DELHI CO-OPERATIVE SOCIETIES RULES, 1950
(1) These rules may be called the Delhi Co-operative Societies Rules, 1950.
(2) Definition. In these rules unless there is anything repugnant to the subject or context, the expression : (i) the Act means the Bombay Co-operative Societies Act, 1925 as extended to the State of Delhi; (ii) "section" means a section of the Act; and (iii) words and expressions defined in the Act and used in these rules shall have the meanings assigned to them in the Act.
(1) Every application for the registration of a society under, sub-section (1) of Section 9 shall be in the form of Schedule A hereto annexed.
(2) In addition to the copy of by-laws which is required to accompany the application for registration under sub-section (3) of Section 9, two other copies of the proposed by-laws of the society shall be forwarded therewith.
(3) In case where one of the members of the society to be registered is a registered society, a member of the Managing Committee of such registered society shall be authorised by such Committee by resolution to sign. the application for registration and the by-laws on its behalf and a copy of such resolution shall be appended to the application.
If the Registrar refuses to register the society or its by-laws under section 10, he shall communicate to the applicant his reasons for doing so.
(1) Matters in respect of which a society shall make by-laws are the following :
(a) the objects of the society, the purpose to which its funds are applicable, occupation of its members, if the membership is proposed to be restricted and the area for which it is to be registered;
(b) the objects of the society, the purposes to which its funds are applicable, qualifications for membership, the terms of admission of members and their rights and liabilities, the consequences of default in payment of any sum due by a member and in the case of credit societies, the conditions on which loans may be granted, the maximum amount that may be lent to a member and the rate of interest and system of calculation of interest and, in case of non-credit societies the mode of conducting business, purchase, sale, stock taking and other like matters;
&n
When a society has been registered, the by-laws submitted under sub- section (3) of section 9 shall, subject to any modification approved by the Registrar, and adopted at a general meeting, having a quorum, by a majority of not less than two-thirds of the members present at such meeting, become the by- laws of the society after they have been duly stamped with official seal of the Registrar.
By-laws may be made, altered or abrogated by a resolution passed at a general meeting of the society; provided that,
(1) due notice of any proposal to make, alter, abrogate the by-laws is given in accordance with the by-laws
(2) the resolution is passed by not less than two-thirds of the members present at the general meeting at a quorum and a copy of the resolution is forwarded to the Registrar within a period of three months from the date of meeting. A copy of the existing by-laws so marked to show the alterations proposed to be made with a certificate that the provisions of clauses (1) and (2) of this rule have been fully complied with and three copies of the proposed amendments signed by two officers of the society, shall be attached to the copy of resolution; and
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Notwithstanding anything contained in these rules or by-laws of a society as to the manner of summoning a general meeting and notice to be given for the said purpose, any person authorised in this behalf by the Registrar may call a special general meeting; for which requisition has been made by the Registrar under sub-section (2) of section 13, in such manner and at such time and place as the Registrar may direct. A special general meeting so convened shall have powers to transact all business which can be transacted at the Annual General Meeting under the by-laws framed by the society and other business as is specially mentioned in the requisition made by the Registrar.
Every society shall, from time to time, for in a general meeting the maximum liability which it may incur in the loans and deposits from non- members. The maximum so fixed shall be subject to the sanction of the Registrar who may at any time reduce it for reason to be communicated by him to the society in writing, and may prescribe a period not being less than four months within which the society shall comply with his orders. No such society shall receive any loan or deposits from a non-member which will make its liability to non-members exceed the limit sanctioned by the Registrar.
The shares of a society for a loan shall not be hypothecated to society by its members as a security for a loan.
If a member resigns his membership of a society, or is removed under Rule 51 ,or dies, the sum representing the value of his shares or interest in the capital of the society to be paid to him or his nominee, heir or legal representative shall be ascertained as under :
(i) In the case of society with unlimited liability, it shall be the actual amount received by the society in respect of such share or interest.
