Section 34 of The Multi-State Co-operative Societies Act, 2002
The transfer of share or interest of a member in the capital of a multi-State co-operative society shall be subject to such conditions as to maximum holding as specified in section 33.
Summary
- Any transfer of a member's shares or interest in the capital of a society is strictly restricted.
- Share transfers must comply with the maximum holding restrictions established under Section 33.
- The transfer is restricted to prevent any single non-exempt member from exceeding the one-fifth shareholding limit.
- The rules or bye-laws of the society govern the validity of share transfers based on these limits.
Practical examples
FAQ
1. Can a member freely transfer their shares to anyone under Section 34 of the Multi-State Co-operative Societies Act, 2002?
No, under Section 34 of the Multi-State Co-operative Societies Act, 2002, a transfer of shares is restricted and cannot be made to any person if it would cause their total shareholding to exceed the limits set in Section 33.
2. What is the maximum limit that restricts share transfers under Section 34 of the 2002 Act?
Under Section 34 of the Multi-State Co-operative Societies Act, 2002, share transfers are subject to the same restriction specified in Section 33, meaning the transferee cannot hold more than one-fifth of the total share capital.
3. Does Section 34 of the Multi-State Co-operative Societies Act apply to the transfer of a member's interest other than shares?
Yes, Section 34 of the Multi-State Co-operative Societies Act, 2002 applies to the transfer of both a member's shares and their interest in the capital of the society.
4. How does Section 34 of the Act of 2002 prevent the concentration of capital in a co-operative?
Section 34 of the Multi-State Co-operative Societies Act, 2002 prevents capital concentration by blocking any transfer of shares or interest that would cause a single non-exempt member to own more than twenty percent of the total share capital.
Test yourself
Q1.Under Section 34 of The Multi-State Co-operative Societies Act, 2002, what main condition restricts a member from transferring their shares or interest?
Q2.Under Section 34 read with Section 33 of The Multi-State Co-operative Societies Act, 2002, what is the maximum portion of share capital a non-exempt person can hold after receiving a transfer?
Q3.Under Section 34 of The Multi-State Co-operative Societies Act, 2002, a transfer of share or interest is void if it results in which of the following outcomes?
Q4.Under Section 34 of The Multi-State Co-operative Societies Act, 2002, what two assets of a member in the capital of a society are restricted from transfer?