The Multi-State Co-operative Societies Act, 2002
Administered Ministry: Ministry of Cooperation
Section
Section 41 Board of directors.
(1) Subject to the provisions of this Act and rules, there shall be a board of directors for every multi-State co-operative society consisting of such number of members as specified in sub-section (3).
(2) The members of a multi-State co-operative society, by a resolution in a general meeting, shall elect directors who shall be members of board.
(3) The board shall consist of such number of directors as may be specified in the bye-laws:
Provided that the maximum number of directors in no case shall exceed twenty-one:
Provided further that the board may co-opt two directors in addition to twenty-one directors specified in the first proviso:
Provided also that the functional directors in the national co-operative societies shall also be the members of the board and such members shall be excluded for the purpose of counting the total number of directors specified in the first proviso.
(2) The members of a multi-State co-operative society, by a resolution in a general meeting, shall elect directors who shall be members of board.
(3) The board shall consist of such number of directors as may be specified in the bye-laws:
Provided that the maximum number of directors in no case shall exceed twenty-one:
Provided further that the board may co-opt two directors in addition to twenty-one directors specified in the first proviso:
Provided also that the functional directors in the national co-operative societies shall also be the members of the board and such members shall be excluded for the purpose of counting the total number of directors specified in the first proviso.
Section 42 Association of employees in management decision making process.
Every multi-State cooperative society shall devise such procedure, as may be specified in the bye-laws or in the administrative instructions of such society, for the association of the representatives of employees of such multi-State cooperative societies at such level or bodies as may be specified in the bye-laws or the instructions issued in this regard, in the management decision making process.
Section 43 Disqualifications for being a member of board.
(1) No member of any multi-State cooperative society or nominee of a member, society or a national co-operative society shall be eligible for being chosen as, or for being, a member of the board of such multi-State co-operative society or a national co-operative society, or of any other co-operative society to which the multi-State co-operatives society is affiliated, if such member--
(a) has been adjudged by a competent court to be insolvent or of unsound mind;
(b) is concerned or participates in the profits of any contract with the society;
(c) has been convicted for an offence involving moral turpitude;
(d) holds any office or place of profit under the society:
Provided that the Chief Executive or such full time employee of the society as may be notified by the Central Government from time to time or a person elected by the employees of such society to represent them on the board of such society shall be eligible for being chosen as, or for being, a member of such board;
(e) has been a member of the society for less than twelve months immediately preceding the date of such election or appointment;
(f) has interest in any business of the kind carried on by the society of which he is a member;
(g) has taken loan or goods on credit from the society of which he is a member, or is otherwise indebted to such society and after the receipt of a notice of default issued to him by such society, has defaulted--
(i) in repayment of such loan or debt or in payment of the price of the goods taken on credit, as the case may be, within the date fixed for such repayment or payment or where such date is extended, which in no case shall exceed six months, within the date so extended, or
(ii) when such loan or debt or the price of goods taken on credit is to be paid in instalments, in payment of any instalment, and the amount in default or any part thereof has remained unpaid on the expiry of six months from the date of such default:
Provided that a member of the board who has ceased to hold office as such under this clause shall not be eligible, for a period of one year, from the date on which he ceased to hold office, for re-election as a member of the board of the multi-State co-operative society of which he was a member or for the election to the board of any other multi-State co-operative society;
(h) is a person against whom any amount due under a decree, decision or order is pending recovery under this Act;
(i) is retained or employed as a legal practitioner on behalf of or against the multi-State cooperative society, or on behalf of or against any other multi-State co-operative society which is a member of the former society.
Explanation.--For the purposes of this clause, "legal practitioner" has the same meaning as in clause (i) of sub-section (1) of section 2 of the Advocates Act, 1961 (25 of 1961);
(j) has been convicted for any offence under this Act;
(k) is disqualified for being a member under section 29;
(l) has been expelled as a member under section 30;
(m) absents himself from three consecutive board meetings and such absence has not been condoned to by the board;
(n) absents himself from three consecutive general body meetings and such absence has not been condoned by the members in the general body.
(2) A person shall not be eligible for being elected as member of board of a multi-State co-operative society for a period of five years if the board of such multi-State co-operative society fails--
(a) to conduct elections of the board under section 45; or
(b) to call the annual general meeting under section 39; or
(c) to prepare the financial statement and present the same in the annual general meeting.
