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 ~ e r m dooperative ~ a n k (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 11 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) 2. In the principalAct in Section 13,after Sub- Section (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 14 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. 4. Inthe PrincipalAct in Section 17 (1) shall be 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". (i) Interest rates ondepositsand loans inconformity with RBI guidelines, (ii) Borrowings and investments, (ii) Loans policies and individuals loans decisions, (iv) Personal policy, staffing, recruitment, posting and compensation for the audit. (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) (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. (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 h u d s have been identified, or (iii Ifthere are judicial directives to this effects or there is perpetual lack of quorum. (3) The RCS shall conduct elections to a Short Term Cooperative Credit Structure Society within two month from the date of supercession. (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 8. In the principal Act, after Section39,the following 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 9. In the principal Act, after Section42, the following Section 42 as section shall be inserted, namely:- Section 42-A Provided that in the case of Societies in the Cooperatives Credit Structure, shall have the 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 (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 12. In the principal Act, after Section 52, the following 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 f k d s ". To be inserted in 13. In the principal Acr, in Section 54, after Sub- Section Section 54 as (3), the following Sub-section shall be added, namely:- Sub- Section (4) (5) "(4)- A Short Term Cooperative Credit Structure Society of PACSIMPCS shall pay devident in accordance with the guidelines h e d by the RCS in consultation with theNABARD." To be inserted in 14. In the Principal Act, in section 55, after Sub- Section Section 55 as Sub-section shall be inserted, namely:- Su-Section (4) (5) "The Registrar shall ensure conduct of audit and certification of the account of the SCB by Chartered Accountants. The panel of auditors shall be prepared by the Registrar in prior consultant with the NABARD. (5)- The Registrar shall ensure conduct of special audit of SCB if requested by the RBI in the manner and fonn sptipulated by the RBI and also f b k h thereport to RBI within the time stipulated."