In reacting to a piece on the amendments in multi state cooperative societies act,2010, Ashok Davas, Member Governing Council, NCUI has given a rather longish comment. Discussion and debates being hallmark of democratic institutions, we publish his piece without editing -Editor

Cooperatives are ideally autonomous bodies which are member driven, managed and owned by the members. Govt. control is neither required nor desirable.

The proposed Bill is a retrograde step and would only harm the Cooperatives and the proposed legislation if enacted, is bound to be exploited by the jealous officers and the corrupt politicians.

If the Govt. can not support the Cooperatives then it must leave the Cooperatives to chalk-out their own destiny.

History is witness to the fact that where ever the Govt. has supported the Cooperatives by way of conducive policy support, the Cooperatives have thrived and have served the community in a most be-fitting manner.

In the post-independence era the Democratic Governments have used the Cooperatives as Growth Engines to eradicate poverty ; remove economic and social inequality.

Thereafter different State Governments enforced different Legislations which resulted in diverse results. The coope movement thrived because of supportive Legislation in the States like Gujarat, Maharashtra and to some extent in Punjab, Haryana ; UP.

Where ever the Legislation was stringent and was more of a controlling type the movement has suffered. There is no end to the greed of govt control.

Instead of controlling, supportive legislations must be enforced for cooperatives to continue their objects to remove social and economic inequality. There is need to be  sensitive than be stringent. Care is the need, not the Control. Nurse Cooperatives, don’t ruin it.

It would be a wise if the Govt. withdraws the proposed Bill.

ASHOK DABAS, Member Governing Council, NCUI

A big change in the multi state cooperative societies is in offing which will not only change the multi state cooperative institutions but also the cooperative movement as a whole. Union Cabinet has already passed the Multi-State Cooperative societies (Amendment) Bill 2010.

Parliamentary Affairs Minister Pawan Kumar Bansal on behalf of Sharad Pawar on Monday tabled legislation in the Lok Sabha The continuous uproar in the Parliament has so far stalled this bill along with many other business transactions of the House. But it can not be stalled for ever.

Cooperative sector in India is divided on its opinion on the bill with NCUI president Mr Chandra Pal Singh Yadav strongly objecting to provisions of bill while IFFCO Chairman Mr Surendra Jakhar announcing full support to the bill during Nehru Memorial Lecture function.

Government says that after the working of Multi state cooperative act for last 8 years, it has been felt that certain modifications in the act are needed.

But what is the bill and what are its implications? Talking to various experts, Indian cooperative.com has tried to understand them.

We present below the major provisions of the bill

1 The central registrar may declare a multi state cooperative society as sick. He may dissolve the board and constitute an interim board for a maximum period of 5 years.

2 Multi State Cooperative Society may refund full or part of the share capital held by the government on the face value or book value which ever is higher.

3 one seat will be reserved for scheduled caste or schedule tribe and two seats for women in the board of multi state cooperative society.

4 The board will constitute an audit and ethics committee in accordance with the bye laws which shall meet once in three months. Besides, the Central Government may lay down auditing and accounting standards to be adopted by the societies. The Central Govt also may order for a special audit of multi state society where the central govt or state govt holds any share capital

5 On receipt of reference of dispute, the central registrar may decide the dispute himself or may transfer it for decision to such person and upon such terms and condition as may be specified. The order passed under this sub section shall be final and binding and shall not be called in question in any court.

6 Every multi state cooperative society shall appoint a Chief Information Officer to provide information about the affairs and management of the society within 30 days of receipt of application

7 The Central government will appoint a Cooperative Election Authority which will conduct the election, prepare voters list and appoint returning officer.

8 The Central government will establish a fund to be called the Cooperative Rehabilitation and Reconstruction Fund in which a society has to contribute 0.005 to 0.1 percent of its turn over subject to a maximum of Rs 3 crore a year

9 If the Chairman of the multi state cooperative fails to fix a date of meeting of Board the chief executive can convene the meeting of the Board on receipt of the requisition from one fourth of Directors

10 Quorum of board meeting will be one third of total strength and participation by video-conferencing will be counted for the purpose of quorum

11 There would be compulsory filing of applications, document, inspection etc in electronic form

Cooperative Banks image was dashed when the chairman of the Pen Cooperative Bank, Shishir Dharkar, his wife and six others were arrested on Thursday in connection with a Rs 480-crore gold export fraud.

Some exporters took an advance from MSTC Limited, a government of India enterprise for export of gold, but allegedly usurped the amount and deposited the amount in the Pen Urban Cooperative Bank and later used some of it to buy property in and around Pen.

