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L. A. BILL No. XXXIX OF 2021.

A BILL

further to amend the Maharashtra Co-operative Societies Act, 1960.

WHEREAS it is expedient further to amend the Maharashtra

Co-operative Societies Act, 1960, for the purposes hereinafter appearing; it

is hereby enacted in the Seventy-second Year of the Republic of India as

follows:—

1.

This Act may be called the Maharashtra Co-operative Societies (Third

Amendment) Act, 2021.

2.

In section 2 of the Maharashtra Co-operative Societies Act, 1960

(hereinafter referred to as “the principal Act”), in clause (19), sub-clause

(a-1) shall be deleted.

3.

In section 25A of the principal Act, after the words “provisions of

this Act”, the words “or the rules made thereunder” shall be inserted.

Mah.

XXIV of

1961.

Short title.

Amendment of

section 2 of

Mah. XXIV of

1961.

Mah.

XXIV of

1961.

Amendment of

section 25A of

Mah. XXIV of

1961.

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----------------------------

MAHARASHTRA LEGISLATURE SECRETARIAT

The following Bill was introduced in the Maharashtra Legislative Assembly on the

24th December 2021 is published under Rule 117 of the Maharashtra Legislative Assembly

Rules :—

RNI No. MAHBIL /2009/40123

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(1)

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4.

For section 26 of the principal Act, the following section shall be

substituted, namely:—

“26. A member shall be entitled to exercise such rights as provided

in the Act, rules and by-laws:

Provided that, no member shall exercise the rights, until he has

made such payment to the society in respect of membership, or acquired

such interest in the society, as may be prescribed and specified under

the by-laws of the society, from time to time:

Provided further that, in case of increase in minimum contribution

of member in share capital to exercise rights of membership, the society

shall give a due notice of demand to the member and give reasonable

period to comply with it.”.

5.

In section 27 of the principal Act,—

(1) sub-section (1A) shall be deleted;

(2) in sub-section (3), the word “active” shall be deleted.

6.

In section 73A of the principal Act, in sub-section (9), the words “is

not an active member and” shall be deleted.

7.

In section 73AAA of the principal Act, in sub-section (1),—

(1) after first proviso, the following proviso shall be inserted,

namely:—

“Provided further that, in case of an apex society and, in

exceptional circumstances, in case of any other society, the Registrar

may increase the number of members of the committee upto twenty-

five with the prior approval of the State Government:”;

(2) in the second proviso, for the words “Provided further that” the

words “Provided also that” shall be substituted.

8.

In section 73CA of the principal Act, in sub-section (1),—

(1) clause (ii-a) shall be deleted;

(2) in clause (iv), after the words “the rules made thereunder” the

words “or by-laws of the society” shall be inserted.

9.

In section 75 of the principal Act, in sub-section (1),—

(1) before the first proviso, the following proviso shall be inserted,

namely:—

“Provided that, the Registrar may, in exceptional circumstances

such as infectious diseases, pandemic, flood, heavy rains, droughts

or earthquake, by general or special order, extend the above referred

period not exceeding three months;”;

(2) in the first proviso, for the words “Provided that” the words

“Provided further that” shall be substituted;

(3) in the second proviso, for the words “Provided further that” the

words “Provided also that” shall be substituted.

10.

In section 77A of the principal Act,—

(1) in sub-section (1), the third proviso shall be deleted;

(2) in sub-section (3),—

Substitution of

section 26 of

Mah. XXIV of

1961.

No rights of

membership to

be exercised till

due payments

are made.

Amendment of

section 27 of

Mah. XXIV of

1961.

Amendment of

section 73A of

Mah. XXIV of

1961.

Amendment of

section 73 AAA

of Mah. XXIV

of 1961.

Amendment of

section 73CA of

Mah. XXIV of

1961.

Amendment of

section 75 of

Mah. XXIV of

1961.

Amendment of

section 77A of

Mah. XXIV of

1961.

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(i) for the words “six months” the words “twelve months” shall

be substituted;

(ii) in the proviso, for the words “six months” the words “twelve

months” shall be substituted.

11.

In section 78 of the principal Act, in sub-section (1),—

(1) in clause (i), for the words “six months” the words “twelve

months” shall be substituted;

(2) the third proviso shall be deleted.

12.

In section 78A of the principal Act, in sub-section (1), in

clause (a), in sub-clause (ii), for the words “six months” the words “twelve

months” shall be substituted.

13.

In section 79 of the principal Act,—

(1) the existing sub-section (1) shall be renumbered as sub-section

(1-1A) thereof; and before sub-section (1-1A) as so renumbered, the

following sub-section shall be inserted, namely:–

“(1) The Registrar may direct any society or class of societies

to take action to comply with the provisions of this Act, rules made

thereunder, by-laws of the society or any order passed by the

Registrar under this Act; and the officer or officers of the society

shall be bound to comply with order within the period specified

therein.”;

(2) in sub-section (3), for the words, brackets and figure “sub-section

(1)”, the words, brackets, figures and letter “sub-sections (1) and (1-1A)”

shall be substituted.

