Monday, February 4, 2013

News You Can Use: Govt tightens noose on frauds in co-op societies

Mumbai: To check misappropriation or mismanagement of funds in cooperative housing societies, the state will introduce a new provision in the Maharashtra State Cooperative (MSC) Act, 1960, allowing an auditor to register a criminal offence against office-bearers guilty of financial misconduct.

The provision makes auditors (chartered accountant/a certified auditor/ a government auditor) responsible for submitting a “special report pertaining to losses” to members. For willful mismanagement, the auditors will also have to submit another report specifying the offences and will have to register FIRs against those responsible after obtaining registrar’s permission. Failure on part of the auditor to comply with this directive will also amount to an offence.

The move is among a series of changes proposed in the Act to bring it in tune with the recently approved 97th constitutional amendment, which aims at promoting “voluntary formation, autonomous functioning, democratic control, and professional management” of cooperative bodies.

With the Centre directing the state to implement the amendments on or before February 15, CM Prithviraj Chavan has convened a special cabinet meet on Wednesday. On Tuesday, the cooperative department will brief the cabinet on the proposed amendments.

The auditor will have to be appointed by the society’s general body from a state-approved panel. Societies will have to set up redressal panel.

While taking away the registrar’s powers to appoint administrator for unaided societies, a society will be allowed to initiate recovery proceedings in cases of default pertaining to maintenance charges by members too.

Special authority to conduct co-op polls A separate election authority, led by a commissioner (a secretary-rank acting or retired official appointed by the governor), will conduct elections of cooperative societies.

The department has said the existing elected board can complete its tenure; but, the law and judiciary department is of the opinion that these ought to be dissolved post February 15. TNN
Courtesy:
Sandeep Ashar TNN
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