Board of directors

(1) The management of every society shall vest in a board which shall exercise such powers and perform such duties as may be conferred or imposed by this Act, rules and the bye-laws. (2) The term of office of elected members of the board and it’s office bearers shall be five years from the date of election and the term of office bearers shall be conterminous with the term of the board: Provided that, the board may fill a casual vacancy on the board by nomination out of the same class of members in respect of which the casual vacancy has arisen, if the term of office of the board is less than half of its original term. (3) The size of the board shall be in accordance with the bye-laws, subject to a maximum of twenty-one directors. The Chief Executive shall be an ex-officio director of the board. (4) There shall be reservation of one seat for Scheduled Castes or the Scheduled Tribes and two seats for women on board of every co-operative society consisting of individuals as members and having members from such class or category of persons. (5) The society shall make provisions for co-option of persons to be members of the board having experience in the field of banking, management, finance, accounts, audit, human resource or specialization in any other field relating to the objects and activities undertaken by the co-operative society, as members of the board of such society: Provided that, the number of such co-opted members shall not exceed two in addition to twenty-one directors specified in sub-section (3) of this section as such co-opted directors may or may not be the members of the society and shall not have the right to vote in the affairs and in any election of the co-operative society in their capacity as such member or to be eligible to be elected as office bearers of the board: Provided further that, the functional directors of a co-operative society shall also be the members of the board and such members shall be excluded for the purpose of counting the total number of directors. (6) The board shall have a chairman and such other office bearers as may be provided in the bye-laws who shall be elected from amongst the elected directors/appointed directors in terms of section 67A of this Act, in the manner provided in the bye-laws: Provided that, member of the board shall file the return about their loan transactions and their dealings with the society in the form specified by the Registrar from time to time depending upon the type of society. Provided further that, no person shall be, or shall continue to be, chairman and office bearer of a Apex Society or Federal Society, for a consecutive period of more than ten years and at the expiration of that period any such person shall cease to be chairman and or the office bearer of that society, and shall not be eligible for being re-elected or reappointed as a Chairman or office bearer, until a period of five years has elapsed after expiry of the aforesaid period of ten years: Provided also that, should the administrator be appointed or the Chairman and other office bearers are removed by no confidence motion or resigned voluntarily within twenty-four months before the date on which the consecutive period of ten years would, but for such appointment or removal or resignation have been completed, the Chairman or office bearers shall be deemed to have completed the period of ten years on appointment of administrator or removal or resignation of Chairman or office bearers, as the case may be: Provided that no member shall hold the post of directors of more than one Apex Society or Federal Society or two other societies. (7) The board may constitute sub committees from among it’s directors and other office bearers for specific purpose and such committees shall submit their reports with recommendations or observations to the board for action, within the time specified by the board. (8) Every director and employee of a society while exercising his power and discharging his duties shall,- (a) act honestly and in good faith and in the best interest of the society; and (b) exercise such care, diligence and skill as a reasonably prudent person would exercise in similar circumstances. (9) A director or employee who is guilty of misappropriation, breach of trust or any other omission or commission, resulting in loss to the society shall be personally liable to make good that loss, without prejudice to such criminal action to which he is liable under the law. (10) The members of the board and/or committee, as the case may be, shall be jointly liable for the decisions taken by the board and/or committee during it’s term relating to the business of the society. The members of the board and/or committee shall be jointly liable for all the acts and omissions detrimental to the interest of the society: Provided that, before fixing any responsibility mentioned above, the Registrar shall inspect the records of the society and decide as to whether the losses incurred by the society are on account of acts or omissions on the part of the members of the board or of the committee or on account of any natural calamities, business complications, economic fluctuations, market fundamentals, accident or any circumstances beyond the control of such members: Provided further that any member of the board or member of the committee who does not agree with any of the resolution or decision of the board or of the committee, as the case may be, may express his dissenting opinion which shall be recorded in the proceedings of the meeting and such member shall not be held responsible for the decision embodied in such resolution/decision and/ or for any act or omission committed by the board or the committee as per such resolution/decision. Such dissenting member if he so desires may also communicate in writing his dissenting opinion to the Registrar within seven days from the date of such resolution/decision: Provided also that any member who is not present for the meeting of the board or committee in which the business of the society was transacted, and who has not subsequently confirmed the proceedings of that meeting, such member shall also not be held responsible for any of the business transacted in such meeting. (11) If the Auditor, Enquiry Officer or Inspecting Officer during the course of audit or enquiry or inspection has found certain discrepancies in the working of the society which are irregular, illegal in nature and detrimental to the interest of the society, the Registrar may take the cognizance of such irregularities or illegalities and after giving due opportunity to the Directors concerned of being heard, may disqualify him to continue on the board.