The Indian Parliament has recently referred the Multi-State Co-operative Societies (Amendment) Bill 2022 to a joint committee for further deliberation. This proposed legislation seeks to overhaul the Multi-State Cooperative Societies Act, 2002, which has been in place for the past two decades. This move has sparked a debate on the nature of cooperatives and the proposed changes to the legal framework governing them.
Understanding Cooperatives
Cooperatives are grassroots organizations that leverage the power of collective bargaining to advance common interests. They can encompass various arrangements including shared use of resources, pooled capital, and collective pursuits. A notable example in India is Amul, a cooperative society recognized for its achievements in dairy farming.
While cooperatives generally fall under the jurisdiction of state governments, instances exist where a cooperative’s members and operational areas span multiple states. In such cases, these cooperatives are registered under the Multi-State Co-operative Societies Act (MSCS) of 2002. The central registrar maintains administrative control over these entities.
The Need for Amendment
The cooperative landscape has undergone substantial changes since the enactment of MSCS in 2002. These changes range from the creation of the Cooperation Ministry in 2021 to the insertion of Part IXB into the Constitution through the 97th Constitutional Amendment Act 2011. These developments have underscored the need to revise the existing law accordingly.
The Proposed Amendments
The new amendment bill provides for several key changes. Firstly, it enables amalgamation of any cooperative society into an existing Multi State Cooperative Society (MSCS). Secondly, it introduces a ‘Cooperative Election Authority’, aimed at instigating electoral reforms in the cooperative sector.
In addition, the proposed legislation seeks stricter penalties for unlawful gains. It also suggests the appointment of a ‘Cooperative Ombudsman’ to address member complaints. Lastly, the bill introduces a ‘Cooperative Rehabilitation, Reconstruction and Development Fund’ for the revitalization of ailing MSCSs.
Critical Perspectives on the Bill
Despite these proposed changes, several criticisms have been voiced against the bill. Most significantly, opponents argue that the bill seeks to infringe upon state governments’ rights, given that cooperatives are constitutionally a state subject. Further, critics point out that under Entry 43 of the Union List in the 7th Schedule of the Constitution, cooperatives do not fall within the central government’s domain.
The debate over this amendment bill reflects broader conversations around the governance and regulation of cooperative societies. The outcomes of these discussions will likely shape the future trajectory of India’s cooperative movement, impacting individuals and communities across the country.