Arun Shukla
With profound regard I want to make my doubts clear from you about the membership of the transport cooperative society.
I am a member of transport cooperative society in Himachal Pradesh which is plying their trucks to transport the material of Ambuja Cement Ltd. In the same Tehsil there is another cement plant of Jay Pee Cement Ltd and a cooperative society which carries the business of latter. My wife is member of that society.
Is it a violation of cooperative society rules or act? Kindly make it clear to me.
I C Naik
Relevant provisions of law are “Section 19-A of Himachal Pradesh Cooperative Societies Act 2012 and Rule 11of Himachal Pradesh Cooperative Societies Rules 1971.
1. As per Section 19-A No person shall be eligible for being a member of a co-operative society if his business is in conflict or competitive with the business of such co-operative society.
2. As per Ru;e 11 (1) No person shall be eligible for admission as a member of the society if he carries on business similar to that conducted by the society of which he wishes to become a member;
In this case a member and his wife both are members of two different societies carrying on the business of transportation of Cement produced by two cement producing competing companies in Himachal Pradesh.
On the face of it persons of high moral values would get a feeling that there could be a conflict of business interest which is not allowed in the membership of cooperative societies. Two societies are being in the same business serving two mutual competitors.
Both the societies are having their own transport contract independent of each other awarded by third parties. Two Cooperative Societies competing with each other may have instances of common members but that does not create conflict of interest.
The competition is not by either of the member with their own societies of which they are members. If these members were having their own personal trucks in their own name an plying for transportation of cement business then they are liable to be disqualified as member as per above provisions.
In this case the members are not carrying on any commercial activity which is the same – similar as the one carried on by their societies. So there is nothing wrong in this.