97th constitutional amendment

97th constitutional amendment

Subject: Polity

Context: The Supreme Court, on Tuesday, struck down parts of a Constitutional Amendment which shrunk the exclusive authority of States over its co-operative societies, a sector that is considered a massive contributor to the national economy.

Issues and Judgment:

• Supreme Court upheld the validity of the 97th constitutional amendment, but struck down a part related to the setting up and functioning of cooperative societies working within a state.
• The Supreme Court judgement is based on the reasoning that the concerned subject matter of co-operative fell in the state list and hence it belongs wholly and exclusively to the State legislatures to legislate upon and any change would require the ratification by at least one-half of the state legislatures as per Article 368(2) of the Constitution.
• The judgement held that the 97th constitutional amendment had a significant and substantial impact on the State legislatures’ “exclusive legislative power” over its cooperative sector.
• The majority judgment declared that Part IXB of the Constitution of India is operative only in so far as it concerns multi-State co-operative societies both within the various States and in the Union Territories of India.
• The dissenting judge however held that the doctrine of severability would not operate to distinguish between single-State cooperatives and MSCS and had argued that the entire Part IXB should be struck down on the ground of absence of ratification.

• Disagreeing with the Central government’s argument that the amendment was aimed at bringing uniformity in the management of cooperative societies throughout the country, the Supreme Court suggested that if the Centre wanted to achieve uniformity then the only way available was to take the recourse under Article 252 of the Constitution which deals with the power of Parliament to legislate for two or more states by consent.
• Part IXB, introduced into the Constitution through the 97th amendment of 2012, dictated the terms for running co-operative societies. The provisions in the amendment, passed by the Parliament without getting them ratified by State legislatures as required by the Constitution.
• The amendment went to the extent of determining the number of directors a co-operative society should have or their length of tenure and even the necessary expertise required to become a member of the society Govt version
• The Centre justified they were injecting professionalism and autonomy into the functioning of co-operative societies.
• Lack of accountability by the members of these societies has led to poor services and low productivity. Even elections are not held on time.
• The court held that co-operative societies come under the exclusive legislative power of State legislatures. The judgment may be significant in the background of fears voiced by States whether the new Central Ministry of Cooperation would disempower them.
• Part IX B of the Constitution, which consists of Articles 243ZH to 243ZT, has “significantly and substantially impacted State legislatures’ exclusive legislative power over its co-operative sector under Entry 32 of the State List to over the co-operative sector. I
• The court pointed out how Article 243ZI makes it clear that a State may only make law on the incorporation, regulation and winding up of a co-operative society subject to the provisions of Part IXB of the 97th Constitutional Amendment

Concept:

• The 97th constitutional amendment amended Article 19(I) c by inserting, after the words ‘or unions’ the words ‘or Co-operative Societies’.
• It also inserted Article 43B in Part IV of the Constitution as “The State Shall endeavor to promote Voluntary formation, autonomous functioning, democratic Control and professional management of the Co-operative societies”
• After Part IX-A of the Constitution, Part IX-B was inserted. Part IX-B extended from Article 243ZH to Article 243ZT.
• It amended Article 19(1)(c) to give protection to the cooperatives and inserted Article 43 B and Part IX B, relating to them