When a society is registered the bye-laws of the society as approved and Registered by the Registrar are the Bye-laws of the Society says Adv. R. P. Rathod.
Bye-laws: It means bye-laws registered under Maharashtra Co-operative Societies Act and includes registered amendments of such bye-laws see Section 2(5) of the Maharashtra Co-operative Societies Act. Bye-laws include the objects of the society and completely define and restrict the society's activities, but the rights and liabilities of members are determined by the Act and not by the bye-laws as such.
The bye-laws are the basic structure of the society and are binding on the members.
Some matters in respect of which Registrar may direct society to make bye-laws or society may make bye-laws:
The registrar may require a society to make bye-laws in respect of all or any of the following matters - that is to say –
a) the name of the society and address of the society and its branches;
b) the objects of the society;
c) the privileges, rights, duties and liabilities of members including nominal, associate and sympathiser members;
d) the mode of appointment either by election or otherwise and removal of member of the committee and other officer, if any, their duties and powers;
e) the chairman's power, duties and functions and his removal on his losing support of the majority;
f) the manner in which penalty should be levied on a member who is found to be guilty of breach of bye-laws;
g) appointment of provisional committee where necessary;
h) the mode of appointment and removal of committee and its powers and duties;
i) The mode of convening annual and special general meetings, issue of notices and the business which may be transacted there at.
According to the provisions of Rule 8(2) of the Maharashtra Co-operative Societies Rules 1961, a society may make bye-laws for all or for any of the following matters:
1) The circumstances under which withdrawal from membership may be permitted.
2) The procedure to be followed in cases of withdrawal; ineligibility and death of members;
3) The conditions, if any under which the transfer of share or interest of a member may be permitted;
4) The method of appropriating payments made by members from whom moneys are due;
5) The authorisation of an officers to sign documents and to institute and defend suits and other legal proceedings on behalf of the society;
6) The constitution and maintenance of various funds as required to be maintained under the provisions of the Act, rules and bye-laws;
7) Constitution of representative body consisting of delegates of members of the society and the mode of election of such delegates to exercise the powers of the general body of members and to specify the powers which may be exercised by such smaller body
In exercise of the powers conferred by sec 165(2)(iii) of the Act the State Government may, for the whole or any part of the State and for any society or class of societies, make rules for the conduct and regulation of the business of such society or class of societies, and carrying out the purposes of the Maharashtra Co-operative Societies Act, and also may prescribe the matters in respect of which a society may make, or the Registrar may direct a society to make bye-laws and the conditions to be followed in making, altering and abrogating bye-laws and the conditions to be satisfied prior to such making, alteration or abrogation.
Bye-laws must be constructed: in a manner so as to reflect intention of its framers as to make them effective and workable. This was discussed by the Nagpur Branch of the Bombay High Court in case of Wasudeo Gulabrao Deshmukh v/s. State of Maharashtra, 1995(2) Mah L.J.160
In the case of the housing society bye-laws cannot be claimed force of law so as to bind stranger non-members such as licensees from members. Licence by member without previous written consent as per bye-laws cannot make the licence illegal-See Sardar Ajit Singh v/s. Saibaba Co-operative Housing Society ltd, 1978 Mah L.J.404
It is well settled law that over the bye-laws the Rules will have the precedence and over the Rules the Act will have the precedence for binding effects and no bye-laws can be adopted contrary to the provisions of either Act or the rules - See A. I. Umrani v/s. Saraswat Suburban Co-operative Housing Society Ltd 1985 CTJ 357.
Bye-laws must be consistent with the Act and the Rules made under the Act: It must relate to subjects within the scope of the corporate powers. It must not be ultra-vires. They can not be held to be a law or to have the force of law. See Co-op Credit Bank v/s. Industrial Tribunal, Hyderabad AIR 1970 SC 245: 1984(1) SCR 767.
Amendment of bye-laws of Society: Under the provisions of Section 13 of the Maharashtra Co-operative Societies Act, 1960 no amendment of the bye-laws of a society shall be valid until it is registered under the Maharashtra Co-operative Societies Act.
Amendment ordinarily means the act of making better, correction, improvement, but in this sense it means any alteration or change either by way of correction or addition.
1) Subject to the provisions of rule 12, Maharashtra Co-operative Societies Rules, 1961 bye-laws of a society may be amended by passing a resolution at a general meeting of the society held for that purpose.
2) The society has to give due notice in accordance with its bye-laws to all the members for considering any amendment thereof.
3) An amendment shall be deemed to have been duly passed, if a resolution in that behalf is passed in a general meeting by not less than two-third of the members present there at and voting.
4) After a resolution is passed, a copy thereof shall within a period of two months from the date of the meeting at which the resolution was passed be furnished to the Registrar along with-
a) a copy of the relevant bye-laws in force with amendments proposed to be made in pursuance of the resolution, together with reasons justifying such amendments;
b) four copies of the text of the bye-laws as it would stand after amendment, signed by the officers duly authorised in this behalf by the committee of the society;
c) a copy of the notice given to the members of the society of the proposal to amend the bye-laws;
d) Such other information as may be required by Registrar.
5) On receipt of the resolution and other particulars the Registrar has to examine the amendment proposed by the society and if he is satisfied that the amendment is not contrary to the Act or the Rules and is in the interest of the society and co-operative movements, he may register the amendment and issue to the society a copy of the amendment certified by him under Section 13(2) of the Maharashtra Co-operative Societies Act Where the Registrar is of opinion that proposed amendment may be accepted subject to any modification after explaining in writing there of.
For refusal of amendment, Registrar has to notify the reasons. The high Court of Bombay has decided in the case of Eknath Vishnu Hinge v/s. State of Maharashtra L.J.727 ;1985 (1 Bombay CR 598 that the General body has power to amend the bye-laws.
It is obligatory on the Registrar that every application for registration of an amendment of the bye-laws must be disposed of within a period of two months from the date of receipt of an application.
After registering amendment of the bye-laws, Registrar has to issue a copy of the certified amendment to the society and such certified copy will be treated as conclusive evidence that the same is duly registered. But in the absence of such copy, even the Registrar's letter accepting the amendment, is the proof of its registration. This decision was passed in the case of Jawahar Nagar Co-op Hsg Society v/s. Gersoppa, 10B CT 38.
Amendment of bye-laws has no retrospective effect.
Under Section 152(1) appeal can be made within two months against an order registering an amendment and also against decision refusing to register an amendment of bye-laws.
Registrar's power to direct amendment of bye-laws: Registrar has power under Section 14 of the Maharashtra Co-operative Societies Act, if it appears to him that an amendment of the bye-laws of the society is necessary or desirable in the interest of such society, he can call upon the society in the manner prescribed to make an amendment within such time as he may specify. If the society fails to make amendment after giving an opportunity of being heard he may amend the bye-laws subject to appeal binding on the society and its members. See section 14(2) of the Maharashtra Co-operative Societies Act, 1960 and Rule 8 of the Maharashtra Co-operative Societies Rules, 1961.
Powers under Section 14 of the Maharashtra Co-operative Societies Act can be used only if it is established that the amendment of the bye-laws was desirable and was in the interest of the society.