A group of people formed as a separate organization and which has as a stated purpose some charitable or benevolent purpose either in regards to the public at-large or in regards to the common interests of the members, and which operates as nearly as possible at cost.
Features:-
- It's a group of persons
- For some common interest or purpose
- United by a common vow
- Follows the same trade or profession
Benefits of Society:
- Easy to form
- No obstruction for membership
- Limited liability
- Service motive
- Democratic management
- Stability and continuity
- Economic operations
- Surplus shared by the members
- State patronage
Limitations of Society:
- Limited resources
- Inefficient management
- Lack of secrecy
- Cash trading
- Excessive Government interference
- Absence of motivation
- Disputes and differences
Suitability:
Any group of persons can form a cooperative society of their own if they so like to act jointly for the common benefit of each other. But that is not the legal way of formation the cooperative society. All societies must be formed under the Cooperative Societies Act, 1912 or under the relevant state cooperative laws.
Formation of Society:
For formation of a cooperative society at least 10 persons are required. They must have the common objective to serve each other by forming a society. They have to contribute capital in form of share capital and decide to take up any one or more activities. They form a managing committee from and among the members who looks after the management of the society and implements the decisions of the members. As our Constitution is wedded to a socialistic pattern of society, it is a part of the Government policy to promote and encourage establishment of cooperative societies.
Therefore, co-operative societies enjoy several benefits provided by the Government from time to time. But in order to avail those benefits the society must have to register under the Cooperative Societies Act.
The procedure for registration are as follow :
Apply for registration of the association as cooperative society in a prescribed proforma available with the Registrar of Cooperative Societies with requisite information like -
- List of members, their individual addresses
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Name and objectives of the society for which it has been formed
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Collection of funds - share capital or loan fund with their utilization process
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Office bearers as managing committee and their powers
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Admission and retirement of members
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Bye-law of the society