- GS 2: Functions and responsibilities of the Union and the States, issues and challenges pertaining to the federal structure, devolution of powers and finances up to local levels and challenges therein.
- Recently, Supreme Court (SC) quashed some provisions of the 97th Constitutional Amendment Act that deals with cooperative societies.
- The SC has upheld the judgement of the Gujarat High Court and has struck down some of the provisions with a 2:1 majority.
- While Justices Nariman and Justice Gavai struck down only that part of Part IXB that dealt with cooperative societies and were confined to states, Justice Joseph in a separate judgment struck down the entire 97th constitutional amendment.
- SC held that cooperative societies is a subject in List II (State List) of the 7th Schedule of Indian Constitution. So, the Parliament do not have the constitutional mandate to make laws on this subject.
- The 97th amendment gave usurping power to the Parliament and made a direct in-road into the exclusive domain of states to enact laws with regard to cooperatives.
- The 97th Constitutional Amendment Act was enacted in 2011 to deal with issues relating to co-operatives societies of our country.
- The amendment inserted the word cooperatives in Article 19(1)(c), Article 43B and Part IXB of Indian Constitution.
View of the Union Government
- The centre has emphasised on the importance of 97th It said that the provision was added to bring uniformity and professionalism in the management of cooperative societies.
- Cooperative societies were suffering from poor services and low productivity due to lack of accountability by the members.
- Elections are not held on time. Co-operative societies need to run on democratic principles. These reasons have made it imperative for the centre to intervene.
Supreme Court reply
- The SC, however, said that had the centre’s objective were to bring uniformity, it should have done it through Article 252 of Indian Constitution that deals with power of Parliament to legislate for two or more states by consent.
- It held that as per Article 368(2) of the Constitution, the 97th Constitutional Amendment required ratification by at least one-half of the state legislatures.
- Since such ratification was not done in the case of the 97th amendment, it was unconstitutional and need to be struck down.
What the Supreme Court upheld?
- The SC upheld the validity of provisions related to Multi State Cooperative Societies (MSCS).
- It did not strike down the portions of Part IXB of the Amendment concerning ‘Multi State Co-operative Societies (MSCS)’ due to the lack of ratification as discussed above.
- Here SC was of the view that MSCS are not confined to one state, thus, the legislative power dealing with this section would reside with Union of India as given under Entry 44 List I (Union List) of the 7th Schedule of the Constitution.
- The judgement declared that Part IXB of the Constitution is operative only insofar as it concerns MSCS both within the various States and in the Union Territories.
Also Read: Ministry of Cooperation