EPFO EO/AO 2023 General Ability Test · Question 57 of 120

Correct — D, (d) 1, 2 and 3. The provision behind the question is Article 243ZL of the Constitution, inserted into Part IXB by the Ninety-seventh Amendment, and it is built as a general prohibition followed by exceptions and then by a further prohibition. Reading it in that order is what makes the item easy. The general rule is that no board of a co-operative society shall be superseded or kept under suspension for a period exceeding six months. The first proviso then lists the cases in which a board MAY be superseded or kept under suspension: persistent default; negligence in the performance of its duties; the board having committed any act prejudicial to the interests of the society or its members; a stalemate in the constitution or functions of the board; and failure by the authority or body provided by the State Act to conduct elections in accordance with that Act. Match the statements against that list. Statement 1, negligence in the performance of duties, is on it. Statement 2, an act prejudicial to the interest of the society or its members, is on it. Statement 3, failure to conduct elections in accordance with the provisions of the State Act, is on it. All three are grounds, so the answer must include all three. Statement 4 is not a ground at all — it is the opposite. The second proviso to the same clause says that the board of such a co-operative society shall NOT be superseded or kept under suspension where there is no Government shareholding or loan or financial assistance or any guarantee by the Government. The logic is easy to see: supersession is an extraordinary interference with a body of persons who have associated voluntarily, and the State's warrant for it rests on the public money at stake. Where no public money is at stake, the power falls away. Statement 4 reproduces that immunity accurately and the question then invites the candidate to mistake it for a ground, which is the entire trap. Two printing points, both left as the booklet has them. Statement 4 reads 'There is no Government shareholdings', with the number disagreement in the original. And the stem writes 'cooperative' unhyphenated while statement 2 writes 'co-operative' with the hyphen, in the same question.

• (a)1 and 2 only — Both of the statements it names are genuine grounds, and the word 'only' is what makes the option wrong. Failure to conduct elections in accordance with the State Act is listed in the very same proviso as negligence and as an act prejudicial to the society, so an option that excludes statement 3 leaves out one of the express grounds. This is the option for a candidate who has stopped reading the proviso after the first two limbs — a real hazard, because those two are the ones any general reasoning about mismanagement would suggest, while the election ground has to be known.
• (b)1 and 3 only — Again both named statements are real grounds, and again the exclusion is the error. Leaving out statement 2 discards the widest ground of the five — an act prejudicial to the interests of the society or its members — which is the limb under which most supersession orders in practice are made. Nothing in the provision ranks the grounds or makes one an alternative to another; they stand together, and a question asking when a board CAN be superseded is satisfied by every one of them.
• (c)3 and 4 only — The option that walks into the trap. Statement 3 is a ground, but statement 4 is the express bar on supersession, not a reason for it: where there is no Government shareholding, loan, financial assistance or guarantee, the board may NOT be superseded or kept under suspension at all. Pairing a ground with the immunity inverts the provision, and the option compounds the error by dropping the two grounds a reader is likeliest to be sure of. The lesson is to notice when a statement in a list is phrased as a negative condition — such a statement usually belongs to the exception rather than to the rule.

Part IXB of the Constitution, comprising Articles 243ZH to 243ZT, was inserted by the Ninety-seventh Amendment, which came into force in 2012. The same amendment added the words 'or co-operative societies' to the freedom of association in Article 19(1)(c) and inserted Article 43B among the Directive Principles, directing the State to promote voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies. Part IXB sets out a scheme for them — incorporation, the number of directors and their term of five years, reservation of seats for Scheduled Castes or Scheduled Tribes and for women, elections to be conducted by an authority provided by State law, audit, filing of returns, offences and penalties — and Article 243ZL restricts the power to supersede a board within it. That restriction has three parts worth carrying: the six-month ceiling on any supersession or suspension, the closed list of grounds, and the bar where no Government money or guarantee is involved. A special rule applies to co-operative banks: the Banking Regulation Act, 1949 governs them, and for a co-operative bank other than a multi-State society the ceiling reads one year instead of six months. An administrator appointed on supersession must arrange elections within the period specified and hand charge to the newly elected board. One later development belongs to any full answer on this Part: in July 2021, in Union of India v. Rajendra N. Shah, the Supreme Court held that the amendment needed ratification by half the State legislatures under Article 368(2) because co-operative societies are a State subject, and struck Part IXB down to the extent that it relates to co-operative societies operating within a State, leaving it standing for multi-State co-operative societies.

Co-operatives matter to an Enforcement Officer because a co-operative society can itself be an establishment under labour and social security law, and because the same design question — how much autonomy a voluntary body keeps once public money enters it — runs through both fields. The examiner's construction here is the one to learn from: three of the four statements come from the list of grounds and the fourth comes from the proviso that takes the power away, so the item is decided by whether the candidate has read the provision to its end. The habit rewarded is finishing the section, since the sting of a statutory provision is very often in its last proviso.

• Article 243ZL, inserted by the Ninety-seventh Amendment, governs supersession and suspension of the board of a co-operative society.
• General rule: no board shall be superseded or kept under suspension for a period exceeding six months.
• Grounds on which it may be superseded or suspended: persistent default; negligence in the performance of duties; an act prejudicial to the interests of the society or its members; a stalemate in the constitution or functions of the board; failure by the authority or body provided by the State Act to conduct elections.
• Express bar: the board shall NOT be superseded or kept under suspension where there is no Government shareholding or loan or financial assistance or any guarantee by the Government.
• For a co-operative bank other than a multi-State society, the ceiling is one year instead of six months, and the Banking Regulation Act, 1949 applies.
• The administrator appointed on supersession must arrange elections within the specified period and hand over management to the elected board.
• The Ninety-seventh Amendment also inserted Article 43B in the Directive Principles and added co-operative societies to the freedom of association in Article 19(1)(c).
• In July 2021 the Supreme Court struck down Part IXB in so far as it relates to co-operative societies operating within a State, for want of ratification under Article 368(2), leaving it in force for multi-State co-operative societies.

• Treating the immunity in the last proviso as though it were one more ground for supersession.
• Reading an option with 'only' as safer than one without it; here the complete option is the correct one.
• Assuming the six-month ceiling is uniform, when a co-operative bank other than a multi-State society has a one-year ceiling.
• Answering from a State co-operative societies Act remembered in outline rather than from the constitutional provision the question is built on.

Co-operatives appear in EO/AO papers through the Ninety-seventh Amendment — the articles it inserted, the term of a board, reservation on it, and the grounds for supersession. The format is almost always a numbered list of statements with code options, and the wrong statements are drawn from the provisos rather than invented, so the preparation that pays is reading Part IXB itself once rather than a summary of it.

No directly related past PYQ was found.

• practice — not a real PYQ

  Under Article 243ZL, the board of a co-operative society shall not ordinarily be superseded or kept under suspension for a period exceeding :

  • (a)Three months
  • (b)Six months
  • (c)One year
  • (d)Two years

  Answer(b) Six months

• practice — not a real PYQ

  Part IXB of the Constitution, dealing with co-operative societies, was inserted by which Constitutional Amendment Act ?

  • (a)The Seventy-third Amendment
  • (b)The Seventy-fourth Amendment
  • (c)The Ninety-seventh Amendment
  • (d)The One Hundred and First Amendment

  Answer(c) The Ninety-seventh Amendment