PUNJAB CO-OPERATIVE SOCIETIES ACT, 1961
Received the assent of the President of India on the 22nd June, 1961 and first published for general information in the Punjab Government Gazette (Extraordinary), Legislative Supplement, of the 8th July, 1961.
An Act to consolidate and amend the law relating to co-operative societies in the State of Punjab.
Be it enacted by the Legislature of the State of Punjab in the Twelfth Year of the Republic of India as follows :-
(1) This Act may be called the Punjab Co-operative Societies (Amendment) Act, 1961.
(2) It extends to the whole of the State of Punjab.
(3) It shall come into force on such date as the Government may, by notification, appoint.
In this Act, unless the context otherwise requires :-
[(a) "associate member" means a member who holds jointly a share of a co-operative society with others but whose name does not stand first in the share certificate.]
[(aa) "bye-laws" means the registered bye-law for time being in force;]
(b) "committee" means the governing body of a co-operative society, by whatever name called, to which the management of the affairs of the society is entrusted;
(c) "co-operative society" means a society registered or deemed to be registered under this Act ;
(d) "co-operative society with limited liability" means a co- operative society the liability of whose members is limited by its bye-laws to the amount, if any, unpaid on the shares individually held by them or to such amount as they may individually undertake to contribute to the assets of the society, in the event of
(1) The Government may appoint a person to be the Registrar of Co-operative Societies for the State.
(2) To assist the Registrar in his function under this Act the Government may appoint such number of Additional Registrars, Joint Registrars, Deputy Registrars, Assistant Registrars and other persons with such designations as it may think fit.
(3) The Government may, by general or special order, confer on any person appointed under sub-section (2), all or any of the powers of the Registrar under this Act.
(4) Every person appointed under sub-section (2) shall exercise his powers subject to the general superintendence and control of Registrar.]
[(5) Notwithstanding anything contained in this Act, where any power of the Registrar is exercised by any person by virtue of the order issued by the Government under sub-section (3), the order passed or decision made by such person shall, fo
(1) Subject to the provisions hereinafter contained, a society which has as its object the promotion of the economic interest of its members in accordance with co-operative principles, or a society established with the object of facilitating the operations of such a society, may be registered under this Act with or without limited liability:
Provided that, unless Government by general or special order otherwise directs, the liability of the society of which a member is a co-operative society shall be limited.
(2) The word limited or its equivalent in any Indian language shall be the last word in the name of every society registered under this Act with limited liability.
No society, other than a society of which a member is a co-operative society, shall be registered under this Act, unless it consists of at least ten individuals above the age of eighteen years.
No member other than the Government, a Public Sector Undertaking or a co-operative society shall, hold more than such portion of the share capital of a co-operative society, as may be prescribed which in no case shall exceed one-tenth of the share capital:
Provided that in the case of milk producers co-operative society engaged in the marketing of such other perishable commodity, as may be notified by the Government, from time to time, in this behalf (hereinafter referred to as `society dealing in notified commodity') registered after the commencement of the Punjab Co-operative Societies (Amendment) Act, 1978, no member shall have or claim any interest in the shares of such society exceeding one thousand rupees.]
(1) For purposes of registration an application shall be made to the Registrar.
(2) The application shall be signed.
(a) in the case of a society of which no member is a co-operative society, by at least ten persons qualified in accordance with the requirements of section 5 ; and
(b) in the case of the society of which a member is a co-operative society, by a duly authorised person on behalf of every such society and where all the members of the society are not co-operative societies by ten other members, (or when there are less than ten other members), by all of them.
(1) If the Registrar is satisfied -
(a) that the application complies with the provisions of this Act and the rules,
(b) that the objects of the proposed society are in accordance with section 4,
(c) that the proposed bye-laws are not contrary to the provisions of this Act and the rules ; and
(d) that the proposed society has reasonable chances of success, the Registrar may register the society and its bye-laws.
(2) When the Registrar refuses to register a society, he shall communicate the order of refusal together with the reasons therefor, to such of the applicants as may be prescribed.
(3) The application for registration shall be disposed of by the Registrar within a period of two months from the date of receipt thereof by him.
Where a society is registered under this Act the Registrar shall issue a certificate of registration signed by him, which shall be conclusive evidence that the co-operative society therein mentioned is duly registered under this Act.
(1) No amendment of any bye-laws of a co-operative society shall be valid unless such amendment has been registered under this Act.
(2) Every proposal for such amendment shall be forwarded to the Registrar and if the Registrar is satisfied that the proposed amendment -
(i) is not contrary to the provisions of this Act and the rules;
(ii) does not conflict with co-operative principles; and
(iii) will promote the economic interests of the members of the society,
he may register the amendment.
(3) The Registrar shall forward to the society a copy of the registered amendment together with a certificate signed by him and such certificate shall be conclusive evidence that the amendment has been duly registered.
(4) Where the Registrar refuses to register an amendment of the bye-laws of a co-operative society, he shall c
(1) If in the opinion of the Registrar, an amendment of the bye-laws of a co-operative society is necessary or desirable in the interest of such a Society or of the co-operative movement, or to bring such bye-laws in conformity with any provision of the Act or rules made thereunder he may by notice in writing, call upon the society to make such amendment within a period of three months of the date of service of the notice.
(2) If within the period specified in Sub-section (1) the co-operative society fails to make such an amendment the Registrar may after giving the society an opportunity of making its representation, register the amendment and issue to the society a copy of the amendment together with a certificate signed by him.
(3) The certificate issued under Sub-section (2) shall be conclusive evidence that the amendment has been duly registered and such amendment shall have the same effect as an amendment registered u
(1) A co-operative society may, by an amendment of its bye-laws, change its name but such change shall not affect any right or obligation of the society or of any of its members or past members, and any legal proceedings pending may be continued by or against the society under its new name.