Pen bank’s director, Prem Kumar Sharma, Jayesh Desai, director of Joshi Bullion Gems and Jewellery Private Limited, Rahis Ahmed, partner in Strategic Consultancy, and R Mani, proprietor of Great Aid were also arrested along with Dharkar’s wife, Gulraihna Oomer, a Bahrain national.

Sharma, Ahmed and Mani allegedly acted as agents between the exporters and MSTC. The special judge for CBI cases on Friday remanded the accused into CBI custody until December 6.

Shamrao Vithal Cooperative Bank is recruiting in clerical cadres. The Bank is 104 years old and is  among leading top three Urban Co-operative Banks in the country.

Eligible candidates are advised to apply for the post till 18.12.2010 ,only through the Shamrao Vithal Cooperative Bank’s website

http://www.svcbank.com/docs.

Educational Qualifications: Graduate/Post Graduate of a recognized University with minimum 45% marks and adequate knowledge of computer application.

Age Limit (eligibility as on 18.12.2010) 30 years for graduates / post graduates / double graduates.

Importants dates for the Shamrao Vithal Cooperative Bank’s recruitment

Closing date  for online registration is 18.12.2010

Date for the written examination is 23.01.2011

Cooperative can usher in blue revolution. After green and white revolution, we hear talk of blue revolution. Blue is the colour of ocean and revolution to increase the productivity of fish is called blue revolution. Fortunately, both the revolutions-green and white were ignited by cooperative sector only. Now it has to plunge headlong to bring about blue revolution.

Speaking on the occasion of workshop organized by FISHCOFED at NCUI in Delhi on Thursday Prof. K.V. Thomas, Minister of State for Agriculture said that cooperatives offer huge scope for reorganizing this sector.

The fishermen cooperatives can enable them to develop the skill required and also any kind of financial support to them by framing fishermen cooperatives in the country said the Chief Guest The cooperatives should be answerable to the members as well as to the people for which they are working.

The fishermen are facing the problem of the marketing of the fishes as there is a substantial gap between what fishermen receives for its produce and what the other agencies receive from the final consumer. The cooperatives should develop effective network of marketing system so that the exploitation of fisherman is checked, said the Minister.

We also need to increase social security system for the fishermen and their families so that fishing sector can be developed and revitalized, he said. He further urged fishery cooperatives and specially the FISHCOPFED to provide the capacity building to the fishery cooperatives in the country and said his Government can provide all help and support in this regard.

The National Workshop was organized on Net-working of Fish Marketing & Achievement on Insurance of Fishers by National Federation of Fishery Cooperatives in collaboration with National Cooperative Union of India and Oriental Insurance Company Ltd.

Shri Naeem Ahmed Ansari, Chairman, FISHCOPFED, the National apex level Fishery Cooperative said that FISHCOPFED has kept the target of covering the accidental Insurance Policy for 33 lakhs fishermen for the year 2010-11.

He further said that through its strong base of 22 state level fishery and women cooperative union and 133 district level fishery cooperatives and 20000 primary level fishery cooperatives, it is possible to achieve this target and also provide human resource development to this sector by the FISHCOPFED.

He requested the Minister to provide necessary land at Kerala so that the activities of the fishery cooperatives can be further strengthen in the Southern Costal States.

Speaking on the occasion Shri Ajay Srivastava, Director, Department of Animal Husbandry, Dairy and Fishery, Ministry of Agriculture, Govt. of India said that the present Government is giving due priority to the Fishery Cooperatives through its various livelihood schemes and social security system.

Shri C.R. Murthy, Executive Director, National Fishery Development Board said that their Board is committed for all round development of fishermen and fishery sector in the country and making the Blue Revolution successful and increasing the production and productivity of the fishery in the country and utilizing the existing potential of both inland and marine fishery resources.

Shri B.K. Mishra, Managing Director, FISHCOPFED proposed vote of thanks and said that their federation is working on Net-working and developing the data base for all the 20000 primary level fishery cooperatives in the country and requested the Minister to provide small shops as infrastructure for marketing of fishery in the line of milk booth in Delhi.

There was a piece of news titled Kudos to Indian Cooperators! in which story of Dr Chandra Pal Singh having been unanimously elected as Vice-President of International Cooperative Alliance Asia Pacific Region (ICA-AP) held on 5th Sept. 2010 at Beijing (China) was mentioned .

The story also mentioned another Indian who got elected to consumer committee Mr Virendra Singh. Unfortunately another Indian name was omitted inadvertently and without malice. He  is Mr Bhagwati Prasad, Ex-Chief-Executive, NCUI who has been  elected as Chairman of ICA HRD Committee for the next term of four years. We sincerely apologize to him and can assure him of fair play and impartial reporting.

