Question

Essay on cooperative institutions in 300 words

Answer 1

Essay on Co-Operative Society

Essay Contents:

Essay on the Meaning of Co-Operative Society

Essay on the Essential Features of Co-Operative Society

Essay on the Advantages of Co-Operative Society

Essay on the Disadvantages of Co-Operative Society

Essay on the Classes or Types of Co-Operatives

Essay on the Present Position and Future Possibilities of Co-Operatives in India

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Essay # 1. Meaning of Co-Operative Society:

A co-operative society is commonly termed as a co- operative. A co-operative is an organisation or enterprise owned by and operated for the benefit of those using its services.

It is a voluntary association of persons who undertake business and economic activities not for the purpose of making profits only but to bring about equality for the promotion of economic interests of themselves through self-help and co-operation. Will­ingness and ability to work with others are the basic ingredients in the formation of a co-operative. A co-operative is another form of business organisation.

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The basic elements of a co-operative such as capital struc­ture, membership, management and control, registration, etc., are more or less similar to that of a company form of business organisation. Yet, it has some distinctive characteristics in the commercial and economic world.

Essay # 2. Essential Features of Co-Operative Society:

A co-operative, being different in orienta­tion and outlook, possesses the following features:

1. Ownership:

Being a voluntary association, it is owned by a group of persons (who are called members) living generally in the same locality or working at the same place. A minimum number of ten members is prescribed by law but there is no limit for maximum membership. Its membership is open to all.

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2. Management and Control:

The members of a co-operative elect the office bearers of a Managing Committee from among the members by casting of their votes. The committee members retire annually by rotation and the vacancies so created are filled up by holding a fresh election at the annual general meeting. The retiring members are eligible for re-election.

The committee formulates and executes the broad policies outlined by the mem­bers. The members exercise and maintain the overall control through the holding of meetings. Its ownership and control are perfectly harmonised. It stands for a common interest among its members and thereby institutes a democratic control of its affairs.

3. Capital and Liability:

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Its members supply the capital jointly.

Irrespective of the amount of contribution towards its capital, each member has usually one vote. It may be organised on the basis of either limited’ liability or unlimited liability. The liability of each member is limited upto the value of his or her shareholdings.

The value of each share being small and the extent of shareholdings by an individual member being restric­ted, the liability of a member is not very high. The limited liability co-operative societies must use the word ‘limited’ as a part of their names. Credit societies in rural areas, where the majority of members are farmers, can be famed with unlimited liability of members.

4. Legal Status and Registration:

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It must be registered under the Co-operative Societies Act 1912 or State Co-operative Societies Act, and with the Registrar of Co-operative Societies. The Governments of the State control the Co-operatives.

On registration, the co-operative becomes a body cooperate like a company and acquires the facilities of perpetual succession, common seal and legal entity. Its shares are not liable to attachment on the part of outside creditors.

The requirements of registration are:

(i) That there must be at least ten members above the age of 18 years;

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(ii) That member must reside in the same town or village;

(iii) That all details as to the membership, objects, share capital, etc., are furnished to the Registrar through a joint application of the members; and

(iv) That a copy of the bye-laws containing the rules and regulations of the society is submitted to the Registrar for purposes of scrutiny.

5. Profit-Sharing:

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Its profit is shared by the members in the form of dividend in proportion to their contribution to capital. At least one-fourth of the profit is transferred to reserve funds for being capitalised later for the society’s development purposes.