(2) Where a co-operative society changes its name, the Registrar shall enter the new name on the register of co-operative societies in place of the former name and shall amend the certificate of registration accordingly.
(1) Subject to the provisions of this Act and the rules, a co-operative society may, by an amendment of its bye-laws, change the form or extent of its liability.
(2) When a co-operative society has passed a resolution to change the form or extent of its liability, it shall give notice thereof in writing to all its members and creditors and notwithstanding any bye-law or contract to the contrary, any member or creditor shall, during a 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.
(3) Any member or creditor who does not exercise his option within the period specified in sub-section (2) shall be deemed to have assented to the change.
(4) An amendment of a bye-law of a co-operative society changing the form or extent of its liability shall not be registered or take effect until either -
(1) A co-operative society may with the previous approval of the Registrar and by a resolution passed by a two-thirds majority of the members present and voting at a general meeting of the society:-
[(a) transfer its assets and liabilities in whole or part to another co-operative society provided the co-operative society to which the assets and liabilities are to be transferred also passes a resolution in the aforesaid manner to accept such assets and liabilities in whole or in part, as the case may be;]
(b) divide itself into two or more co-operative societies.
(2) Any two or more co-operative societies may, with the previous approval of the Registrar and by a resolution passed by a two-third majority of the members present and voting at a general meeting of each such society, amalgamate themselves and form a new co-operative society.
(3) The resolution of a co-operative society
(1) Where the whole of the assets and liabilities of a co- operative society are transferred to another co-operative society in accordance with the provisions of Section 13, the registration of the first mentioned co-operative society shall stand cancelled and the society shall be deemed to have been dissolved and shall cease to exist as a corporate body.
[(1-A) Where one or more co-operative societies are amalgamated with any other co-operative society by an order under sub-section (8) of Section 13, the registration of the co- operative society or co-operative societies, as the case may be, so amalgamated shall stand cancelled and the society or societies whose registration stands so cancelled shall be deemed to have been dissolved and shall cease to exist as a corporate body on the date of the aforesaid order and the members thereof shall become the members of the other co-operative society.]
(2) Where two or more co-ope
No person shall be admitted as member of a co-operative society except the following, namely:-
(a) an individual competent to contract under section 11 of the Indian Contract Act, 1872 (9 of 1872);
(b) any other co-operative society;
(c) the Government;
(d) a Public Sector Undertaking; and
(e) such class or classes of persons or associations of persons as may be notified by the Government.]
(1) No individual shall be admitted as member of a central or apex society unless such a society has been exempted by the Registrar in this behalf, by a general or special order.
(2) The Central and apex societies having individuals as members on the date of commencement of the Punjab Co-operative Societies (Amendment) Act, 1969 shall retire the shares of such individuals within a period of three years of such commencement in the prescribed manner.
Explanation - For the purpose of this Section, Section 26, Section 26-B and Section 84-A -
(a) "primary society" means a co-operative society whose membership consists exclusively of individuals ;
(b) "Central society" means a co-operative society whose membership includes primary societies ;
(c) "apex society" means a co-operative society whose membership includes central societies
(1) Notwithstanding anything to the contrary contained in this Act -
(i) every person eligible for admission as a member of a co-operative society shall be deemed to have been admitted as a member of the society from the date of receipt of his application for such admission in the office of that society ;
(ii) the Registrar may of his own motion or on a complaint made by the committee of the society or any aggrieved person by an order determine that such a person is not eligible to be a member of the society and on such determination that person will cease to be a member :
Provided that no such order shall be made unless the person already admitted as a member is given an opportunity of being heard and where an order is to be made on the basis of a complaint it shall be made within a period of thirty days of the receipt thereof.
(2) The provisions of this section shall apply only
(1) Notwithstanding anything contained in clause (d) of section 15, a co-operative society may admit any person as a nominal or associate member in accordance with its bye-laws.
(2) A nominal or associate member shall not be entitled to any share in any form whatsoever in the assets or profit of the co-operative society.
(3) Save as provided in this section, a nominal or associate member shall have such privileges and rights of a member and be subject to such liabilities of a member, as may be specified in the bye-laws of the society.
No member of a co- operative society shall exercise the rights of member unless he has made such payments to the society in respect of membership or has acquired such interest in the society as may be specified in the bye-laws.
Every member of a co-operative society shall have one vote in the affairs of the society :
Provided that, -
(a) in the case of an equality of votes, the Chairman shall have a second or casting vote;
(b) a nominal or associate member shall not have right of vote;
(c) where the Government is a member of the co-operative society, each person nominated by the Government on the committee shall have one vote.
(1) Every member of a co-operative society shall exercise his vote in person and no member shall be permitted to vote by proxy.
[(2) Notwithstanding anything contained in sub-section (1), a co-operative society which is a member of another co-operative society, may, subject to the rules, appoint one of the members who is eligible to vote on its behalf in the affairs of that other society.
Explanation. - In case the member appointed by a society, to vote on its behalf in the affairs of another society of which such society is a member, gets elected to the committee of that society, his term of office shall be co-terminus with the term of committee of that society.]
The transfer of the share or interest of a member in the capital of a co-operative society shall be subject to such conditions as to maximum holding as are specified in section 6.
