (Amendment) Act, 1941 (C. P. and B. 6 of 1941 ); (iii) the C. P. and Berar Co- operative Societies Amendment and Liquidators' Orders Validation Act, 1945 (C. P. and B. 10 of 1945 ); and (iv) Madhya Pradesh by M. P. Act 8 of 1954. Rep in its application to the Mahakoshal region by M. P. Act 17 of 1961. Repealed in its application to the Union territory of Andaman and Nicobar Islands vidi Regulation 3 of 1973.
(2) It extends to the whole of India except 1[ the territories which, immediately before the 1st November, 1956 , were comprised in Part B States].
2. Definitions. In this Act, unless there is anything repugnant in the subject or context,--
(a) " by- laws" means the registered by- laws for the time being in force, and includes a registered amendment of the by- laws:
(b) " committee" means the governing body of a registered society to whom the management of its affairs is entrusted:
(c) " member" includes a person joining in the application for the registration of a society and a person admitted to membership after registration in accordance with the by- laws and any rules:
(d) " officer" includes a chairman, secretary, treasurer, member of committee, or other person empowered under the rules or the by- laws to give directions in regard to the business of the society:
(e) " registered society" means a society registered or deemed to be registered under this Act:
(f) " Registrar" means a person appointed to perform the duties of a Registrar of Co- operative Societies under this Act: and
(g) " rules" means rules made under this Act. REGISTRATION
3. The Registrar. The State Government may appoint a person to be Registrar of Co- operative Societies for the State or any portion of it, and may appoint persons to assist such Registrar, and may, by general or special order, confer on any such persons all or any of the powers of a Registrar under this Act.
4. Societies which may be registered. Subject to the provisions hereinafter contained, a society which has as its object the promotion of the economic interests of its members in accordance with co- operative principles, or a society established with the object of facilitating the operations of such a
1. Subs. by the Adaptation of Laws (No. 2) Order, 1956, for" Part B States".
society, may be registered under this Act with or without limited liability: Provided that unless the State Government by general or special order otherwise directs--
(1) the liability of a society of which a member is a registered society shall be limited;
(2) the liability of a society of which the object is the creation of funds to be lent to its members, and of which the majority of the members are agriculturists, and of which no member is a registered society, shall be unlimited.
5. Restrictions on interest of member of society with limited liability and a share capital. Where the liability of the members of a society is limited by shares, no member other than a registered society shall--
(a) hold more than such portion of the share capital of the society, subject to a maximum of one- fifth, as may be prescribed by the rules; or
(b) have or claim any interest in the shares of the society exceeding one thousand rupees.
6. Conditions of registration.
(1) No society, other than a society of which a member is a registered society, shall be registered under this Act which does not consist of at least ten persons above the age of eighteen years and, where the object of the society is the creation of funds to be lent to its members, unless such persons--
(a) reside in the same town or village or in the same group of villages; or
(b) save where the Registrar otherwise directs, are members of the same tribe, class, caste or occupation.
(2) The word" limited" shall be the last word in the name of every society with limited liability registered under this Act.
7. Power of Registrar to decide certain questions. When any question arises whether for the purposes of this Act a person is an agriculturist or a non- agriculturist, or whether any person is a resident in a town or village or group of villages, or whether two or more villages shall be considered to form a group, or whether any person belongs to any particular tribe, class, caste or occupation, the question shall be decided by the Registrar, whose decision shall be final.
8. Application for registration.
(1) For purposes of registration an application to register shall be made to the Registrar.
(2) The application shall be signed--
(a) in the case of a society of which no member is a registered society by at least ten persons qualified in accordance with the requirements of section 6, sub- section (1); and
(b) in the case of a society of which a member is a registered society, by a duly authorised person on behalf of every such registered society, and where all the members of the society are not registered societies, by ten other members or, when there are less than ten other members, by all of them.
(3) The application shall be accompanied by a copy of the proposed by- laws of the 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 Registrar may require.
9. Registration. If the Registrar is satisfied that a society has complied with the provisions of this Act and the rules and that its proposed by- laws are not contrary to the Act or to the rules, he may, if he thinks fit, register the society and its by- laws.
10. Evidence of registration. A certificate of registration signed by the Registrar shall be conclusive evidence that the society therein mentioned is duly registered unless it is proved that the registration of the society has been cancelled.
11. Amendment of the by- laws of a registered society.
(1) No amendment of the by- laws of a registered society shall be valid until the same has been registered under this Act, for which purpose a copy of the amendment shall be forwarded to the Registrar.
(2) If the Registrar is satisfied that any amendment of the by- laws is not contrary to this Act or to the rules, he may, if he thinks fit, register the amendment.
(3) When the Registrar registers an amendment of the by- laws of a registered society, he shall issue to the society a copy of the amendment certified by him, which shall be conclusive evidence that the same is duly registered.
RIGHTS AND LIABILITIES OF MEMBERS
12. Member not to exercise rights till due payment made. No member of a registered society shall exercise the rights of a member unless or until he has made such payment to the society in respect of membership or acquired such interest in the society, as may be prescribed by the rules or by- laws.
13. Votes of members.
(1) Where the liability of the members of a registered society is not limited by shares, each member shall, notwithstanding the amount of his interest in the capital, have one vote only as a member in the affairs of the society.
