MEGHALAYA COOPERATIVE
SOCIETIES (AMENDMENT) ACT, 2010 THE MEGHALAYA COOPERATIVE SOCIETIES (AMENDMENT) ACT, 2010 [Act No. 04 of 2011] [04th January, 2011] An Act further to amend the Meghalaya Cooperative Societies Act
(Assam Act. No. 1 of 1950 as adapted and amended by Meghalaya). Be it enacted by the
Legislative of the State of Meghalaya in the sixty-first Year of the Republic
of India as follows:- (1)
This Act may be called the Meghalaya Cooperative Societies
(Amendment) Act, 2010. (2)
It shall come into force at once. In Section 2 of the
Meghalaya Cooperative Societies Act (Assam Act No. 1 of 1950 as adapted by
Meghalaya) (hereinafter referred as the Principal Act) - (i) after
Clause (e), the following new Clause(ee) shall be inserted, namely,- "Co-operative Credit
Structure Societies" includes the State Co-operative Bank and Primary
Agricultural Credit Co-operative Societies, by whatever name called. (ii) after
Clause(k), the following new Clause (kk) and Clause (kkk) shall be inserted,
namely: (kk) "Multipurpose
Co-operative Society" means a Primary Society, the object of which is to
provide various services including services related to credit, business,
industry and consumer durables to its members". (kkk) "National
Bank" means the National Bank for Agricultural and Rural Development
established under Section 3 of the National Bank for Agricultural and Rural
Development Act, 1981 (Central Act No. 61 of 1981);" (iii) ?after Clause (n), the following new Clauses
(nn) and (nnn) shall be inserted, namely: (nn) "Primary
Agricultural Credit Society" means a Cooperative Society as defined under
Clause (cciv) of Section 5 of the Banking Regulation Act, 1949 (Central Act 10
of 1949) and includes a Multipurpose Cooperative Society". (nnn) "State
Cooperative Bank" means an Apex Society engaged in the business of
banking". (iv) after
Clause (p), the following new Clause (pp) shall be inserted, namely: (pp) "Reserve
Bank" means the Reserve Bank of India established under Section 3 of the
Reserve Bank of India Act, 1934 (Central Act 2 of 1934);" (v) after
Clause(q), the following new Clause (qq), Clause (qqq) and Clause(qqqq) shall
be inserted, namely: (qq) "Apex
Society" means a Cooperative Society whose area of operation extends to
the whole of the State of Meghalaya and which has, as its principal object, the
promotion of the principal objects of, and the provision of facilities for the
operation of other Cooperative Societies affiliated to it and classified as an
Apex Society by the Registrar;" (qqq) "Primary
Society" means a Cooperative Society whose membership consist exclusively
of individuals and self help group;" (qqqq) "Capital to
Risk Weighted Assets Ratio" means the Capital adequacy norms stipulated by
the Reserve Bank from time to time;" (vi) ?after Clause(r), the following new clause(rr),
shall be inserted, namely: (rr) "Chartered
Accountant" means a member of the Institute of Chartered Accountants of
India within the meaning of the Chartered Accountants Act, 1949 (38 of
1949)." After Chapter XIVA a new
Heading of the Chapter shall be inserted, namely, - "Special Provisions
Applicable to Cooperative Credit Structure Societies;" In section 84A of the
principal Act: (i) For the
words "Contained in this Act" appearing therein, the words "or
inconsistent contained in any Chapter of this Act or Rules framed thereunder or
bye-laws of any registered society or orders issued thereunder, the provision
of this Chapter shall have overriding effect"- shall be substituted. In section 84A (b) of the
principal Act: (i)
For Clause(b) of the Principal Act be deleted and substituted,
namely; (ii)
"No Primary Agricultural Credit Society or its Federation or
association [except those which are permitted to act as a bank under Banking
Regulation Act, 1949 (Central Act 10 of 1949)] shall be registered with the
words 'bank' or any other derivative of the word 'bank' in its registered name
or shall use the same as a part of its name." (iii)
"Provided that where any Primary Agricultural Credit Society
or its Federation or association (except those which are permitted to act as a
Bank under Banking Regulation Act, 1949 (Central Act 10 of 1949) has been registered
or using the same as a part of its name before the commencement of the
Meghalaya Cooperative Societies (Amendment) ordinance 2010 with the word
"bank" or any of its derivatives in its registered name, it shall
within three months' from the date of such commencement, change its name so as
to remove the word 'bank' or its derivative, if any, from its name". (iv)
?"Provided further that
where any such society fails to comply with the above provisions within the
period specified therein, the Registrar shall order the winding up of such
society forthwith." In Section 84A (c) of the
principal Act: (i)
for Clause (c) of the principal Act be deleted and substituted,
namely; (ii)
"Every person or group holding a minimum deposit of rupees
one thousand for a continuous period of minimum two years or such other amount
or time as maybe prescribed in a Primary Agricultural Credit Society shall
become a member of the Society by subscribing the minimum Share Capital
specified in the bye-laws and shall have full membership and voting
rights." (iii)