On the death of a member, a co- operative society may transfer the share or interest of the deceased member to the person nominated, in accordance with rules, made in this behalf, or, if there is no person so nominated, to such person as may appear to the committee to be the heir or legal representative of the deceased member, or pay to such nominee, heir or legal representative, as the case may be, a sum representing the value of such member's share or interest as ascertained in accordance with the rules or bye-laws:
Provided that -
(i) in the case of a co-operative society with unlimited liability, such nominee, heir or legal representative, as the case may be, may require payment by the society of the value of the share or interest of the deceased member ascertained as aforesaid ;
(ii) in the case of a co-operative society with limited liability the society shall transfer the share or interest of th
(1) Subject to the provisions of sub-section (2), the liability of a past member or of the estate of a deceased member of a co-operative society for the debts of the society as they existed,-
(a) in the case of a past member, on the date on which he ceased to be a member;
(b) in the case of deceased member, on the date of his death;
shall continue for a period of two years from such date.
(2) Where a co-operative society is ordered to be wound up under Section 57, the liability of a past member or of the estate of a deceased member who ceased to be member or died within two years immediately preceding the date of the order of winding up, shall continue until the entire liquidation proceedings are completed, but such liability shall extend only to the debts of the society as they existed on the date of his ceasing to be a member or death, as the case may be.
(1) The final authority in a co-operative society shall vest in the general body of members ;
[******]
[(1A) Notwithstanding anything in sub-section (1), where a co-operative society consists of not less than such number of members as may be prescribed the society may provide in its bye-laws for the constitution of a smaller general body designated as the representative general body to be elected in the prescribed manner for a term of three years, consisting of such number of members of the society and to exercise all or such of the powers of the general body as may be specified in the bye-laws; and thereupon any reference in this Act to the general body or meeting thereof shall be construed as a reference to the representative general body or its meetings:
Provided that the representative general body shall not alter any provision in the bye-laws relating to its constitution or powers.]
A general meeting of a co-operative society shall be held once in a year for the purpose of -
(a) approval of the programme of the activities of the society prepared by the committee for the ensuing year;
(b) election, if any, of the members of the committee other than nominated members;
(c) consideration of the audit report and the annual report ;
(d) disposal of the net profits; and
(e) consideration of any other matter which may be brought forward in accordance with the bye-laws.
[Provided that where the committee of any co-operative society has divided the area of operation of the society into zones in the manner laid down in sub-section (1A) of Section 26, election of the members of the committee may not be held in general meeting.]
(1) The committee of a co-operative society may, at any time call a special general meeting of the society and shall call such meeting within one month after the receipt of a requisition in writing from the Registrar or from such number of members or a proportion of the total numbers of members, as may be provided in the bye-laws.
(2) If a special general meeting of a co-operative society is not called in accordance with requisition referred to in sub-section (1), the Registrar or any person authorised by him in this behalf shall have the power to call such meeting and that meeting shall be deemed to be a meeting called by the committee.
[(1) The members of the committee of a co-operative society shall be elected in the manner prescribed and no person shall be so elected unless he is a share holder of the society:
Provided that the maximum number of members of the committee of a co-operative society shall not exceed twenty-one:
Provided further that there shall be reservation of one seat for the scheduled castes and two seats for women on the committee of every co-operative society consisting of individuals as members and having members from such class or category of persons.]
[(1A) The committee of any co-operative society may subject to the approval of the Registrar, divide the area of operation of the society into zones for the purpose of election of members of the committee.]
[(1-B) The term of office of elected members of the committee and its office bearers shall be five years from the date of election and t
(1) Notwithstanding anything in section 26, the Registrar may, by an order in writing, direct the committee of any co-operative society or any class of co-operative societies to co-opt in the prescribed manner for serving on the committee such number of members not exceeding two as may be specified in the direction.]
(2) Where a direction is issued under sub-section (1), co-option shall be made from amongst members of the co-operative society belonging to scheduled castes, scheduled tribes or backward classes or from amongst members who as landowner or tenant or as both do not hold more than the prescribed area of agricultural land and fulfil the prescribed conditions.
(3) Members co-opted under sub-section (2) for serving on the committee of a co-operative society shall have the same rights and privileges and shall be subject to the same liabilities as elected members of the committee of that society.
(1) No individual shall, at any time, be a member of committee of -
(a) more than two primary societies; and
(b) more than one central and one apex society:
Provided that nothing in this sub-section shall apply to a member nominated under sub-section (2) of Section 26 or to a member of the committee of an apex or central society nominated to serve on the committee of another apex or central society, as the case may be, in accordance with the provisions of their bye-laws.
[(2) No person shall be eligible for being elected to the committee of any co-operative society after he has served on the committee of that co-operative society for two continuous terms, unless a period of not less than one term has expired since he last so served.
Explanation - For the purpose of computing the period of two terms under sub-section (2), if a person ceased to serve on the com
(1) If, in the opinion of the Registrar, a committee or any member of a committee persistently makes default or is negligent in the performance of the duties imposed on it or him by this Act or the rules or bye-laws made thereunder, or commits any act which is prejudicial to the interest of the society or its members, or makes default in the implementation of production or development programmes undertaken by the co-operative society, or there is stalemate in the constitution or functions of the committee, the Registrar may, after giving the committee or the member, as the case may be, a reasonable opportunity to state its or his objections, if any, by order in writing,-
(a) remove the committee, and appoint a Government servant as an administrator, to manage the affairs of the society for a period not exceeding six months, as may be specified in the order; and
(b) remove the member and get the vacancy filled up through ele
(1) (a) If the record, registers or the books of accounts of co-operative society are likely to be tampered with or destroyed and the funds and property of a society are likely to be misappropriated or misapplied; or
(b) If the committee of a co-operative society is reconstituted at a general meeting of the society or, the committee of a society is removed by the Registrar under section 27 or if the society is ordered to be wound up under section 57 and the outgoing members of the committee refuse to hand over charge of the records and property of the society to those having or entitled to receive such charge;
the Registrar may apply to the magistrate, within whose jurisdiction the society functions, for securing the records and property of the society.
