Revolutionary move: Gujarat allows distribution of dividends without AGM

In a far-reaching move, the Gujarat govt has allowed the boards of co-operative bodies in the state to decide on the distribution of dividends even before the Annual General Meeting is conducted. Its only condition is that the same has to be approved whenever the AGM is held.

According to the notification, “All the Cooperative Societies have been exempted from the provision of Section 66(2) of Gujarat Cooperative Societies Act for the distribution of the dividend for the financial year 2019-20 with the approval of the Managing committee subject to the condition that the approval will be sought in the ensuing Annual General Meeting”, it reads.

The recently announced notification also extended the deadline for conducting the Annual General Meeting of cooperatives in the state. The date has been extended till 31st March 2021.

Besides, the existing boards have been allowed to continue till 31 December 2020 that is till the election is held. Several co-op organizations including Kaira District Cooperative Milk Union, Sumul Dairy and others have organized their elections with the prior approval from the district collector. It is being said that co-ops can organize the elections by taking approval from the district collector.

The notification was released recently by Atul N Patel, Deputy Secretary, Govt. of Gujarat, Agriculture, farmers welfare and Cooperation department. “The present Management Committees of the Cooperative Societies specified under section- 74- C (2)(4) of Gujarat Cooperative Societies Act and all other Cooperative Societies covered under section- 74 (1-G) (2) have been exempted from the said provision and it has been decided to extend the term of these present Management Committees till the date of their election or 31- 12- 2020 whichever occur earlier”, according to the notification.

It is to be mentioned here only those co-ops which are not having banking licence like Gujcomasol and other co-ops can distribute dividend to their members with the approval of the Managing Committee.

It bears recall that earlier several local co-operators of the state including NCUI Vice-President and Gujarat State Cooperative Union Chairman G H Amin had urged the government to extend the date of AGM and election. Amin has also met the state Co-op Minister Ishwarsinh Patel in this regard.

On an average there are 6,000 credit co-ops in Gujarat, 220 Urban Cooperative Banks,18 DCCBs and others.

Though, the notification remains silent on how to conduct the AGM through video conferencing or any other Audio-Visual Means.