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CHAPTER XXIII
Co-operative
Societies
2301. Types of Co-operative Societies.— The following types of
co-operative societies are functioning on the Railways:-
(1) Consumer
co-operative Societies
(2) Co- operative credit Societies and Banks.
(3) Co-operative Housing Societies.
2302. Encouragement to co-operatives.- Government policy is
directed towards encouraging co-operative movement on Indian
Railways.
CONSUMER CO- OPERATIVE SOCIETIES
(OR CO-OPERATIVE STORES)
2303. Organisation:- consumer co-operative societies
referred to in this Chapter mean retail societies which provide for
the needs of their members.
The work relating to organisation, supervision routine inspection, etc., of
consumer co-operative societies and giving guidance to them and developing their
activities is the responsibility of the Railway Administrations. This work will
be under the overall control of the Chief Personnel Officers at the headquarters
and they will ensure necessary co-ordination in the divisions through the
Divisional Personnel officers who in turn should keep a close watch on the work
of the welfare inspectors one of whose essential duties will be to look after
the co-operative societies. The welfare Inspectors should be given training in
the principles and practice of 'Co-operation' by the co-operative inspectors
attached to the railways according to the syllabus approved by the Railway
Board. The welfare inspectors should associate themselves with the co-operative
inspector during the latter’s visit to the societies and learn as much as
possible from him of the technique of organisation, supervision, etc., of
consumer societies and acquaint themselves with the type of work that is
required to be done by them. One welfare inspector should be placed in charge of
each centre for attending to all the items of work relating to that particular
society. The welfare inspectors should submit to the chief Personnel Officers
through the Divisional Personnel Officer monthly report showing the work
actually done by them in connection with the organisation development etc., of
the co-operative Societies.
Railway Administrations should submit to the Railway Board a
quarterly report in from No. 79 of appendix 9 about the progress
made in developing co-operative activity by the welfare. Inspectors.
These reports should be for the quarters ending 31st March, 30th
June, 30th September and 31st December of each year and should be
submitted within a month from the close of the quarter.
2304. There should normally be only one co- operative store functioning
at a junction station between two or more railways to be established under the
auspices of the railway working the station who should bear all debits
on-account of grant of subsidy. To open branches of the main store,
accommodation may be provided by the other railways, for whose staff, branches
are proposed to be opened. In case a non-railway building is rented for the main
store or a branch, the cost of rent will be borne by the working railway under
whose auspices the main store is established .
2305. Classification:- The consumer co-operative societies should be
classified as follows:-
| (1) |
Small co-operative
stores- with a membership below one thousand; |
| (2) |
Big co-operative stores-
with a membership of one thousand and above. |
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The area of operation of
each store will be fixed on the following principles:- |
| (a) |
Competition between
different stores should be avoided, i.e. the jurisdiction of one society
should not overlap with that of the other; |
| (b) |
A small store will
generally have an area of operation covering a radius of about 32 Kms and
minimum of six hundred railway servants residing therein; |
| (c) |
the area of operation of
the stores must lie within the territorial boundary of the State in which
the head office is situated. |
2306. Membership- (1) membership shall be open to all serving
railway servants. A Railway servant desiring to become a member
shall be required to purchase at least one share. The value of each
share shall not be less than Rs. 10. They should also pay an
admission fee of 50 Paise or Re. 1,as may be provided in the
bye-laws of ,the -society.
(2) Retired or ex-Railway servants should not be permitted to become
members or to continue as such beyond a limited period.
(3) Relatives and nominees of retired railway servants should not be
allowed to derive any benefit of membership and their share money
should not be accepted but refunded, if necessary.
2307. Management - Railway co-operative societies shall be managed as
under:—
| (1) |
The Management of the
societies will be carried on through a management committee which will be
formed from amongst the shareholders of the society; |
| (2) |
The society will appoint
a paid secretary who should supervise subject to the control of the
managing committee, the day to day working of the staff and organise the
business of the society; |
| (3) |
The managing committee
may appoint sub-committees for supervising different activities of the
society; |
| (4) |
Subcommittees so
appointed may be delegated final powers in certain matters but policy
decisions taken by them must be confirmed by managing committees; and
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| (5) |
The supreme authority
must vest in the general body of shareholders; |
2308. Taking part in the activities of Consumer Co-operative
Societies by gazetted railway servants.— Gazetted Railway
servants can become members of consumer societies and also be
elected as office-bearers but they should not become ex-officio
office-bearers unless the Railway Board so approve.