(a) has been adjudged by a competent court to be insolvent or of unsound mind;
(b) is concerned or participates in the profits of any contract with the society;
(c) has been convicted for an offence involving moral turpitude;
(d) holds any office or place of profit under the society:
Provided that the Chief Executive or such full time employee of the society as may be notified by the Central Government from time to time or a person elected by the employees of such society to represent them on the board of such society shall be eligible for being chosen as, or for being, a member of such board;
(e) has been a member of the society for less than twelve months immediately preceding the date of such election or appointment;
(f) has interest in any business of the kind carried on by the society of which he is a member;
(g) has taken loan or goods on credit from the society of which he is a member, or is otherwise indebted to such society and after the receipt of a notice of default issued to him by such society, has defaulted--
(i) in repayment of such loan or debt or in payment of the price of the goods taken on credit, as the case may be, within the date fixed for such repayment or payment or where such date is extended, which in no case shall exceed six months, within the date so extended, or
(ii) when such loan or debt or the price of goods taken on credit is to be paid in instalments, in payment of any instalment, and the amount in default or any part thereof has remained unpaid on the expiry of six months from the date of such default:
Provided that a member of the board who has ceased to hold office as such under this clause shall not be eligible, for a period of one year, from the date on which he ceased to hold office, for re-election as a member of the board of the multi-State co-operative society of which he was a member or for the election to the board of any other multi-State co-operative society;
(h) is a person against whom any amount due under a decree, decision or order is pending recovery under this Act;
(i) is retained or employed as a legal practitioner on behalf of or against the multi-State cooperative society, or on behalf of or against any other multi-State co-operative society which is a member of the former society.
Explanation.--For the purposes of this clause, "legal practitioner" has the same meaning as in clause (i) of sub-section (1) of section 2 of the Advocates Act, 1961 (25 of 1961);
(j) has been convicted for any offence under this Act;
(k) is disqualified for being a member under section 29;
(l) has been expelled as a member under section 30;
(m) absents himself from three consecutive board meetings and such absence has not been condoned to by the board;
(n) absents himself from three consecutive general body meetings and such absence has not been condoned by the members in the general body.
(2) A person shall not be eligible for being elected as member of board of a multi-State co-operative society for a period of five years if the board of such multi-State co-operative society fails--
(a) to conduct elections of the board under section 45; or
(b) to call the annual general meeting under section 39; or
(c) to prepare the financial statement and present the same in the annual general meeting.
Section 44 Prohibition to hold office of chairperson or president or vice-chairperson or vice-president in certain cases.
(1) No member of a board shall be eligible to be elected as the chairperson or president or vice-chairperson or vice-president of a multi-State co-operative society if such member is a Minister in the Central Government or a State Government.
(2) No member of a board shall be eligible to be elected as the chairperson or president of a multiState co-operative society, after he has held the office as such during two consecutive terms, whether full or part:
Provided that a member who has ceased to hold the office of the chairperson or president continuously for one full term shall again be eligible for election to the office as such.
Explanation.--where any member holding the office of the chairperson or president at the commencement of this Act is again elected to that office after such commencement, he shall for the purpose of this section, be deemed to have held office for one term before such election.
(2) No member of a board shall be eligible to be elected as the chairperson or president of a multiState co-operative society, after he has held the office as such during two consecutive terms, whether full or part:
Provided that a member who has ceased to hold the office of the chairperson or president continuously for one full term shall again be eligible for election to the office as such.
Explanation.--where any member holding the office of the chairperson or president at the commencement of this Act is again elected to that office after such commencement, he shall for the purpose of this section, be deemed to have held office for one term before such election.
Section 45 Establishment of Co-operative Election Authority.
1[45. Establishment of Cooperative Election Authority.--(1) The Central Government shall, by notification, establish an Authority to be known as the Co-operative Election Authority which shall consist of a Chairperson, a Vice-Chairperson and Members not exceeding three to be appointed by the Central Government on the recommendation of the Selection Committee consisting of such persons as may be prescribed.
(2) The head office of the Authority shall be at such place as may be notified by the Central Government.
(3) The election of the members of the board shall be held in the general meeting of the members of the multi-State co-operative society.
(i) Chairperson of the Authority unless he held the post of Additional Secretary to the Government of India or equivalent rank;
(ii) Vice-Chairperson of the Authority unless he held the post of Joint Secretary to the Government of India or equivalent rank; and
(iii) Member unless he fulfils such qualification and experience as may be prescribed
(4) The Chairperson, Vice-Chairperson or Member of the Authority shall hold office for a period of three years from the date on which they enter upon their office or until they attain the age of sixty-five years, whichever is earlier and they shall be eligible for re-appointment:
Provided that in case of appointment of a Government servant as a Chairperson, Vice-Chairperson or a Member, he shall be treated as an ex officio Member and he shall continue so long as he holds the office by virtue of which he is a Chairperson, Vice-Chairperson or Member.
