Bye laws of a Co-operative society

Analysis on: BYE  LAWS of  a Coop. Society:

01. PREAMBLE:

a)  A Coop. Society, is by default an Autonomous Body, due to the fact that Society services, duties & responsibilities are related and binding ONLY on its own members, and not on others (who-so-ever).  It is akin to a Local Self Government, hence Bye-Laws have to be Society Specific.

b) Each Bye-Law is unique to each Society and to its own Members, which means "uniform bye-laws"  CANNOT be formulated,  since even in Housing Societies, there are Societies which are Tenant Co-partnership Society and then there are Tenant-Ownership Society.  The objectives of both these type of Societies are totally different, hence the self-governance provisions (means Bye-Laws)  are to be made differently, BUT, compulsorily within the provisions and parameters of the MCS Act & Rules.

c)  Society Bye-Laws are a set of suggestive guide-lines for the specific usage of those members, who voluntarily commit themselves to be self-governed and self-regulated by it and such bye-law provisions have necessarily to be under a specific Act (eg. MCS Act), which certainly means that such Bye-Laws have local & limited application.

d)   Society Bye-Laws are Voluntary guidelines, to be self-imposed, more so since a Coop Society can make numerous Modifications / Additions / Deletions / Alterations (within the parameters u/s 13, 14, 16 r/w rule 8, 9, 12, 13 of the MCS Act).  The jurisdiction of Modifications / Additions / Deletions / Alterations are with the General Body members of a Coop. Society AND CANNOT BE WITH THE COOP. REGISTRAR and/or with the Federation OR any other body, which means the Registrar cannot impose his orders on adopting any fixed Pre-Printed Model Bye-Laws that the Registrar whimsically thinks is appropriate, for EACH & EVERY Society.

02.  WHO CAN COMPOSE A COOP. SOCIETY BYE-LAW ?

a) EACH & EVERY duly registered Coop. Society can compose / formulate their own brand new set of bye-Laws, including appendix and transfer forms,  BUT ONLY after due consultation and approval of the General Body members of the Society.

b) NO two bye-laws need to be similar, under any circumstances.  Bye-Laws are Society specific and not generalized.

c) Presently, there is no law, which mandates that pre-printed bye-laws and /or bye-laws, prescribed by the Coop. Dept., or the District Federation, should be adopted, which again will not be tenable under the Law.  Therefore a Coop. Society, need not adopt the static model bye-laws available in the open market and in a website.

d) Under the parameters u/s 13, 14, 16 r/w rule 8, 9, 12, 13 of the MCS Act, a Coop. Society is empowered with the jurisdiction of Composing totally new Bye-Laws, as per its own whims and fancies, subject to & restricted to the provisions of the Act & Rules.

e) A minimum and clear mandatory FOURTEEN days static notice is required to be given to all the Society members (under Bye-Law no. 167), with a General Body meeting agenda specific for "adopting proposed bye-laws".  The presence of a minimum of 67% (2/3rd) members is mandatory at such General Body meeting, to adopt such proposed bye-laws.  Such general body may delete / modify / add any number of such proposed bye-laws.  After adoption of such proposed bye-laws is completed, the adopted bye-laws have to be submitted to the ward Coop. Registrar,  who alone has the jurisdiction to scrutinize & approve & register the Bye-Laws, subsequent to which the registered bye-laws may be implemented for voluntary self-governance amongst its own members.  The Registrar may direct the Society to amend a particular bye-law, ONLY IF the specific bye-law contravenes the MCS Act and Rules, OTHERWISE the Coop. Registrar has no lawful jurisdiction to enforce his own whimsical thoughts in the bye-laws.  The jurisdiction of the Registrar is restricted to directing the Society to make its own bye-law under rule 8(1), subsequent to which he has to mandatorily scrutinize the bye-laws put before him, then approve and register the bye-laws, ONLY FOR THAT SPECIFIC Coop. Society. 

f) Coop. Society Bye-Laws can be lawfully & unrestrictingly Added / Modified / Deleted, every second month, after following due procedures.  Here the Coop. Registrar has no jurisdiction to restrain or restrict the Society from repeatedly amending its Bye-Laws.

