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Co-operative Principles : Advocate Mrudgandha Joshi

Cooperative is a State subject as per the Constitutional provisions. Accordingly the State governments have to formulate Acts and rules for implementation in their respective States. As per the 97th Constitutional amendment, executed from 13.02.2013; A person has fundamental right to form a cooperative. (Art 19 1(i))

Also new Article 43B(Directive Principles of State Policy) states that

“The State shall endeavour to promote voluntary formation, autonomous functioning, democratic control and professional management of the cooperative societies”

Cooperatives are an important part of Indian economy. There has been a noticeable increase in the number of cooperatives in the past few years. For proper and smooth functioning and to propagate the growth of cooperatives, all the four factors i.e. voluntary formation, autonomous functioning, democratic control and professional management are necessary.  In order to bring about orderly development of co-operative movement in the State, seven Cooperative principles have been enumerated which can be called as the guidelines for co-operatives. The Seven principles of Cooperatives are as follows:-

1.Voluntary & open membership

Membership is voluntary and open. No discrimination on basis of caste, creed , race ,religion etc

2. Democratic member control

State cooperative Election Authority formed, elected committee has to act as a trustee, provisions to use power given by General Body (members)

3. Member Economic Participation

e.g. Member to pay his share of contribution for maintenance of cooperative society

4. Autonomy & Independence

No interference by outside body. Govt., local authorities e.g. autonomy and independence to conduct  Audit.

5. Education Training & Information

 Education and training of members compulsory

 6. Cooperation among Cooperatives

Help other cooperatives to grow, Investment in specified cooperative Banks, Buying produces from cooperatives

 7. Concern for Community

Sustainable development of community. Opportunity to be given to members

 After the 97th constitutional amendment many new provisions and concepts have been introduced in the Maharashtra Cooperative Societies Act 1960, the Maharashtra Cooperative Societies Rules 1961 and Bye-laws. For eg

  • Active member
  •  Revised methods for auditors
  •  Establishment of election authorities
  •  Education & Training for office bearers and members .

It can be said that understanding of provisions of cooperative laws would be easier if these are studied in the backdrop of Cooperative principles.


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