(ii) In the case of society with limited liability, it shall be the amount arrived at by a valuation based on the final position of his society as shown in the last audited balance sheet preceding the resignation, removal or death of such member provided that it shall not exceed the actual amount received by the society in respect of such shares or interest.
Agricultural credit societies shall not accept deposits which are not fixed for a period of at least two months, except savings deposit in such societies as have made in their by-laws provision for encouragement of thrift among their members by the opening of the savings accounts.
No society shall make any loan to a member on a bond secured by suretyship of a non-member; provided that the Registrar may for a special reason, exempt any society by name from the operation of this rule.
Losses may be written off against firstly the bad debt fund and then the reserve fund of any society, and in the case of limited societies, if losses exceed the bad debt fund and the reserve fund the balance remaining may be written off against the share capital of the society:
Provided that (i) no losses shall be written off without a sanction of a general meeting; (ii) before any such losses are so written off, the society if it is affiliated and indebted to a Central Bank, shall obtain the approval of the Central Bank in writing which approval shall be given after consultation with the Assistant Registrar and shall be countersigned by him. If the society is not so affiliated or if the society is so affiliated and is not indebted to the Central Bank, it shall first obtain the approval of the Assistant Registrar in writing; and (iii) if the society itself is a Central Bank, the a
For the purpose of sub-section (1) of section 34, a loan also means and includes a deposit made by one society with another society.
(1) Every credit society shall keep the following accounts and books, viz.
(a) a register of members including persons nominated under section 27;
(b) a register of shares and debentures (where capital is raised by shares or debentures);
(c) a share transfer register (where capital is raised by shares (debentures);
(d) cash account;
(e) members loan account;
(f) deposit account;
(g) loan register;
(h) interest account;
(i) expense account;
(j) bank account;
For the purpose of Section 31 copies of documents or entries in the books of a society may be certified by any officer of the society.
Members of co-operative societies or the public may be permitted on payment of a fee of rupee one for each occasion of inspecting, to inspect for any lawful purpose any of the following documents filed in the office of the Registrar of Co-operative Societies and may obtain certified copies on payment of following fees:
The Registrar may require any society to submit any statement and any periodical return of receipts and disbursement on such dates and in such form as he may prescribe. Every housing society shall submit a property register to the Registrar on such dates and in such form as he may prescribe.
In case of failure by any society to submit any statement of return mentioned in rule 18 or to maintain any accounts or books mentioned in rule 15 or to get such accounts or books written according to the direction given by the Registrar under rule 15, Registrar may depute an officer of the Provincial Government or the Delhi Audit Fund or any Registered Accountant to prepare the necessary statement or return or account or books at the expense of the society. Such expenses shall be recoverable from the society in the manner specified in section 65.
All registered societies classified by the Registrar as Central Banks or as Urban Banks with a working capital of more than Rs. 50,000 shall submit to that officer a quarterly finance statement in the form prescribed by Government for the quarter ending February 28th, May 31st, August 31st and November 30th not later than March 15th, June 15th, September 15th and December 15th respectively.
All societies which obtain any portion of their working capital by deposit shall maintain such fluid resources as may from time to time be prescribed by the Registrar.
On or before July 15th of each year, the Committee of every society shall prepare an annual balance sheet, showing : (a) the profit and loss, (b) the receipts and expenditure of the previous financial year, and (c) the assets and liabilities as they stood on June 30th. This balance sheet shall be open to the inspection of any member during office hours at the office of the Society and a copy thereof shall be submitted before July 15th to the Inspector, Co-operative Societies incharge of the society.
The name and address of every person nominated under section 27 and any revocation or variation of such nomination shall be entered in the register kept under rule 15(a).
A member may by writing under his hand deposited with the society during his life-time, or by statement signed by him in the register of members of the society nominate any person or persons to whom under section 17 his share or interest in the society or so much thereof as may be specified in such nomination, shall be paid or transferred on his death, but, no member may nominate more than one person in societies with share capital unless he holds more than one share and in any case unless the amount to be paid to such nominee, whether by way of whole shares or by fixed proportion of the amount available for transfer, as the case may be, is duly specified when the nominees are appointed. The nominee or nominees may become members only if admitted by the society in accordance with its by-laws. (2) A nomination so made may be revoked or varied by another nomination similarly made.
