register a Cooperative Society
humanity cooperative company has become a thing of the past in this contemporary world. Everyone is busy scaling up self-dreams, and nobody has enough time to look after society’s needs. However, the existence of the Co-operative Society is an exceptional organization that redeems our faith in humanity. The fundamental objective of such communities is to safeguard the interest of economically weaker sections. This blog will act as a comprehensive guide to registering a cooperative Society that entails everything from its features to eligibility and procedure.
Key Features of a Cooperative Society
A Co-operative Society possesses these characteristics:
- Open Membership: when a cooperative company a maximum of 10 members with a common interest come together to form a society, it is referred to as a Co-operative Society. Besides, the co-operative Societies Act, of 1912 does not specify any maximum number of members, while the member may specify the maximum limit after the formation of the society.
- Voluntary Collaboration: No Co-operative Society registration is possible without the volunteer efforts of members to build one. The members have access to enough freedom to join and leave the Co-operative Society at any time by providing a legal notice of the same.
- A Separate Legal Entity: when a company registers under the Cooperative Societies Act, 1912 it becomes a separate legal entity. Thus, a Co-operative Society holds a limited liability for its members. Any instances like insolvency, death, or lunacy of the member will not affect the Co-operative Societies. Also, members have the power to enter into an agreement with others to sell or purchase properties under their name.
- Fosters Service Motive: unlike other types of organizations, Co-operative Societies do not emphasize maximizing profit; instead, their main objective is to fulfill the members’ common interest.
- Democratic Management: Every Co-operative Society follows an “All for each and each for all” agenda which hinders dictatorship rule. Such societies conduct an Annual General Meeting (AGM) every year to select the ‘Board of Directors Irrespective of how many shares a member holds, he only has a single vote.
Procedure for Registering a Cooperative Society
If you want to register under the co-operative societies act, of 1912, have a look at the step-by-step procedure for registering a Cooperative Society:
- 1st Step: To cooperative company form a Cooperative Society, it’s essential to find 10 individuals who share a common objective and desire to commence a Society.
- 2nd Step: The next thing to do is to form a Provisional Committee and elect a chief Promoter amidst them.
- 3rd Step: Then all the members must voluntarily select a name for the society.
- 4th Step: Now you need to apply to the Registration Authority for name reservation of your Co-operative Society. You must obtain a confirmation letter for the name reservation. Also, understand that the reserved name shall be valid for 3 months.
- 5th Step: Further, collect the entrance fees and share capital from all the prospective members of your society.
- 6th Step: Thereby open a bank account in the name of your Co-operative Society and deposit the collected entrance fees and share money in that account. Also, procure a certificate in that respect.
- 7th Step: You are almost done with the process of Co-operative Society registration. Now deposit the registration fees with the Reserve Bank of India and thereof obtain a receipt of 1challan.
- 8th Step: Submit the application for registration to the Registrar of Societies of the concerned municipal ward along with the necessary documents.
Documents Required to Register a Cooperative Society
Ensure to affix these documents during the registering a Cooperative Society:
- Submit cooperative company the PAN Card of all the members of your proposed society with the registration application.
- Next, deposit the valid Residential proof of all the members, Bank Statement, Driving License, Aadhaar Card, Utility Bill, and Passport.
- Prepare a Memorandum of Association  that must contain these clauses and information:
1. The central objectives of your society for which it got established.
2. All details of members forming the society
3. The address of the registered office of your society.
Also, prepareanArticles of Association containing the following information:
- The cooperative company rules and regulations will govern and maintain of day to day activities of the proposed society.
- Moreover, it will contain the rules for taking Membership of the Co-operative Society.
- The details about the meetings that will be held in future.
- Information about the Auditors
- v. Forms of Arbitration in case of disputes between the society’s members.