g) Coop. Society Bye-Laws can be freshly formulated by themselves or thru an legal expert.  This is done after considering various aspects and needs of the specific society.  A 3 floor society can have a different bye-law and a 40 floor tower building can have a different bye-law.  The Coop. Registrar imposed or formulated bye-law does not have any legal force of law and can be safely junked down the sewage drain.

h) Bye-Laws are formulated for the specific purposes, AS & WHEN required by the members of the Society for their own specific requirements.  These specific requirements CANNOT be known or imagined by the Coop. Registrar and hence such specific requirements may not be incorporated in the Coop. Registrar imposed or formulated bye-laws.

03.  HERD MENALITY:

a) It is grossly evident that almost all Societies follow a standard set of Model Bye-Laws, without making any amendments (Additions / Deletions / Modifications), that too, evidently without any application of mind.

b) This static set of Model Bye-Laws, are usually the cause of mass discontent and gross disputes in a Coop. Society.

c) This static set of Model Bye-Laws, are misused by the Mg. Committee, to harass, subdue & demoralize the general society members, into staying away from active participations in the affairs of an autonomous Coop. Society.

d) Various Book-Sellers, Associations and Federations, just simply mint money, by selling hundreds of thousands of standard MODEL bye-laws, to those gullible Societies, who are always ready to be corrupted.  The Coop. Dept., inspite of being a legal guardians of the Cooperative movement, prefers to remain mute spectators to such obvious misleading and illogical activities and on the contrary grants permission to “print” such bye-laws, as is evident from the pages of the 2009 bye-laws (green cover).

04. CAN THE COOP. DEPT.,  COMPOSE ANY BYE-LAW:

a) It is not in the jurisdiction of the Coop. Dept to compose /formulate a Coop. Society Bye-Laws.  They can at the most prepare a "GENERAL & SUGGESTIVE"  set of  "MODEL"  Bye-Laws, which can be totally discarded by a Coop. Society, which means that a Coop. Society can make umpteen Modifications / Additions / Deletions / Alterations, which in turn means that a Coop. Society can compose / formulate its own bye-laws, by following due procedures.

b) The Coop. Ministry / Dept. can only compose / formulate Laws (MCS Act & Rules) THAT TOO only after the peoples representatives (Legislature) has approved and passed it. IT is not the business nor the jurisdiction of the Coop. Ministry, to compose a Coop. Society Bye-Laws. The suggestive guidelines in the Model Bye-Law have no force of Law and cannot be considered or taken cognizance of in matters which reach the court, when such bye-laws supersede the legislative Act.

c) The Authoritive jurisdiction of the Coop. Registrar (of the ward) is limited and restricted to "Scrutinize & Approve and Register" the Bye-Laws, duly submitted before him by a Coop. Society.   Period .... Nothing else.

d) The Coop. Registrar is not bound to follow the Bye-Laws, when hearing disputes.  However he is under mandatory duty to implement & enforce the provisions of the MCS Act & Rules, vis-à-vis the Society Bye-Laws.

e) It is lawfully unfeasible and untenable, for the Coop. Dept.,  to dictatorially impose a static set of Bye-Laws, by publishing the same on their website and issuing a dictatorial direction to all the autonomous Coop. Society to compel them to adopt his own formulated bye-laws, within a time-frame.  This would amount to infringing on the autonomous authority of a Coop. Society, which further means stepping into the shoes of the General Body members.

f)  Model Bye-Laws are not promulgated by any authority (including the state legislature) and does not have the sanction of the people’s representatives of the Legislature.

