Chapter III MEMBERS AND THEIR RIGHTS AND LIABILITIES

1. (1) Subject to the provisions of section 24, no person shall be admitted as a member of society except the following, that is to say-
   • (a) an individual; who is competent to contract under the Indian Contract Act, 1872,
   • (b) a firm, company or any other body corporate constituted under any law for the time being in force, or a society registered under the Societies Registration Act, 1860;
   • (c) a society registered, or deemed to be registered under this Act;
   • (d) the State Government or the Central Government;
   • (e) a local authority;
   • (f) a public trust registered under any law for the time being in force for the registration of such trusts : Provided that, the provisions of clause (a) shall not apply to an individual seeking admission to a society exclusively formed for the benefit of students of a school or college: Provided further that, subject to such terms and conditions as maybe laid down by the State Government by general or special order, a firm or company may be admitted as a member only of society which is a federal or urban society or which conducts or intends to conduct an industrial undertaking - Provided also that, any firm or company, which is immediately before the commencement of this Act, a member of a society deemed to be registered under this Act, shall have, subject to the other provisions of this Act, the right to continue to be such member on and after such commencement Explanation: For the purpose of this section an “urban society” means a society the business of which mainly falls within the limits of a municipal corporation, municipality, cantonment or notified area committee.

(1-A) Not withstanding anything contained in sub section (1) the State Government may, having regard to the fact that the interest of any person or class of persons conflicts or likely to conflict with the objects of any society or class of persons conflicts or likely to conflict with the objects of any society or class of societies, by general or special order, published in the Official Gazette, declare that any person or class of persons engaged in or carrying on any profession, business or employment shall be disqualified from being admitted, or for continuing, as members or shall be eligible for membership only to a limited extent of any specified society or class of societies, so long as such person or persons are engaged in or carry on that profession, business or employment (as the case may be; and the question whether a person is or is not so engaged in or carrying on any profession business or employment or whether a person belongs or does not belong to such class of persons as declared under this sub section and has or has not incurred a disqualification under this sub section shall be decided by the Registrar under section 11.

(1-B) Notwithstanding anything contained in sub section (1) where the Registrar has decided under

Section 11 that a person has incurred a disqualification under sub section (1-A), the Registrar or the person not below the rank of District Deputy Registrar of Cooperative Societies, authorized by him in this behalf, may, by order, remove such person from membership of the society; and such person shall cease to be a member of the society on expiration of a period of one month from the date of receipt of ;such order by him.

1. (2) Where a person Is refused admission as a member of society, the decision (with the reasons therefore) shall be communicated to that person within fifteen days of the date of the decision, or within three months from the date of receipt of the application for admission, whichever is earlier. If the society does not communicate any decision to the applicant within three months from the date of receipt of such application, the applicant shall be deemed to have been admitted as a member of the society. If any question arises whether a person has become a deemed member or otherwise, the same shall be decided by the Registrar after giving a reasonable opportunity of being heard to all the concerned parties.

1. (1) No society shall, without sufficient cause, refuse admission to membership to any person duly qualified therefore under the provisions of this Act and its bye-laws.

(1-A) Where a society refuses to accept the application from an eligible person for admission as a member, or the payment made by him in respect of membership, such person may tender an application in such form as may be prescribed together with payment in respect of membership, if any, to the Registrar, who shall forward the application and the amount, if any so paid, to the society concerned within thirty days from the date of receipt of such application and the amount; and thereupon if the society fails to communicate any decision to the applicant within sixty days from the date of receipt of such application and the amount by the society, the applicant shall be deemed to have become a member of such society. If any question arises whether a person has become a deemed member or otherwise, the same shall be decided by the Registrar after giving a reasonable opportunity of being heard to all the concerned parties.