- vi. Ways for the dissolution of the society
Co-operative Society Registration cooperative company is the first step that you can take to build a progressive association and strengthen the weaker sections of our society. If you also want to establish such a society, then first gather a minimum of 10 members that share a mutual goal with you. Thereafter take the assistance of our professionals. We will help you at every step to ease the process of registration and suggest the right way of doing things to build strong foundations for your society.
Overview of Cooperative Housing Society In India
Cooperative company housing societies in India are organizations that are formed by a group of individuals who come together to collectively purchase, develop, and manage residential property. These societies are governed by the Cooperative Societies Act of 1912 of the respective state in India.
They aim cooperative companies to serve the common economic, social, and cultural needs of their members through a jointly owned and democratically controlled enterprise. There are various types of cooperative societies in India, including credit societies, housing societies, agricultural societies, and consumer societies.
Cooperative societies play a significant role in India’s economy, as they provide access to credit, employment, and other economic opportunities for their members. They also contribute to the development of rural and urban areas by providing essential services such as banking, insurance, and housing.
Benefits of Cooperative Housing Society Registration
Cooperative housing societies are a type of cooperative company of residential development where the residents own and manage their housing complex as a cooperative. Some of the benefits of registering a cooperative housing society include:
- Legal Recognition: Registering a cooperative housing society gives it legal recognition and makes it a distinct entity in the eyes of the law. This can be important for issues such as obtaining loans or resolving disputes
- Collective Ownership: In a cooperative housing society, the members collectively own the property and have a say in the management and maintenance of the society. This can be a more democratic and inclusive model compared to traditional housing societies where a single landlord or developer owns the property
- Shared Resources: Cooperative housing societies often have shared resources such as gardens, playgrounds, and parking facilities, which can be more cost-effective and environmentally friendly than each member having their own individual facilities
- Community: Living in a cooperative housing society can foster a sense of community and belonging, as members are actively involved in the decision-making process and the management of the society
- Financial Benefits: Cooperative housing societies can potentially offer financial benefits such as lower costs for maintenance and shared expenses, as well as the opportunity to pool resources for large projects.
Byelaws Governing Co-operative Housing Society
Byelaws are rules and regulations that govern the operation and management of a cooperative housing society. Some examples of bylaws are as follows.
- Only individuals who are above the age of 18 years and who have contributed to society financially can become members
- No individual can become a member of more than one cooperative housing society
- Members must pay a one-time membership fee as well as monthly maintenance charges.
- Elections cooperative company for the managing committee of the society will be held every three years
- Only members of the society are eligible to contest the elections and vote
- The election process will be conducted by an independent electoral officer.
- The society cooperative company must hold a general meeting at least once every six months
- An extraordinary general meeting can be called by the managing committee or by at least one-tenth of the members of the society
- A notice of at least 14 days must be given before a general meeting
- A quorum of at least one-third of the members must be present for a meeting to be valid.
- The cooperative company managing committee of the society will be responsible for the overall management of the society
- The managing committee will consist of a president, vice-president, secretary, treasurer, and other members
- The managing committee will be elected by the members of the society
- The managing committee will be responsible for maintaining the accounts and records of the society.
Some of the other bye-laws governing the cooperative housing society, in general, are as follows:
- A society, upon registration, should immediately become a member of the Housing Federation of the District. The society receives funds from the district’s Central Co-operative Bank as per the law
- Society has the right to raise funds through entrance fees, issuance of shares, loans, subsidies, and donations. In order to transfer shares a prescribed amount can be charged along with the occupancy
- The structural audits of the society have to be conducted mandatorily by the body under which the registration was done. For buildings between 15 and 30 years of age, the audit will be done once in five years. If it is more than 30 years, then the audit will be once in three years
- As per the law, the area of the society should be within the towns and cities of Maharashtra.
