In this article, we will discuss Meaning and Features of Cooperative Society. A voluntary association of persons who have joined for the promotion of economic interests of its members is known as Cooperative Society. It is compulsory for such societies to get themselves registered under the Cooperative Societies Act, 1912. Minimum 10 adult persons are required to form the society. The capital is raised by the members of the society through the issue of shares. The society has a separate legal identity distinct from its members.
Meaning and Features of Cooperative Society
The following are the features of a cooperative society:
Voluntary Membership: In cooperative societies, an association of persons is voluntary which means a person is free to join and leave the society according to his will and desire. There is no compulsion for joining or leaving the society. Also, the membership of the society is open to all, irrespective of religion, caste, creed etc.
Legal Status: It is compulsory for a cooperative society to get itself registered. Registration gives the society a separate legal identity, different from its members. In this sense, the existence of the society is not affected by joining or leaving of the members. Also, the society can buy and sell property in its name, enter contracts, sue others and can be sued by others.
Limited Liability: The members of the cooperative society have a limited liability to the extent of the amount of capital contributed by them.
Control: The society has a democratic character in the sense that the members have the right to vote to select the members of the managing committee. The managing committee manages and controls all its affairs.
Service Motive: The main motive of the society is a mutual help and the welfare of its members. Hence, the basic purpose is to serve its members.
It is important to mention here that though the basic purpose is to serve its members any surplus arising out of business operations is distributed among the members as dividend according to the bye-laws of the society.
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