(2) Where the liability of the members of a registered society is limited by shares, each member shall have as many votes as may be prescribed by the by- laws.
(3) A registered society which has invested any part of its funds in the shares of any other registered society may appoint as its proxy, for the purpose of voting in the affairs of such other registered society, any one of its members.
14. Restrictions on transfer of share or interest.
(1) The transfer or charge of the share or interest of a member in the capital of a registered society shall be subject to such conditions as to maximum holding as may be prescribed by this Act or by the rules.
(2) In case of a society registered with unlimited liability a member shall not transfer any share held by him or his interest in the capital of the society or any part thereof unless--
(a) he has held such share or interest for not less than one year; and
(b) the transfer or charge is made to the society or to a member of the society. DUTIES OF REGISTERED SOCIETIES
15. Address of societies. Every registered society shall have an address, registered in accordance with the rules, to which all notices and communications may be sent, and shall send to the Registrar notice of every change thereof.
16. Copy of Act, rules and by- laws to be open to inspection. Every registered society shall keep a copy of this Act and of the rules governing such society, and of its by- laws, open to inspection free of charge at all reasonable times at the registered address of the society.
17. Audit.
(1) The Registrar shall audit or cause to be audited by some person authorised by him by general or special order in writing in this behalf the accounts of every registered society once at least in every year.
(2) The audit under sub- section (1) shall include an examination of overdue debts, if any, and a valuation of the assets and liabilities of the society.
(3) The Registrar, the Collector or any person authorised by general or special order in writing in this behalf by the Registrar shall at all times have access to all the books, accounts, papers and securities of a society, and every officer of the society shall furnish such information in regard to the transactions and working of the society as the person making such inspection may require. PRIVILEGES OF REGISTERED SOCIETIES
18. Societies to be bodies corporate. The registration of a society shall render it a body corporate by the name under which it is registered, with perpetual succession and a common seal, and with power to hold property, to enter into contracts, to institute and defend suits and other legal proceedings and to do all things necessary for the purposes of its constitution.
19. Prior claim of society. Subject to any prior claim of the Government in respect of land- revenue or any money recoverable as land- revenue or of a landlord in respect of rent or any money recoverable as rent, a registered society shall be entitled in priority to other creditors to enforce any outstanding demand due to the society from a member or past member--
(a) in respect of the supply. of seed or manure or of the loan of money for the purchase of seed or manure- upon the crops or other agricultural produce of such member or person at any time within eighteen months from the date of such supply or loan;
(b) in respect of the supply of cattle, fodder for cattle, agricultural or industrial implements or machinery, or raw materials for manufacture, or of the loan of money for the purchase of any of the foregoing things- upon any such things so supplied, or purchased in whole or in part from any such loan, or on any articles manufactured from raw materials so supplied or purchased.
20. Charge and set- off in respect of shares or interest of member. A registered society shall have a charge upon the share or interest in the capital and on the deposits of a member or past member and upon any dividend, bonus or profits payable to a member or past member in respect of any debt due from such member or past member to the society, and may set off any sum credited or payable to a member or past member in or towards payment of any such debt.
21. Shares or interest not liable to attachment. Subject to the provisions of section 20, the share or interest of a member in the capital of a registered society shall not be liable to attachment or sale under any decree or order of a Court of Justice in respect of any debt or liability incurred by such member, and neither the Official Assignee under the Presidency- towns Insolvency Act, 1909 (3 of 1909 ), nor a Receiver under the Provincial Insolvency Act, 1907 1[ (3 of 1907 ), shall be entitled to or have any claim on such share or interest.
22. Transfer of interest on death of member.
(1) On the death of a member a registered society may transfer the share or interest of the deceased member to the person nominated in accordance with the rules made in this behalf, or, if there is no person so nominated, to such person as may appear to the committee 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 or by- laws: Provided that--
(i) in the case of a society with unlimited liability, such nominee, heir or legal representative, as the case may be, may require payment by the society of the value of the share or interest of the deceased member ascertained as aforesaid;
(ii) in the case of a society with limited liability, the society shall transfer the share or interest of the deceased member to such nominee, heir or legal representative, as the case may be, being qualified in accordance with the rules and by- laws for membership of the society, or on his application within one month of the death of the deceased member to any person specified in the application who is so qualified.
1. See now the Provincial Insolvency Act, 1920 (5 of 1920 ).
(2) A registered society may pay all other moneys due to the deceased member from the society to such nominee, heir or legal representative, as the case may be.
(3) All transfers and payments made by a registered 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.
23. Liability of past member. The liability of a past member for the debts of a registered society as they existed at the time when he ceased to be a member shall continue for a period of two years from the date of his ceasing to be a member.
24. Liability of the estates of deceased member. The estate of a deceased member shall be liable for a period of one year from the time of his decease for the debts of a registered society as they existed at the time of his decease.
25. Register of members. Any register or list of members or shares kept by any registered society shall be prima- facie evidence of any of the following particulars entered therein:--
(a) the date at which the name of any person was entered in such register or list as a member;
(b) the date at which any such person ceased to be a member.
26. Proof of entries in societies books. A copy of any entry in a book of a registered society regularly kept in the course of business, shall, if certified in such manner as may be prescribed by the rules, be received, in any suit or legal proceeding, as prima- facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions and accounts therein recorded in every case where, and to the same extent as, the original entry itself is admissible.