Co-operative Principles. – Individuals or registered societies

3. Co-operative Principles. – Individuals or registered societies intending to form a registered society under this Act shall frame bye-laws conforming to the following Principles of Co-operation, namely – (a) membership of a registered society shall be voluntarily available without restriction of any social, political, racial or religious discrimination, to all the citizens of India who can make use of its services and are willing to accept the responsibilities of membership; (b) Registered societies are democratic organisations; their affairs shall be administered by persons elected or appointed in a manner agreed to by the members and accountable to the societies. Members of registered societies shall enjoy equal rights of voting (one member one vote) and participation in decisions affecting the registered societies of which they are members; (c) the economic results, arising out of the operations of a registered society belong to the members of that registered society and shall be distributed in such a manner as would avoid one member gaining at the expense of others, which shall be achieved- i. by provision for development of the business of the Co- operative Society, ii. by provision of common services, or iii. by distribution among the members in proportion to their transactions with the Co-operative society in addition to the distribution of dividend to the share-holders; (d) all registered societies shall make provision for the education and training of their members, office-bearers and employees and of the general public, in the principles and techniques of Co-operation, both economic and democratic; (e) all registered societies, in order to best serve the interest of their members and their communities, shall actively co-operate in every practical way with other co-operatives at local, national and international levels for achievement of unity of action by co-operators throughout the world. 3(2) Indian Companies Act, not to apply - The provisions of the Indian Companies Act, 1956 (1 of 1956), as amended from time to time, shall not apply to the registered societies.