(2) On receipt of an application under sub-section (1), the magistrate may, by a warrant, authorise any police officer not below the rank of Sub-Inspec
No act of a co-operative society or of any committee or of any officer shall be deemed to be invalid by reason only of the existence of any defect in procedure or in the constitution of the society or of the committee or in the appointment or election of an officer or on the ground that such officer was disqualified for his appointment.
The registration of a co-operative society shall render it a body corporate by the name under which it is registered having perpetual succession and a common seal, and with power to hold property, enter into contract, institute and defend suits and other legal proceedings and to do all things necessary for the purpose for which it is constituted.
(1) Notwithstanding anything contained in any law for the time being in force, but subject to any prior claim of the Government in respect of land revenue or any money recoverable as land revenue, and debt or outstanding demand owing to a co-operative society by any member of or past member or deceased member shall be a first charge upon the crops and other agricultural produce, cattle, fodder for cattle, agricultural or industrial implements or machinery, raw materials for manufacture and any finished products manufactured from such raw materials, belonging to such member, past member or forming part of the estate of deceased member as the case may be.
(2) No person shall transfer any property which is subject to a charge under sub-section (1) except with the previous permission in writing of the co-operative society which holds the charge.
(3) Notwithstanding anything contained in any law for the time being in force, any
Notwithstanding anything contained in this Act or in any other law for the time being in force -
(i) any person who makes an application to a society of which he is a member for a loan shall, if he owns any land or has interest in any land as a tenant, make a declaration in the prescribed form which shall state that the applicant thereby creates a charge on such land or interest specified in the declaration for the payment of the amount of the loan which the society may make to the member in pursuance of the application and for all future advances, if any, required by him which the society may make to him as such member subject to such maximum as may be determined by the society together with interest on such amount of the loan and advances;
(ii) any person who has borrowed a loan from a society of which he is a member before the date of the coming into force of this Act, and who owns land or has any interest in land as a t
A co-operative society shall have a charge upon the share of contribution or interest in the capital and on the deposits of a member or past member or deceased member and upon any dividend, bonus or profits payable to a member or past member or the estate of a deceased member in respect of any debt due from such member or past member or the estate of such deceased member or the society and may set off any sum credited or payable to a member or past member or the estate of deceased member in or towards payment of any such debt.
Subject to the provisions of Section 33, the share of contribution or interest of a member or past member or deceased member in the capital of a co-operative society shall not be liable to attachment or sale under any decree or order of any court in respect of any debt or liability incurred by such member, and a receiver under the Provincial Insolvency Act 1920 (VI) of 1920), shall not be entitled to or have any claim on such share or contribution or interest.
Any register or list of members of shares kept by any co-operative society shall be prima facie evidence of any of the following particulars entered therein -
(a) the date on which any person entered in such register or list became a member;
(b) the date on which any such person ceased to be member.
A copy of any entry in a book of a co-operative society regularly kept in course of its business, shall, if certified in such manner as may be prescribed, be received in any suit or legal proceedings as prima facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions and accounts therein recorded in every case where, and to the same extent as, the original entry itself is admissible.
(2) No officer of a co-operative society and no officer in whose office the books of a co-operative society are deposited after liquidation shall, in any legal proceedings to which the society or the liquidator is not a party, be compelled to produce any of the society's books or documents the contents of which can be proved under this section, or to appear as a witness to prove the matters, transactions and accounts therein recorded, except under order of the court or the arbitrator made for special cause.
Nothing in clauses (b) and (c) of sub-section (1) of Section 17 of the Indian Registration Act, 1908 (XVI of 1908), shall apply to -
(1) any instrument relating to shares in a co-operative society notwithstanding that the assets of the society consist in whole or in part of immovable property; or
(2) any debenture issued by any such society and not creating, declaring, assigning, limiting or extinguishing any right, title or interest to or in immovable property, except in so far as it entitles the holder thereof the security afforded by a registered instrument whereby the society has mortgaged, conveyed, or otherwise transferred the whole or part of its immovable property or any interest therein to trustees upon trust for the benefit of the holders of such debentures; or
(3) an endorsement upon or transfer of any debenture issued by any such society.
(1) The Central Government may, by notification in the Official Gazette, remit the income-tax payable in respect of the profits of any class of co-operative societies or the dividends or other payments received by members of any class of such societies on account of profits.
(2) The Government may, by notification remit in respect of any class of co- operative societies-
(a) the stamp duty chargeable under any law for the time being in force in respect of any instrument executed by or on behalf of a co-operative society or by an officer or member thereof and relating to the business of such society, or any class of such instruments or in respect of any award or order made under this Act, in cases, where, but for such remission the co- operative society officer or member as the case may be, would be liable to pay such stamp duty;
(b) any fee payable under any law for the time being in force relating to
(1) Notwithstanding anything contained in any law for the time being in force a member of a co-operative society may execute an agreement in favour of the society providing that his employer shall be competent to deduct from the salary or wages payable to him by the employer, such amount as may be specified in the agreement and to pay the amount so deducted to the society in satisfaction of any debt or other demand owing by the member to the society.
