In a recent ruling, the Supreme Court has clarified the investment powers of multi‑state cooperative societies, holding that such entities cannot use the insolvency process to acquire companies operating in unrelated industries.
The Court interpreted the phrase “same line of business” under Section 64(d) of the Multi‑State Cooperative Societies Act, 2002, as requiring substantial similarity in core activities not merely broad industry overlap.
The case arose from an appeal against orders of the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT), which had declared a cooperative society ineligible to submit a resolution plan for a textile company undergoing insolvency…