The Nagaland Co-operative societies (3rd Amendment) Act, 2011

The Nagaland Co-operative societies (Amendment) Act, 2011 (Act No. 5 of 2011) Received the assent Government of Nagaland on 07/04/20 11 and published in theNagaland Gazette extraor- dated 3 1/05/2011. To Amend the Assam Cooperative Societies Act, 1949, as applicable to the State ofNagaland, it is hereby enacted in the Sixty Second Year of the Republic of India as follows: Short title extend commencement: (i) This may be called the Nagaland Cooperative Societies (Amendment) BiU- 2011. (in) It shall extend to the whole State of Nagaland. i It shall come into force on such date as the State Government may, by notifcation in the Official Gazette, appoint. The following clauses shall be inserted in the Assam Cooperative Societies Act, 1949, inthe applicable to the State ofNagaland.

Notwithstanding anyhng contained in the Assam Cooperative Societies Act, 1949, in

the case of Revival and Restructuring of the Short Term Cooperative Societies Credit Structure (STCCS) in the state, comprising the State ~erm dooperative ~ank (SCB) and Primary Agricultural Credit Societies (PACS) including LAMPS, MPCS and FSS affiliated to theAgriculture State Co-operative Bank Ltd., on a sustainable basis as under. To be inserted in 1. In the Principal Act, After Section 1 1, the following Section Section shall be inserted, namely:- As Section"1 I .A" "1 1. A:- No primary Agriculture Credit Cooperative SocietyIMPCS shall used the word "Bank', "Banking", Banker or any other derivative of the word "Bank" in its name and the existing society using such name shall be deregistered by the Registrar. To be inserted in Section 13 As Sub- Section (4)

1. (3) the following Sub-section shall be inserted, namely:- (4):- Provided that the application forthe registration of the Amendment of bye-Laws of a Short Term

Cooperative Credit Structure Society shall be

disposed off so far as pmcticable within30 days fiom the date of the receipt ofthe application. To be inserted in 3. In thePrincipalAct 14, after Section 14, the Section following section shall be inserted as 14-A:- As Sub-section "14-A" " 14-A (i):- A short Term Cooperative Credit Structure Society shall be at liberty to affiliate or disaffiliate with any federal Societv of its choice. provided s resolution approving such affiliation or disaftiliation with the federal societv aassed in the . A annual general meeting with three fourth majority

of total members, subject to the approval of the

R.C.Sn (ii):- A Short Term Cooperative Credit Structure Society shall have the freedom of entry and exist

To be inserted in Section 17 (1) Sub- Clause (a) at any tier of CCS and there shall be no mandatory

restrictions of geographical boundaries for its

operations.

inserted as Sub-clause (a). namely:- \ ,. "17 (1) (a): To provide full voting membership right to all de~ositors/borrowers in Coo~eratives other L than Cooperative Banks, provide that he or she is a share holder of the Registered Cooperative Society". To be inserted in "34-A (1):- The Committee of every Section 32 (I) (a-i) society in a Cooperative Credit Structure shall have

freedom to decide its financial and internal

administrative matters, especially in the following areas".

1. (i) Interest rates ondepositsand loans inconformity with RBI guidelines,
2. (ii) Borrowings and investments,
3. (ii) Loans policies and individuals loans decisions,
4. (iv) Personal policy, staffing, recruitment, posting and compensation for the audit.

1. (2) No person shall be elected, nominated or co- opted or allowed to continue as a member of the Board of Short Term Cooperative Credit Society, if he, :-
   • (i) Is a person who represents a society other than PACSMPCS on the Board of the SCB, if such societyto whom herepresents has committed a default towards the payments to such Bank for a period exceeding 90 (Ninety) days.
   • (ii) Is a person who committed a default towards the payments to a PACSMPCS or represents a society on the Board of the SCB, if such society to whom he

represents has committed a default towards the

payments suchbank for a period exceeding one year unless the default is cleared. To be inserted in 7. Inthe principal Act, in Section 36, after Sub-

Section 36 as Section36-A (I) (2)

1. (3) (4) Section 5, the following section shall be inserted, namely- 36 (A) (1): The Supercession of the Board of the SCB SCB by theRCS under any other Sectionofthe State

Cooperative Society Bill, shall be done only

in consultation ofthe RBI.

1. (2) The Supercession of the Board of the PACS/ MPCS shall be done by the RCS only under the following conditions; 6) Ifa society incurs losses for three consecutive years, or 6) If serious financial irregularities or huds have been identified, or (iii Ifthere are judicial directives to this effects or there is perpetual lack of quorum.
2. (3) The RCS shall conduct elections to a Short Term Cooperative Credit Structure Society within two month from the date of supercession.
3. (4) The member ofthe Board which has been removed under Sub- Section 2 (i),
   • (ii) and 2 (iii) shall not be eligible to contest the election again for a period of three years from the date of supercession. To be inserted in

Section 39 as section shall be inserted, namely:- Section "39.A" " 39 (A) :- The Directors and Chief Excecutive Officers of the SCB who do not fulfil the criteria

stipulated by the RBI shall be removed by the

Registrar or the AppointingAuthority, as the case may be at the recommendation of the NABARD or RBI. To be inserted in

Section 42 as section shall be inserted, namely:- Section 42-A

fieedom to obtain loans fiom any Bank or financial institutions regulated by RBI and refinance from NABARD or any other refinancing agency directly or through any RBIregulated fmancial institutions

To be re-numbered And added in Section 43 as andnot necessary from the federal society to which is afliliated ". 1 0. In the Principal Act, in section 43, the existing section shall be renumbered as Sub-section (1) of the section and after Sub-section (1) as so renumbered, clause(2) the following Sub-section shall be added, namely:- "(2) 25% State equity shall be applicable to the State Cooperative Bank (SCB) in the normal course, the State Government may be further allowed to contribute equity above the limit only in case of equity infusion as required in the SCB in accordane with Section 11 (1) of the BRAct 1949

1. (AACS) provide that there shall be only one Government representative on the Board of SCB duly nominated by the authority concerned. The

CEO of the SCB shall not be treated as the

representative on the Board. However, in case of the Board of PACS/MPCS/LAMPS/FSS, there shall be no Government nominee. The State or a Cooperative may reduce or enhance the State equity at any level if so advice." To be added in 11. In the Pricipal Act, in Section 5 1, after Sub Section Section 5 1 as (2), the following Sub- Section shall be added, namely:- Sub-section 51 (3) (4) " (3)- A Short Term Cooperative Credit Structure Society shall have the freedom to invest or deposit

its funds in the Bank or financial institution

regualated by the Reserve Bank of India and not necessarily in the federal society to which it is affiliated." To be inserted in Section 53 as Section 52-A

to be inserted, namely:- "52-A. Provide that in the case of societies in the Cooperative Credit Structure, the Government or Registrar shall have no powers to direct the society

to contribute to any other fund other than those required for improving the net worth/owned fkds ". To be inserted in

(4):- Provided that the application for the registration of the Amendment of bye-Laws of a Short Term Cooperative Credit Structure Society shall be disposed off so far as practicable within 30 days from the date of the receipt of the application.