(2) On the execution of such agreement, the employer shall, if so required by the co-operative society by a requisition in writing and so long as the society does not intimate that the whole of such debt or demand has been paid, make the deduction in accordance with the agreement and pay the amount so deducted to the society, as if it was a part of the salary or wages payable in the day as required under the Payment of Wages Act, 1936 (IV of 1936). Such payment shall be valid discharge of the employ
Notwithstanding anything contained in any law for the time being in force the Government may-
(a) subscribe to the share capital of a co-operative society;
(b) give loans or make advances to co-operative society;
(c) guarantee the repayment of principal and payment of interest on debentures issued by a co-operative society;
(d) guarantee the repayment of share capital of a co-operative society and dividends thereon at such rates as may be specified by the Government;
(e) guarantee the repayment of principal and payment of interest on loans and advances to a co-operative society; and
(f) give financial assistance in any other form, including subsidies to any co-operative society.
No part of the funds of a co- operative society shall be divided by way of bonus or dividend or otherwise among its members :
Provided that after at least one-tenth of the net profits in any year have been carried to the reserve fund, payments from the remainder of such profits and from any profits of past years available for distribution may be made among the members to such extent and under such conditions as may be prescribed by the rules or bye-laws.
Any co-operative society may, with the sanction of the Registrar, after one-tenth of the net profits in any year has been carried to the reserve fund contribute an amount not exceeding five per cent of the remaining net profits to any purpose connected with the development of co-operative movement or charitable purpose as defined in Section 20 of the Charitable Endowments Act, 1890 (VI of 1890).
A co-operative society shall out of its net profits in any year credit such portion of the profits not exceeding 5 per cent as may be prescribed to the Co-operative Education Fund constituted under rules.
(1) A co-operative society may invest or deposit its funds-
(a) in the post office savings bank; or
(b) in any of the securities specified in Section 20 of the Indian Trust Act, 1882; or
(c) in the shares or securities of any other co-operative society; or
(d) with any bank carrying on the business of banking approved for this purpose by the Registrar; or
(e) In any other mode permitted by the rules.
(2) Any investments or deposits made before the commencement of this Act which would have been valid if this Act had been in force are hereby ratified and confirmed.
(1) A co-operative society shall not make a loan to any person other than a member:
Provided that with the general or special sanction of the Registrar a co-operative society may make loan to another co-operative society.
(2) Notwithstanding anything contained in sub-section (1), a co-operative society may make a loan to a depositor on the security of his deposit.
A co-operative society shall receive deposits and loans only to such extent and under such conditions as may be prescribed or as may be specified in the bye-laws.
Save as provided in Sections 45 and 46, the transactions of a co-operative society with person other than member shall be subject to such prohibitions and restrictions, if any, as may be prescribed.
(1) The Registrar shall audit or cause to be audited by a person authorised by him by general or special order in writing in this behalf, the accounts of every co-operative society at least once in each year.
(2) The audit under sub-section (1) shall include an examination of overdue debts, if any, the verification of the cash balance and securities, and a valuation of the assets and liabilities of the society.
(3) The person auditing the accounts of a co-operative society shall have free access to the books, accounts, papers, vouchers, stock and other property of such society and shall be allowed to verify its cash balance and securities.
(4) The directors, managers, administrator and other officers of the society shall furnish to the person auditing the accounts of a co-operative society all such information as to its transactions and working as such person may require.
(5) The
The Registrar or any person authorised by general or special order in this behalf by the Registrar, may inspect a co- operative society. For the purpose of inspection, the Registrar or the person so authorised by the Registrar shall at all times have access to all books, accounts, papers, vouchers, securities, stock and other property of the society and may in the event of serious irregularities discovered during inspection take them into custody and shall have power to verify the cash balance of the society and subject to the general or special order of the Registrar to call a committee and a general meeting. Every officer or member of the society shall furnish such information with regard to the working of the society as the Registrar or the person making such inspection may require.
(1) The Registrar may of his own motion or on the application of a majority of the committee or of not less than one-third of the members, hold an inquiry or direct some person authorised by him by order in writing in this behalf to hold an inquiry into the constitution, working and financial condition of a co-operative society.
(2) The Registrar or the person authorised by him under sub-section (1) shall have following powers, namely :-
(a) he shall at all times have, for purposes of examination, free access to the books, accounts, cash and other properties belonging to or in custody of the society and may summon any person in possession or responsible for the custody of any such books, accounts, documents, securities, cash or other properties to produce the same at any place within the district within which the society has its registered address; [and may if considered necessary, by an order in writing, direct the society
(1) The Registrar shall, on the application of a creditor of a co-operative society, inspect or direct some person authorised by him by order in writing in this behalf to inspect the books of the society :
Provided that no such inspection shall be made unless the applicant
(a) satisfies the Registrar that the debt is a sum then due, and that he has demanded payment thereof and has not received satisfaction within a reasonable time; and
(b) deposits with the Registrar such sum as security for the costs of proposed inspection as the Registrar may require.
(2) The Registrar shall communicate the result of any such inspection to the creditor.
When an inquiry is held under Section 50, or an inspection is made under Section 51, the Registrar may apportion the costs, or such part of the costs, as he may think fit between the society, the members or creditor demanding an inquiry or inspection, and the officers or former officers and the members or past members of the society:
Provided that-
(a) no order of the apportionment of the costs shall be made under this section unless the society or the person liable to pay the costs thereunder has had a reasonable opportunity of being heard;
(b) the Registrar shall state in writing under his own hand the grounds on which the costs are apportioned.
Any sum awarded by way of costs under Section 52 may be recovered on application to a Magistrate having jurisdiction in the place where the person, from whom the money is claimable actually and voluntarily resides or carries on business, and such Magistrate shall recover the same as if it were a fine imposed by himself.
