Shivpal’s stint as bank chairman ‘expires’ on June 25

Bylaws prohibit minister from becoming chairman.

Cooperative Minister Shivpal Yadav may have become chairman of the Uttar Pradesh Sahkari Gram Vikas Bank, but he cannot continue beyond June 25 unless major changes are made in the bank's bylaws, turning it into a cooperative bank of the state.

At present, the bank is a multi-state bank governed by the Multi-State Cooperative Societies (MSCS) Act, 2002, which prohibits a minister from becoming chairman.

Shivpal became chairman when the Central Registrar of Cooperative Societies, on December 26 last year, revived the board of directors which had been superseded by the previous Mayawati government. Simultaneously, the central registrar ordered that fresh elections should be held under the provisions of MSCS Act 2002 within six months.

That time limit expires on June 25, 2013. Section 44 (1) of the MSCS Act clearly says that a minister, whether at the Centre or in a state, cannot become chairman of a multi-state cooperative society. Therefore, Shivpal cannot continue beyond June 25.

The Uttar Pradesh Sahkari Gram Vikas Bank, which is commonly known as the Land Development Bank (LDB), is the nodal bank for implementing the state government's Rs 1,600 crore loan waiver scheme for farmers, brought by the Akhilesh Yadav government.

Shivpal became its chairman for the first time in 1991 and again in 2005. In 2007, the Mayawati regime superseded the board and appointed an administrator. When the BSP was still in power, the Samajwadi Party opposed the move by the state's registrar to conduct the bank's elections.

The SP argued that it was a multi-state bank with 323 branches in Uttar Pradesh and 19 in Uttaranchal. Therefore, it should be governed by the MSCS Act 2002 and the elections conducted by the central registrar.

The matter went to court, which asked the central registrar to ascertain if the bank qualified to be registered as a multi-state bank. On September 23, 2010, the central registrar held that the bank qualified as a multi-state bank. But formalities for its registration as a multi-state bank were never completed so long as the BSP government was in power.

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