Act No. 12 of 1978
05th April, 1978
An Act to consolidate and amend the law relating to co-operative societies in the State of Sikkim. WHEREAS it is expedient to further facilitate the formation and working of co-operative societies for the promotion of thrift, self-help and mutual aid among persons with common economic needs and to bring about improvement in agriculture and industry through better methods of production, better business and better living and for that purpose to amend and consolidate the law relating to co-operative societies in the State of Sikkim. Be it enacted by the State legislature in the .... 28 ...... year of the Republic of India as follows:
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In this act, unless the context otherwise requires. 2.
(1) The Government may appoint a person to be the Registrar of Co-operative Societies for the State of Sikkim and may appoint other persons to assist him.
(2) The Government may, by general or special order, confer on any person appointed to assist the Registrar all or any of the powers of the Registrar under this Act.
(3) Every person appointed to assist the Registrar shall exercise the powers conferred on him under sub-section (2) subject to the general guidance, superintendence and control of the Registrar.
(4) The Government may, by notification in the Official Gazette and subject to such conditions as it may think fit to impose, confer all or any of the powers of the Registrar under this Act on the State Co-operative Bank or any federal society or an officer of such bank or federal society and every such bank or federal society or officer on whom the powers of the Registrar are so conferred shall exercise such powers under the general guidance, superintend
(1) Subject to the provisions hereinafter contained, a society which has as its object the promotion of the economic interests of its members in accordance with co-operative principles, or a society established with the object of facilitating the operations of such a society and the State Co-operative Bank may be registered under this act.
Provided that the Registrar shall not register any society with unlimited liability.
(a) No society, other than a federal society, shall be registered under this Act unless it consists of at least ten persons not belonging to the same family who are qualified to be members under this Act and who reside in the area of operation of the society.
Explanation- For the purposes of this Act 'Family' means the husband, wife, sons and unmarried daughters,
(b) The word "limited" shall be the last word in the name of overy society with limited liability registered under this Act.
(i) For the 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 society, by at least ten persons qualified in accordance with the requirements of section 5; and (b) in the case of a society of which a member is a co-operative society, by a duly authorised person on behalf of such society and where all the members of the society are not societies, by ten other members or when there are less than ten other members qualified to do so under section 5 by all of them.
Where any question arises whether, for the purpose of this Act, a person resides in the area of operation of a society or not, or whether a society is of the same type as another society or of different type, the question shall be decided by the Registrar whose decision shall be final.
(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, and that the registration thereof may not have any adverse effect on the development of co-operative movement, the Registrar may register the society and its bye-laws.
(2) When the Registrar/refuses to register a society, he shall communicate within a period of six months from the date of receipt of application the order of refusal, together with the reasons therefor, to the applicant as may be prescribed.
Where a society is registered, the Registrar shall issue a certificate of registration signed by him, which shall be conclusive evidence that the society therein mentioned is duly registered under this Act.
The registration of a 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 acquire, hold and dispose of property, enter into contracts, institute and defend suits and other legal proceedings and to do all things necessary for the purpose for which it is constituted.
(1) No amendment of any bye-laws or a society shall be valied unless it is registered under this Act.
(2) Every proposal for such amendment shall be forwarded to the Registrar and if the Registrar is satisfied that 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 society, he shall communicate the order of refusal together with the reasons therefor, to the society in the manner prescribed.
Notwithstanding anything contained in section 11, it in the opinion of the Registrar, an amendment of the bye-laws of a society is necessary or desirable in the interest of such society or of the co-operative movement, he may, in such manner as may be prescribed, call upon the society to make, any amendment within such time as he may specify. If the society fails to make such an amendment within the time so specified the Registrar may, after giving the society an opportunity of making its representation, register such amendment and forward to the society by registered post a copy of the amendment together with a certificate signed by him, such a certificate shall be conclusive evidence that the amendment has been duly registered; and such an amendment shall have the same effect as an amendment of any bye-laws duly made by the society.
An amendment of the bye-laws or a society shall, unless it is expressed to come into operation on a particular day, come into force on the day on which it is registered.
(1) A society may, by an amendment of its bye-laws, in such manner as may be prescribed, change its name; but such change shall not affect any right or obligation of the society or of any of its members, past members or deceased members and any legal proceedings pending may be continued by or against the society under its new name.
(2) Where a society changes its name, the Registrar shall enter the new name on the register of societies in place of the former name and shall amend the certificate of registration accordingly.
(i) No society with limited liability shall change itself into a Society with unlimited liability.
(2) Subject to the provision of sub-section (1), a society may change the form and extent of its liability by an amendment of its bye-laws in the manner prescribed.
(3) When a society has amended its bye-laws under sub-section (2), 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, within a period of 30 days from the date of service of the notice upon him, have the option to withdraw his shares or deposits or recall the loans, as the case may be.
