(1) A society which has as its chief object the promotion of the economic interest and general welfare of its members in accordance with cooperative principles may be registered under this Act; provided that a society established with the object of facilitating the operation of such a society including a society formed by the division of an existing registered society or amalgamation of existing two or more societies, may be registered under this Act with limited liability.
(2) No society shall be registered if in the opinion of the Registrar its declared objects are not likely to be achieved or if it is economically unviable, technically and cooperatively unsound or if it may have an adverse effect upon any registered cooperative society or the cooperative movement as a whole or if the members or the applicants do not need the services or are not in a position to use the services of the cooperative society.
Provided that no other organization, entity or societies registered under any Other Act existing for the time being in force other than this Act shall be registered or converted or merged as a cooperative society.
(3) The Cooperative Society to be registered as a Cooperative Bank shall specifically indicate in its byelaws submitted before the Registrar at the time of registration, that the society shall be a Cooperative Bank which shall carry on the business of banking as defined under Section 5 (b) of the Banking Regulation Act, 1949 (Act No. 10 of 1949) on the basis of which the Registrar shall register the said society as a Co-operative Bank as defined under this Act.