Given below is his letter to Indiancoopeartive.com on the issue

I am visiting this site for the first time hence sorry for delay in posting my comments. Besides election of above two Indian leaders to different positions in ICA Asia-Pacific,another Indian,myself (Bhagwati Prasad,Ex-Chief-Executive,NCUI and Vice-President,Cooperative House-Building and Finance Corporation Ltd.,Lucknow(Registered under Multi State Cooperative Societies Act.2002)was elected as Chairman of ICA HRD Committee for the next term of four years on 1st.Sept.2010 during ICA Regional Assembly held in Beijing,China.

Who so ever has provided information about the above news has knowingly or unknowingly missed/suppressed this news or forgot that I am also an Indian.

Cosmos Co-operative Bank Ltd., Pune, Maharashtra, has violated Reserve Bank of India directives by sanctioning loans to directors, their relatives and firms in which directors or their relatives are interested.

The bank has violated instructions by not publishing the correct amount of loans outstanding in the names of directors/relatives/firms in which they are interested in the `notes on account’ to the balance sheet in the successive annual reports during 2004 to 2009.

The Reserve Bank of India has imposed a monetary penalty of 5.00 lakh (Rupees Five Lakh only) on Cosmos Co-operative Bank Ltd., Pune, Maharashtra, in exercise of powers vested in it under Banking Regulation Act, 1949  (as applicable to co-operative societies), for violation of instructions/guidelines of the Reserve Bank of India.

The bank had not furnished correct information in the quarterly control returns submitted to RBI during the period 2004 to 2009. None of the 43 loans sanctioned in violation of directives were reflected in the OSS data submitted to Reserve Bank of India.

The Reserve Bank of India had issued a show cause notice to the bank, in response to which the bank submitted written reply. After considering the fact of the case and the bank’s reply in the matter, the Reserve Bank came to the conclusion that the violations were substantiated and warranted imposition of the penalty.

Interestingly, Mr Abhyankar, Chairman of the Cosmos bank is in the committee set up to grant licence to cooperative banks.

On the 23^rd Jawaharlal Nehru Memorial IFCCO Lecture, held on 19^th November at NCUI Auditorium in Delhi Dr Karan Singh, scholar and statesman recounted the contributions of Pandit Nehru to the country in general and to cooperative movement in particular. Calling IFFCO as one of the finest cooperative institutions in the world he wondered at its network of 40 thousand members.

Farmers’ ills are being addressed by the IFFCO in a comprehensive manner-is a matter of great satisfaction, added Dr Karan Singh. Leading green revolution in the country IFFCO has indeed achieved great heights of excellence in the field of agriculture and farming.

Dr Singh wanted IFFCO to venture in the field of organic fertilizer and solar energy. “Using the platform of IFFCO I send my good wishes to the farmers of the nation”, said Dr Singh.

The occasion was graced by the who is who of the cooperative sector in India as IFFCO also announced the Sahakar Ratna and Sahakar Bandhu awards to Shri Mahendra Shastri and Shri O P Agrawal respectively for their eminent contribution to the field of cooperative movement.

Addressing the jam packed auditorium, Chairman of IFFCO Shri Surendra Kumar Jakhar said that since 1983 IFFCO is organizing Nehru Memorial Lecture and it is a tribute to the great leader Nehru who dreamt of changing India’s social and economic status through cooperation and cooperative movement. He felt proud of the fact that IFFCO is the only organization from India to be a member of International Cooperative Alliance (ICA).

Referring to proposed amendment to Multi State Cooperative Act, Shri Khakher said that IFFCO lends its full support to the amendments.

Shri U S Awasthi, Managing Director said that we do produce chemical fertilizer but our focus remains to be farmers. Referring to Save the Soil campaign he said that it has led to growth multiplication of 3 times for the farmers. Following Panditji’s vision IFFCO is trying to make cooperative as one’s way of life, said Dr Awasthi. Rural communication , insurance and dairy are some of the means through which  we try to realize Panditji’s dream, said a proud MD.

Massages for the occasion from the President Pratibha Devisingh Patil, Vice President Hamid Ansari, Prime Minister Manmohan Singh, Sonia Gandhi, Shard Pawar and other leaders were also read out. They all wished great success to IFFCO.

Chan Ho Choi, Regional Director lauded IFFCO’S role while Sahakar Ratna and Sahakar Bandhu awardees thanked IFFCO for honouring them and leading the cooperative movement in India by front.