1. (2) Any person aggrieved by the decision of a society, refusing him admission to its membership, may appeal to the Registrar. Every such appeal, as far as possible, be disposed of by the Registrar within a period of three months from the date of its receipt: Provided that, where such appeal is not so disposed of within the said period of three months, the Registrar shall record the reasons for the delay.
2. (3) The decision of the Registrar in appeal, shall be final and the Registrar shall communicate his decision to the parties within fifteen days from the date thereof:
3. (4) Without prejudice to the foregoing provisions of this section, in the case of agro-processing societies or any other society for which a definite zone or an area of operation is allotted by the State Government or the Registrar, it shall be obligatory on the part of such society to admit, on an application made to it, every eligible person from that zone or the area of operation, as the case may be, as a member of such society, unless such person is already registered as a member of any other such society, into the same zone or the area of operation.

1. (1) Notwithstanding anything contained in section 22, a society may admit any person as a nominal, associate or sympathizer member.
2. (2) A nominal member or sympathizer member shall not be entitled to any share in any form whatsoever in the profits or assets of the society as such member. A nominal or sympathizer member shall ordinarily not have any of the privileges and rights of a member, but such a member, or an associate member, may, subject to the provisions of sub-section (8) of section 27, have such privileges and rights and be subject to such liabilities, of a member, as may be specified in the bye-laws of the society.

A person shall cease to be a member of a society on his resignation from the membership thereof being accepted, or on the transfer of the whole of his share or interest in the society to another member, or on his death, or removal or expulsion 'from the society, or where a firm, company, any other corporate body, society or trust is a member on its dissolution or ceasing to exist. 25-A. Removal of names of members from Membership registers— The committee of a society shall remove from the register of its members the name of a person who has ceased to be a member or who stands disqualified by or under the provisions of this Act for being the member or continuing to be the member of a society:

No rights of membership to be exercised till due payments are made.— No person shall exercise the right of a member of a society, until he has made such payment to the society in respect of membership, or acquired such interest in the society, as may be prescribed by the rules or the bye-laws of such society.

1. (1) Save as otherwise provided in subsections (2) to (7), both inclusive, no member of any society shall have more than one vote in its affairs; and every right to vote shall be exercised personally, and not by proxy : Provided that, in the case of an equality of votes the Chairman shall have a casting vote.
2. (2) Where a share of a society is held jointly by more than one person, the person, whose name stands first in the share certificate, if present, shall have the right to vote. But in his absence the person whose name stands second, and in the absence of both, the person whose name stands next, and likewise, in the absence of the preceding persons the person whose name is next on the share certificate, who is present and who is not a minor, shall have the right to vote.
3. (3) A society, which has invested any part of its funds in the shares of any federal society, may appoint one of its members to vote on its behalf in the affairs of that federal society; and accordingly such member shall have the right to vote on behalf of the society: Provided that, any new member society of a federal society shall be eligible to vote in the affairs of that federal society only after the completion of the period of three years from the date of its investing any part of its fund in the shares of such federal society: Provided further that, where the election is to elect a member or members of the committee of a District Central Co-operative Bank including the reserved seats on such committee, as provided under this Act, all the elected members of such Primary Agricultural Credit Societies which have invested any part of their funds in the shares of such District Central Co-operative Bank, shall have a right to vote on behalf of that societies; so however that the Registrar shall, as provided in sub-section (2) of section 73, by general or special order published in the Official Gazette, fix the maximum number of members on the committee of such society or class of such societies: Provided also that, for contesting the election for the members of the committee of a District Central Co-operative Bank, all the elected, co-opted and appointed members on the committees of such Primary Agricultural Credit Societies, which have invested any part of their funds in the shares of such District Central Co-operative Bank, shall be eligible from their respective constituencies us specified in the bye-laws: Provided also that, except in the election to the committee of a District Central Co-operative Bank, in case of any other society where the election is as provided under this Act, no person shall have more than one vote.

(3-A) An individual member of a society shall not be eligible for voting in the affairs of that society for a period of two years from the date of his enrollment as a member of such society.