14.

For section 82 of the principal Act, the following section shall be

substituted, namely:—

“82. (1) If the result of the audit held under the last preceding section

discloses any defects in the working of a society, the society shall within

three months from the date of the audit report, explain to the Registrar

the defects or the irregularities pointed out by the auditor or auditing

firm, and take steps to rectify the defects and provide remedy to

irregularities, and report to the Registrar the action taken by it thereon

and place the same before the next general body meeting. The Registrar

may also make an order directing the society or its officers to take such

action, as may be specified in the order to remedy such defects, within

the time specified therein.

(2) The Registrar or the person authorised by him shall scrutinise

the audit rectification report and accordingly inform the society about

such report within six months from the date of receipt thereof.

(3) It shall be the responsibility of the auditor or auditing firm

concerned to offer his or its remarks, as the case may be, on the

rectification report of the society, itemwise, till entire rectification is

made by the society and submit his or its report to the Registrar.

(4) If, the society fails to submit the audit rectification report to the

Registrar and to the annual general body meeting, the Registrar may by

an order declare that any officer or member of the committee, as the case

may be, whose duty was to submit the audit rectification report to the

Registrar and to the annual general body meeting, and who without

Amendment of

section 78 of

Mah. XXIV of

1961.

Amendment of

section 78A of

Mah. XXIV of

1961.

Amendment of

section 79 of

Mah. XXIV of

1961.

Substitution of

section 82 of

Mah. XXIV of

1961.

Rectification of

defects in

accounts.

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reasonable excuse failed to do the aforesaid act, shall be disqualified for

being elected or for being any officer or member of the committee for

such period not exceeding five years, as he may specify in such an order

and, if the officer is a servant of the society, impose upon him a penalty

of an amount not exceeding five thousand rupees :

Provided that, before making such an order under this sub-section,

the Registrar shall give, or cause to be given, a reasonable opportunity

to the person concerned of showing cause against the action proposed to

be taken against him.”.

15.

In section 109 of the principal Act, in sub-section (1),—

(1) for the words “extended by the Registrar” the words “extended

by the Registrar or the Government” shall be substituted;

(2) for the first proviso, the following provisos shall be substituted,

namely:—

“Provided that, the Registrar shall not grant any extension for

a period exceeding one year at a time and four years in the aggregate:

Provided further that, if it is necessary to grant further

extension beyond ten years, the Registrar shall send proposal for

such extension to the Government. The Government may grant

extension for a period not exceeding one year at a time and five

years in the aggregate :

Provided also that, immediately, after the expiry of fifteen years

from the date aforesaid, it shall be deemed that the liquidation

proceedings have been terminated and the Registrar shall pass an

order of terminating the liquidation proceedings:” ;

(3) the second proviso shall be deleted.

16.

In section 144-5A of the principal Act, before Explanation, the

following proviso shall be inserted, namely:—

“Provided that, the salary earners' credit co-operative society may

accept deposits voluntarily from their members after their retirement

by enrolling them as nominal members.”.

17.

In section 146 of the principal Act, clause (l-1) shall be deleted.

18.

In section 147 of the principal Act, clause (l-1) shall be deleted.

19.

In section 152A of the principal Act, in sub-section (1), for the words

“within three days” the words "within three working days” shall be

substituted.

20.

In section 154 of the principal Act, in sub-section (2A),—

(a) the words and figures “or Certificate issued by the Liquidator

under section 105” shall be deleted;

(b) for the words “amount of recoverable dues : ” the words “amount

of recoverable dues. If the revision application is allowed, the Revisional

Authority may pass an order directing the society to refund the amount

so deposited to the applicant : ” shall be substituted.

Amendment of

section 109 of

Mah. XXIV of

1961.

Amendment of

section 144-5A

of Mah. XXIV

of 1961.

Amendment of

section 146 of

Mah. XXIV of

1961.

Amendment of

section 147 of

Mah. XXIV of

1961.

Amendment

of section 152A

of Mah. XXIV

of 1961.

Amendment of

section 154 of

Mah. XXIV of

1961.

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21.

In section 154B of the principal Act,—

(1) in sub-section (1), for the figures, letters, words and brackets

“78A, sub-sections, (1), (1A)” the figures, letters, words, brackets and

sign “78A, sub-sections, (1), (1-1A), (1A)” shall be substituted.

(2) in sub-section (2), for the brackets, figures, letters and sign “(19)

(a), (a-1), (b)” brackets, figures, letters “(19) (a), (b)” shall be substituted.

22.

In section 157 of the principal Act, the second proviso shall be

deleted.

Amendment of

section 154B of

Mah. XXIV of

1961.

Amendment of

section 157 of

Mah. XXIV of

1961.