Mr Rakesh Kapoor, Joint MD gave a brief introduction of Dr Karan Singh while Shri Ghanshayam Das, Head PR proposed vote of thanks.

Madhya Pradesh Cooperative Minister Shri Gourishankar Bisen has said that people increasingly see cooperatives as the last resort. While inaugurating a function on the eve of Cooperative Week in Bhopal he said that there is a need for better coordination between cooperative institutes and cooperative department of the government.

Giving bonanza, he also announced  50 per cent dearness allowance with the basic pay of the employees of Cooperative Federation.State Cooperative Federation Chairman Shri Arun Singh Tomar, Madhya Pradesh State Cooperative Marketing Federation Chairman Shri Ramakant Bhargava, State Cooperative Housing Federation Chairman Shri Sushil Waswani, Madhya Pradesh State Agriculture And Rural Development Bank Chairman Shri Kishan Singh Bhatol and Commissioner Cooperative Shri Arun Pandey were present on the occasion.

Bisen claimed that the cooperatives have become beneficial to the farmers. Chief Minister Shri Shivraj Singh Chouhan has taken a historical decision to give agricultural loan to the farmers at 3 per cent interest rate. He said that this is an example for the whole country. Cooperative revolution in the state is better than any other state, he added

Bisen also patted himself and his BJP govt on back for checking the  misappropriation of  society funds. He said that strong action has been initiated against the land mafia who deprived society members of the cooperative housing societies of plots of land.

What is needed today is to give wide publicity for the good work being done in the cooperative sector, added the Minister The State Cooperative Federation can play important role in this direction, he said. The cooperative institutions should cooperative with the Federation to strengthen it financially for this purpose, concluded the Minister.

Indian Cooperative.com published a piece in which Dr G N Saxena, Director(Cooperative Development) at IFFCO shared his views about Education Fund and demanded that it should be shifted in the custody of some neutral government agency such as NCDC.

NCUI, the apex body of Cooperatives in the country has reacted to this statement by Dr Saxena.

Indian Cooperative.com believes that discourse and free flow of ideas will build strong cooperative movement and thus offers plat form to cooperatives institutions and cooperators so that meaningful dialogue could be started.

We produce excerpts of the rejoinder from NCUI which came as a signed copy from Mrs Anita Manchanda,Chief Executive

In a strong rebuttal to the frivolous and fallacious charges leveled by Dr. G.N. Saxena, one of the officers of IFFCO about the operation of Cooperative Education Fund by NCUI (News posted by Ajay Jha on 12th October, 2010 in Indian Cooperative.com), NCUI has to emphatically explain its position as under :-

2. NCUI is registered under Multi-State Cooperative Societies Act, 2002 and all the provisions contained therein have the sanctity and sanction of the concerned authorities / bodies.

3. Any unwarranted deviation from the provisions of the Act could, therefore, be termed as questioning the wisdom of the above said authorities or in other words should have their considered approval / sanction before any interference in any of the provision(s) is suggested.

4. NCUI is an apex body of cooperatives in the country.  Education and training is one of its prime objectives well recognized by GOI and cooperatives.  The role of NCUI has been recognized in the said Act itself.  As per Section 63 (1) (b) of the Act, “a multi-state cooperative society shall out of its net profits in any year credit one per cent to cooperative education fund `maintained’ by the National Cooperative Union of India, New Delhi in the manner as may be prescribed.”  IFFCO being one of the profit making multi-state cooperative societies contributes to the Cooperative Education Fund “maintained” by NCUI which is in accordance with the provisions of the Act and a step in the right direction.

5. As per Multi-State Cooperative Societies Rules, 2002, Section 25 (1), “the Cooperative Education Fund shall be “administered” by a Committee constituted by the Central Government.”  The Committee comprises of : President, NCUI, Chairperson, the Central Registrar, FA of DOAC, two representatives of Multi-State Societies nominated by the Central Government, the Director General, NCCT and Director, VAMNICOM.  Pursuant to the said provision, the present Committee was constituted by DOAC on 11.9.2009 for two years.  For “administration” of the Fund the following conditions apply :-

a) NCUI shall “maintain” the Fund in a separate account.

b) The Fund shall be utilized for the purpose connected with the Cooperative Education and HRD for cooperatives.  The Committee may undertake the said programme through NCUI, NCCT, “contributing members” or “any other professionally qualified body” as the Committee may decide.

c) No expenditure out of the Fund shall be incurred without the approval of the Committee.

Section 70 (Chapter VIII) of the Act provides for provision for Audit and Inspection by a system to be enunciated by the Central Registrar.

