Multi State Cooperative Societies Act, 2002 was enacted to consolidate and amend the laws relation to Cooperative societies with objects not confined to one state.

  • MSCS is a Cooperative Society with objects to serve the interest of the members in more than one State.
  • A registered MSCS shall be a body corporate with limited liability

Conditions for Registration

1. Object of

a) To serve the interests of members in more than one state; and

b) Bye-laws providing for social and economic betterment of its members through self-help and mutual aid in accordance with the co-operative principles

2. Registration shall be with limited liability

3. The word ‘limited’ shall be the last word in the name.

3. Registration Procedure

  • Applicants for registration can be any of the following:-

Registration Procedure

AR* Chairperson or Chief executive or any other member duly authorized by the board of directors or governing body

  • Check list for application for registration
Sr No Documents

(to be signed by the Chief Promoter/ Promoters)

1 Application to the Central Registrar – Form 1
2 4 copies of the proposed bye-laws of the MSCS duly signed
3 List of members along with ID proofs of the members duly attested by Chief promoter
4 Certificate from the bank or banks stating the credit balance
5 Viability  of the proposed MSCS
6 Proposed area of operation for registration shall initially be permitted for two contagious states only.
7 Certified copy of resolution of the promoters specifying name& address of applicants
8 Contact number & e-mail of the Chief promoter or society on cover page
  • Central Registrar registers the application in Form II and disposal of the application shall be within 4 months from the date of receipt.
  • If satisfied, he shall issue the Registration certificate.

4. Bye Laws

Bye-laws may provide for all or any of the following matters, namely:

1. the name, address and area of operation of the society;

2. the objects of the society;

3. the services to be provided to its members;

4. the eligibility & procedure for obtaining membership;

5. the conditions for continuing as member;

6. the procedure for withdrawal of membership;

7. the transfer of membership;

8. the procedure for expulsion from membership;

9. the rights and duties of the members;

10. the nature and amount of capital of the society;

11. the manner in which the maximum capital to which a single member can subscribe;

12. the sources from which the funds may be raised;

13. the purpose for which the funds may be applied;

14. the manner of allocation or disbursement of net profits;

15. the constitution of various reserves;

16. the manner of convening general meetings and quorum;

17. the procedure for notice and manner of voting, in meetings;

18. the procedure for amending the bye-laws;

19. the number of members of the board not exceeding twenty one;

20. the tenure of, directors, chairperson and other office bearers of the society, not exceeding five years;

21. the procedure for removal and for filling up of vacancies of board

22. the manner of convening board meetings, its quorum, number of meetings in a year and venue of such meetings;

23. the frequency of board meetings;

24. the powers and functions of the Chief Executive( in addition section 52);

25. the manner of imposing the penalty;

26. the appointment, rights and duties of auditors and procedure of audit;

27. the authorization of officers to sign documents and to institute and defend suits and other legal proceedings on behalf of the society;

28. the terms on which a society may deal with persons other than members;

29. the terms on which a society may associate with other cooperative societies;

30. the terms on which a society may deal with organization other than cooperative societies;

31. the rights, if any, which the multi-state cooperative society may confer on any other multi-state cooperative society or federal cooperative and the circumstances under which such rights may be exercised by the federal cooperative;

32. the procedure and manner for transfer of shares;

33. the educational and training programs to be conducted;

34. the principal place and other places of business;

35. the minimum level of services, to be used by its members;

36. any other matter which may be prescribed.

5. Membership of MSCS

1. Who can become member of MSCS

a) Individual

b) Any MSCS or Cooperative society

c) Central Government

d) State Government

e) National Co-operative Development Corporation

f) Any other corporation owned or controlled by the Government

g) Government Company

2. Procedure for membership

1. Membership only on application.

2. Application shall be disposed of by the society within 4 months and communicated within 15 days from date of such decision

3. If not disposed of in 4 months, deemed to be rejected.

3. Disqualification of membership

Any person is being treated disqualified as member in the following cases:-

a) Insolvent

b) Is concerned /participates in the profits of any contract with the society

c) Has been convicted for an offence involving moral turpitude

d) Holds any office or place of profit under the society

e) Has been a member of the society for not less than 12months immediately preceding the appointment.

f) Has interest in any business of the kind carried on by the society.

g) conducts business that is in conflict or competitive to that of the MSCS

h) he used for two consecutive years the services below the minimum level specified in the bye-laws

i) has not attended 3 consecutive general meetings of the MSCS and such absence has not been condoned by the members in the general meeting

j) has made any default in payment of any amount being loan or goods on credit or otherwise to the MSCS even after service of notice of default.

k) Any person against whom any amount due under decree, order pending recovery under this Act.

l) Is retained oe employed as legal practitioner on behalf of/against MSCS, other MSCS which is a member of former society

m) Has been convicted of any offence under the Act.

n) Disqualified as member u/s 29

o) Has been expelled as member u/s 30

p) Absent in 3 consecutive board meetings and such absence has not been condoned by the board.

q) Absent in 3 consecutive general body meetings and such absence has not been condoned by the members in general body.

6. Conclusion

It can be concluded that the concept of MSCS was crystallized to facilitate self-help and mutual aid resulting economic promotion and social betterment within a legal framework.

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Qualification: CA in Practice
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Location: ERNAKULAM, Kerala, IN
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June 2021