(5) The salaries and allowances payable to, and the other terms and conditions of service of the Chairperson, Vice-Chairperson and Members of the Authority, other than the ex officio Member, shall be such as may be prescribed.]
(2) The head office of the Authority shall be at such place as may be notified by the Central Government.
(3) The election of the members of the board shall be held in the general meeting of the members of the multi-State co-operative society.
(i) Chairperson of the Authority unless he held the post of Additional Secretary to the Government of India or equivalent rank;
(ii) Vice-Chairperson of the Authority unless he held the post of Joint Secretary to the Government of India or equivalent rank; and
(iii) Member unless he fulfils such qualification and experience as may be prescribed
(4) The Chairperson, Vice-Chairperson or Member of the Authority shall hold office for a period of three years from the date on which they enter upon their office or until they attain the age of sixty-five years, whichever is earlier and they shall be eligible for re-appointment:
Provided that in case of appointment of a Government servant as a Chairperson, Vice-Chairperson or a Member, he shall be treated as an ex officio Member and he shall continue so long as he holds the office by virtue of which he is a Chairperson, Vice-Chairperson or Member.
(5) The salaries and allowances payable to, and the other terms and conditions of service of the Chairperson, Vice-Chairperson and Members of the Authority, other than the ex officio Member, shall be such as may be prescribed.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45A Power of Chairperson.
1[45A. Power of Chairperson.--The Chairperson of the Authority shall have powers of general superintendence and directions in the conduct of the affairs of the Authority and he shall, in addition to presiding over the meetings of the Authority, exercise and discharge such other powers and functions as may be prescribed.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45B Removal and suspension of Chairperson, Vice Chairperson and Members.
1[45B. Removal and suspension of Chairperson, Vice Chairperson and Members.--(1) The Central Government may, by order, remove from office the Chairperson, Vice-Chairperson or Member of the Authority, other than ex officio Member, if the Chairperson, Vice-Chairperson or Member of the Authority, as the case may be,--
(a) has been adjudged as an insolvent;
(b) has been convicted of an offence which, in the opinion of the Central Government involves moral turpitude;
(c) has been physically or mentally incapable of acting as a Chairperson, Vice-Chairperson or Member of the Authority;
(d) has acquired such financial or other interests, as is likely to affect prejudicially his function as a Chairperson, Vice-Chairperson or Member of the Authority;
(e) has so abused his position, as to render his continuance in office prejudicial to the public interest; orbr
(f) has engaged at any time during his term of office in any other employment.
(2) The Chairperson, Vice-Chairperson or Member of the Authority shall not be removed from his office except by an order of the Central Government on the ground of his proved misbehaviour or incapacity after the Central Government has, on an inquiry, held in accordance with the procedure prescribed in this behalf by it, come to the conclusion that the Chairperson, Vice-Chairperson or Member of the Authority ought on any such ground to be removed.
(3) The Central Government may suspend the Chairperson, Vice-Chairperson or Member of the Authority in respect of whom an inquiry under sub-section (2) is being initiated or pending until the Central Government has passed an order on receipt of the report of the inquiry.]
(a) has been adjudged as an insolvent;
(b) has been convicted of an offence which, in the opinion of the Central Government involves moral turpitude;
(c) has been physically or mentally incapable of acting as a Chairperson, Vice-Chairperson or Member of the Authority;
(d) has acquired such financial or other interests, as is likely to affect prejudicially his function as a Chairperson, Vice-Chairperson or Member of the Authority;
(e) has so abused his position, as to render his continuance in office prejudicial to the public interest; orbr
(f) has engaged at any time during his term of office in any other employment.
(2) The Chairperson, Vice-Chairperson or Member of the Authority shall not be removed from his office except by an order of the Central Government on the ground of his proved misbehaviour or incapacity after the Central Government has, on an inquiry, held in accordance with the procedure prescribed in this behalf by it, come to the conclusion that the Chairperson, Vice-Chairperson or Member of the Authority ought on any such ground to be removed.
(3) The Central Government may suspend the Chairperson, Vice-Chairperson or Member of the Authority in respect of whom an inquiry under sub-section (2) is being initiated or pending until the Central Government has passed an order on receipt of the report of the inquiry.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45C Disclosure and declaration of interest.
