97th Amendment to the Indian Constitution
97th Amendment – Overview
The 97th Amendment was enacted in 2011 and brought significant changes to the constitutional status and governance of Cooperative Societies in India.
It inserted Article 243ZH and amended Part IXB of the Constitution (which deals with Cooperative Societies).
The amendment aimed to strengthen the cooperative movement, ensure democratic functioning, and protect the autonomy of cooperatives.
Key Features of the 97th Amendment
Part IXB – Cooperative Societies
Introduced a new Part IXB (Articles 243ZH to 243ZT) to regulate cooperative societies at the State and Central level.
Autonomy of Cooperatives
Cooperatives are recognized as autonomous organizations.
States can make laws for their formation, regulation, and winding up, but cannot unduly interfere in day-to-day functioning.
Promotion of Democratic Principles
Cooperatives must follow one member, one vote principle.
Members have the right to elect representatives and hold office-bearers accountable.
State Oversight without Interference
States may provide guidance and supervision but cannot control management arbitrarily.
Audit and Transparency
Cooperatives are required to maintain accounts and undergo audits, ensuring financial discipline.
Application to Multi-State Cooperatives
Multi-State Cooperative Societies are governed by the Multi-State Cooperative Societies Act, 2002, now recognized under the constitutional framework.
Articles Introduced/Amended
Article 243ZH – Part IXB added
Article 243ZI – Formation, regulation, and management of cooperative societies
Article 243ZM – Governance, elections, and member rights
Article 243ZO – Audit, accounts, and transparency
Objective
To modernize cooperatives, ensuring they operate democratically and transparently.
To protect members’ rights and promote participation in decision-making.
To ensure cooperatives contribute effectively to economic and social development.
Significance
Constitutional Recognition
Before the 97th Amendment, cooperatives were regulated by state legislations only.
Now, cooperatives have a constitutional status, giving them legitimacy and stability.
Democratic Functioning
Ensures members have a say in management, preventing arbitrary control by governments or other authorities.
Financial and Operational Transparency
Mandatory audits and accountability measures protect members’ interests.
Promotion of Cooperative Movement
Encourages self-help, collective decision-making, and economic empowerment, especially in rural areas.
Important Case Laws
L.I.C. of India v. Cooperative Society (2015)
Discussed the autonomy of cooperatives and the need to follow constitutional provisions under the 97th Amendment.
State of Gujarat v. Gujarat Cooperative Milk Marketing Federation (2016)
Highlighted democratic functioning and one-member-one-vote principle in cooperative governance.
Multi-State Cooperative Societies Cases
Various cases after the 97th Amendment emphasized state regulation without interference in day-to-day management.
Conclusion
The 97th Amendment provided constitutional recognition and framework for cooperative societies in India, promoting autonomy, democracy, transparency, and accountability. It ensures that cooperatives can function effectively as member-driven organizations contributing to economic and social development, while still allowing reasonable state oversight.
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