In Focus

Registrar may direct CHS to make bye-laws

By Gajanan Khergamker

There are times when the Registrar may direct the society to make bye-laws in respect of certain matters. The Maharashtra Cooperative Societies Rules 1961 clearly provides for that.

Rule 8 of the MCS Rules, 1961 deals with matters in respect of which Registrar may direct society to make bye-laws or society may make bye-laws.

(1) The Registrar may require a society to make bye-laws in respect of all or any of the following matters, that is to say-
a) the name of the society and address of the society and its branches;
b) the area of operation;
c) the object of the society;
d) the manner in which the limit up to which the funds of the society may be raised, the maximum share capital which any one member may hold and the purpose to which the funds would be made applicable;
e) the terms and qualifications for admission to membership
f) the privileges, rights, duties and liabilities of members including nominal, associate and sympathiser members;
g) the consequences of default in payment of any sum due by a member;
h) conditions regarding sale or disposal of produce of members wherever applicable;
i) in case of credit societies
(i) the maximum loan admissible to member
(ii) the maximum rate of interest of loan to member;
(iii) the conditions on which loans may be granted to members and penalties for misapplication of loans so advanced;
(iv) the procedure for granting extension of time for the repayment of loans and advances;
(v) the consequences of default in payment of any sum due;
(vi) the circumstances under which a loan may be recalled;
j) in the case of non-credit societies, the mode of conducting business such as manufacture, purchase, sale, stock taking and other like matters;
k) in the case of a composite society, that is to say, society having both credit and non-credit functions, matters referred to in clauses (i) and (j);
l) the mode of holding meetings of the general body and of the committee;
m) the procedure for expulsion of members;
n) the manner of making, altering, abrogating bye-laws:
o) the mode of appointment either by election or otherwise and removal of members of the committee and other officer, if any, their duties and powers;
p) the chairman’s powers, duties and function and his removal on his losing support of the majority;
q) the method of recruitment, the conditions of service and the authority competent to fix, revise or regulate the scale of pay and allowances of salaries officers and servants of the society and the procedure to be followed in the disposal of disciplinary cases against them;
r) the mode of custody and investment of funds and mode of keeping the accounts and records;
s) the disposal of net profits;
t) the manner in which penalty should be levied on a member who is found to be guilty of breach of bye-laws;
u) appointment of a provisional committee where necessary;
v) the mode of appointment and removal of committee and its powers and duties;
w) the mode of convening annual and special general meetings, issues of notices, and the business which may be transacted thereat;
x) in the event of winding up of the society, the purpose for which surplus assets, if any, shall be utilised;
y) the conduct of elections to the committee and other bodies of the society as provided in the bye-laws, including the numbers of members to be elected by different constituencies and appointment of Returning Officer;
z) any other matters incidental to the management of its business.

Concurrently, the MCS Rules provide for a manner in which a society may make bye-laws by itself. Accordingly, as per Rule 8 (2):
A society may make bye-laws for all or any of the following matters, that is to say, -
(a) The circumstances under which withdrawal from membership may be permitted;
(b) The procedure to be followed in cases of withdrawal, ineligibility and death of members;
(c) The condition, if any, under which the transfer of share or interest of a member may be permitted;
(d) The method of approaching payments made by members from whom moneys are due;
(e) The authorisation of an officer or officers to sign documents and to institute and defend suits and other legal proceedings on behalf of the society;
(f) The constitution and maintenances of various funds as required to be maintained under the provisions of the Act, rules and bye-laws;
(g) Constitution of representative body consisting of delegates of members of the society and the mode of election of such delegates to exercise the powers of the general body of members and to specify the powers which may be exercised by such smaller body.

To avail a legal service, an expert opinion or an appointment with Solicitor and Property Law Expert Gajanan Khergamker, call 8080441593