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STATEMENT OF OBJECTS AND REASONS

A new Part IX-B regarding Co-operatives Societies has been inserted in

the Constitution of India by the Constitution (Ninety Seventh Amendment)

Act, 2011. The Government of Maharashtra has made various amendments

in the Maharashtra Co-operative Societies Act, 1960 (Mah. XXIV of 1961)

(hereinafter referred to as “the said Act”), so as to make the provisions in the

said Act in consonance with the constitutional provisions of the said Part IX-B.

2.

The Gujarat High Court in the case of Rajendra Shah Vs Union of

India Chief Director (Co-operation) (C/WPPIL/166 of 2012) has declared the

said Constitutional Amendment Act inserting Part IX-B ultra-virus the

Constitution. The Supreme Court, in Civil Appeal No. 9108-9109 of 2014 has

upheld the judgement of the Gujarat High Court except to the extent that it

strikes down the entirety of Part IX-B of the Constitution of India. The

Supreme Court in the said judgment has declared that Part IX-B of

Constitution of India is operative only in so far as it concerns multi-state

co-operative societies both within the various states and in the Union

Territories of India.

The Government considers it expedient to make certain amendments in

the said Act for the interest of the society members and for smooth functioning

of the co-operative movement.

3.

The salient features of the proposed amendments to the said Act

are as follows:—

(1) to amend sections 2(19), 26, 27 and 73A with a view to delete the

definition of “active member” and provisions relating thereto ;

(2) to amend section 25A to enable the society to remove the name

of the member from the register of its members who has ceased to be a

member or who stands disqualified by or under the provisions of the

rules made under the said Act ;

(3) to amend section 73AAA to enable the Registrar to increase the

number of members of committee of apex society and, in exceptional

circumstances, of any other society upto twenty-five, with the prior

approval of the State Government, in order to give representation to all

revenue divisions, districts or talukas in the committee of the apex

societies or any other Society, as the case may be ;

(4) to amend section 73CA to enable the society to disqualify a

member who has incurred disqualification as per the bye-laws of the

society ;

(5) to amend section 75 to provide that the Registrar may, in

exceptional circumstances such as infectious diseases, pandemic, etc.

by general or special order, extend the period, not exceeding three

months, for conducting annual general meeting ;

(6) to amend sections 78 and 78A to extend the period of six months

to twelve months of administrator or committee of administrators

appointed thereunder to carry out their administrative duties ;

(7) to amend section 79 to enable the Registrar to direct any

co-operative society or class thereof to comply with the provisions of

the said Act, rules or bye-laws ;

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(8) to amend section 82 to facilitate the Registrar to deal with

the audit rectification report and take further action in case of non-

compliance.

(9) to amend section 109 to enable the State Government to extend

the period of completion of liquidation process of society from ten years

to fifteen years, as it has been noticed that liquidation work of certain

societies could not be completed within ten years due to complex

liquidation process.

(10) to amend section 144-5A to allow salary earners' credit

co-operative society to take deposits from members after their

retirement by making them nominal members, to overcome liquidity

crunch due to refund of deposits to retired members.

(11) to amend section 157 to restore the powers of the State

Government to exempt any society or class of societies from any of the

provisions of the said Act or rules made thereunder.

4.

The Bill seeks to achieve the above objectives.

Mumbai,

BALASAHEB PATIL,

dated the 23rd December 2021.

Minister for Co-operation.

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MEMORANDUM REGARDING DELEGATED LEGISLATION.

The Bill involves the following proposals for delegation of legislative

power, namely :—

Clause 4.— Under this clause, which seeks to substitute section 26 of

the Maharashtra Co-operative Societies Act, 1960, the power is taken to the

State Government to prescribe the payment to be made by member to the

society in respect of membership or the interest to be acquired by the member

in the society so as to enable him to exercise rights of member under the said

Act, rules and bye-laws.

Clause 9.— Under this clause, which seeks to amend section 75 of the

said Act, the power is taken to the Registrar to extend the period of conducting

annual general meeting, by general of special order, not exceeding three

months in exceptional circumstances such as infectious diseases, pandemic,

flood, heavy rains, droughts or earthquake.

2.

The above-mentioned proposals for delegation of legislative powers

are of normal character.

Vidhan Bhavan :

RAJENDRA BHAGWAT,

Mumbai,

Principal Secretary,

dated the 24th December 2021.

Maharashtra Legislative Assembly.

ON BEHALF OF GOVERNMENT PRINTING, STATIONERY AND PUBLICATION, PRINTED AND PUBLISHED BY DIRECTOR, RUPENDRA DINESH MORE,

PRINTED AT GOVERNMENT CENTRAL PRESS, 21-A, NETAJI SUBHASH ROAD, CHARNI ROAD, MUMBAI 400 004 AND PUBLISHED AT DIRECTORATE OF

GOVERNMENT PRINTING, STATIONERY AND PUBLICATIONS, 21-A, NETAJI SUBHASH ROAD, CHARNI ROAD, MUMBAI 400 004. EDITOR : DIRECTOR,

RUPENDRA DINESH MORE.