1. (4) A company or any other body corporate, constituted under any law for the time being in force, which has invested any part of its funds in the share of a society, may appoint any of its directors or officers to vote on its behalf in the affairs of such society; and accordingly, such director or officer shall have the right to vote on behalf of the company or body corporate.
2. (5) Where a firm has invested any part of its funds in the shares of a society, any one of its partners appointed by the firm shall be entitled to vote in the affairs of the society on behalf of the firm.
3. (6) A local authority or public trust which has invested any part of its fund in the shares of a society, may appoint any of its members or trustees, to vote on its behalf in the affairs of that society; and accordingly such person shall have the right to vote on behalf of the local authority or the public trust, as the case may be.
4. (7) In the case of a federal society, the voting rights of individual members thereof shall be such as may be regulated by the rules made under this Act and by the bye-laws of the society.
5. (8) No nominal or sympathizer member shall have the right to vote and no such member shall be eligible to be a member of a committee or for appointment as a representative of the society on any other society.
6. (9) No nominee of the Government or any financing bank on the committee of any society shall be entitled to vote at any election of officers of such committee such as, the President, Vice- President, Chairman, Vice-Chairman, Secretary, Treasurer or any other officer by whatsoever designation called, who holds the office by virtue of his election to that office.
7. (10) In the case of an agricultural credit society, if a member has taken a loan from the society, such member shall, whenever he is a defaulter in paying two or more consecutive installments towards repayment of the loan on the due dates, have no right to vote in the affairs of the society : Provided that, a member shall not be deemed to be a defaulter, if 'he has discharged his obligation to deliver his marketable produce to the marketing or processing society and the value of such produce is not less than the amount Of his dues, even if the actual settlement of his dues, either in whole or in part, takes place at a later stage.
8. (11) The agricultural credit society may, issue suitable orders for the purpose of carrying out the provisions of sub-section (10).

In any society, no member other than the Government, or any other society, or with the previous sanction of the State Government, a Zilla Parishad constituted under the Maharashtra Zilla Parishads and Panchayat Samitis Act, 1961, shall

1. (a) Hold more than such portion of the total share capital of the society ( in no case exceeding one-fifth thereof) as may be prescribed; or
2. (b) have or claim any interest in the shares of the society exceeding twenty thousand rupees: Provided that, the State Government may, by notification in the Official Gazette, specify in respect of any class of societies a higher or lower maximum than one fifth of the share capital or, as the case may be, a higher or lower amount than 2twenty thousand rupees.

1. (1) Subject to the provisions of the last preceding section as to the maximum holding of shares and to any rules made in this behalf, a transfer of, or charge on, the share or interest of a member in the share capital of a society shall be subject to such conditions as may be prescribed.
2. (2) A member shall not transfer any share held by him or his interest in the capital or property of any society, or any part thereof, unless-
   • (a) he has held such share or interest for not less than one year;
   • (b) The transfer is made to a member of the society or to a person whose application for membership has been accepted 3by the society, or to a person whose appeal under section 23 of the Act has been allowed by the Registrar or to a person who is deemed to be a member under sub-section (1A) of Section 23.
3. (3) Notwithstanding anything contained in sub-sections (1) and (2), where a member is allowed to resign, or is expelled, or ceases to be a member on account of his being disqualified by this Act, or by the rules made there under or by the bye-laws of the society, the society may acquire the share of interest of such member in the share capital by paying for it at the value determined in the manner prescribed, provided that the total payment of share capital of a society in any financial year for such purposes does not exceed ten percent of the paid-up share capital of the society on the last day of the financial year immediately preceding. Explanation I - The right to forfeit the share or interest of any expelled member in the share capital by virtue of any bye-laws of the society, shall not be affected by the aforesaid provision. Explanation II - In this section, the expression "financial year" means the year ending on the 31st day of March or in the case of any society or class of societies the accounts of which are with the previous sanction of the Registrar balanced on any other day; the year ending on such day.
4. (4) Where the State Government is a member of a society, the restrictions contained in this section shall not apply to any transfer made by it of its share or interest in the capital of the society; and that Government may, notwithstanding anything in this Act, withdraw from the society its share capital at any time, after giving to the society notice thereof of not less than three months.