(4) 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.
(5) An amendment of the bye-laws of a society changing the form or extend of its liability shall not be registered or take effect until either-
(1) A society may, with the previous approval of the Registrar and by a resolution passed by at least a two thirds majority of the members present and voting at a general meeting of the society-
(2) Any two or more societies may, with the previous approval of the Registrar and by a resolution passed by at least a two-thirds majority of the members present and voting at a general meeting of each society, amalgamate themselves and form a new society.
(3) The resolution of a society under sub-section (1) or sub-section (2) shall contain all particulars or the transfer, division or amalgamation, as the case may be.
(4) When a society has passed any such resolution, it shall give notice thereof in writing to all its members and creditors and, notwithstanding any bye-laws or contract to the contrary, any member o
(1) Notwithstanding anything contained in this Act, it the Registrar is of the opinion that-
(2) Such order may also provide for-
Where the whole of the assets and liabilities of a society are transferred to another society in accordance with the provisions of section 16 or where a society is directed to be amalgamated under section 17, the liability of the other society, or the new society, as the case may be, shall be limited.
(1) Where the whole of the assets and liabilities of a society are transferred to another society in accordance with the provisions of section 16 or section 17, the registration of the society whose assets and liabilities are so transferred, shall stand cancelled and the said society shall be deemed to have been dissolved and shall cease to exist as a corporate body.
(2) Where two or more societies are amalgamated into a new society in accordance with the provisions of section 16 or section 17, the registration of each of the amalgamating societies shall stand cancelled on the registration of the new society, and each society shall be deemed to have been dissolved and shall cease to exist as a corporate body.
(3) Where a society divides itself into two or more societies in accordance with the provisions of section 16, the registration of that society shall stand cancelled on the registration of the new societies and that society shall be deemed to have been dissolved
(i) No person, shall be admitted as a member of a society except the following, namely;
(2) Any person who is duly qualified for admission as a member under the provisions of this Act and the bye-Jaws of a primary agricultural credit society, makes an application for membership of such society, shall be deemed to have been admitted as a member of such society from the date of receipt of the application in the office of the society.
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(1) No person shall be eligible for admission as a member of a society, if he.-
(2) If a member becomes subject to any of the disqualifications specified in sub-section, (1), he shall be deemed to have ceased to be a member from the date when the disqualification was incurred.
(3) Subject to the general or special orders of the Registrar published in the official Gazette, no individual who is a member of a credit society, shall be eligible for admission as a member of another credit society.
Every member of a society shall have one vote in the affairs of the society; provided that-
(1) Every member of a society shall exercise his vote in person at a meeting of the society and no member shall be permitted to vote by proxy.
(2) 'Notwithstanding anything contained in sub-section (i), a society or corporation or firm which is a member of another society may, subject to any rules made under this Act, appoint one of its members or partners, as the case may be, to vote on its behalf in the affairs of that society.
(1) A society may admit any individual or other person or firm as a nominal member in accordance with its bye-laws.
(2) A nominal member shall not be entitled to any share, in any form, whatsoever, in the assets or profits of the society or to become an officer of the society.
(3) A nominal member shall have such privileges and rights of a member and be subject 60 such liabilities of a member, as may be specified in the bye-laws of the society.
No member of a society shall exercise the rights of a 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.
In any society, no member other than the Government or any other society shall hold or have claim to more than such portion' of the total share capital of the society which exceed one-fifth thereof or Rs. 5,000/- whichever is less.
Provided that the Government may, by notification in the Official Gazette, specify in respect of any class of societies a higher maximum than one-fifth of the share capital or a higher amount than Rs. 5,000/- as the case may be.
(1) The transfer of a share or interest of a member in the capital of a society shall be subject to the restrictions specified in section 26.
(2) No transfer by a member of his share or interest in a society shall be valid unless
(1) On the death of a member the society shall transfer the share or interest of the deceased member to the person or persons nominated in accordance with the rules or, if no person has been so nominated, to such person as may appear to the Committee to be the heir or legal representative of the deceased member:
Provided that such nominee, heir or legal representative, as the case may be, is admitted as the member of the society;
Provided further that nothing in this sub-section shall prevent a minor or a person of unsound mind from, acquiring by inheritance the share or interest of a deceased member in a society.
(2) Notwithstanding anything contained in sub-section (1) any such nominee, heir, or a legal representative, as the case may be require the society to pay to him the value of the share or interest of the deceased member ascertained in accordance with the Rules.
(3) The society may pay all other moneys due to the deceased member from the society
(1) Subject to the provisions of sub-section (2), the liability of a past member or of the estate of the deceased member of a society for the debts of the society as they existed shall continue for a period of two years-
(2) Where a society is ordered to be wound up under section 75, the liability of a past member or of the estate of a deceased member who ceased to be a 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 a 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 of every society shall vest in the generals body of members in general meeting:
Provided that in such circumstances as may be prescribed the final authority may vest in the delegates of such members elected in the prescribed manner and assembled in general meeting.
