With the enactment of the 97th amendment to the
Constitution of India and its inclusion in Part IX of the Constitution,
formation of cooperative societies has become one of the fundamental rights of an
Indian citizen. Cooperative societies have thus come under the ambit of The
Right to Information Act. Cooperative societies normally include cooperative
banks, credit societies, sugar factories, distilleries, handloom-power loom
factories, distilleries, milk producing societies, water supply societies etc.
Henceforth, all such institutions will have to appoint public information
officers, appellate authorities and comply all the provisions of the RTI act.
This is the most revolutionary event in the history of our country in the
recent past.
Normally there are three sectors of industries; Public, private and
cooperative sectors. The first one is wholly owned by a state or the central
government and the governments have complete control over its investments and
management and it is accountable to the governments as well as to the public. Although
the private sector abides by the laws, rules and regulations of the governments
it is not answerable or accountable to the governments or the public for the
losses/profits or management. It is accountable only to its owners or shareholders
as per the law of the land. The cooperative sector was a blend of the public
and private sectors. So far, it was enjoying the facilities available to the
public sector such as loans, share capital from the state etc. but was not
accountable to the state or the public. With the 97th amendment, the
scenario has changed and the cooperative sector is now accountable to the state
and the public.
Article 19 of the Constitution of India protects certain fundamental
rights of the citizens. All citizens have the right to freedom of speech and
expression, to assemble peaceably and without arms, to form associations or
unions, to move freely throughout the territory of India, to reside and settle
in any part of the territory of India; and to practise any profession, or to
carry on any occupation, trade or business. Now forming a cooperative society is
also fundamental right. Not only that , as per article 43B of Part IV it
is now the duty of the States to promote voluntary formation, autonomous
functioning, democratic control and professional management of cooperative
societies to encourage economic activities of cooperatives which in turn help
progress of rural India.
Part IX of the Constitution consists local self-governments. Part IX
is about panchayats, Part IX B is about municipalities and now with insertion
of Part IX C, cooperative societies have acquired the status of local self-governments.
Correspondingly, cooperative societies have come under the RTI Act.
So far, there was no clarity about the applicability of the RTI Act
to cooperative societies. Several information commissions and courts had given
contradictory verdicts on this matter. Cooperative societies were out of the ambit
of the RTI Act because it was not an ‘authority’ or ‘body’ or an ‘institution’
of self-government established or constituted by or under the Constitution. Hence,
attempts to bring a cooperative society under the RTI Act, claiming it to be an
‘institute’, a ‘body owned, controlled or substantially financed by
notification issued or order made by the appropriate Government’ failed. In
addition, authorities of these institutes always took the stand that they did
not come under the RTI act.
In reality, considerable part of the country’s economy is occupied
by the cooperative sector. It is said that about 1/6th of this part
is of Maharashtra. A major part of Maharashtra politics is also influenced by
cooperative sector. The scale of illegalities, scams and corruption in this
sector is also high. The cooperative sector including banks and societies block
substantial government funds going into hundreds of crores.
Anarchy in this sector is so high that current statistics of
cooperative societies in the state and the country are not easily available.
The statistics of the department of cooperative societies of Maharashtra in 2009-10
show that there were 2,18,320 cooperative societies in Maharashtra and the total
membership of these societies was five crores forty-two lakhs. One estimate of
the number of societies is at about 2,30,000 with a membership of about six and
half crores. For the entire country, this number could go up to six and half
lakh societies with thirty crores members.
A giant sector such as this was uncontrolled and unaccountable
till now. One can hope that this sector will move in a positive direction after
the 97th amendment to the constitution. After the amendment was enacted, a
period of one year was given to the States to amend as well as repeal existing
provisions of law to bring in line with the new provisions in the Constitution.
Usually, State Assemblies approve such amendment. However, as the assembly was not
in session, the Government of Maharashtra introduced an ordinance on 15
February 2013 and thus these amendments have now become law.
The highlights of the Maharashtra Cooperative Societies Act and
Rules after amendments are:
(i)
Incorporation of cooperative
societies on the principles of voluntary formation, democratic member control,
member economic participation and autonomous functions;
(ii)
Conduct of election of a
cooperative society by an independent electoral authority;
(iii)
A fixed term of five years for
the office bearers of the cooperative society;
(iv)
Supersession of Board of
cooperative society for a period of not exceeding six months;
(v)
Independent professional audit
of the cooperative societies;
(vi)
Convening of the General Body
meeting of every cooperative society within a period of six months of the close
of the financial year;
(vii)
Access to every member of the
society to the books, information and the accounts of the cooperative society;
(viii)
Filing of the returns by every
cooperative society within six months of the close of every financial year;
(ix)
Free, fair, impartial and
timely elections of cooperative societies by independent body .
(x)
Audit of the cooperative
societies to be carried by the auditors from the government approved panel of
auditors or firms;
(xi)
Maximum number of 21 Directors
to be applicable to all cooperative societies irrespective of their size with
two seats reserved for women; and
(xii)
Co-opted members not to be
eligible to be elected as office-bearers of the Board.
Also there are provisions of penalty for consistent defaults, acting
against the interest of the institution, deadlock in the board of directors, not
ordering elections within specified time, corruption, irregularities in duty,
deliberately giving false information, disobeying orders of authorities etc.
P.S.
Before 1992, panchayats and municipalities were also not
bodies established by or under the Constitution. However, that did not mean
that there were no panchayats or municipalities. These institutes as well as
laws were very much in existence. But due to the autonomous status. their
functioning was arbitrary. They did not acquire the status and dignity of
viable and responsive people's bodies due to varied reasons including
absence of regular elections, prolonged supersession, insufficient
representation of the weaker sections etc.
Hence, to give certainty, continuity, and strength to panchayat raj
with 73rd amendment, Part IX was inserted in the Constitution. Later
as Urban Local Bodies were not able to perform effectively as vibrant
democratic units of self-government, with the 74th Amendment, Part
IX B was inserted to give municipalities a status and dignity. Now with the 97th
Amendment, Part IX B has been inserted to give cooperative societies a status
of local self-government.
As per RTI Act section 2 (h) "public authority" means
any authority or body or institution of self-government established or
constituted—
(a) by or under
the Constitution;
(b) by any other
law made by Parliament;
(c) by any other
law made by State Legislature;
(d) by
notification issued or order made by the appropriate Government,
and now as
per section 2 (h) (a) of RTI act, Cooperative Societies have become an “authority”
or “body” or “institution of self-government” established or constituted by or
under the Constitution and hence are under the ambit of the RTI Act.