05.  WHAT CAN BE COMPOSED IN A SOCIETY BYE-LAW ?

a) All the SELF-Made & SELF-Regulatory guidelines (bye-laws)  which can have a literal authority-of-law, for SELF-governance, BY the Society Members, OF the Society members and ONLY FOR the SPECIFIC Society (and not any other society).

b)  The Coop. Dept., has no jurisdiction what-so-ever to direct the Societies to Add / Modify / Delete any bye-laws that is conformity of the MCS Act & Rules .  The most that the ward Coop. Registrar can do is to reject OR approve & register the bye-laws put before him.

c) There is no need to formulate bye-laws pertaining to "Lift usage charges/services", if the society building does not have lifts. BUT the gullible Societies still keep on adopting those bye-laws, which has no relevance for governance in their society.

d) A bye-law can be composed & formulated by a Statutory Body (Municipal Body, other Local self-government bodies / associations).  Such bye-laws may compose finer points / details / code of conduct / penalties and so on …. BUT necessarily and mandatorily as a subordinate sub-law, necessarily based on a Law (Act) passed by the local state legislature.

e) A dispute /grievance under the self-imposed bye-law provisions can be sorted out by the Society committee (alias Grievance redressal committee / Arbitration).  The courts of law, would not have the jurisdiction to uphold the provisions of such untenable bye-laws and further the courts would not have the jurisdiction to act as a Grievance redressal committee / Arbitrator.

f) Bye-Laws could be totally UNIQUE and would vary from Society to Society, since ANY  provisions of the bye-laws can be Added / Modified / Deleted umpteen number of times, by individual Societies.   Bye-Laws are a "Self Code of Conduct", for self-governance and self-regulation (voluntary & autonomous which is implementable in nature).

g)Bye-Laws may specify specific duties and liabilities of the Mg. Committee and the Members (Meeting frequency, Penalties, Interest on Bill payments, Membership Transfer procedures & fees thereon, Sub-letting procedures and fees thereon, sub-ordinate rules & conditions, and so on)

h) Bye-Laws have necessarily to be under the provisions of a Act, and such Act is to be necessarily passed by the Legislature (meaning peoples representatives).

06.  ORIDINANCE BASED BYE LAWS:

a) An ordinance is not a Act that is passed by the Legislature (meaning peoples representatives).   An ordinance is issued under the unique & undisputable authority of the State Governor AND only the State Governor is within his territorial jurisdiction to promulgate an State Ordinance, IRRESPECTIVE of the fact that the said Ordinance does not have the mandate of the Legislature.

b) Ordinance is a Law, BUT does not have the same force as an Act, since the Ordinance does not have the mandate of the Legislature.   Further in normal circumstances, the ordinance lapses by default by end of 6 weeks, until re-issued with due procedures (depending on various parameters).

c) India is a democratic country and the laws of the Country has to be formulated in a democratic manner, which means the laws of the country can be formulated only by the elected representatives of the people.  IF at all an Ordinance had a Permanent force of law, THEN logically there would be no need for the legislature to compose laws AND the laws could always be created thru an ordinance, without the consent of the people.

d)  The Coop. Dept., has no jurisdiction to nullify the Governors ordinance,   which in turn means that no subordinate sub-laws can be created (here its means the Bye-Laws).   Similarly AND IF AT ALL Bye-Laws are composed & formulated on the Governors Ordinance, THEN such Bye-Laws will also lapse with the lapse of the Ordinance (which is logically inevitable),  .OR.  as soon as a new Act is passed by the Legislature.

e) It would be illogical & meaningless to Adopt any bye-laws based on the Maharashtra Ordinance dated 15-02-2013 /25-04-2013, since this ordinance has to lapse, by legal default. Bye-Laws cannot be composed based on defunct Ordinances or Acts.  Defunct bye-laws, would mean loss of Society members funds.

f)  It would not be necessary that the exact & whole ordinance would be converted into a Act.  The Legislature may decide otherwise and Add / Delete / Modify or compose its own Act, with or without any or all components of the ordinance.  Here, a new bye-laws would have to be composed / formulated which would now be MANDATORILY based on the legislature-passed-Act,  which means the earlier bye-laws based on the ordinance becomes defunct by default.  The whimsical & dictatorial directions for adopting such defunct bye-laws,  issued by the various Coop. Registrars have no force of Law and has now become a dictatorial burden on all the Coop. Societies, which indirectly means, loss of Society members funds.

Apathy, Ignorance, Arrogance, Ego are the bane of Cooperative Society’s, which is evident from the consistent scores of litigations before the Registrar's office and in the Coop. Courts.

Author: Hemant Agarwal 

Email: ha21@rediffmail.com