Question

Attempt the following:

Describe the features of the Co-operative Society.

Answer 1

The features of Co-operative Society are as follows:

1. Limited Liability: The liability of members IS limited. It depends upon the value of shares purchased by members. Therefore, their personal property is not used for payment of society’s debt.
2. Management: Elected representatives of members from the Managing Committee. The Managing Committee works according to bye-laws. Collective decisions are taken after conducting meetings. The organisation is managed on democratic principles.
3. Service Motive: The main motive of a co-operative organisation is to give service to the people. It is not profit oriented. Utmost importance is given to the welfare of the people. In that sense, a co-operative society differs from other forms of organisation.
4. Surplus Profit: Profits are made in the course of business after payment of dividends to shareholders. A percentage of profit is always used for the welfare of the people. A bonus is given to employees and as a bonus on purchase made by members.
5. Separate Legal Status: A Co-operative Society is formed according to the Co-operative Societies Act, 1912, which gives it independent legal status. It is distinct from its members. Therefore it can enter into contract purchase property, etc. in its name.
6. Equal Voting Rights: All the members in Co-operative Societies have equal voting rights irrespective of the number of shares held by them.
7. Number of Members: Minimum 10 members are required for the formation of the Co-operative Society. There is no limit on maximum number of members.
8. Democratic Principle: Democracy is followed in the working of cooperatives. Equality of voting rights is the main principle of the organisation. The principle of ‘One member One vote’ is followed. All members are equal in society.
9. Voluntary Association and Open Membership: Co-operative organisation is a voluntary association of individuals. Membership is voluntary. Any person can become a member of the organisation. No difference is made on the basis of language, religion, caste, etc. There is an open membership. A person can become a member of his own free will and terminate membership whenever he wants.
10. Registration: Registration of a Co-operative organisation is compulsory under the Co-operative Society’s Act, 1912. Registration is done according to the Act of every state. In Maharashtra, Societies are registered under Maharashtra State Co-operative Societies Act, 1960.
11. State Support: Co-operatives receive support from the government. They are under the control and supervision of the State. All of them are registered under the Co-operative Societies Act, 1912. They get a corporate status. They get concessions from the government in the purchase of land, payment of tax, etc. They get legal and financial assistance also.