(2) The general meeting shall be summoned and shall exercise its authority in such manner as may be prescribed.
(1) The management of every society shall vest in a committee constituted in accordance with the bye-laws.
(2) No person shall be eligible to be elected as a member of a committee unless he is a member of the society.
(3) No member of a society shall be eligible for being elected as a member of the committee of that society or of any other society to which such society is affiliated, if such member-
(4) A member of the committee of a society shall cea
(1) The general meeting of every society shall be held within a period of six months after the date fixed for making-up its accounts for the Co-operative year under the rules far the time being in force, far the purpose of-
Provided that the Registrar may, by general or special order extend the period far holding such meeting far a further period not exceeding three months:
Provided further that, if in the opinion of the Registrar no such extension is necessary or such meeting is not called by the society within the exte
(1) The committee of a society may, at any time, call a special general meeting of the society and also 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 number of members, as may be provided in the bye-laws.
(2) If a special general meeting of a society is not called in accordance with the requisition referred to in sub-section (1), the Registrar or any person authorised by him in this behalf shall call such meeting and exercise all powers and functions of an officer of the society who is authorised to convene such special general meeting and that meeting shall be deemed to be a meeting called by the committee, and the Registrar may Order that the expenditure incurred in calling such a meeting shall be paid Put of the funds of the society or by any such person or persons who, in the Opinion of the Registrar, were responsible for the refusal or failure to conve
(1) The superintendence, direction and control of the preparation of the electoral rolls for, and the conduct of, elections of the members of the committees of such societies or class of societies as may be notified by the state government in the official gazette shall be vested in such returning officers not below the rank of gazetted officers as may be appointed by the Government in this behalf.
(2) The vote at such elections shall be by secret ballot.
The term of office of the elected members of the committee shall be such, not exceeding three co-operative years including the co-operative year of their election, as may be specified in the bye-laws of the society:
Provided that the elected members shall continue to hold office till their successors are elected or nominated under the provisions of the Act or the rules or bye-laws.
Notwithstanding anything contained in this Act, a person shall be disqualified for election as, or for being, the president, vice-president, chairman, vice-chairman, Secretary, Joint Secretary or treasurer of a committee,-
Provided that nothing contained in this sub-section shall be deemed to disqualify any such person for election as, or for being, a delegate of a society or a member of another committee.
Explanation 1: Where any person holding any office as aforesaid at the commandment of this Act is again elected to any such office after such commencement, he shall, for the p
On the committee of a primary agricultural credit society or other societies as may be prescribed, not less than One-third of total seats shall be reserved for economically weaker sections of the members who, as land owners or tenants or as both, do not hold more than the prescribed area of agricultural land or who fulfill the prescribed conditions, and if no such persons are elected, the committee shall co-opt the required number of members from amongst the persons entitled to such representation.
(1) Notwithstanding anything contained in this Act, but subject to the provisions of section 36, where the Government has subscribed to the share capital of a society or has assisted directly or indirectly, in the formation or augmentation of the share capital of a society, or has guaranteed the repayment of principal and payment of interest on loans and advances to a society, the government or any other person authorised by it in this behalf shall have the right to nominate members on the committee in the manner prescribed below viz.
(1) If, in the opinion of the Registrar, the committee of any society persistently makes default or is negligent in the performance of the duties imposed on it by this Act or the rules or the bye-laws, or commits any act which is prejudicial to the interest of the society, or its members, or the co-operative movement in the state, or wilfully disobeys or fails to comply with any lawful order or directions issued under this Act or the rules, the Registrar may, after giving' the committee an opportunity to state its objections, if any, by order in writing, remove the committee; and
(1) (a) It the records, registers, documents or the books of accounts of a society are likely to be tampered with or destroyed and the funds, securities and other properties of a society are likely to be misappropriated or misapplied; or
(b) If the committee of a society is reconstituted at a general meeting of the society or the committee of a society is removed by the Registrar under section 39 or if the society is Ordered to be wound up under section 75 and the Outgoing members of the committee refused to hand over charge of the records and properties of the society to those hiving or entitled to receive such charge the Registrar or any other person authorised by him in this behalf 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-Inspector t
No act of a 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 followed 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.
(1) Notwithstanding anything contained in any other law for the time being in force but subject to any claim of the Government in respect of land revenue or any sum recoverable as land revenue or as public demand, any claim, any debt or other amount due to a society by any member including a past or deceased member shall be a first charge upon the crops or 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 owned by or belonging to such member, past member or forming part of the estate of the deceased member as the case may be.
(2) Such charge shall be available even as against any amount recoverable by the Government as if it were an arrear of land revenue subsequent to the incurring of the debt or the liability for the other amount due to the society referred to in sub-section (1).