How to Register a Cooperative Housing Society
- Step 1: To cooperative company register a society, a minimum of 10 members should have a similar interest with the same objective for their mutual benefit
- Step 2: When the members are decided, a provisional committee in which everyone mutually agrees has to be formed. Out of which, a person will be selected as a chief promoter
- Step 3: Next, a name has to be selected for the cooperative society. It is to be noted that the name has to be in line with the laws
- Step 4: Upon the name selection, the members must apply to the registration authority. It must contain the details like intent to form the society, the name of the society for approval, and the chief promoter’s details
- Step 5: The application fee and increase in authorized share capital have to be collected. It has to be as per the law or as prescribed by the members themselves
- Step 6: Now open a bank account per the promoter of the registering authority. It has to be in the name of the society and the amount has to be deposited in the account. Also, a certificate should be obtained from the bank
Vakilsearch iscooperative company the go-to platform for all your legal services in India. We provide legal services at an affordable price in a hassle-free way. Once the details of the cooperative housing society are verified by our expert lawyers, we start the registration process. Our process is completely transparent, and you will get timely updates from us. We will also sit with you on a call and explain the nuances of the cooperative housing society. You can get assistance from our team of experts if you have any questions during the registration process.
FAQs on Cooperative Housing Society Registration
Why is it important to register a cooperative housing society?
How long does it take to register a cooperative housing society?
Is it necessary to hire a lawyer to register a cooperative housing society?
Can a cooperative housing society be deregistered?
What are the documents required for cooperative housing society registration?
Procedures of Registration of Co-operative Housing Society-
For registering the Co-operative Housing Society, the concerned Registrar by scrutinizing the proposal submitted after fulfillment of the above-mentioned documents shall make an arrangement of issuing a certificate of the registration society under Section 9 (1) of the Maharashtra Co-operative Society Act 1960, and a copy of the registered bye-law, memorandum regarding registration of society to the chief promoter. The order regarding the registration of society should have been sent for publishing in the government gazette to the Government Printing Press for appropriate action.
The Chief Promoter should have to arrange the first general body meeting of the Promoter members within 3 months from the date of registration of society (Under rule 59 of the Maharashtra Co-operative Societies Rules 1961) and necessary resolution should be passed in this meeting. If such a meeting was not taken by the chief Promoter then in that case if a complaint was received by the concerned Registrar, then by appointing an authorized officer such a meeting can be conducted in the Chairmanship of an authorized officer.
If the registration of the society is denied, then it is necessary that by passing the written order in this regard by the Registrar, a copy of it should have been given to the concerned. An appeal under section 152 can be filed before the immediate senior officer against this decision.
It is necessary to take a decision on the registration of the society within a period of two months from the date of the proposal of the society submitted to the Registrar. If such a decision was not taken within two months then it is necessary to send that proposal to the immediate senior officer.
If the Registrar had not taken any action on the proposal received for registration under section 9(2) of the Maharashtra Co-operative Societies Act 1960, as expected under this section within two months, then it is presumed that the deemed registration of the Housing Society.
It could not be said that the officers from the Co-operation department will remain present in the meeting, therefore it should be noted in the memorandum of registration that the office bearer representative of the District Federation along with the officers from the Co-operation department be present in the first meeting so that the information regarding the procedure of working of the society and also bye-laws can be given to the members in the first meeting itself.
A step-by-step guide to setting up a cooperative society
To form or set up a cooperative society one has to follow certain set rules or guidelines which have to be followed in sequential order which will be dealt with in the latter part of this paper, but firstly it is important to ascertain the nature and importance or advantages of forming a society in present scenario over other business structures.
The cooperative movement started to protect the interests of weaker sections of society. The primary or main objective of this movement is ‘how to protect economically weaker sections of society’ from the middlemen who gain illegally by eating away the major chunk of the profits. In all forms of business structures whether be it is a sole trade, partnership, or joint stock company, the primary motive is to increase profits.
The laws governing the societies are “THE co-operative societies act, 1912” which is a central Act formed by the Union with the liberty to the concerned states to form their State Act governing the societies to suit their local conditions but the condition being that it should not be in derogation to the central Act. Many states have enacted their own co-operative society Act and rules there under but more or less the requirements to be met by persons who want to form the society remain the same.
