The Multi-State Cooperative Societies Act, 2002 that substitutes the sooner statute of 1984, facilitates the incorporation of cooperative societies whose objects and functions touch too many states. The Act provides for formation of each primary (with each individual and institutional members) and federal cooperatives (with solely institutional membership).
Any application for the registration of a multi-state cooperative society, of that all the members square measure people, ought to be signed by a minimum of fifty persons from every of the states involved. Within the case of a society of that the member’s square measure cooperative societies, it ought to be signed by punctually approved representations of a minimum of five such societies registered in numerous states (Sec.6).
Their main objects shall be serving the interests of members in additional than one state and their by-laws shall give for social and economic betterment of their members through assistance and logistic assistance in accordance with co-operative principles (Sec. 7). Otherwise, they are ineligible for registration. A multi-state co-operative society could be a body company with financial obligation (Sec.9).
In order to make sure money discipline, in depth provisions are enacted. No a part of the fund apart from net income shall be distributed among members (Sec.62). Investment of society’s fund solely in recognized securities is permissible (Sec.64). Contribution to political parties or loans to non-members or borrowing from external sources area unit prohibited. Annual auditing by recognized auditors is necessary (Sec.65). Central Government could direct for special audit if it is of the opinion that the society’s affairs are not being managed in accordance with the co-operative principles or prudent business practices (Sec.77).