Cooperative Society : Principles

Cooperation is a act of Voluntary execution strategy

The Cooperative society in it have objectives of  promoting the interests of its members in accordance with the principles of cooperation. Therefore the cooperative society incorporates different strategy than other form of business.

The main characteristics includes 

• Open membership policy – That means its open to all those of have common interest.
• Voluntary association – Members can exit at its will and join as long as they can.
• State Control –  To protect the interest of members, co-operative societies are placed under state control through registration. While getting registered, a society has to submit details about the members and the business it is to undertake.
• Finance is being contributed by all its members
• Service is main motive
• Separate legal entity – can buy/sell all its properties by own name.
• Self Help through cooperation and distribution of profits to all its members.

Cooperative societies may be governed by the respective State cooperative societies Act or by the Multi-State Cooperative Societies Act 2002. The societies main objective is to serve in the interests of its members are governed by the Cooperative Societies Act of that particular State. While, a Society whose objectives is to serve in the interests of its members more than a State are governed by the Multi-State Cooperative Societies Act, 2002.

Cooperative societies application for registration  shall be made to the Registrar of Cooperative societies under the state act, At least ten persons having the capacity to enter into a contract with common economic objectives.

Therefore Advantages it primly have easy formation, reasonable pricing and services, limited liability, elimination of middle men’s profit, state and central assistance and stable life. But also disadvantages it can be face in terms of Capital, Managerial, organisational limitation and dependence on Government.

Click here for government certification in Legal