Note- In respect of Railway
men’s consumer Co-operative societies made eligible for financial
assistance referred to in items (i) and (ii) of para 2309 below, the
above provisions will not apply and in that case the General manager
(or officer to whom the General manager delegates his powers in this
respect) would nominate on the managing committee of the Railway
men’s Consumer Co-operative society Concerned, gazetted officers as
official representatives upto one third of the strength of the
Managing Committee or three Directors, whichever is less.
2309. Concessions:- The following concessions are granted to
these societies:-
| (i) |
Grant of
Matching share capital contribution upto Rs. 2,500 (Per
society) in the case of those Railway men's consumer
co-operative Societies which have started functioning on and
after 1.9.1963 as also in the case of such of doremant
societies which ceased to function for want of finances and in
the opinion of the Railway Administration, could be revived by
the grant of this concession. The power to sanction this rests
with the General Managers which may be re delegated by them to
Chief Personnel Officers but not to any authority lower than
him. |
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(NO. 63/E
(Coop)/40/26 Pt.dt.5.6.69) |
| (ii) |
Grant of
interest-bearing repayable working capital loan upto Rs. Rs.
10,000 per society to such of the Railway men’s Consumer
Co-operative Societies which, for want of finances, are either
not functioning progressively or cannot expand their scope of
activity and take up additional activities like the opening of
fair price shops. The actual amount of capital loan, however,
should be determined with specific reference to the actual
need of the society. Co-operative Societies having more than
one fair price shop may, however be granted working capital
loan @ Rs. 10.000 per fair price shop instead of Rs. 10,000
for the society as a whole. The power to sanction this loan is
delegated to the General Manager subject to: (I) provision of
funds by Railway administration for the allotment of which the
Board should be approached in advance; (ii) fulfillment of
conditions by the Railway consumer co-op. Stores as laid down
in para 2308 above and (iii ) the powers delegated may be
re-delegated to Chief Personnel Officers but not to any
authority lower than him. |
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As to the
authorities empowered to execute agreement form on behalf of
the president of India for grant of interest bearing loan,
para 16 of Part XVIII of the revised notification relating to
the execution of contracts etc. issued by the Ministry of Law
on 1.2.66 circulated to the Railways etc. vide Board’s letter
No. E(X)II-62/CNT-1 dt. 25.2.65 may be referred to. |
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(NO.
63/E(Coop)/40/26 dt.. 1.2.65, 64/E/(Coop)/14/7 Pt. dt.
28.3.66, 63/E(Coop)/ 40/26/Pt. dt.5.6.69 and 74/E(Coop) 14/9/
dt. 6.8.74) |
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(iii) |
Subsidy
amounting to not more than half the administrative and
establishment charges for the first three years, irrespective
of whether the financial results of working of the society
reveal a net profit or not, subject to the condition that the
state co-operative Department concerned certifies that the
society is functioning properly; |
| (iv) |
Subsidy
amounting to not more than half the administrative and
establishment charges incurred in respect of fair price shop
section in the case of the Railway men's Consumer
co-operative- Societies which were in existence for more than
3 years from the date they started fair price shops section
subject to the proviso that the concession will not be for
more than 3 years from the date of starting fair price shop. |
| (v) |
(a) |
Provision of
suitable accommodation on payment of nominal rent of Re. 1
p.a. (plus actual municipal taxes) should be charged from such
of the Railway men's consumer co-operative societies, which
run fair price shops. |
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(b) |
Rent to be
charged from such of the Rail men’s consumer Co-operative
Societies, which do not run fair price shops should be only
the out of pocket expenses in the way of maintenance charges
and municipal taxes but should not include any element of
depreciation and of interest. In this case rent calculated at
the above rates should be recovered in terms of para1960-E.No.