1[45C. Disclosure and declaration of interest. --(1) Before appointing any person as Chairperson, Vice-Chairperson or Member, the Central Government shall satisfy itself that the person does not have any such financial or other interest as is likely to affect prejudicially his functions as such Chairperson, Vice-Chairperson or Member.
(2) The Chairperson, Vice-Chairperson or Members shall immediately after entering office and every year thereafter, make a declaration as to the extent of their interest, whether direct or indirect and whether financial or otherwise, in any co-operative society.
(3) The declaration so made under sub-section (2) shall be placed in the public domain by the Authority.]
(2) The Chairperson, Vice-Chairperson or Members shall immediately after entering office and every year thereafter, make a declaration as to the extent of their interest, whether direct or indirect and whether financial or otherwise, in any co-operative society.
(3) The declaration so made under sub-section (2) shall be placed in the public domain by the Authority.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45D Resignation of Members.
1[45D. Resignation of Members.-- The Chairperson, Vice-Chairperson or Members, other than ex officio Members, may, by notice in writing of not less than thirty days under their hand addressed to the Central Government, resign their office and on such resignation being accepted by that Government, shall be deemed to have vacated their office:
Provided that the Chairperson, Vice-Chairperson or Member shall, unless he is permitted by the Central Government to relinquish his office sooner, continue to hold office until the expiry of three months from the date of receipt of such notice or until a person duly appointed as his successor enters upon his office or until the expiry of his term of office, whichever is the earliest.]
Provided that the Chairperson, Vice-Chairperson or Member shall, unless he is permitted by the Central Government to relinquish his office sooner, continue to hold office until the expiry of three months from the date of receipt of such notice or until a person duly appointed as his successor enters upon his office or until the expiry of his term of office, whichever is the earliest.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45E Filling of casual vacancy.
1[45E. Filling of casual vacancy.--- If a casual vacancy occurs in the office of the Chairperson, Vice Chairperson or Member of the Authority, whether by reason of his death, resignation or otherwise, such vacancy shall be filled within a period of ninety days by making a fresh appointment in accordance with the provisions of section 45 and the person so appointed shall hold office for the remainder of the term of office for which the Chairperson, Vice-Chairperson or Member of the Authority, as the case may be, in whose place he is so appointed.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45F Restriction of reemployment.
1[45F. Restriction of reemployment.--The Chairperson, Vice-Chairperson and Member of the Authority, on ceasing to hold office shall not, for a period of two years, accept any employment (including as consultant or otherwise) in any co-operative society:
Provided that nothing contained in this section shall apply to any employment under the Central Government or in any State Government or any Corporation established by or under any Central or State Act or a Government Company as defined under clause (45) of section 2 of the Companies Act, 2013 (18 of 2013).]
Provided that nothing contained in this section shall apply to any employment under the Central Government or in any State Government or any Corporation established by or under any Central or State Act or a Government Company as defined under clause (45) of section 2 of the Companies Act, 2013 (18 of 2013).]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45G Vacancies, etc., not to invalidate proceedings of Authority.
1[45G. Vacancies, etc., not to invalidate proceedings of Authority.--No act or proceeding of the Authority shall be invalid merely by reason of--
(a) any vacancy in, or any defect in the constitution of the Authority;
(b) any defect in the appointment of a person as Chairperson or Member of the Authority; or
(c) any irregularity in the procedure of the Authority not affecting the merits of the case.]
(a) any vacancy in, or any defect in the constitution of the Authority;
(b) any defect in the appointment of a person as Chairperson or Member of the Authority; or
(c) any irregularity in the procedure of the Authority not affecting the merits of the case.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45H Meetings of Authority.
1[45H. Meetings of Authority.-- (1) The Authority shall meet at such places and times and shall observe such rules of procedure in regard to the transaction of business at its meetings (including the quorum at its meetings), as may be prescribed.
(2) The Chairperson of the Authority shall preside at the meeting of the Authority and if for any reason the Chairperson of the Authority is unable to attend a meeting of the Authority, the Vice Chairperson of the Authority shall preside at the meeting.
(3) All questions which come up before any meeting of the Authority shall be decided by a majority of votes of the members present and voting and, in the event of an equality of votes, the Chairperson or the Vice-Chairperson of the Authority presiding shall have the right to exercise a second or casting vote.
(4) Save as otherwise provided in sub-section (1), every Member shall have one vote.]