In calculating the profits of society for the year, all accrued interest which is overdue shall be deducted from the gross profits of the year before the net profits are arrived at. All accrued interest, that has been so deducted from the profits of the year and is actually recovered during the subsequent year, may be added to the profits of the subsequent year.
No registered society shall distribute any bonus on shares beyond the dividend declared under section 31.
(1) No society shall pay its shareholders a dividend exceeding 8 1/4% in any year on the paid-up share capital standing in the same of each shareholder.
(2)
(a) No Resource or General Society shall without the previous written sanction of the Registrar, pay to its shareholder a dividend exceeding 6 1/4% (inclusive of bonus, if any) in any year on the paid-up share capital standing in the name of each shareholder.
(b) Such society may credit in any year a sum not exceeding 2 per cent on the paid-up share capital to a fund called the "Dividend Equalisation Fund" until the total amount in such fund amounts to 6 1 /4% of the paid-up share capital. Except for the purpose of paying a dividend no withdrawals from such fund shall be made without the previous written sanction of the Registrar. No soci
Any distribution of the remaining balance of profits under section 40 and after the distribution of dividend under section 38, shall be in accordance with the by-laws of the society regarding such distribution. It shall be in proportion to the wage earned by each member in the case of a Producers Society, and to the amount of goods purchased by each member or where it is so provided in the by-laws, by each member or customer in the case of a Customers Society. It shall also be in proportion to the amount of rent paid by each member in the case of a Housing Society, and in the case of a Resource Society may be in proportion to the goods obtained or sold through the society by each member, or to the loans borrowed from, and the deposit made with the society by each member.
(a) Without the sanction of the Registrar, no part of the funds of a registered society shall be divided, by way of bonus or dividend or otherwise amongst its members in any year unless the entire expenditure incurred by such society has been debited in the annual profit and loss account before the net profit has been calculated :
Provided that any loss or portion of loss on account of bad debts written off during the year may not be so deducted if it be deducted with the sanction of the Registrar from the Bad Debts Fund or the Reserve Fund.
(b) No dividend shall be paid by any society while any claim due from the society to a depositor or lender remains unsatisfied.
No society shall contribute any money towards the expenses of any cooperative conference unless such conference is held under the auspices of a society which is authorised by the by-laws to hold such conference. The society holding such conference shall keep separate accounts of its income and expenditure due to such conference and such account shall be open to audit by the Registrar or the persons authorised by him under section 22.
With the previous sanction of the Registrar any society may invest its funds, or a portion thereof :
(a) in the shares of the Reserve Bank of India constituted under the Reserve Bank of India Act, 1934,
(b) in Government of India loans and securities,
(c) in the purchasing of leasing of land or buildings, and
(d) in the construction of buildings provided that the purchase of such land or the construction of such building, is likely to be advantageous to the society in the conduct of its business.
The reserve fund of any society may be utilised in the business of the society, or be invested or deposited in any of the ways mentioned in clauses (a), (b), (c) and (d) of section 31. The Registrar may for reasons to be communicated in writing by him to the society by general or special order, direct that the latter course be adopted. In the case of a society constituted with the object of co-operative housing on co-partnership tenancy basis the reserve fund may be utilised for expenditure in the maintenance, repair and renewal of the buildings of the society.
The fund created by any registered society for the purpose of constructing buildings shall be called "Building Fund". The amount of such fund may, when it is not utilised for the construction of buildings, be used in the business of a society or be invested or deposited in the same manner and subject to the same conditions as the reserve fund of society is permitted to be used, invested or deposited under the Act and these rules.