(1) If in the course of an audit inquiry, inspection or the winding up of a co-operative society it is found that any person who is or was entrusted with the organisation or management of such society or who is or has at any time been an officer or an employee of the society, has made any payment contrary to this Act, the rules or the bye-laws or has caused any deficiency in the assets of the society by breach of trust or wilful negligence or has mis-appropriated or fraudulently retained any money or other property belonging to such society, the Registrar may of his own motion or on the application of the committee liquidator or any creditor, enquire himself or direct any person authorised by him by an order in writing in this behalf, to inquire into the conduct of such person:
Provided that no such inquiry shall be held after the expiry of six years from the date of any act or omission referred to in this sub-section.
(2)
(1) Notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitution, management or the business of a co-operative society arises -
(a) among members, past member and persons claiming through members, past members and deceased member; or
(b) between a member, past member or person claiming through a member, past member or deceased member and the society, its committee or any officer, agent or employee of the society or liquidator, past or present; or
(c) between the society or its committee and any past committee, any officer, agent or employee; or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent, or deceased employee of the society; or
(d) between the society and any other co-operative society, between a society and liquidator of another society o
(1) The Registrar may, on receipt of the reference of dispute under Section 55, -
(a) decide the dispute himself; or
(b) transfer it for disposal to any person who has been invested by the Government with powers in that behalf; or
(c) refer it for disposal to one arbitrator.
(2) The Registrar may withdraw any reference transferred under clause (b) of sub-section (1) or referred under clause (c) of that sub-section and decide it himself or refer the same to another arbitrator for decision.
(3) The Registrar or another person to whom a dispute is referred for decision under this section may, pending the decision of the dispute, make such interlocutory orders as he may deem necessary in the interest of justice.
(1) If the Registrar, after an inquiry has been held under Sections 50, or an inspection has been made under Section 51, or on receipt of an application made by not less than, three- fourths of the members of a co-operative society, is of opinion that the society ought to be wound up, he may issue an order directing it to be wound up.
(2) The Registrar may of his own motion make an order directing the winding up of a co-operative society -
(a) where it is a condition of the registration of the society that the society shall consist of at least ten members and the number of members has been reduced to less than ten; or
(b) where the co-operative society has not commenced working or has ceased to function in accordance with co-operative principles.
(3) The Registrar may cancel an order for the winding up of a co-operative society, at any time, in any case where, in his opinion, the
(1) Where the Registrar has made an order under Section 57 for the winding up of a co-operative society, he may appoint a liquidator for the purpose and fix his remuneration.
(2) A liquidator shall, on appointment, take into his custody or under his control the property, effects and actionable claims to which the society is or appears to be entitled and shall take such steps as he may deem necessary or expedient, to prevent loss or deterioration of, or damage to such property, effects and claims. He may carry on the business of the society so far as may be necessary with the previous approval of the Registrar.
(3) Where an appeal is preferred under Section 68 an order of winding up of a co-operative society made under Section 57 shall not operate thereafter until the order is confirmed in the appeal:
Provided that the liquidator shall continue to have custody or control of the property effects and act
(1) Subject to any rules made in this behalf, the whole of the assets of a co-operative society , in respect of which an order for winding up has been made, shall vest in the liquidator appointed under Section 58 from the date on which the order takes effect and the liquidator shall have power to realise such assets by sale or otherwise.
(2) Such liquidator shall also have power, subject to the control of the Registrar-
(a) to institute and defend suits and other legal proceedings on behalf of the co-operative society by the name of his office;
(b) to determine from time to time the contribution (including debts due and costs of liquidation) to be made or remaining to be made by the members or past members or by the estates or nominees, heirs or legal representatives of deceased members or by any officers or former officers, to the assets of the society;
(c) to investigate all cla
Notwithstanding anything contained in the Provincial Insolvency Act, 1920, the contributions assessed by a liquidator shall rank next to debts due to the Government or to any local authority in order of priority insolvency proceedings.
(1) The Registrar may after considering the report of the liquidator made to him under sub-section (3) of Section 59 order the registration of the co-operative society to be cancelled.
(2) An order passed under sub-section (1) shall be communicated by registered post to the President of the society and to the financing institutions, if any, of which the society was a member.
Notwithstanding anything contained in Chapter VIII or any other law for the time being in force, but without prejudice to any other mode of recovery provided in this Act, Registrar or any person subordinate to him empowered by the Registrar in this behalf may, on the application of a co-operative society, make an order directing the payment of any debt or outstanding demand due to the society by any member or past or deceased member, by sale of the property or any interest therein, which is subject to a charge under Section 31:
Provided that no order shall be made under this section unless the member, past member or nominee, heir or legal representative of the deceased member, has been served with a notice in the manner prescribed.
Every decision, award or order duly passed under Sections 54, 56, 62, 68 or 69 shall, if not carried out -
(a) on a certificate signed by the Registrar or any person authorised by him in this behalf, be deemed to be decree of a civil court and shall be executed in the same manner as decree of such court; or
(b) be executed by the Registrar or any other person subordinate to him, empowered by the Registrar in this behalf, by the attachment and sale or by sale without attachment of any property of the person or of the co- operative society against whom the order, decision or award has been obtained or passed; or
(c) be executed according to the law for the time being in force for the recovery of arrears of land revenue :
Provided that an application for the recovery of any sum in the last aforesaid manner shall be made to the Collector and shall be accompanied by a certificate sign
The orders of the liquidator under Section 59 shall be executed according to the Act and under the rules for the time being in force for the recovery of arrears of land revenue.
Where the Registrar is satisfied that a party to any reference made to him under Section 55 with intent to defeat or delay of the execution of any decision that may be passed thereon is about to -
(a) dispose of the whole or any part of the property ; or
(b) remove the whole or any part of the property from the local limits of the jurisdiction of the Registrar, the Registrar may unless adequate security is furnished, direct the conditional attachment of the said property or such part thereof as he thinks necessary. Such attachment shall be executed by a civil Court having jurisdiction in the same way as on attachment order passed by itself and shall have the same effect as such an order:
Provided that the powers of the Registrar under this section shall not be delegated to any officer below such rank as may be prescribed.