(2) The Chairperson of the Authority shall preside at the meeting of the Authority and if for any reason the Chairperson of the Authority is unable to attend a meeting of the Authority, the Vice Chairperson of the Authority shall preside at the meeting.
(3) All questions which come up before any meeting of the Authority shall be decided by a majority of votes of the members present and voting and, in the event of an equality of votes, the Chairperson or the Vice-Chairperson of the Authority presiding shall have the right to exercise a second or casting vote.
(4) Save as otherwise provided in sub-section (1), every Member shall have one vote.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45-I Functions of Authority.
1[45-I. Functions of Authority.--- The Authority shall discharge the following functions, namely:–--
(i) conduct the elections of the multi-State co-operative society;
(ii) supervise, direct and control the matters relating to preparation of electoral rolls; and
(iii) such other functions as may be prescribed.]
(i) conduct the elections of the multi-State co-operative society;
(ii) supervise, direct and control the matters relating to preparation of electoral rolls; and
(iii) such other functions as may be prescribed.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45J Elections of members of board.
1[45J. Elections of members of board.-- (1) No person shall be eligible to be elected as a member of the board or office bearer of a multi-State co-operative society, unless he is an active member of the general body of that society.
Explanation.--For the purposes of this sub-section, the term "active member" means any member--
(i) availing minimum level of products or services of the society; or
(ii) attending not less than three consecutive general meetings,
as specified in section 29.
(2) A member of the board or office bearer of a multi-State co-operative society shall cease to be such member or office bearer, if he ceases to be a member of general body of that society.
(3) The election of members of board shall be held by secret ballot in such manner as may be prescribed.
(4) The election of the members of the board shall be held in the general meeting of the members of the multi-State co-operative society and the elected members of the board shall, if the bye-laws of such society permit, be eligible for re-election.
(5) The term of office of elected members of the board and its office bearers shall be five years from the date of election and the term of office bearers shall be co-terminus with the term of the board:
Provided that the board may fill casual vacancies up to one-third of number of elected directors on the board by nomination out of the same class of members in respect of which the casual vacancy has arisen, if the term of office of the board is less than half of its original term:
Provided further that in case the number of such casual vacancies in the same term of the board exceeds one-third of number of elected directors, such vacancies shall be filled by elections.
(6) The expenses for holding elections by the Authority shall be borne by the multi-State co-operative society in such manner as may be prescribed.
(7) The Central Government may make rules to provide for the powers and the procedure to be followed by the Authority for conduct of election of members of the board.
(8) The Chairperson and the Chief Executive of the multi-State co-operative society shall inform the Authority, six months before the expiry of the term of the existing board, to conduct the elections within time.
(9) The multi-State co-operative society in respect of which the election is being held shall provide such infrastructure, personnel, information, documents or other assistance to the Authority as it may require.]
Explanation.--For the purposes of this sub-section, the term "active member" means any member--
(i) availing minimum level of products or services of the society; or
(ii) attending not less than three consecutive general meetings,
as specified in section 29.
(2) A member of the board or office bearer of a multi-State co-operative society shall cease to be such member or office bearer, if he ceases to be a member of general body of that society.
(3) The election of members of board shall be held by secret ballot in such manner as may be prescribed.
(4) The election of the members of the board shall be held in the general meeting of the members of the multi-State co-operative society and the elected members of the board shall, if the bye-laws of such society permit, be eligible for re-election.
(5) The term of office of elected members of the board and its office bearers shall be five years from the date of election and the term of office bearers shall be co-terminus with the term of the board:
Provided that the board may fill casual vacancies up to one-third of number of elected directors on the board by nomination out of the same class of members in respect of which the casual vacancy has arisen, if the term of office of the board is less than half of its original term:
Provided further that in case the number of such casual vacancies in the same term of the board exceeds one-third of number of elected directors, such vacancies shall be filled by elections.
(6) The expenses for holding elections by the Authority shall be borne by the multi-State co-operative society in such manner as may be prescribed.
(7) The Central Government may make rules to provide for the powers and the procedure to be followed by the Authority for conduct of election of members of the board.
(8) The Chairperson and the Chief Executive of the multi-State co-operative society shall inform the Authority, six months before the expiry of the term of the existing board, to conduct the elections within time.
(9) The multi-State co-operative society in respect of which the election is being held shall provide such infrastructure, personnel, information, documents or other assistance to the Authority as it may require.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45K Appointment of Returning Officer and other officers.
