First in relation to qualification for membership:

A person other than a cooperative society shall not be qualified for society membership unless the following requirements are met.

1.                  He has attained the age of 18 years;
2.                  His employment occupation or profession falls within the category or description of those for which the society was formed;
3.                  He is resident within or occupies land within the society’s area of operation as described in the relevant by-law; 

Under Section 15 there is a limitation on holding of share capital.  It is to the effect that no member other than a cooperative society shall hold more than one fifth of the issued and paid-up share capital of any society. 

No company incorporated or registered under the Companies Act and no unincorporated body of persons shall be entitled to become a member of a cooperative society except with a written authorisation through a resolution by an annual general meeting of that society.

No member of a society shall exercise any of the rights of a member unless he has made such payments to the society in respect of membership or has acquired such interest in the society as maybe prescribed by the Act or under Society bylaws.

Section 18 provides a limitation of membership to one society.  It provides that no person shall be a member of more than one society with unlimited liability and no person shall be a member of more than one society having the same of similar object.  (there is limitation to membership to how many societies one can belong to) but there is a proviso to the effect that a person who is a member of the society and carries on business on land or at premises outside the area of operation of that society maybe a member of a society in whose area of operation that land or those premises are situated not withstanding that its objects are the same or similar to those of the first mentioned society.

Section 19 provides for voting rights of members stating that each member has only one vote in the affairs of the society irrespective of the number of shares that he holds.  (number of shares is irrelevant it is a question of one person one vote.)  but there is a proviso stating that a society which is a member of a cooperative union or an apex society shall have as many votes as may be prescribed by the by laws of the cooperative union or apex society of which it is a member and may subject to such by laws appoint any member of its committee members no exceeding the number of such votes to exercise its voting power.

Shares or Transfer of Shares is provided for under Section 20 stating that the transfer or charge of the share or interest of a member in the capital of a society is subject to such conditions as to maximum holding as are laid down in section 15.  Section 15 deals with the principles that you cannot have more than one fifth of the paid up capital.  In the case of a society registered with unlimited liability a member shall not transfer or charge any share held by him or his interests in the capital of the society or any part thereof unless

  1. He has held such share or interest for at least one year; and
  2. The transfer or charge is in favour of the society or a member of the society;  (transfers are subject to holding the shares for one year effected to either the society or member of the society and not to strangers.


A member of a society has the following rights under Section 21
1.         To attend and participate in the decisions taken at all annual general and special meetings of the society and to vote;

  1. He has a right to be elected to the organs of the society subject to its bylaws;
  2. right to enjoy the use of all the facilities and services of the society subject to its bylaws;
  3. A right to all legitimate information relating to the society including internal regulations, registers, minutes of general meetings, supervisory committee meetings all reports, annual accounts and inventories and investigation reports at the society’s head office.

On the other hand a member has the following obligations:

(a)                To observe and comply with all the society’s by laws and decisions taken by the relevant organs of the society in accordance with its bylaws;
(b)               He has the obligation to buy and pay up for shares or make any other payments provided for in its bylaws;
(c)                He has the obligation to meet the debts of the society in case of bankruptcy in accordance with the provisions of the Act and Society bylaws.


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