6. NCUI has opened a separate account to maintain the fund.  All the receipts and income by way of interest or otherwise accruing from the contribution are credited to this Fund.  The application of Fund for education and training programmes, decided by the Committee is reflected in the Annual Account and Annual Report of NCUI placed before the Parliament, through DOAC every year.

7. Thus, for all practical purposes, the power to “administer” the fund, audit and inspection of NCUI (including the Fund) lies with Central Registrar and DOAC.  All the expenditure incurred by NCUI has to have the approval of the Committee  and is subject to audit and inspection.  Therefore, the question of “hard earned money not being utilized properly” does not arise.  NCUI is only “maintaining” the Fund as prescribed by the Committee.

8. IFFCO is the most successful cooperative in India and therefore, is rightly contributing to the Cooperative Education Fund as per provisions of the Act. During the last 4 years, IFFCO has contributed to the Fund as under :- .

For the Year                                                     Amount (Rs. in Crores)

2005-06                                                           3.41

2006-07                                                           1.75

2007-08                                                           2.57

2008-09                                                           3.58

2009-2010                                                       Not received so far.

Therefore, the statement that IFFCO contributed about Rs. 4.5 crores last year (even in any year) is not borne out of facts.  For the year 2009-10, no funds have been received so far.  In any case, the contribution of IFFCO has ranged between 24 to 30% in these years.  The balance has been contributed by other organizations.  As per the statement,  it may touch Rs. 10 crores (estimated) this year.  If this materializes, NCUI would welcome it and have the potential and programmes to expend the same.

9.  As already stated that all the expenditure incurred by NCUI, out of the Education Fund has the approval of the Committee.  Therefore, “any talk of education fund diverted to renovate the guest house in NCUI and this has led to heart burning among the “contributors” seems to be nothing but figment of imagination.  As a matter of fact, NCUI is maintaining the “hostel” in proper shape, which is part and parcel of education and training activities of NCUI/NCCE and not the “guest house” and no other contributor has raised this trivial issue.

10. It has been rightly pointed out that NCUI is the apex body of cooperatives and therefore, custodian of the fund “so far”.  As a matter of fact, NCUI is charged with the responsibility of “maintaining” the Fund which means to keep it in proper and good condition or is the “custodian” as stated which means keeping it safe or guarding it, but the responsibility of “administering” or to direct or control it lies with the Central Registrar and DOAC.  Since, the mandate of NCUI is education and training, it is not only obligatory but essential for them to maintain the Fund perpetually.

11. The insinuation that custody of the Fund should be shifted from NCUI to NCDC i.e. some neutral government agency or Dr. Saxena emphasized the need to have a government body like NCDC to take care of the Fund is illogical, untenable, much against the fundamental principles of cooperation and provisions of the Act sanctified by the Parliament.

12. As per Section 25 (5) of the Rules, the Committee is empowered to undertake the programmes of cooperative education and training and HRD through “NCUI”, “NCCT”, “contributing members” or “any other professionally qualified body”, as the Committee may decide.  Ever since its establishment in 1929, NCUI has been the premier institution for organising cooperative education and training through a countrywide network right from village to national levels, built through decades of selfless service.  No other institution has such an infrastructure.  The contribution of NCUI is well recognized.

13. NCDC is a Statutory Corporation under DOAC and is basically a promotional and developmental financing institution.  It has certain objectives to fulfil.  It has its own modest set up of training of personnel of projects funded by it.  There is a sea of difference between the objectives of the two organisations and therefore, the suggestion that custody of the Fund may be transferred to NCDC is ill-conceived and aimed at undermining or tarnishing the image of NCUI.

14. Such a move is against the fundamental principle of “Cooperation among Cooperatives” and self and mutual aid.  To say the least, NCDC is not a” multi state cooperative” and NCUI no less a “professionally qualified body.”  NCDC is also not a contributing member to the Fund.

15. IFFCO has been member of the Committee for 15 years and at no occasion this matter was raised by them.  IFFCO is also in the Governing Council of NCUI and did not bother to raise this issue.  Propriety demands that if they have any grouse or suggestion to make that can be done by directly taking up the matter with NCUI or raising the issue in the NCUI Governing Council Meeting(s).  It is therefore, surmised that this is the personal opinion of Dr. Saxena and not the official stated position of IFFCO.

16.The sudden outburst of Dr. Saxena is just to spread a canard.  The adoption of such extra territorial tactics may neither serve his interest and certainly not of the cooperative movement at large.  There are other pressing issues which need collectively our attention.  In our opinion, the matter of maintenance and administration of the Fund may be left in the care of time tested NCUI and thoughtfully crafted Committee of DOAC.