The Multi-State Cooperative Societies Act, 1984

CHAPTER III: MEMBERS OF MULTI-STATE COOPERATIVE SOCIETIES AND THEIR RIGHTS AND LIABILITIES

19. Persons who may become members -

(1) No person shall be admitted as member of a multi-State cooperative society except the following, namely :-

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

(b) any multi-State cooperative society or any cooperative society;

(c) the Central Government;

(d) a State Government;

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

(f) any other corporation owned or controlled by Government;

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

(h) such class or classes of 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;

(2) Such number of individuals possessing such qualifications as may be prescribed may be admitted as members of the National Cooperative Union of India Limited, New Delhi.

(3) Save as otherwise provided in sub-section (2) and notwithstanding anything contained in sub-section (1) no individual shall be eligible for admission as a member of a national cooperative society.

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

(5) 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.

(6) Notwithstanding anything contained in this section, the Central Government may, having regard to the fact that the interest of any person or class of persons conflicts or is likely to conflict with the objects of any multi-State cooperative society or class of multi-State cooperative societies, by general or special order published in the Official Gazette, declare that any person or class of persons engaged in or carrying on any profession, business or employment shall be disqualified from being admitted, or for continuing, as members or shall be eligible for membership only to a limited extent of any specified multi-State cooperative society or class of multi-State cooperative societies, so long as such person or persons is or are engaged in or carrying on that profession, business or employment, as the case may be.

20. 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 such payments to the society in respect of membership, or has acquired such interest in the society, as may be specified in the bye-laws.

21. Expulsion of members -

(1) 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.

(2) No member of the multi-State cooperative society who has been expelled under sub-section(1) shall be eligible for readmission as a member of that society, for a period of three years from the date of such expulsion:

Provided that the Central Registrar may, on application of the multi-State cooperative society and if satisfied that in the special circumstances of the case, it is necessary so to do in the interests of the multi-State cooperative society, sanction the re-admission or admission within the said period, of any such members as a member of the said society.

22. Votes 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) a member who is an employee of such society shall not be entitled to vote -

(i) at an election of a member of the board of such society.

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

(b) in the case of an equality of votes, the Chairman shall have a second or casting vote;

(c) where any of the authorities referred to in clauses (c) to (g) of sub-section (1) of section 19 is a member of a Multi-State cooperative society, each person nominated by such authority, on the board, in accordance with the provisions contained in this Act and the rules, shall have one vote;

(d) a multi-State cooperative society, the members of which include cooperative societies or other multi-State cooperative societies, may provide 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 and other relevant circumstances.

23. 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 which is a member of another multi-State cooperative society, may, subject to the provisions of sub-section (3) of section 29 and the rules, appoint its representative to vote on its behalf in the affairs of that other society.

24. Restrictions on holding of shares -

No member, other than any of the authorities referred to in clauses (c) to (g) of sub-section (1) of section 19 or a multi-State cooperative society or a cooperative society, shall hold more than such portion of of the total share capital of the society (in no case exceeding one-fifth thereof) as may be prescribed;

Provided that the Central Government may, by notification, specify in respect of any class of societies a higher or lower maximum than one-fifth of the share capital.

25. Restrictions on transfer of shares or interest -

The transfer of the 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 are specified in section 24.

26. Redemption of share -

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 19 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.

27. Transfer of interest on death of members -

(1) On the death of a member of multi-State cooperative 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 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 members 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;

(2) 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.

(3) All transfer 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.

28. Liability of past member and estate of deceased member -

(1) 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; -

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

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

(2) Notwithstanding anything contained in sub-section(1), where a multi-State cooperative society is ordered to be wound up under section 77, 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.