1. (1) On the death of a member of a society, the society shall transfer the share or interest of the deceased member to a person or persons nominated in accordance with the rules or, if no person has been so nominated, to such person as may appear to the committee to be the heir or legal representative of the deceased member: Provided that, such nominee, heir or legal representative, as the case may be, is duly admitted as a member of the society; Provided further that, nothing in this sub section or in section 22 shall prevent a minor or person of unsound mind from acquiring by inheritance or otherwise, any share or interest of a deceased member in a society
2. (2) Notwithstanding anything contained in sub section (1), any such nominee, heir or legal representative, as the case may be, may require the society to pay to him the value of the share or interest of the deceased member, ascertained in accordance with the rules.
3. (3) A society may pay all other moneys due to the deceased member from the society to such nominee, heir or legal representative, as the case may be.
4. (4) All transfers and payments duly made by a society in accordance with the provisions of this section shall be valid and effectual against any demand made upon the society by any other person.

The share or interest of a member in the capital of a society, or in the loan stock issued by a housing society, or in the funds raised by a society from its members by way of savings deposit, shall not be liable to attachment or sale under any decree or order of a Court for or in respect of any debt or liability incurred by the member; and accordingly, neither the Official Assignee under the Presidency towns Insolvency Act, 1909, nor a Receiver under the Provincial Insolvency Act, 1920, nor any such person or authority under any corresponding law for the time being in force, shall be entitled to, or have any claim on, such share or interest.

1. (1) Every member of a society shall be entitled to inspect, free of cost, at the society's office during office hours, or any time fixed for the purpose by the society, a copy of the Act, the rules and the bye-laws, the last audited annual balance sheet, the profit and loss account, a list of the members of the committee, a register of members, the minutes of general meetings, minutes of committee meetings and those portions of the books and records in which his transactions with the society have been recorded.
2. (2) A society shall furnish to a member, on request in writing and on payment of such fees as may be prescribed therefore, a copy of any of the documents mentioned in the foregoing sub- section within one month from the date of payment of such fees. 32-A. certain societies to give pass books to members and entries in such book evidence of amount due.—
3. (1) A society which gives loans to its members, or a society or class of societies which the State Government may notify in the Official Gazette, from time to time, shall furnish each member with a pass book, which shall contain an account of the transactions with the member, such as, the date of the transaction, the amount of loan advanced, the rate of interest, the repayment made by the member, the amount of the principal and interest due and such other particulars as may be prescribed. The necessary entries shall be made in the pass book, from time to time, which shall be counter-signed by such office-bearer of the society as may be authorised in this behalf by the committee. For this purpose, the member shall be bound to present the pass book to such office-bearer and if the pass book is required to be kept for some time, for making the necessary entries, the member shall be granted a receipt therefore, by such office-bearer.
4. (2) The entries in the pass book duly made shall, until the contrary be proved, be prima facie evidence of the account of transactions of the society with the member.

1. (1) Subject to the provisions of sub-section (2), the liability of a past member or of the estate of a deceased member, of a society for the debts of the society as they stood;
   • (a) in the case of a past member, on the date on which he ceased to be a member; and
   • (b) in the case of a deceased member, on the date of his death, shall, continue for a period of two years from such date
2. (2) Where a society is ordered to be wound up under any provisions of this Act, the liability of a past member or of the estate of a deceased member, who ceased to be a member or died, within two years immediately preceding the date of the order of winding up, shall continue until the entire liquidation proceedings are completed; but such liability shall extend only to the debts of the society as they stood on the date of his ceasing to be a member or death, as the case may be.

Notwithstanding anything contained in the Presidency-towns Insolvency Act, 1909, the Provincial Insolvency Act, 1920, or any corresponding law for the time being in force, the dues of a society from a member, in insolvency proceeding against him, shall rank in order of priority next to the dues payable by him to Government or to a local authority.

1. (1) A society may, by resolution passed by a majority of not less than three-fourths of the members entitled to vote who are present at a general meeting held for the purpose, expel a member for acts which are detrimental to the interest or proper working of the society : Provided that, no resolution shall be valid, unless the member concerned is given an opportunity of representing his case to the general body and no resolution shall be effective unless it is approved by the Registrar.
2. (2) No member of a society who has been expelled under the foregoing sub-section, shall be eligible for re-admission as a member of that society, or for admission as a member of any other society, for a period of one year from the date of such expulsion : Provided that, the Registrar may, on an application by the society and in special circumstances, sanction the re-admission or admission, within the said period, of any such member as a member of the said society or of any other society, as the case may be.