63/E(Coop)/40/25 dt.30-3.64) |
| (vi) |
provision of
one ceiling fan for the society free of cost; |
|
(vii) |
Supply of
water and electricity at concessional rates; |
|
(viii) |
Recovery of
dues on account of credit sales from the salary bills of
railway servants; |
| (ix) |
Recovery of
share money in lumpsum or by installments from salary bills of
Railway servants; |
| (x) |
Special
passes and special casual leave to the members of the managing
committee for attending meetings of the committee or board of
directors or a sub-committee; |
| (xi) |
Privilege
passes and privilege ticket orders to the employees of the
societies; |
|
(xii) |
Medical
facilities to the staff of the societies. |
All reasonable assistance should be
afforded in the matter of giving quarters to the staff of the
Railwaymen's Consumer Co-operative stores (including the fair price
shops run by them) wherever it is considered absolutely essential
and where the towns and villages are situated far away .from. the
railway colonies, reasonable rent i.e., as for outsiders being
recovered when ever feasible to spare quarter.
Note- The concessions of additional subsidy and nominal rent of
Re. 1/- P.M. to the Railwaymen’s Consumer Co-operative Societies,
are intended to be allowed to such of the societies which continue
to trade in the items of commodities normally covered by the fair
price shop scheme for supply to their members and other railway
employees even during the period when the fair price shop sections
are temporarily closed down during a year according to the policy of
the State Governments. Such broken periods should be reckoned for
the purpose of granting additional subsidy for the maximum period of
3 years and that the broken periods wherein the consumer
Co-operative Societies do not effect sales of the items normally
covered by the fair price shops scheme should be excluded for this
purpose.
2310. Subsidy- For the purpose of calculating the amount of
subsidy to the consumer co-operative societies the following items
shall be included-:
|
Establishment Charges: |
| (a) |
Pay and
allowances of the staff, including monthly allowances to the
secretary and other office bearers, as also society’s
contribution to a duly constituted employees provident Fund,
if any, subject to the following exceptions:- |
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(i) |
cost of staff
appointed for maintaining the accounts of credit given to
members by way of credit sales; and |
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(ii) |
honoraria
which shall be paid out of the net profits after the end of
the year; |
| (b) |
travelling
allowance to staff and office-bearers; |
| (c) |
contingent
expenses claimed by the staff and office-bearers by way of
conveyance charges. If any; |
| (d) |
sitting fee,
if any, paid to members of the managing committee or those of
the Board for attending meeting of the managing committee or
board of directors; |
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|
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Administrative Charges |
| (e) |
Rates and
taxes excluding charges on account of water and
electricity;This does not include sales tax, transport
charges, insurance premia, purchase of stationery and books,
printing of forms, postal expenses and audit fees etc. and
municipal tax payable on the building owned by such a
co-operative society shall also be excluded. |
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Note-
(1) All consumer co-operative societies registered after 12th
August 1949 despite the fact that they were working as
unregistered organisations prior to that date, should be
considered eligible for the subsidy provided they fulfill
other conditions. |
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(2) No
subsidy will be paid societies towards the rent that will be
borne by borne by them with effect from 1st October 1958. |
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(3) Any
subsidy, grant in aid etc. which for all intents and purposes
is an “income” of Railway men’s consumer co-operative society
should be taken into account for accounting purposes and shown
in the annual profit and loss accounts separately for their
relevant period. |
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(No.
E(Coop)/55 Taxes/1 dt. 16.3.1956 & 65/E (Coop)/34/1 dt.
19.9.1967) |
2311. Procedure for payment of subsidy- (i) The following
procedure is prescribed for expediting the payment of subsidy
shortly after the close of each quarter of the year, i.e. ending
30th September, 31st December, 31st March and 30th June the consumer
co-operative societies should, in the first instance, make an
application in Form No. 80 of appendix 9, to the General Manager,
through the respective Registrar of co-operative societies, giving
therein the different items as laid down in paragraph 2310. The
registrar of Co-operative Societies, while forwarding the
application of the society to the General Manager of the railway
will attach a certificate in form No. 81 (Section A) of appendix 9
as to whether the society has been working properly or not. If the
claim is supported by the Registrar of Co-operative Societies which
shall include a certificate signed by an Assistant Registrar, Deputy
Registrar or Joint Registrar on behalf of the Registrar, the papers
should be passed on to the Co- operative inspector attached to the
railway who will visit the society shortly there after, scrutinise
each item carefully with the vouchers and see whether these are in
order in the event of an item, the claim for which is not covered by
the "Railway Board's instructions referred to above, it should, for
the time being, be excluded though the matter can be settled later
by making a reference to the Railway Board. The papers along with
the inspector’s certificate in Form No. 81 (Section B) of Appendix 9
should he passed on to the financial Adviser and Chief Account
Officer for payment without further scrutiny. In case the Registrar
does not give a certificate of satisfactory working, the society’s
claim should be rejected and the society informed accordingly.
