Sections 15-16 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 15 says where a multi-State co-operative society must show its name and registered address: outside its offices, on its seal, and on its letters, bills, cheques and other papers. Section 16 deals with liability. No society with unlimited liability can be registered after commencement of the Act, existing ones had to choose within a year, and a society may change the extent of its liability by amending its bye-laws, with a one-month option for members and creditors to withdraw.
Both sections are read as per the Ministry of Cooperation copy of the Act read with the Multi-State Co-operative Societies (Amendment) Act, 2023; neither was amended in 2023. If your society needs its public-facing papers or its liability clause reviewed, a legal consultation is a sensible first step.
Every society must paint or affix its name and registered-office address on its places of business, engrave its name on its seal, and mention its name and address on its business papers (s.15). No unlimited-liability society is registered after commencement; a society may change its liability by amending its bye-laws, after notice to all members and creditors, who have one month to withdraw their shares, deposits or loans (s.16). Neither section was changed in 2023.
Section 15: publishing the name
Section 15 has three clauses. The society:
| Clause | What it must do |
|---|---|
| (a) | "shall paint or affix its name and the address of its registered office and keep the same painted or affixed, on the outside of every office or place in which its business is carried on, in conspicuous position, in letters easily legible"; and where the characters are not those of a language in general use in that locality, also in the characters of that language |
| (b) | "shall have its name engraven in legible characters on its seal" |
| (c) | "shall have its name and the address of its registered office mentioned in legible characters in all its business letters, in all its bill heads and letter paper, and in all its notices and other official publications"; also in all bills of exchange, hundies, promissory notes, endorsements, cheques and orders for money or goods signed on its behalf, and in all bills of parcels, invoices, receipts and letters of credit |
The "name" is the registered name, which includes the word "limited" (or its Indian-language equivalent) for a limited-liability society under section 5(2). The registered address now includes an e-mail address under section 14 as amended; see Sections 12-14. The 2023 Amendment Act did not alter section 15 itself, so the clause (c) list of papers is unchanged. Section 15 itself states no consequence for a breach.
Section 16: liability
Sub-section (1): no unlimited liability after commencement
"No multi-state cooperative society with unlimited liability shall be registered after the commencement of this Act." The proviso gave earlier societies a choice: a society with unlimited liability that was functioning before commencement "shall exercise the option within a period of one year from such commencement either to continue to function as such or to convert itself into a multi-state cooperative society with limited liability" by the procedure in sub-sections (2) to (4). The commencement date of the principal Act is by notification, date not in the source; this article gives no date.
Sub-sections (2) to (5): changing the extent of liability
- (2) Bye-law amendment. "Subject to the provisions of this Act and the rules, a multi-state cooperative society may, by an amendment of its bye-laws, change the extent of its liability." The ordinary route for bye-law amendment in section 11 applies.
- (3) Notice and option. After the resolution, the society "shall give notice thereof in writing to all its members and creditors", and "notwithstanding anything contained in the bye-laws or contract to the contrary, any member or creditor shall, during the period of one month from the date of service of the notice upon him, have the option of withdrawing his shares, deposits or loans, as the case may be."
- (4) Silence is assent. "Any member or creditor who does not exercise his option within the period specified in sub-section (3) shall be deemed to have assented to the change."
- (5) Not registered, or not effective, until: "(a) the assent thereto of all members and creditors has been obtained; or (b) all claims of members and creditors who exercise the option referred to in sub-section (3) within the period specified therein have been met in full or otherwise satisfied."
The meaning of limited liability is in section 3(q): members' liability limited by the bye-laws to the unpaid amount on shares held or to the amount they undertake to contribute if the society is wound up; see Section 3, clauses (q) to (w).
Reading the sub-section (5) test
Either all members and creditors assent, or the claims of those who exercised the option have been met in full or otherwise satisfied. Because silence amounts to assent under sub-section (4), where some have withdrawn and the rest are silent, the second route applies: those who stay silent are treated as assenting, and those who withdraw must have their claims met.
How the sections work together
| Question | Answer in the Act |
|---|---|
| Can a new unlimited-liability society be registered? | No (s.16(1)) |
| How can an existing society change its liability? | By bye-law amendment (s.16(2)), after notice to every member and creditor (s.16(3)) |
| How long do members and creditors have to withdraw? | One month from service of the notice (s.16(3)) |
| What if they say nothing? | Deemed assent (s.16(4)) |
| When can the change be registered or take effect? | Only after assent of all, or after claims of those who opted out are met (s.16(5)) |
| Where must the name appear? | Offices, seal, letters, bills, cheques and other papers (s.15) |
A practical example
Sahyadri Thrift Society, an invented multi-State society, has been running with unlimited liability since before commencement and wishes to convert to limited liability. It amends its bye-laws by resolution (section 11 procedure), gives written notice to its members and creditors, and waits one month from service on each. Twelve depositors withdraw their deposits during that month, and the society pays them in full. The rest do not respond and are deemed to assent. The change can then be registered. After registration, the society reprints its name with "Limited", repaints its signboards, re-engraves its seal and updates its cheque books, as section 15 requires.
For a view of how this fits the wider Act, see the complete guide, and for the comparison with State co-operatives see the MSCS vs State comparison.
What the 2023 Amendment Act changed
| Provision | Before | After |
|---|---|---|
| Section 15 (a), (b), (c) | As printed above | No change |
| Section 16 (1) to (5) | As printed above | No change |
Need help with liability or name display?
Changing liability touches every member and creditor, and getting the notice and the one-month window right matters. A legal consultation can help you plan the resolution, the notice and the payouts.
Key takeaways
- A society must show its name and registered-office address outside its offices, on its seal and on its business papers (s.15).
- No unlimited-liability society is registered after commencement (s.16(1)).
- Liability can be changed only by bye-law amendment, after written notice to all members and creditors (s.16(2), (3)).
- Members and creditors have one month to withdraw shares, deposits or loans; silence is assent.
- Registration or effect waits until all assent or the claims of those withdrawing are met.
- Neither section was amended in 2023.
Read next
- Sections 12-14: bye-law amendment in force, change of name and address
- Section 17: amalgamation, transfer of assets and division
- Section 11: amendment of bye-laws, procedure and registration
- MSCS vs State co-operative society: comparison
Disclaimer: Based on the Ministry of Cooperation copy of the Multi-State Co-operative Societies Act, 2002 read with the Multi-State Co-operative Societies (Amendment) Act, 2023 (in force from 3 August 2023), as consulted on 2 October 2026. The Multi-State Co-operative Societies Rules, 2002 as amended, later notifications and later amendments are not covered and should be checked. This article is general information, not legal advice; check the official text before acting.