The Registrar may levy audit fee on all or any type of societies at such rates as may be fixed by him from time to time. The Registrar shall employ the proceeds of such audit fees in maintaining a staff to audit the accounts of and supervise the societies. Such audit fees are recoverable under Section 65.
When a dispute has been referred to the Registrar under section 54, the Registrar or his nominee shall issue a notice to all parties and unless either of the parties desires within 15 days of the issue of such notice that the matter be referred to arbitration, shall proceed to decide the dispute himself. When either of the parties desires that the matter be referred to arbitration, the Registrar (or his nominee) shall call on each party to nominate its arbitrator within 15 days, and to send a statement signed by the proposed arbitrator, about his willingness to serve as an arbitrator. When there are more persons than one on each side, the principal party on each side will have the right to nominate the arbitrator. In such case the Registrar will decide who is the principal party and his decision shall be final. When either of the parties fails to make a nomination within the period aforesaid, the Registrar may nominate an arb
The Registrar may appoint any person to perform the duties of his nominee for disputes arising in anyone or more co-operative societies within any area specified in the order, for a period to be specified in the order. Such period shall not ordinarily exceed one year but may be extended by further special order for further period not exceeding one year at a time.
The Registrar or his nominee and the arbitrators shall have power to order the expenses determining the disputes to be paid out of the funds of the society, or by such party or parties to the dispute as they may think fit according to a scale laid down by the Registrar. The Registrar may fix the fees to be paid to his nominees out of expenses so recovered.
The Registrar or his nominee shall record a brief note in English or in vernacular of the evidence of the parties and witness who attend, and upon the evidence so recorded and upon consideration of any documentary evidence produced by either side, a decision or award, as the case may be, shall be given in accordance with justice, equity and good conscience and shall be reduced to writing. If any party duly summoned to attend fails to appear, the dispute may be decided ex parte. In cases where three arbitrators are appointed, the opinion of the majority shall prevail. In case of equality of votes, the matters shall be decided by Registrar himself.
In proceedings held under rules 35 to 38, no party shall be represented by a legal practitioner.
Subject to the provisions of section 59 of the Act, the Registrar may, by an order in writing, specially authorise any officer of the Co-operative Department or Delhi Audit Fund, not below the rank of a Sub-inspector, to call for and send arbitration orders obtained by any society for execution. The societies in respect of which these powers are to be exercised by the officers authorised shall be mentioned in the order.
When a liquidator has been appointed under section 47, the following procedure shall be adopted :
1. The appointment of the Liquidator shall be notified by the Registrar to the President of the society concerned and to the Central Co-operative Bank to which it is affiliated.
2. The Liquidator shall at once take charge of books and property and assets of the society and publish, by such means as he may think proper, a notice requiring all claims against the society to be notified to him within two months of the publication of the notice. He shall, thereafter, proceed to take such further action as he is empowered to take under the Act. All liabilities, recorded in the account books of a society, shall be deemed to have been duly notified to the liquidator.
3. The Liquidator shall make separate
Every order passed by the Registrar under section 50A and every order issued under Section 55, shall, if not carried out, be executed in accordance with Section 52.
When recovery is made under Section 59, in execution of any order referred to in the said section, and property is not sold, such execution, the Registrar may order the expenses of such recovery to be paid by any party in default according to scale laid down by him not exceeding in aggregate five per cent of amounts of the dues.
Subject to the provisions of rule 43 when recovery is made under Section 59 in execution of any order referred to in the said section by village officers, the Registrar may order the expenses of such recovery to be paid out of the funds of the society or by such party or parties in default, as he may think fit, according to a scale laid down by the Registrar.
(1) When an order directing a society to be wound up is issued under Section 47 and no Liquidator is appointed, the officers of the society which is wound up shall within 15 days of the issue of the order by Registrar, send by registered book post or railway parcel, the record and books of the society to the Assistant Registrar or hand over the same to the local inspector.