(ii) However, for payment of subsidy in terms of para 2309 (iv),
production or a certificate of the Registrar of Co-operative
Societies is not necessary. Instead, Co-operative /Welfare
Inspector, in addition to giving a certificate in Form No. 81
(Section B) should also give a certificate will be countersigned by
the officer under whose signature the subsidy, bill is drawn. In the
certificate to be recorded in Form No. 81 (Section B) the following
may be added at the end.
To the best of my knowledge and
belief, there is no reasonable suspicion of corrupt practices in the
working of the above Railway men’s Consumer Co-operative society.
(No. 64/E (Coop)/9/6 dt. 1-5-67)
2312. Allocation of subsidy-: The expenditure incurred in
connection with the grant of subsidy should be booked under the
sub-detailed head J.421-subsidy to Co-operative stores.
2313. Accommodation:- Where convenient suitable existing
premises may be offered to the consumer Co-operative societies on
rent. If these are not available accommodation may be taken
ensuring that the rent is reasonable and the accommodation is not
excessive. If neither of the courses is feasible, new building may
be constructed with Railway Board’s sanction. The buildings should
be so designed as to admit of their conversion into staff quarters
later, if necessary. In the newly established railway colonies, it
should be possible to provide accommodation to consumer co-operative
societies, where provision for construction of a market exists;
where however, a market is not provided the construction of building
for allotment to the society on a reasonable rent should be dealt
with separately for each case on merits and with the prior approval
of the Railway Board.
2314. Recovery of rent:- Railway men’s Consumer Co-op.
Societies as well as any agency authorised by state Govts. to run
fair price shop will be charged nominal rent of Re. 1/- per annum
(Plus actual municipal taxes) which also includes the rent of
electrical installations provided in the building so licensed. In
the case of Railway men’s consumer Co-op. Societties which do not
run fair price shops, the rent to be charged should only cover
maintenance charges @ 2.5% per annum on the capital cost w.e.f.
23-5.66.Municipal and other taxes payable under local laws are to be
recovered in addition in case of Railway buildings, constructed
after 26.5.50. the service charges paid to the local bodies in lieu
of municipal taxes should be recovered from the societies allotted
with such accommodation. The rent will be recovered from the
existing as well as from the new societies whether they are housed
in railway buildings which are already available in buildings which
are specifically for the purpose as under:
Rent Payable
During the first year from 1st Oct. 1958 or the date of inauguration
of the Society whichever is later.
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|
Nill. |
| Do. |
Second year |
one-fourth |
| Do. |
Third year |
Half rent |
| Do. |
Fourth year |
Three-fourths
rent |
| Do. |
Fifth year:
onwards |
Full rent. |
2315. Minor alterations to buildings:- Minor structural
alterations may be carried out by the railways to buildings allotted
to consumer societies so as to make them suitable for locating their
shops.
2316. Lease of Railway land:- Land, it surplus to railway,
requirements may be licensed on nominal rent to the consumer
co-operative societies for the purpose of construction of their own
buildings subject to the condition laid down in paragraph 819, of
the Indian Railway Code for the Engineering Department. The licence
should include provision for resuming the land at short notice not
exceeding a month. The buildings that may be put-up by the societies
on railway land should be according to specification approved by the
Railway Administration concerned so that such buildings may be
utilised for staff quarters later.
2317. Supply of equipment:- No. equipment should be supplied
to co-operative stores free of cost.
2318. Provision of Electric fans and charges for electricity and
water:- The co-operative stores should not be charged for
electrical installations and fittings as the rent for the
accommodation covers the cost of electrification also. The
expenditure for electrification should be met from the funds
provided for staff amenities. Celling fans may be provided free of
cost at not more than one in number per store, additions being paid
for by the society concerned. The rate for consumption of
electricity should be fixed on the same basis as far railway
institutes.