The Registrar or any person empowered by him in this behalf shall be deemed, when exercising any powers under this Act for the recovery of any amount by the attachment and sale or by the sale without attachment of any property, or when passing any orders on any application made to him for such recovery, or for taking a step in aid of such recovery, to be civil court for the purposes of Article 182 of the First Schedule to the Indian Limitation Act, 1908 (9 of 1908).
(1) All sums due from a co-operative society, or from an officer or member or past member of a co- operative society as such, to Government, including any costs awarded to Government under any provisions of this Act may, on a certificate issued by the Registrar in this behalf, be recovered in the same manner as arrears of land revenue.
(2) Sums due from a co-operative society to Government and recoverable under sub-section (1) may be recovered, firstly from the property of the society, secondly, in the case of a society the liability of the members of which is limited, from the members, past members or the estates of deceased members, subject to the limit of their liability; and thirdly, in the case of other societies, from the members, past members or the estates of the deceased members:
Provided that the liability of past members and the estates of deceased members shall in all cases be subject to the provisions of Secti
[67A. ***.]
(1) An appeal shall lie under this Section against -
(a) an order of the Registrar made under sub-section (2) of section 8 refusing to register a society;
(b) an order of the Registrar made under sub-section (4) of Section 10 refusing to register an amendment of the bye-laws of a co-operative society;
[(b) an order of the Registrar made under section 10A directing amendment of the bye-laws of a co-operative society] ;
(c) a decision of a co-operative society, other than a producers' society, refusing to admit any person as a member of the society who is otherwise duly qualified for membership under the bye-laws of the society;
(d) a decision of a co-operative society expelling any of its members;
[(e) an order made by the Registrar removing or suspending a committee or a member thereof under Section 27] ;
(f) an ord
The State Government and the Registrar may, suo moto or on the application of a party to a reference, call for and examine the record of any proceedings in which no appeal under Section 68 lies to the Government or the Registrar, as the case may be, for the purpose of satisfying itself or himself as to the legality or propriety of any decision or order passed and if in any case it appears to the Government or the Registrar that any such decision or order should be modified, annulled or revised, the Government or the Registrar, as the case may be, may, after giving persons affected thereby an opportunity of being heard, pass such order thereon as it or he may deem fit].
[Explanation. -
(i) The application of a party to a reference shall not lie before the Registrar or the Government, as the case may be, if appeal under section 68 of the Act lies or has been availed of by such a party to a reference;
(ii
Where an appeal is made under section 68 or where the[Government or the Registrar] calls for the record of a case under section 69, the appellate authority or the [Government or the Registrar], as the case may be, may, in order to prevent the ends of justice being defeated, make such interlocutory orders, including an order of stay, pending the decision of the appeal or revision as such authority or the [Government or the Registrar may deem fit].
Notwithstanding anything contained in this Act in the case of a [insured]Co-operative bank, -
(1) an order for winding up or an order sanctioning a scheme of compromise or arrangement or of amalgamation or reconstruction [including division or reorganisation]of the bank may be made only with the previous sanction in writing of the Reserve Bank of India;
(2) an order for the winding up of the bank shall be made by the Registrar if so required by the Reserve Bank of India in the circumstances referred to in Section 13-D of the Deposit Insurance and Credit Guarantee Corporation Act, 1961 (Central Act 47 of 1961);
(3) if so required by the Reserve Bank of India in the public interest or for preventing the affairs of the bank being conducted in the manner detrimental to the interests of the depositors or for securing the proper management of the bank an order shall be made by the Registrar for supersession
Any person other than a co-operative society carrying on business under any name or title of which the word "co-operative" or its equivalent in any Indian language, is part, without the sanction of the Government shall be punishable with fine which may extend to two hundred rupees and in the cases of a continuing breach with a further fine which may extend to five rupees for every day during which the breach is continued after conviction for first such breach.
(2) Any member or past member or the nominee, heir or legal representative or a deceased member of a co-operative society who contravenes the provisions of Sections 31 and 32 by disposing of any property in respect of which the society is entitled to have a first charge under that section or do any other act to the prejudice of such claim, shall be punishable with fine which may extend to five hundred rupees.
(3) A co-operative society or an officer or member thereof
(1) No court inferior to that of a [Judicial Magistrate] of the first class shall try any offence under this Act.
(2) No prosecution shall be instituted under this Act without the previous sanction of the Registrar and such sanction shall not be given without giving to the person concerned a reasonable opportunity to represent his case.
Every co-operative society shall have an address registered in the manner prescribed to which all notices and communications may be sent, and shall send to the Registrar notice of every change thereof within thirty days of such change.
Every co- operative society shall keep a copy of this Act, the rules and its bye-laws and also a list of its members, open to inspection free of charge at all reasonable times at the registered address of the society.
No person other than a co-operative society shall trade or carry on business under any name or title of which the word "co-operative" or its equivalent in any Indian language is part:
Provided that nothing in this section shall apply to the use by any person or his successor-in-interest of any name or title under which he carried on business at the date on which the Co-operative Societies Act, 1912 (2 of 1912), came into operation.
Notwithstanding anything contained in this Act, Government may by general or special order and subject to such conditions, if any, as it may impose, exempt any society or class of societies from any of the requirements of this Act as to registration.
