Co-Operative Societies in India
Co-operative organization is a society which has as its objectives the promotion of the interests of its members in accordance with the principles of cooperation. It is a voluntary association of ten or more members residing or working in the same locality, who join together on the basis of equality for the fulfillment of their economic or business interest. The basic feature which differentiates the co-operatives from other forms of business ownership is that its primary motive is to provide services to the members rather than making profits.
There are different types of cooperatives like consumer co-operatives, producer's co-operatives, marketing co-operatives, housing co-operatives, credit co-operatives, farming co-operatives etc. The aim of all such co-operatives is to promote the welfare of their members.
Its main features are:
- It is a voluntary organization as a member is free to leave the society and withdraw his capital at any time, after giving a notice.
- The minimum number of members is 10, but there is no limit to the maximum number of members. However, the members must be residing or working in the same locality.
- Registration of a co-operative enterprise is compulsory. A co-operative society may be registered with the Registrar of Co-operatives Societies.
- After registration, co-operative enterprise becomes a body corporate independent of its members i.e. a separate legal entity.
- It is governed by the provisions of the Co-operative Societies Act, 1912 or State Co-operative Societies Acts. It has to submit annual reports and accounts to the Registrar of Societies.
- The liability of every member is limited to the extent of his capital contribution.
- The shares of co-operative society cannot be transferred but can be returned to the society in case a member wants to withdraw his membership.
- Being a separate legal entity a co-operative enjoys continuity of existence which is not affected by death, insolvency, retirement, etc. of the members.
- More capital investment and credit opportunities
- Better conditions of service to employees
- Perpetual existence
- Limited liability
- Inability to allocate sufficient capital
- Inability to provide efficient managerial services
- Organizational constraint
Procedure for registration of Co-operative Societies:
- The first Step is to bring together 10 Individuals, who are desirous of forming a Society
- A Provisional Committee should be formed and a chief Promoter should be elected from elected ones.
- A name for the Society has to be selected.
- An application has to be made to the Registration Authority for reservation of name and a letter to that effect has to be obtained confirming the reservation of Name. The reserved name is valid for only 3 months unless application for registration of the society is submitted to the Registrar of Societies within the said period.
- The entrance fees and share capital has to be collected from the prospective members.
- A Bank account has to be opened in the name of the proposed society. The entrance fees and share money has to be deposited in such bank account and the certificate has to be obtained in that respect, from the bank.
- The registration fee has to be deposited with the Reserve Bank of India and acknowledgment thereof is to be obtained.
- The application for registration of the society should be submitted to the Registrar of Societies of the concerned municipal ward. The documents to be submitted for registration are as follows:
(a) Form No. A in quadruplicate signed by 90% of the promoter members
(b) List of promoter members
(c) Bank Certificate (as mentioned in point no. 6)
(d) 4 copies of proposed bye-laws of the society
(e) Proof of payment of registration charges.
(f) Detailed explanation of working of the society.
(g) Other documents like affidavits, indemnity bonds, any documents specified by the
- The Registrar will enter the particulars in register of application maintained in Form 'B' and give serial number and issue receipt in acknowledgment of the same.
- On registration, the Registrar will notify the registration of the Society in the Official Gazette and issue Registration Certificate.