Bye-laws
“Bye-law” refers to the registered bye-laws of a Society for the time being in force and includes registered amendments of bye-laws of a Society;
“Co-operative Society” or “society” means a Co-operative Society registered under this Act and includes a society formed after amalgamation of such two or more societies or by division of an existing society;
Byelaws of a cooperative society -Sec 9
(1) A cooperative society shall frame their own bye-laws and the affairs of the cooperative society shall be managed in accordance with the terms, conditions and procedure specified in the bye-laws
(2) Subject to the provisions of this Act, the functioning of every cooperative society shall be regulated by its bye-laws.
(3) The bye-laws may contain such matters as decided by the General Assembly and shall be specific and confined only to the matters provided in Schedule B. However, the bye-laws of a society shall in no case supersede the provisions of the Act.
Note– a society which has as its chief object the promotion of the economic interest and general welfare of its members in accordance with cooperative principles laid down in Schedule ‘A’ may be registered under this Act. The Registrar shall register the society and also take on record its bye-laws and communicate by registered post a certificate of registration
Subject matter for specific consideration when framing Bye-laws
1- Identity of the cooperative society:
(a) the name of the cooperative;
(b) the village/town/city where the Head Office of the Cooperative society is to be located;
(c) the custody and use of the common seal;
(d) the area of operation from where the membership is to be draw.
2- Aim and services:
(a) the aim of the cooperative society explicitly stated as a common need of the members which the cooperative society aims at fulfilling;
(b) key service and support services to members to fulfill the common need stated in the aim;
(c) the conditions under which-services may be provided to non-membership.
3- Membership :
(a) eligibility, ineligibility for obtaining membership;
(b) eligibility, ineligibility for continuing membership;
(c) procedure for obtaining membership;
(d) procedure for withdrawing membership;
(e) procedure for termination of membership;
(f) circumstances under which membership ceases;
(g) procedure for cessation of membership.
4- Member rights and obligations :
(a) the rights of members;
(b) manner of fixation of minimum performance expected annually of each member vis-a-vis use of services, financial commitment, participation in meetings and adherence to bye-laws, in order to be eligible to exercise the rights of membership including the right to vote;
(c) the consequences of performing below the minimum level fixed;
(d) the consequences of default in payment of any sum due by a member.
5- General Body:
(a) the role of the general body and of the delegate General body, if any, and subjects which must be dealt with by the general body, and by the representative general body, if any;
(b) the manner and frequency of convening general meetings, the mode of communication of the intimation of these meetings and quorum required;
(c) the minutes of proceedings of general meetings.
6- Board of Directors:
(a) The size and composition of the Board of Directors;
(b) Eligibility, ineligibility for becoming Director;
(c) Eligibility, ineligibility for retaining Directorship;
(d) The procedure for election including the appointment of election officer, removal of Directors, the election of the President, Vice4President, and representative and filling of casual vacancy;
(e) The terms of office of the Directors;
(f) The frequency of board meetings;
(g) The manner of convening board meetings, and quorum;
(h) The functions, responsibilities and powers of the-Board;
(i) The minutes of proceedings of Board meetings;
(j) The functions, responsibilities and powers of Directors.
7- Chief Executive and staff:
(a) the person to sue or be sued on behalf of the cooperative society;
(b) the manner of appointment and removal of Chief Executive;
(c) the functions, responsibilities and powers of the Chief Executive.
8- Finance:
(a) the financial year which the cooperative society wishes to adopt;
(b) the manner of appointment of auditors and their duties;
(c) the manner of appointment of internal auditors and their duties;
(d) the nature and amount of equity capital, if any, of the cooperative society;
(e) the maximum capital which a single member can hold;
(f) the types and extent of funds to be raised;
(g) the purposes for which the funds raised by the cooperative society may be applied;
(h) the debt-equity ratio that the cooperative society wishes to maintain at all times, and the maximum external debt that a cooperative society wishes to permit itself at any point of time;
(i) procedure for transfer of shares or interest by a member;
(j) procedure for redemption of shares by the cooperative society;
(k) procedure for transfer or payment of interest on death of member;
(l) the nature and extent of the liability of the members for the debts contracted by the cooperative society;
(m) the nature and extent of the liability of the Directors for the debts contracted by the cooperative society;
(n) the manner of disposal of funds if under liquidation.
9- Secondary cooperative societies:
(a) the rights, if any, which the cooperative society wishes to confer on any secondary cooperative society of which it is a member, and the circumstances under which these rights may be exercised by such secondary cooperative society;
(b) the procedure of appointing and changing representative to secondary cooperative society.
10- Other matters:
(a) the manner of making or amending bye-laws;
(b) the manner of constitution and functioning of arbitration council along with the qualification of the members for settlement of disputes;
(c) the manner of dissolution of the cooperative society;
(d) the language in which the affairs of the cooperative society are to be conducted;
(e) refunding of loan, guarantee, share capital, grant or subsidy received from Government;
(f) other matters which the provisions of this Act requires to be provided by bye-laws.
