Q.Explain the procedure for registration of a cooperative society, and state the effects of registration.

Registration is what actually turns a group of members into a legally recognised body distinct from themselves — the procedure and its legal effects are two sides of the same answer.

Procedure for registration. At least ten persons who have attained the age of majority, sharing a common economic objective and normally belonging to the same area of operation, may come together to form a cooperative society. An application is made to the Registrar of Cooperative Societies of the state, stating the proposed name of the society, its objects, its area of operation, and accompanied by a copy of its proposed bye-laws — the society's own internal rules covering membership conditions, management structure, and working, broadly comparable to a company's Memorandum and Articles of Association. If the Registrar is satisfied that the application and bye-laws comply with the requirements of the Cooperative Societies Act, the society is registered, its name entered in the register of cooperative societies, and a certificate of registration is issued.

Effects of registration. From the date of registration:

1. The society becomes a body corporate, with a legal personality distinct from its individual members.
2. It acquires a common seal.
3. It can hold, acquire, and deal with property in its own name.
4. It can enter into contracts and sue or be sued in its own name, rather than requiring members to act or be sued individually. …

Students sometimes think registration is optional for a cooperative society, as it is for a JHF business or a partnership. It is not — a cooperative society only comes into legal existence as a body corporate once it is actually registered …