Laws Applicable to Co-Operative Society
The Cooperative Societies Act, of 1912 expanded the sphere of cooperation between its members and provided for supervision by a central organization. A cooperative society, which has its object the promotion of the economic interests of its members in accordance with the cooperative principles may be registered with limited or unlimited liability by filing an application to the registering authority with requisite documents to be submitted by them
A Co-operative Society has to conduct itself as per the following listed below:
- Co-operative Societies Act under which the same is registered whether it be under the state Act or Central Act.
- Co-operative Societies rules made there under whether it be central or state rules
- Bye-laws approved by the registrar at the time of registration and amendments made from time to time and approved by the registrar, these by-laws have to be formed by the concerned members themselves and presented to the registration authority for its approval.
- Notification and Orders by the concerned Government
The following steps have to be followed while forming a Cooperative society, are
Step 1: Ten Individuals together who are desirous of forming a Society
To form a society, the law mandates that 10 members minimum must show intention to be part of the society having the same aim and objective to be achieved through the society for their mutual benefit and thereby be desirous to be part of it.
Step 2: Provisional Committee to Select Chief Promoter
Once a group of individuals have a desire to form a society the next step should be there must be a provisional committee of which everyone is part and all of them should by mutual consent or by majority whichever they prefer must choose a person who will be a chief promoter of the society which is going to be formed by them.
Step 3: A Name for the Society has to be selected
Thereafter once a chief promoter is selected by a set of individuals among them, they have to select a name for the cooperative society which they wish to form
Step 4: Application has to be made to the Registration Authority
Once the name of the society is selected by the members then they have to make an application to the registration authority stating that they have the intention to form a society and the name of the society has to be given to the authority for its approval and registering authority has to confirm that name is in conformity with laws and issue a confirmation certificate to the members. Then when the members get their name approval from the authority it is valid for 3 months from the date of approval.
Step 5: entrance fees and share capital
Thereafter once name approval comes from the concerned authority, the entrance fee and the share capital must be collected from the concerned prospective members to meet the statutory requirements under the law and it can be prescribed by the members themselves or the society act mandates certain fees to be paid by them.
Step 6: Bank Account
Thereafter once the prescribed fee and share capital are collected from the prospective members, then as per the directions of the registering authority promoter has to open a bank account in the name of the society and deposit the said fees and share capital in that account and a certificate has to be obtained from the bank to that effect
In India, Co-operative Societies were regarded as ideal instruments to motivate people to come together and help themselves in the process of eliminating the unscrupulous middlemen making a huge profit at the expense of.
The main guiding factor if an individual or group of individuals want to form a society must be whether all the concerned members have a common goal to achieve or not, it is an important factor because only when they share a common desire or intention then only society is desirable otherwise the whole purpose of forming a society will be defeated.
Societies like any other business structure come with certain advantages and disadvantages, they are:
- Cooperative stores supply quality goods, unlike other shops wherein adulterated foods may be given to its consumers and thus saved them from adulteration and other malpractices.
- As consumers or members of society are the owners and managers of such stores, the genuine requirements of the majority of consumers can be met. In other words, goods required by a majority of the customers or members of society are always dealt with by such stores.
- Cooperative societies are an important form of democratic business enterprise because ownership is not vested in one person completely so as a result, no single group can secure control over the organization
- It only caters to the needs of small and medium-income groups so when there are large groups with higher economic interest then it is preferable to choose another business model.
- There is much dependence on the honesty, integrity, and loyalty of members and workers and once there are trust issues between the members it is hard to transact business thereafter.
- It is limited to certain objectives hence profits are minimal.
- Management of society usually rests in the hands of people with less managerial experience due to which society will suffer and many do not invest in hiring professionals to handle the society due to lack of funds or interest so henceforth growth of the society may be put at a stake by its own members.