(2) When the affairs of the society for which a Liquidator has been appointed have been wound up, an order cancelling the registration is made under section 42, the Liquidator will forward all the books and record of the cancelled society and all his own paper and proceeding, to the Assistant Registrar together with an account of his expenses, showing how the balance has been disposed off and attaching the receipt of the person to whom it was handed over.
(3) All the b
On any debt which is due from the society that is being wound up, the creditor may move interest upto the date of the Registrars order for winding up at a rate, which in the case of a District Central Co-operative Bank or the Cooperative Bank permitted by the Registrar to finance societies, shall be the contract rate and in other cases shall be a rate to be fixed by the Registrar and not exceeding the contract rate :
Provided that, if any surplus assets remain after all liabilities, including liabilities on shares, has been paid off, further interest on such debt at a rate to be fixed by the Registrar and not exceeding the contract rate may be allowed to creditors from the date mentioned above upto the date of the repayment of the principal.
Summons as issued by the Registrar, or by a person authorised to hold an enquiry or to make an inspection by the Auditor or the Liquidator or by the Registrars Nominee, under Section 58 shall, if sent for service to a Tehsildar, be served by such officers.
All (fees) fines levied under Section 61 and rule 47 shall be credited to Government.
(1) A summon issued by any of the officers mentioned in rule 47 may be served personally or through Tehsildar or any member of the Co-operative Department, or Chairman or Secretary of the society or by registered post, acknowledgement paid.
(2) The serving officer, in all cases in which summons has been served, endorsed or annexed or cause to be endorsed or annexed on or to the original summons a return stating the time when, and the manner in which the summons was served, and the name, and address of the persons (if any), identifying the persons served, and witnessing the delivery or tender of the summons.
(3) The persons issuing the summons may examine the serving officer on oath or cause him to be examined by the Tehsildar through whom it is served, and make such further enquiry in the matter as he thinks fit, and shall either declare
(1) Where property to be attached is movable property, other than agricultural produce, in the possession of the debtor, attachment shall be made by actual seizure and the attaching officer shall keep the property in his own custody or in the custody of one of his subordinates, or of a receiver, if one is appointed under sub-rule (2) and shall be responsible for the due custody thereof :
Provided that when the property seized is subject to speedy and natural decay or when the expense keeping it in custody is likely to exceed its value, the attaching officer may sell at once. (Attachment of immovable property)
(2) Where it appears to the officer ordering conditional attachment under section 56 to be just and convenient, he may appoint a Receiver for the custody of the movable property attached under sub-rule (1) and his duties and liabil
No person being a member of a co-operative credit society or any society dispensing credit other than a land mortgage bank or general financing society or sale society shall be a member of any other society of a similar type without the general or special sanction of the Registrar, or the Deputy Registrar or the Assistant Registrar and where a person has become a member of two or more societies, any or all such societies shall be bound to remove him from membership upon receiving a written requisition from the Registrar or the Deputy Registrar or the Assistant Registrar to that effect.
(1) No consumers society shall, without sufficient cause refuse admission to membership to any person duly qualified therefor under its by-laws.
(2) Any person aggrieved by the decision of consumer societies refusing admission to him of its membership may appeal to the Assistant Registrar, Cooperative Societies, Delhi.
(3) The decision of the Assistant Registrar, Co-operative Societies, Delhi in appeal shall be final.
No society may take any action which would involve the society in the discussion or propagation of controversial opinions of a religious character, and the Registrar may prohibit any action or rescind any resolution which in his opinion is of such a tendency.
The Registrar shall keep a Register of the names and addresses of all registered societies and shall record a copy of the registered by-laws and subsequent amendments to the by-laws of such societies.
(1) A member of consumers society who carries on business of the kind carried by such society shall not be eligible to be a member of the Committee of such society without the general sanction of the Assistant Registrar, Cooperative Societies, Delhi.
(2) Where such person has been elected a member of the Committee of such society without the sanction of the Assistant Registrar, Co-operative Societies, Delhi, such person shall cease to be a member of such society upon receipt by the Committee of a written requisition on this behalf from the Assistant Registrar, Co-operative Societies, Delhi.