1[45L. 45K. Appointment of Returning Officer and other officers.-- (1) The Authority may appoint a Returning Officer to conduct the election of the multi-State co-operative societies and discharge such functions, as directed by the Authority, in such manner as may be prescribed.
(2) The Central Government shall provide such staff and officers to the Authority as may be necessary for the efficient discharge of functions by the Authority under the Act. (3) The Authority may appoint,--
(a) such observers as it may consider necessary to supervise the elections and discharge such other functions as may be prescribed; and
(b) such number of Assistant Returning Officers as it may consider necessary to assist the Returning Officer.
(2) The Central Government shall provide such staff and officers to the Authority as may be necessary for the efficient discharge of functions by the Authority under the Act. (3) The Authority may appoint,--
(a) such observers as it may consider necessary to supervise the elections and discharge such other functions as may be prescribed; and
(b) such number of Assistant Returning Officers as it may consider necessary to assist the Returning Officer.
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 45L Power to issue directions.
1[45L. Power to issue directions.-- The Authority may, by general or special order, issue such directions to the board, its members, Chief Executive and other staff of the multi-State co-operative society as may be necessary for the conduct of free and fair elections and the board, its members, Chief Executive and staff of the society shall comply with such directions.]
1. Subs. by s. 17, ibid., for section 45 (w.e.f. 3-8-2023).
Section 46 Holding of office in co-operative society.
Notwithstanding anything contained in this Act, no person shall be eligible to hold, at the same time, office of a president or chairperson or vice-president or vice-chairperson on the board of more than two multistate co-operative societies.
Section 47 Removal of elected members by general body.
An elected member of a board, who has acted adversely to the interests of multi-State co-operative society, may on the basis of a report of the Central Registrar or otherwise be removed from the board upon a resolution of the general body passed at its meeting by a majority of not less than two-third of the members present and voting at the meeting:
Provided that the member concerned shall not be removed unless he has been given a reasonable opportunity of making a representation in the matter.
Provided that the member concerned shall not be removed unless he has been given a reasonable opportunity of making a representation in the matter.
Section 48 Nominee of Central Government or State Government on board.
(1) Where the Central Government or a State Government has subscribed to the share capital of a multi-State co-operative society, the Central Government or the State Government, as the case may be, or any person authorised by the Central Government or the State Government shall have right to nominate on the board such number of persons as its members on the following basis, namely:--
(a) where the total amount of issued equity share capital held by the Central Government or the State Government is less than twenty six per cent. of the total issued equity share capital, one member of the board;
(b) where the total amount of issued equity share capital held by the Central Government or the State Government is twenty-six per cent. or more but less than fifty-one per cent. of the total issued equity share capital, two members of the board;
(c) where the total amount of issued equity share capital held by the Central Government or the State Government is fifty-one per cent. or more of the total issued share capital, three members of the board:
Provided that the number of such nominated persons shall not exceed one third of the total number of members of the board:
Provided further that where the Central Government or a State Government has guaranteed the repayment of principal and payment of interest on debentures issued by a multi-State co-operative society or has guaranteed the repayment of principal and payment of interest on loans and advances to a multiState co-operative society or has given any assistance by way of grants or otherwise to a multi-State cooperative society, the Central Government or the State Government in this behalf, as the case may be, or any person authorised by the Central Government, shall have the right to nominate person on the board of such a society in the manner as may be prescribed.
(2) A person nominated under this section shall hold office during the pleasure of the Government by which he has been so nominated.
(a) where the total amount of issued equity share capital held by the Central Government or the State Government is less than twenty six per cent. of the total issued equity share capital, one member of the board;
(b) where the total amount of issued equity share capital held by the Central Government or the State Government is twenty-six per cent. or more but less than fifty-one per cent. of the total issued equity share capital, two members of the board;
(c) where the total amount of issued equity share capital held by the Central Government or the State Government is fifty-one per cent. or more of the total issued share capital, three members of the board:
Provided that the number of such nominated persons shall not exceed one third of the total number of members of the board:
Provided further that where the Central Government or a State Government has guaranteed the repayment of principal and payment of interest on debentures issued by a multi-State co-operative society or has guaranteed the repayment of principal and payment of interest on loans and advances to a multiState co-operative society or has given any assistance by way of grants or otherwise to a multi-State cooperative society, the Central Government or the State Government in this behalf, as the case may be, or any person authorised by the Central Government, shall have the right to nominate person on the board of such a society in the manner as may be prescribed.
(2) A person nominated under this section shall hold office during the pleasure of the Government by which he has been so nominated.