The Central Government introduced the Multi-State Cooperative Societies (Amendment) Bill, 2022 on Wednesday, with the goal of improving transparency and accountability, as well as the ease of doing business by shortening the registration period.

The Bill proposes to amend the Multi-State Cooperative Societies Act of 2002 in light of the 97th Constitutional Amendment Act of 2011, which added Part IXB to the Constitution. Clause 6 proposes to amend Section 17 of the main Act to provide that any co-operative society may decide to merge into an existing multi-State co-operative society by a resolution passed by a majority of not less than two-thirds of the members present and voting at a general meeting of such society.

RSP MP N.K. Premchandran opposed the Bill's introduction, claiming that it violated federal principles.

He emphasised that Articles 243ZH and 243ZI of Part IXB of the Constitution distinguish between state cooperative societies and multi-state cooperative societies governed by the Union of India. There is no provision in the Constitution that allows for the merger of a cooperative society incorporated under state law and a Multi-State Cooperative Society. However, he claims that through Clause 6 of the Bill, the Centre is inadvertently infringing on the rights of State Co-operative Societies.

The Bill proposes following amendments:
•    Registration
The main Act states that the Central Registrar must decide on an application for registration of a multi-State co-operative society and its bye-laws within four months. This period would be reduced to three months under the Amendment Act.
•    The Board of Directors
Section 41 of the main Act states that every multi-State co-operative society must have a board of directors made up of a maximum of 21 directors, 2 co-opt directors, and functional directors in national co-operative societies. According to the amendment, one of the 21 directors must be from a Scheduled Caste or Tribe, and two must be women.
•    Co-operative Election Authority
Elections to the board of a multi-State cooperative society are the responsibility of the existing board, according to Section 45 of the principal Act. The Amendment Act now seeks to replace this provision by establishing the "Co-operative Election Authority," which will consist of a Chairperson, a Vice-Chairperson, and up to three members appointed by the Central Government, to implement electoral reforms in the cooperative sector.

It proposes a new section 70A relating to "concurrent audit" for multi-State co-operative societies with an annual turnover or deposit in excess of the Central Government's threshold.

The Amendment also proposes to add a new Chapter IXA devoted to "complaint redressal."