Multi-State co-operative societies are outside constitutional rules on co-operatives entirely.

They are covered by the same Part IX-B rules, just with 'State' terms swapped for 'Central' ones under Article 243ZR.

The Supreme Court struck down all of Part IX-B, including this Article.

In *Union of India v. Rajendra N. Shah* (2021), the Court struck down only provisions affecting State-level co-operatives for lacking required ratification; multi-State provisions like Article 243ZR were upheld.

The Constitution of India

Article 243ZR

Application to multi-State co-operative societies

The provisions of this Part shall apply to the multi-State co-operative societies subject to the modification that any reference to "Legislature of a State", "State Act" or State Government" shall be construed as a reference to "Parliament", "Central Act" or "the Central Government" respectively.§

Why this exists

Part IX-B was added by the 97th Constitutional Amendment (2011) to give co-operative societies constitutional protection—things like democratic elections, fixed board terms, and audits. But many co-operative societies operate across state borders (like large dairy or credit federations), and these fall under central law rather than any single state's law. Article 243ZR extends the same protections and standards to these multi-State bodies by simply substituting the central equivalents for state-level terms, ensuring uniform treatment without rewriting the whole Part.

How courts read it

In *Union of India v. Rajendra N. Shah* (2021), the Supreme Court examined Part IX-B as a whole and held that provisions applying to State co-operative societies required ratification by half the state legislatures under Article 368(2), since they encroached on State subjects. However, because multi-State co-operative societies fall under Parliament's own domain (Entry 44, Union List), the Court upheld Article 243ZR and the multi-State provisions as validly enacted, even while striking down parts of the Amendment concerning purely State-level societies.

Common misconceptions

Myth: Multi-State co-operative societies are outside constitutional rules on co-operatives entirely.
Fact: They are covered by the same Part IX-B rules, just with 'State' terms swapped for 'Central' ones under Article 243ZR.
Myth: The Supreme Court struck down all of Part IX-B, including this Article.
Fact: In *Union of India v. Rajendra N. Shah* (2021), the Court struck down only provisions affecting State-level co-operatives for lacking required ratification; multi-State provisions like Article 243ZR were upheld.