Lok Sabha Question No. 228 (STARRED), answered on 2025-12-16
Subject: Strengthening Regulatory Oversight of Co-operative Societies
Ministry: COOPERATION
Asked by: Dr. Nishikant Dubey, Dr. Vinod Kumar Bind

## GOVERNMENT OF INDIA MINISTRY OF COOPERATION

## LOK SABHA STARRED QUESTION NO. 228 TO BE ANSWERED ON 16 th  DECEMBER 2025

## STRENGTHENING REGULATORY OVERSIGHT OF CO-OPERATIVE SOCIETIES

## 228: DR. NISHIKANT DUBEY: DR. VINOD KUMAR BIND:

Will the Minister of COOPERATION ( सहकारिता मंत्री ) be pleased to state:

- (a) the key amendments finalized for the Multi-State Co-operative Societies (MSCS) Act to strengthen regulatory oversight and monitoring;
- (b) the  manner  in  which  the  newly  operationalized  Tribhuvan  Sahkari  University  (TSU) curriculum is aligned with the current digital and management needs of the cooperative sector;
- (c) the  mechanisms  that  are  in  place  to  ensure  the  mandatory  audit  of  all  registered cooperative societies is completed within the stipulated timeline;
- (d) the  extent  to  which  the  establishment  of  the  National  Cooperative  Database  has streamlined  and  facilitated  the  process  of  identifying  and  reviving  defunct  cooperative bodies; and
- (e) the details of the cooperative institutions currently defunct, State-wise?

## ANSWER

## THE MINISTER OF COOPERATION सहकारिता मंत्री (SHRI AMIT SHAH)

(a) to (e) A statement is laid on the Table of the House.

Statement referred to in reply to parts (a) to (e) in respect of Lok Sabha Starred Question No. 228 regarding ' Strengthening Regulatory Oversight of Co-operative Societies ' asked by Dr. Nishikant Dubey and Dr. Vinod Kumar Bind , Hon'ble Member s of Parliament due for reply on 16 th  December, 2025

(a) The Multi-State Cooperative Societies (MSCS) (Amendment) Act & Rules, 2023 have been notified on 03.08.2023 and 04.08.2023, respectively to strengthen governance, enhance transparency,  increase  accountability  and  reform  electoral  process,  etc.  in  the  Multi  State Cooperative Societies by supplementing existing legislation and incorporating the provisions of Ninety-seventh Constitutional Amendment.

Many provisions  have  been  introduced  via  the  above  amendment  to  strengthen  regulatory oversight  and  monitoring  in  the  functioning  of  cooperative  societies  and  prevent  financial irregularities therein, inter-alia: -

- i. To  ensure  timely,  regular  and  transparent  conduct  of  elections  in  the  multi-State cooperative societies, provision of Cooperative Election Authority has been made.
- ii. Appointment  of  Co-operative  Ombudsman  by  Central  Government  to  provide  a mechanism to address grievances of members.
- iii. To improve transparency, appointment of Information Officer by multi-State cooperative societies to provide information to members.
- iv. Audit reports of Apex multi-State co-operative societies to be laid in Parliament to improve transparency.
- v. Accounting  and  auditing  standards  for  multi-State cooperative societies to be determined by Central Government to ensure uniformity in accounting and auditing.
- vi. To  improve  governance  and  transparency,  annual  report  of  multi-State  cooperative societies to include Board decisions which are not unanimous.
- vii. Central  Government  to  determine  prudential  norms  (liquidity,  exposure,  etc.)  for multi-State co-operative societies in the business of thrift and credit.
- viii. To curb nepotism and favouritism in multi-State co-operative societies, the Director of a multi-State cooperative society shall not be present in the discussion and vote on matters where he or his relatives are an interested party.
- ix. Additional  grounds  for  disqualification  for  directors  have  been  made  to  improve governance.
- x. Provisions for Investment of funds by the multi-State cooperative societies have been redefined to ensure safer investments and remove references to colonial era securities.
- xi. To  have  more  financial  discipline  and  transparency,  the  board  of  multi-State  cooperative  societies  to  constitute  Committee  for  Audit  and  Ethics  along  with  other committees.
- xii. For  strengthening  governance,  criteria  for  appointment  of  Chief  Executive  Officer (CEO) stipulated.
- xiii. To  enhance  democratic  decision  making  in  the  multi-State  cooperative  societies, quorum has been prescribed for board meetings.
- xiv. Central  Registrar  to  conduct  inquiry  if  he  gets  information  that  business  is  being conducted in a fraudulent manner or for unlawful purposes.
- xv. If registration obtained by misrepresentation, fraud, etc., provision for winding up of a multi-State cooperative society after giving opportunity of being heard.
- xvi. To discourage members from acting against collective interests of the multi-State cooperative  societies,  the  minimum  period  of  expulsion  of  an  expelled  member  of  a multi-State co-operative society has been increased from 1 year to 3 years.
- xvii. To prevent only a few members benefitting from resources of the society, Institutions with majority equity shares held by the members of multi-State co-operative societies or their relatives, would not be considered as subsidiary institution.

