• Introduced
    Lok Sabha
    May 22, 2006
    Gray
  • Referred
    Standing Committee
    May 25, 2006
    Gray
  • Report
    Standing Committee
    Aug 20, 2007
    Gray

The Bill was introduced in the Lok Sabha on May 22, 2006 and was referred to the Department Related Standing Committee on Agriculture (Chairperson: Prof. Ram Gopal Yadav). The Standing Committee presented its report on August 20, 2007.

Highlights of the Bill

  • The Constitution (One Hundred and Sixth) Amendment Bill, 2006 proposes to insert a new part IX B in the Constitution (adding Articles 243ZH through 243ZT), which provides for incorporation, regulation and winding up of co-operative societies.
  • The Bill specifies the maximum number of Board members and the tenure of the members. Elections have to be held before the expiry of the term of the Board.
  • The Board of a co-operative society that has government shareholding or loans can be superseded for the maximum period of six months.
  • State governments can co-opt upto two nominees on the Board of a co-operative society.
  • The Bill specifies certain offences related to co-operative societies. State legislatures can define the penalties related to co-operative societies.

Key Issues and Analysis

  • The Constitution lays down the framework for governance and the relationship of citizens and various state institutions. It is debatable whether governance mechanisms of voluntary bodies such as co-operatives should be specified in the Constitution.
  • Co-operative societies may be superseded without giving the Board an opportunity to explain the charges.
  • Only co-operatives with government shareholding can be superseded. This contradicts the Banking Regulation Act, 1949, which allows co-operative banks to be superseded by the Reserve Bank of India .
  • The powers of the Registrar of co-operative societies are not specified in the Bill. This leaves scope for interference by the Registrar in the running of co-operative societies.

Read the complete analysis here