"A group borrower shall become a member of a Primary
Agricultural Credit Society by subscribing the minimum Share Capital specified
in the bye-laws and shall have full voting rights." (iv)
Every group depositor or group borrower admitted as a member shall
be entitled to vote through one delegate nominated by the group." In Section 84A(e) of the
principal Act. For Clause(e) of the
principal Act be deleted and substituted, namely; (i)
There shall be at least such numbers of professionals having
special knowledge or experience in such field as may be stipulated by the
Reserve Bank on the Managing Body of the State Coop. Bank and in case such
number of elected directors do not, in the opinion of Reserve Bank or National
Bank, possess special knowledge or experience in such fields as may be
stipulated by the Reserve Bank, the Managing Body of the State Coop. Bank,
shall co-opt such no. of professionals with full voting rights irrespective of
:- (i)
the limit on the number of members of the committee under this Act
or rules framed there under or its byelaws, (ii)
whether such professional is a member of the Society or not. (iii)
If any person who, in the opinion of the Reserve Bank, has been
co-opted as a member of the managing body under clause(i) of this section
without having requisite knowledge or experience as stipulated by the Reserve
Bank, he shall, on being advised by the Reserve Bank or the National Bank, be
removed from the office after giving him a reasonable opportunity of being
heard. In Section 84A(f) of the
principal Act: (i)
For Clause(f) of the principal Act be deleted and substituted,
namely; (ii)
"The members of the Managing Body and the Chief Executive
Officer of the State Cooperative Bank shall fulfill the criteria stipulated by
the Reserve Bank for the time being in force;" (iii)
"The members of the Managing Body and the Chief Executive
Officer of the State Cooperative Bank who do not fulfill the criteria
stipulated by the Reserve Bank shall be removed by the Registrar or the
Appointing Authority, as the case maybe, at the recommendation of the Reserve
Bank or the National Bank;" In Section 84A(g) of the
principal Act: (i)
For Clause (g) of the principal Act be deleted and substituted,
namely: (ii)
"Every Cooperative Bank shall have its account audited by a
qualified Chartered Accountant in each financial year, subject to such
directions as the Reserve Bank may issue from time to time;" (iii)
The Accounts of the State Cooperative Bank shall be audited and
certified by Chartered Accountants appointed by it from the panel approved by
the National Bank;" (iv)
"The Registrar of the Cooperative Societies shall ensure
conduct of Special Audit of the State Cooperative Bank if requested by the
Reserve Bank and also furnish a copy of the report to the Reserve Bank and the
National Bank within the time stipulated by the Reserve Bank;" In Section 84A(h) of the
principal Act; (i)
In Sub-Section(h) between the words "Prudential Norms"
and "issued by" the words "if any," shall be inserted. (ii)
After Clause(h), the following new Sub-Clauses(h)(i) be added,
namely; (h)(i) "The Prudential
Norms including Capital to Risk Weighted Assets Ratio shall be prescribed by
the Registrar for all the Primary Agricultural Credit Societies in consultation
with the National Bank." In Section 84A(i) of the
principal Act: In Sub-Section(i) between
the words "no" and "without" the words "Credit
Structure Society shall be exempted by the Government from the application of
the provisions of this Chapter" shall be substituted and the words
"or the National Bank" shall be added after the word "Reserve
Bank;". In Section 84A(j) of the
principal Act: (i)
For Clause(j) of the principal Act be deleted and substituted,
namely; (ii)
"The Registrar shall ensure that Reserve Bank's regulatory
prescriptions in case of State Cooperative Bank including recommendation for
supersession of the Managing Body and winding up of the State Cooperative Bank
are implemented within one month of being so advised by the Reserve Bank;" (iii)
"The Registrar shall ensure that the Liquidator or the
Administrator, as the case maybe, is appointed within one month of being so
advised by the Reserve Bank for winding up or supersession;" In Section 84A(k) of the
principal Act: (i)
For Clause(k) of the principal Act be deleted and substituted,
namely; (ii)
"The Managing Body of the State Cooperative Bank shall not be
superceded without prior consultation of the Reserve Bank;" (iii)
"The Supersession of the Managing Body of a Primary
Agricultural Credit Society shall be done only on the following grounds:- (a)
"If the Society incurs losses for three consecutive
years;" or (b)
"If serious financial irregularities or frauds have been
identified;" or (c)
"If there are judicial directives to this effect;" or (d)
"If there is a lack of quorum for three consecutive meetings;" In Section "84A(1) of
the principal Act; (i) For
Clause (I) of the principal Act be deleted as a contextual to Clause(j), and
will be substituted, namely; "The Registrar shall
conduct election to a Cooperative Credit Structure Society before the expiry of
the term of the existing Managing Body;" In Section 84A of the
principal Act: (i)
After Clause(l), the following new Clauses