(b) The  'Tribhuvan'  Sahkari  University  (TSU)  addresses  the  needs  of  cooperatives  by integrating  advanced,  simulation,  and  real-life  case-study-based  pedagogy  for  management subjects  to  understand  real-life  managerial  issues  and  solutions,  thereby  preparing  participants with  real-world  strategic  decision-making  skills.  Concurrently,  the  curriculum  also  aligns  to develop cutting-edge digital competencies for using the latest digital tools and technologies. This dual focus ensures that graduates and trainees are equipped with both the managerial acumen and the digital tools necessary to drive efficiency, innovation, and productivity in their work areas.

(c)      The  following  provisions  have  specifically  been  introduced  for  strengthening  the  audit process of Multi-State Cooperative Societies:

- i. A provision  for  Concurrent  Audit  has  been  introduced  for  Multi-State  Cooperative Societies  with  turnover/deposits  of  more  than  500  crore  rupees  from  a  panel  of auditors approved by Central Registrar. Concurrent audit will ensure early detection of  fraud  or  irregularities,  if  any,  and  accordingly  prompt  course  corrections  can  be made.
- ii. Following  two  panels  of  auditors  for  Multi-State  Cooperative  Societies  have  been notified:
- 1) Panel of auditors for multi-State cooperative societies having an annual turnover/ deposit (as the case may be) of up to five hundred crore rupees for carrying out Statutory Audit.
- 2) Panel of auditors for multi-State cooperative societies having an annual turnover/ deposit (as the case may be) of more than five hundred crore rupees for carrying out Statutory and Concurrent Audit.

A provision has also been introduced for determination of accounting and auditing standards for multi-State cooperative societies by Central Government. Further, it has been provided that every multi-State cooperative society shall file its annual returns with the Central Registrar through the online  CRCS  portal  under  section  120A  of  the  Act,  within  six  months  from  the  close  of  the accounting year, containing the following information prescribed under section 120 of the Act:

- (a) annual  report  of  the  activities  including  details  of  board  decisions  which  were  not unanimous;
- (b) audited statements of accounts;
- (c) plan for surplus disposal as approved by the general body;
- (d) list of amendments to the bye-laws of the multi-State co-operative society;
- (e) declaration regarding date of holding of general body meeting and conduct of elections where due;
- (f) disclosure regarding employees who are relatives of Members of board;
- (g) declaration of any related party transactions by the board of directors; and
- (h) any  other  information  required  by  the  Central  Registrar  in  pursuance  of  any  of  the provisions of this Act or the rules made there under.

Non-submission of such returns may constitute a ground for disqualification under the provisions of section 43 of the Act.

(d)  A comprehensive National Cooperative Database (NCD) has been developed by Ministry of Cooperation,  Government  of  India,  with  the  support  of  States  /  UTs.  The  NCD  portal  was launched on 08th March, 2024. This database provides a single-point access to information on over 8.4 lakh cooperatives across the country. As per NCD portal, as of 15.11.2025, out of total 8.45 lakh Cooperative Societies across the country, 6.56lakh are functional, 1.39 lakh are nonfunctional and 48,537 are under liquidation.

The Ministry of Cooperation has taken proactive measures to convert Primary Agricultural Credit  Societies  (PACS),  Dairy,  and  Fisheries  Cooperatives  into  multi-purpose  cooperative societies. This initiative aims to enhance business diversification, strengthen financial sustainability,  and  prevent  closures  by  enabling  cooperatives  to  engage  in  a  wider  range  of economic activities. The NCD is used for identification of gaps in the geographical spread of cooperatives, including both covered and uncovered gram panchayats and formation of 2 lakh new multipurpose PACS, Dairy and Fishery cooperative societies. Defunct Societies are to be liquidated to form new MPACS wherever possible.

