Directed by the Co-operative Societies Act 2002, these are Multi state co-operative societies that have operations in more than one state like FPOs. Part IXB (likewise embedded by the 97th amendment) of the Indian constitution is applicable just to multi-state co-operative societies which are in accordance with the Hon’ble SC decision, as states have the jurisdiction to enact state co-operative societies.
The Union government has given the sign of approval for the Multi-State Co-operative Societies (MSCS) (Amendment) Bill, 2022. The new change tries to further develop the MSCS Act of 2002 as the new bill will further develop administration, increment accountability, and better transparency in the cooperative sector area. This bill would likewise increase the democratic working of the sector as an election body will be entrusted with directing free, fair, and opportune decisions. The alteration further tries to lessen the ideal time for registrations thereby making business easy.
The previous Act had put the obligation of election to the board on the existing directors. Yet, the amendment to the existing Act looks to lay out a different body that will supervise elections. The ‘Cooperative elections authority’ would include a chairperson, a vice chairperson, and 3 additional members that will be appointed by the union government.
This dedicated body entrusted with regulating elections will introduce a genuinely democratic reform in the cooperative sector.
Merger and division
The bill tries to merge both union and division of the MSCS. Be that as it may, to empower such a dichotomous cycle, the general assembly would need to pass the resolution. What’s more, a majority part or two third of the vote would be expected to pass the resolution. The bill also subtleties the process of the merger of state cooperatives with the MSCS.
The role of the central government
The new bill looks to give overriding powers to the central government. The union government can coordinate the board of the MSCS on which it is the majority shareholder or at least a 51% shareholder. Indeed, even loans provided to any MSCS fall under the domain of the Union government.
Co-operative Ombudsman: The central government will appoint at least one such Ombudsman with regional jurisdiction. They will finish the process of inquiry and adjudication within 90 days from the receipt of the complaint. The appeal should be in no less than a month before the central registrar is appointed by the central government.
Limitation on redemption of government Shareholding
Any shares held by the central and state legislatures can’t be redeemed without their prior endorsement.
Reserve for debilitated cooperative societies
Co-operative Rehabilitation, Reconstruction, and Development Fund: Multi-state cooperative societies that are in profit for the first three financial years shall finance the fund.
Significance of the Bill:
By expanding their straightforwardness and executing a system of frequent election, it will fortify cooperatives. The Bill means to resolve issues with the operation and governance of cooperative societies as well as coordinate its provisions with those in Part IXB of the Constitution.
Objections connected with the Bill:
Forcing an expense on well-functioning societies: Wiped-out multi-state co-operative societies will be revived by a fund that will be supported through contributions by profitable multi-state co-operative societies.
Weaken independence and freedom of co-agents: By enabling the public authority to limit reclamation of its shareholding in multi-state co-usable social orders.
Conclusively , the multi-State Co-operative Societies (Amendment) Bill, 2023 lays out the Co-operative Election Authority to direct and supervise elections to the boards of multi-state co-operative societies, permits state co-operative societies to merge into an existing multi-state co-operative society, lays out the Co-operative Rehabilitation, Reconstruction and Development Fund for revival of sick multi-state co-operative societies and also permits the central government will appoint one or more Co-operative Ombudsman with territorial jurisdiction to will inquire into complaints made by members of multi-state co-operative societies.