(m),(n),(o),(p),(q),(r),(s),(t),(u),(v),(w),(x),(y) and (z) shall be added
namely: (m) "The Registrar
shall conduct elections to a Cooperative Credit Structure Society within two
months from the date of supersession." Provided that in
circumstances beyond control the Government may allow holding of such election
within a period not exceeding six months from the date of supersession. (n) "A member of the
Managing Body of a Primary Agricultural Credit Society which has been
superseded under this Act shall not be entitled to contest the election again
for a period of three years from the date of supersession." (o) "A Cooperative
Credit Structure Society shall have freedom to decide its financial and
administrative matters, especially." (i) Interest
rates on deposits and Loans. Provided that in the case
of the State Cooperative Bank, the interest rates shall be in conformity with
the guidelines issued by the Reserve Bank; (ii)
Borrowing and Investments; (iii)
?Loan policies and
individuals loan decisions; (iv)
Personnel policy, staffing recruitment, posting and compensation
to staff, and: (v)
Internal control systems, appointment of auditors and fees for the
Auditor. (p) "The Government's
subscription in the Share Capital of any Cooperative Credit Structure Society
shall not exceed twenty five percent and the Government or Cooperative Credit
Structure Society may reduce the Government's subscription further at its
choice;" Provided further that in
case State Cooperative Bank unable to comply with requirements of
Sub-Section(1) of Section 11 of the Banking Regulation 1949(Central Act 10 of
1949), the State Government can contribute equity to the extent required to
enable State Cooperative Bank to comply with the requirements of Sub-Section(1)
of Section 11 of Banking Regulation Act 1949 (Central Act 1949);" (q) (i)
" There shall be only one nominee of the State Government in the Managing
Body of the State Cooperative Bank if the State Government has subscribed to
its Share Capital." (ii) "There shall be
no nominee of the Government in the Managing Body of a Primary Agricultural
Credit Society irrespective of Government's subscription to the Share
Capital." (r) "A Cooperative
Credit Structure Society may affiliate or disaffiliate with a Federal
Cooperative Society at its choice." Provided that before disaffiliation
the Society shall discharge its financial liability, if any, to the Society
from whom it is disaffiliating." (s) "A Cooperative
Credit Structure Society shall have the freedom of entry and exit at any tier
and there shall be no mandatory restrictions of geographical boundaries for its
operation." (t) "A Cooperative
Credit Structure Society shall have the freedom to invest or deposit its funds
in any Bank or financial Institution regulated by the Reserve Bank and not
necessarily in the Federal Society to which it is affiliated." (u) "A Cooperative
Credit Structure Society may obtain loans from any bank or financial
institution regulated by the Reserve Bank and refinance from the National Bank
or any other Financial Institution directly or through any Reserve Bank regulated
financial Institution and not necessarily from the Federal Society to which it
is affiliated." (v) "A Primary
Agricultural Credit Society may pay dividend in accordance with the guidelines
framed by the Registrar in consultation with the National Bank." (w) " The Government
or the Registrar shall have no powers to direct any Cooperative Credit
Structure Society to contribute to any fund other than those required for
improving its net worth or own funds." (x) "No person shall
be elected, nominated or co-opted or allowed to continue as a member of the
Managing Body of a Cooperative Credit Structure Society, if he, (i)
is a person who represents a society other than a Primary
Agricultural Credit Society on the Managing Body of the State Cooperative Bank,
if such society he represents has committed a default towards the payments of
such Bank for a period exceeding ninety days. (ii)
is a person who committed a default towards payments to a Primary
Agricultural Credit Society or represents a Primary Agricultural Credit Society
on the Managing Body of the State Cooperative Bank, if such society he
represents has committed a default towards the payment of such bank for a
period exceeding one year unless the default is cleared. (iii)
is a person, who represents a Society whose Managing Body is
superceded. (y) (i)
"The Bye-laws or any Amendment to the Bye-laws of a Cooperative Credit
Structure Society shall be registered by the Registrar within thirty days from
the date of receipt of the application." (ii) If the Registrar is
satisfied that the proposed bye-laws or the Amendments to the Bye-laws are
contrary to the provisions of the Act and the Rules made thereunder he shall
reject the same duly recording his reasons thereon within thirty days from the
date of receipt of the application." (z) "The Government or
the Registrar shall not do anything or take action or issue any order or
directive which may have effect of curtailing any of the freedoms or powers
given under this Chapter to any Cooperative Credit Structure Society or
adversely affect other provision of Chapter XIV-A."
Preamble - MEGHALAYA COOPERATIVE SOCIETIES (AMENDMENT) ACT, 2010PREAMBLE