Additionally, the Ministry of Cooperation has set up Co-operative Rehabilitation, Reconstruction  and  Development  Fund  under  section  63A  of  the  Multi-State  Cooperative Societies (MSCS) (Amendment) Act, 2023 for revival of sick multi-State cooperative societies and providing assistance for meeting infrastructural requirement.

(e)  The  State-wise  details  of  functional,  non-functional  and  under  liquidation  societies,  is attached at Annexure-I.

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Annexure-I State-wise details of cooperative societies

| S. No   | State Name                                   | Functional Societies   | Non-Functional Societies   | Under-liquidation Societies   |
|---------|----------------------------------------------|------------------------|----------------------------|-------------------------------|
| 1       | Andaman And Nicobar Islands                  | 1,206                  | 884                        | 148                           |
| 2       | Andhra Pradesh                               | 12,628                 | 4,996                      | 269                           |
| 3       | Arunachal Pradesh                            | 956                    | 480                        | 24                            |
| 4       | Assam                                        | 7,723                  | 3,415                      | 1,184                         |
| 5       | Bihar                                        | 22,344                 | 4,880                      | 162                           |
| 6       | Chandigarh                                   | 196                    | 221                        | 59                            |
| 7       | Chhattisgarh                                 | 10,211                 | 1,029                      | 573                           |
| 8       | Delhi                                        | 1,939                  | 3,989                      | 16                            |
| 9       | Goa                                          | 3,106                  | 2,362                      | 110                           |
| 10      | Gujarat                                      | 78,215                 | 6,273                      | 1,210                         |
| 11      | Haryana                                      | 14,937                 | 3,089                      | 16,378                        |
| 12      | Himachal Pradesh                             | 4,844                  | 541                        | 282                           |
| 13      | Jammu And Kashmir                            | 8,913                  | 1,662                      | 5                             |
| 14      | Jharkhand                                    | 7,912                  | 3,897                      | 188                           |
| 15      | Karnataka                                    | 40,231                 | 3,446                      | 3,131                         |
| 16      | Kerala                                       | 15,142                 | 3,752                      | 770                           |
| 17      | Ladakh                                       | 165                    | 110                        | -                             |
| 18      | Lakshadweep                                  | 31                     | 12                         | -                             |
| 19      | Madhya Pradesh                               | 27,370                 | 18,423                     | 8,852                         |
| 20      | Maharashtra                                  | 2,17,759               | 3,057                      | 3,907                         |
| 21      | Manipur                                      | 5,317                  | 6,019                      | 288                           |
| 22      | Meghalaya                                    | 2,949                  | 467                        | 20                            |
| 23      | Mizoram                                      | 1,290                  | 175                        | 81                            |
| 24      | Nagaland                                     | 2,245                  | 5,860                      | 3                             |
| 25      | Odisha                                       | 7,560                  | 500                        | 107                           |
| 26      | Puducherry                                   | 431                    | 32                         | 1                             |
| 27      | Punjab                                       | 11,933                 | 2,709                      | 5,031                         |
| 28      | Rajasthan                                    | 25,491                 | 13,419                     | 3,035                         |
| 29      | Sikkim                                       | 1,646                  | 1,869                      | 248                           |
| 30      | Tamil Nadu                                   | 21,103                 | 1,200                      | 777                           |
| 31      | Telangana                                    | 48,186                 | 12,297                     | 377                           |
| 32      | The Dadra And Nagar Haveli And Daman And Diu | 379                    | 157                        | 33                            |
| 33      | Tripura                                      | 2,112                  | 1,007                      | 108                           |
| 34      | Uttar Pradesh                                | 22,724                 | 17,180                     | 775                           |
| 35      | Uttarakhand                                  | 4,728                  | 1,465                      | 159                           |
| 36      | West Bengal                                  | 22,952                 | 8,949                      | 226                           |
|         | Total                                        | 6,56,874               | 1,39,823                   | 48,537                        |

Source: NCD portal as of 15.11.2025