2319. Rules of procedure for credit sales-: (1) The consumer
co-operative societies should encourage cash sales. If, however,
credit sales are to be introduced, there should be provision in the
bye-laws on the lines mentioned below:—
| (i) |
The sales should
generally be in cash; where however, credit sales are to be introduced the
society may, subject to the restrictions that may be prescribed in this
behalf, allow at any one time the purchase of consumer goods on credit
only up to the maximum value of the share subscribed by a railway servant
even if not fully paid up plus the actual amount of the purchase deposits,
if any at his credit provided that he executes an agreement or an
authority in favour of the Railway Administration to deduct from his
monthly pay the amount due from him on account of the sales on credit. |
| (ii) |
The society shall pay to
the Railway Administration from time to time the fee levied by the later
for the recovery of its dues from the salary bills of the member; |
| (iii) |
Every society shall
obtain the approval of the Ministry of labour under Section 7(2)(i)) of
the payment of wages Act, 1936, before introducing credit sales, in
respect of the staff governed by that Act. The amount of credit sales
should not exceed the limit prescribed by that ministry under the Payment
of Wages Act. |
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Note:- No.
Amendments to the bye laws which would infringe the provisions of the
Payment of Wages Act, 1936 shall be made without the prior approval of the
Central Government. |
| (2) |
The various restrictions
that may be imposed on the society in respect of credit sales by Railway
Administrations are:- |
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(i) |
The credit sales to the
extent of full value of shares subscribed, plus the amount of purchase
deposits may be allowed, in the case of those societies which are in a
sound financial position and have surplus funds at their disposal and are
not indebted to their members or non-members in the shape of loans or
deposits etc. |
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(ii) |
The limit of restricted
credits to the extent of 50% of the value of the share or shares
subscribed by a member plus the amount of purchase deposits, if any at his
credit, should be applied in all other cases. |
| (3) |
After the necessary
approval has been obtained, the society shall obtain in duplicate, an
agreement in From No. 82 from its, members and furnish one copy of it to
the Railway Administration. |
| (4) |
Refreshments viz. tea,
coffee, cooked meals, etc., served from canteens or any tea stall, etc.,
managed by the society, should be paid for in cash by the railway servants
and no credit sales should be permitted in such cases. |
| (5) |
Societies which are
selling goods on credit and have not fallen in line with the above
instructions will not be afforded the facility of recovery of their dues
through salary bills. |
| (6) |
No recovery of dues will
be made if credit sales have been based on purchase deposits, since the
dues in question can be set off by the co-operative societies against the
deposits at the credit of any particular member. |
| (7) |
The following \ procedure
will be observed in connection with recovery of credit sale dues:- |
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(i) |
Every society should
prepare in triplicate a list as in Form No. 83 of its member making credit
purchases, and forward it in duplicate to the respective Pay Bill section
of the Railway administration not later than the 20th of each month which
would, in turn, make the deduction from the salary bills in hand and pass
one copy to the Accounts office for taking further action. The Accounts
office will pass the bill and arrange to send a cheque for the
consolidated amount to the society together with that copy of the list.
The society should, on receipt of the cheque arrange to pass credit
entries in respect of the recoveries. |
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(ii) |
The Railway
Administration will try to expedite the despatch of the recovered amount
which should as far as possible be done within 30 days of receipt of the
society’s demand. |
2320. Recovery of share money through salary bills.—
Deduction on account of share money in one lump or in instalments
through salary bills can be permitted only in the case of those
organisations which have been registered under the co-operative
Societies Act of the respective States and if the deductions have
been otherwise authorised under the payment of wages Act, 1936.
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The
following procedure will be observed in this connection:— |
| (i) |
the consent
of the railway servant who desires to pay the value of
share/shares purchased by him through his salary bill be
obtained by the society in Form No: 84 of Appendix 9 in
duplicate. One copy of the form will be furnished to the
Railway Administration (bill preparing section) along with the
first recovery list and the other copy will be kept by the
society: |
| (ii) |
The society
should prepare in triplicate a list of recoveries in Form
No.85 of Appendix 9 and forward it in duplicate to the
respective bill preparing section of the Railway
Administration which will make the deductions from the salary
bills of the Railway servants concerned and pass on one copy
and the recovery list along with the bills (after filling in
Column 6) to the Accounts Office. The Accounts Office will
pass the bill and arrange to send a cheque for the
consolidated amount to the society together with that copy of
the recovery list. The society on receipt of the cheque and
the recovery list will arrange to check the correctness of the
recoveries and make necessary entries in the register
maintained for this purpose. |
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