(3) A member is not eligible for the Committee of any co-operative society, if :
(a) he is under 21 years of age except in registered societies in colleges and schools where he may be 18 years of age;
&
(1) Notwithstanding anything contained in the by-laws of a society, Government may, by an order published with the reasons therefor in the Delhi Government Gazette
(a) remove all the members of the Committee of a society, and appoint a new Committee in their place; or
(b) remove any of the members of the Committee of a society, and appoint one or more members, as the case may be, in the place of the members so removed
(2) When Government has appointed a new committee under clause (a) of sub-rule (1), Government may direct that the members of such Committee shall hold office for a period not exceeding three years from the date of their appointment. The member or members appointed under clause (b) of sub-rule (1) shall hold office so long only as the member or members, in whose place he is or
The Registrar, Liquidators or Assistant Registrar acting under clause (a) or clause (b) of section 59 of the Act shall, at the same time that he signs a certificate effecting any property, issue a proclamation in the form prescribed in Schedule B annexed hereto and, in the case of immovable property shall also forward a copy of the proclamation of the Tehsildar of the Tehsil in which the property is situated.
(1) When in execution of an order sought to be executed under Section 59, any property cannot be sold for want of buyer, if such property is in the possession of the defaulter, or of some person on his behalf, or of some person claiming it under a title created by the defaulter subsequently of the issue of the certificate by the Registrar, Liquidator or Assistant Registrar under clause (a) or (b) of sub-section (1) of the said section, the officer conducting execution shall as soon as practicable report the fact to : (a) the Court or the Collector, as the case may be, and (b) the society which applied for the execution of the said order.
(2) On receipt of a report under sub-rule (1) the society may within six months from the date of the receipt of the report, or within such further period as may for sufficient reason be allowed in any particular case by the Court or the Collector,
(1) In societies of the following classes namely, Central Banks, Banking Unions, Mortgage Banks, Commission Shops and other federal societies, consumers, producers and multipurpose societies, the appointment of officers and staff (other than members of the Committee) shall be subject to such directions as the Registrar may from time to time issue in regard to their technical and educational qualifications and in regard to the deposit of security.
(2) Except with the previous sanction of the Registrar, no relative of any member of Committee or of the Honorary Secretary of the society in question shall be appointed to such office.
Explanation. Relative includes, anyone related to the person concerned or to his wife through a common ancestor not more remote than a great grandfather, or anyone married to a person so related.
Power to make rules under section 17 in respect of clauses (h), (i) and (1) is delegated to the Registrar of Co-operative Societies.
SCHEDULE (See rule 2) SCHEDULE A
(See rule 2) Form of application of registration of co-operative societies
Name of proposed society.
Address to be registered.
Class of society.
Is liability limited or unlimited?
Area of operation.
No. of members at present.
What is the occupation of members?
Capital with details of shares, deposits, fees, etc.
Number and value of share proposed to be used.
Managing Committee,
SCHEDULE SCHEDULE B
Form of proclamation to be issued prohibiting any private
transfer or delivery of or encumbrance or charge on the
property made or created after the issue of a
certificate under Section 59 A. In case of immovable property.
Whereas Society has obtained an award or awards
under section 54 or an order or orders of Liquidator under Section 50 of the Bombay Co-operative Societies Act, 1925, as extended to the State of Delhi for
an amount of Rs against and purpose to execute the same sale of the
undermentioned property of the said defaulter or defaulters and<
SCHEDULE C
Form of certificate for transfer of property under section
59A (See rule 58)
In the case of immovable property:
Whereas in execution of award or awards passed under Section 54 or an order or orders made by the Liquidator under Section 50 of Bombay Cooperative
Societies Act, 1925, as extended to the State of Delhi, in favour
of Society an order was made on the day of 20 for
the sale of the under mentioned property of the person or persons (defaulter or defaulters) and whereas the Court or Collector is satisfied that the said property cannot be sold for want of buyers.
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