Following a recent statement by Union Finance Minister Nirmala Sitharaman, the Cooperative Election Authority (CEA) has begun enforcing the amended provisions of the Banking Regulation Act, 1949, with Surat’s leading Varachha Co-operative Bank becoming the first case in point.
In the election programme released on Monday, the CEA directed the Returning Officer to ensure strict compliance with Section 10A (sub-section 2a(i)) of the Act, which extends the maximum continuous tenure of directors – excluding the Chairperson and Whole-time Directors – from eight to ten years. The provision, effective from August 1, 2025, will apply to Varachha Bank’s upcoming elections.
The Returning Officer has been instructed to verify the tenure, disqualifications, and any RBI penalties of contesting candidates, while the bank’s Managing Director has been asked to submit all relevant documents to ensure a transparent and fair poll process.
The CEA also clarified that Varachha Bank’s jurisdiction extends to the Union Territory of Dadra and Nagar Haveli. Though no members from the UT are currently enrolled, any new members will have voting rights if their names appear on the voters’ list. However, they will not be eligible to contest as directors until completing at least one year of membership.
The issue gained prominence after Finance Minister Sitharaman, in a written reply in the Lok Sabha, confirmed that the CEA would oversee implementation of the amended tenure provisions in multi-State co-operative banks. In Varachha Bank’s case, as many as 10 directors have already served more than eight years.
Elections for 15 director posts are scheduled for March 1, 2026, with 65,567 eligible members set to vote. The key question now is whether Varachha’s long-serving directors will survive the regulatory filter or make way for new leadership.
While Varachha’s elections fall under the CEA’s jurisdiction as a multi-State co-operative bank, the development has raised a wider question for the sector: Will State Cooperative Election Authorities also adopt the amended BR Act provisions for elections to banks governed under state laws?
With the countdown to polls underway, the contest for control of one of Surat’s most influential co-operative banks is set to turn intense.
