Part IXB: Co-operative Societies

Article 243ZQ: Offences and Penalties

Original Article:

(1) The Legislature of a State may, by law, make provisions for the offences relating to the co-operative societies and penalties for such offences.

(2) A law made by the Legislature of a State under clause (1) shall include the commission of the following act or omission as offences, namely:

• (a) a co-operative society or an officer or member thereof wilfully makes a false return or furnishes false information, or any person wilfully not furnishes any information required from him by a person authorised in this behalf under the provisions of the State Act;
• (b) any person wilfully or without any reasonable excuse disobeys any summons, requisition or lawful written order issued under the provisions of the State Act;
• (c) any employer who, without sufficient cause, fails to pay to a co-operative society amount deducted by him from its employee within a period of fourteen days from the date on which such deduction is made;
• (d) any officer or custodian who wilfully fails to handover custody of books, accounts, documents, records, cash, security and other property belonging to a co-operative society of which he is an officer or custodian, to an authorised person;
• (e) whoever, before, during or after the election of members of the board or office bearers, adopts any corrupt practice.

Explanations:

Article 243ZQ addresses offences within co-operative societies, providing a legal framework for penalizing violations and ensuring ethical governance. This article reinforces accountability and deters misconduct.

• Clause (2a): False Returns - Penalizes individuals or officers for submitting false reports or withholding required information.
• Clause (2b): Disobedience - Criminalizes intentional disobedience to legal summons or orders.
• Clause (2c): Employer Obligations - Ensures timely remittance of employee deductions to co-operative societies.
• Clause (2d): Custodianship Violations - Penalizes custodians who refuse to hand over society property.
• Clause (2e): Election Misconduct - Addresses corrupt practices during co-operative elections to uphold fairness.

Legislative History:

Article 243ZQ was introduced through the Constitution (97th Amendment) Act, 2011, recognizing the need for stringent penalties to enhance accountability and curb malpractice within co-operative societies.

Historical Significance:

The inclusion of penalties for co-operative offences reflects India’s commitment to strengthening ethical practices within co-operative societies. This provision empowers co-operative members and protects their interests by deterring corrupt actions.

Debates and Deliberations:

During parliamentary discussions, lawmakers debated the scope of penalties and their implementation. Concerns about misuse of punitive provisions were addressed by emphasizing safeguards to ensure fair application of laws.

Real-Life Examples:

In Maharashtra, a co-operative officer was penalized for providing falsified financial records to its members. This action underlined the importance of adhering to transparency and accountability as outlined in Article 243ZQ.

Similarly, in Gujarat, an employer was prosecuted for failing to remit employee deductions to a credit co-operative society, demonstrating the robust enforcement of this Article.