Promotion of subsidiary institution: co operative societies may form and oversee subsidiaries, subject to control, restrictions and reporting.

A multi State co operative society may, by majority resolution at a general meeting, promote one or more subsidiary institutions to further its objects; such subsidiaries exist only while the general body deems necessary. The society must not transfer its substantive business to the subsidiary. A subsidiary is established by control of management or governing body or by holding more than half the nominal value of equity shares, excluding partnership firms. Annual reports and accounts of subsidiaries must be placed annually before the promoting society's general meeting.

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