Where the Government is satisfied that it is necessary so to do for furthering any object of the society or class of societies specified in its or their bye-laws, it may, by a general or special order, published in the Official Gazette, exempt such society or class of societies from any provision of this Act.]
Any person appointed as liquidator under the provisions of this Act or the rules shall be deemed to be a public servant within the meaning of Section 21 of the Indian Penal Code.
No suit shall be instituted against a co- operative society or any of its officers in respect of any act touching the business of the society until the expiration of three months next after notice in writing has been delivered to the Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims, and the plaint shall contain a statement that such notice has been so delivered or left.
Section 79 of the Punjab Co-operative Societies Act, 1961, establishes the requirement of prior notice before filing a suit against a co-operative society in respect of acts touching its business. It aims to regulate judicial proceedings involving co-operative societies, ensuring that disputes are first addressed through prescribed procedures, primarily to protect the functioning of such societies and promote arbitration and amicable settlement.
Section 79 mandates that no suit shall be instituted against a co-operative society or its officers in respect of any act touching its business unless a written notice has been served in advance. The notice must specify the cause of action, the name, description, and residence of the plaintiff, and the relief sought. The suit can only be filed after the expiry of three months from the date of service of the notice.
Failure to serve the requisite notice under Section 79 renders the suit liable to be dismissed. Courts have consistently held that suits without prior notice are not maintainable, and such non-compliance can lead to dismissal, as seen in various judgments [Lohani Co-op. Credit & Services Society Ltd. VS Bhagwanpuri].
The provisions of the Companies Act, 1956 (1 of 1956), shall not apply to co-operative societies.
(1) Every society now existing which has been registered under the Co-operative Credit Societies Act, 1904, or under the Co-operative Credit Societies Act, 1912, or under the Punjab Co- operative Societies Act, 1954 shall be deemed to be registered under the corresponding provisions of this Act, and its bye-laws shall, so far as the same are not inconsistent with the express provisions of this Act, continue in force until altered or rescinded.
(2) All appointments, rules and orders made, notifications and notices issued and suits and other proceedings instituted under the said Acts shall, so far as they are consistent with the provisions of this Act be deemed to have been respectively made, issued and instituted under this Act, save that an order made cancelling the registration of a society shall be deemed, unless the society has already been finally liquidated, as an order issued under Section 57 for its being wound up.
Save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of -
(a) the registration of a co-operative society or its bye-laws or amendment of bye-laws ;
(b) the removal of a committee ;
(c) any dispute required under section 55 to be referred to the Registrar ; and
(d) any matter concerning the winding up and the dissolution of a co- operative society.
(2) While a co-operative society is being wound up no suit or other legal proceedings relating to the business of such society shall be proceeded with or instituted against, the liquidator as such or against the society or any member thereof except by leave of the Registrar and subject to terms as he may impose.
(3) Save as provided in this Act, no order, decision or award made under this Act shall be questioned in any court on any ground whatsoever.
(1) In exercising the functions conferred on it by or under this Act, the Registrar, the arbitrator or any other person deciding a dispute under Section 56 and the liquidator of a co-operative society or person entitled to audit, inspect or hold an inquiry shall have all the powers of a civil court, while trying a suit, under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following mattes, namely:-
(a) summoning and enforcing the attendance of any person and examining him on oath ;
(b) requiring the discovery and production of any document;
(c) proof of facts by affidavit ; and
(d) issuing commission for examination of witnesses.
(2) In the case of an affidavit, any officer appointed by the Registrar, the arbitrator or any other person deciding a dispute and the liquidator, as the case may be, may administer the oath to the deponent.
No suit, prosecution or other legal proceeding shall lie against the Registrar or any person subordinate to him or acting on his authority in respect of anything in good faith done or purporting to have been done under this Act.
(1) An apex society may suo moto; and when required to do so by the Registrar, shall, constitute a common cadre of all or specified class of employees in the service of that society or in the service of the central societies which are members of the apex society or in the service of the primary societies which are members of the apex society or the aforesaid societies.
(2) When a common cadre is constituted under sub-section (1) the apex society shall make rules for the regulation of recruitment and the conditions of service of such employees with the prior approval of the Registrar.]
Notwithstanding anything contained in this Act or any other law for the time being in force, or any agreement, settlement, or award, no employee of a co-operative society shall be paid dearness allowance at a rate higher than, that admissible to the employees of the Government drawing pay at the same rate.
(1) The Government may, for any co-operative society or class of such societies, make rules to carry out the purposes of this Act.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely :-
(i) the maximum number of shares or portion of the capital of a co- operative society which may subject to the provision of section 6, be held by a member;
(ii) the form to be used and the conditions to be complied with in the making of applications for the registration of a society and the procedure in the matter of such applications ;
(iii) the procedure and conditions for change in the form and extent of the liability of a co-operative society ;
(iv) the matters in respect of which the society may or shall make bye-laws and for the procedure to be followed in making, alteri
The Punjab Co-operative Societies Act, 1954 (14 of 1965), is hereby repealed; but notwithstanding such repeal, anything done or any action taken under the repealed Act shall, to the extent of being consistent with this Act, be deemed to have been done or taken under this Act.
Model Bye-laws
Model Bye-laws of a Co-operative Society
Bye-laws of
The_________________________________________
Name, Address And Area of Operation
1. The society shall be called the ____________________. It shall be referred to herein-after in these bye-laws as the society.
2. The registered address of the Society shall be the ________ Post Office __________ Tehsil _________ District_______________
3. The area of the society shall be________________
4. Definitions.
(i) "Act" mean
Elevate your legal practice with advanced AI-driven research and drafting solutions. Experience unmatched efficiency, precision, and security, tailored exclusively for legal professionals.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
AI Assistant