(3) No person shall transfer any proper
(1) Notwithstanding anything contained in this Act or in any other law for the time being in force, but subject to any claim of the Government in respect of land revenue, whether prior in time or subsequent, any member of a society, owning any land or having interest in any land or other immovable property as a tenant, making an application for financial assistance from the society shall make a declaration in the form prescribed creating a charge in favour of the society on such land or interest or such portion thereof as may be specified in the declaration, as security for the payment of the loan to be granted to him on the application and for all future loans, if any, that may be granted to him by the society from time to time subject to such maximum as may be determined by the society together with the interest on such amount of the loans.
(2) Such declaration may be varied or cancelled at any time by the member with the consent of the society in whose favour it is made.<
A mortgage executed in favour of a primary agricultural credit society or the State Co-operative Bank shall have priority Over any claim of the Government arising from a loan granted subsequent to the execution of the mortgage.
(1) Notwithstanding anything contained in the Indian Registration Act, 1908, a declaration made under sub-section (1) of section 43 or a variation or cancellation made under-sub-section (2) of section 43 Or a mortgage executed by a member in favour of a primary agricultural credit society or State Co-operative Bank, as the case may be, in respect of financial assistance given by that society shall be deemed to have been duly registered in accordance with the provisionss of that Act with effect from the date of such declaration, variation, cancellation or mortgage, as the case may be, provided that the society sends to the Sub-Registrar within the local limits of whose jurisdiction the whole or any part of the property charged or mortgaged is situated within thirty days from the date of such declaration, variation, cancellation or mortgage, as the case may be, by registered post acknowledgement due, a copy of the document making such declaration, variation, cancellation or mortgage
Whenever a charge or a mortgage of land or interest therein is created in favour of a society or is discharged by a society the society shall give intimation to such revenue official as may be designated in this behalf by the Government, of the particulars of the charge or mortgage in its favour or discharge thereof. The revenue official shall make a note of the particulars' of charge or mortgage or discharge thereof in the Record of Rights.
Provided that the absence of an entry in the record of rights on the basis of such declaration or a defective entry passed in the record in respect thereof shall not affect the validity of the charge or mortgage or discharge thereof.
The Registration in the records of the Sub-Registrar or the recording in the record of rights of a change or variation made under section 43 shall constitute sufficient notice of such change or variation to any person dealing with the property subject thereto.
(1) Notwithstanding anything contained in any law for the time being in force, a member who has availed himself of financial assistance from ' a society by creating a charge or mortgage on land or interest therein, shall not, so long as the financial assistance continues to be outstanding, lease, transfer or create any encumbrance on such-land or interest therein without prior permission in writing of the society in whose favour such charge or mortgage is created.
(2) Any lease or transfer or encumbrance created in contravention of this section shall be void.
(3) Nothing contained in any law relating to ceiling on agricultural holdings shall apply to the acquisition of land by a society charged or mortgaged to it as security by for loan.
A society shall have a charge upon the share or contribution or interest in the capital and on the deposits of a member or past member, or deceased member and upon any dividend, or profits payable to a member or past member or the estate of a deceased member, in respect of any debt or outstanding demand owing to 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 48 the share or contribution or interest of a member to past member or deceased member in the capital of a 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 any receiver appointed under any law relating to insolvency for the time being in force shall not be entitled to or have any claim on such share or contribution or interest.
Every society shall keep and maintain a register or list of members or shares of the society which shall be prima facie evidence of the following particulars entered therein:-
(1) A copy of any entry in the books of a society which are maintained in the ordinary course of business shall, if certified in the 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 to the same extent as the original entry.
(2) No officer of a society and no officer in whose office the books of a 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, tribunal or the arbitrator made for special cause.
No provision relating to registration or documents contained in any law for the time being in force shall apply to-
(1) The Government may, by notification in the Official Gazette, remit in respect of any class of societies-
(2) The Government may, by notification, exempt any class of societies from-
(i) Notwithstanding anything contained in any law for the time being in force, a member of a 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 society by a requisition in writing and so long the society does not intimate that the whole of such debt or demand has been paid, made the deduction in accordance with the agreement and pay the amount so deducted to the society within seven days of such deduction. Such payment shall be valid discharge of the employer of his liability to pay the amount so deducted and paid to the society.
(3) If after the receipt of a requisition made under sub-section
Notwithstanding anything contained in any law for the time being in force, the Government may
(1) The Registrar may from time to time frame rules governing the terms of employment and working conditions of officers and employees in a society including the State Co-operative Bank or a class of societies and the society or the class of societies to which such terms of employment and of working conditions are applicable shall comply with the order that may be issued by the Registrar in this behalf.
Provided that while prescribing the remuneration of the officers and other employees of the State Co-operative Bank, the Registrar shall have due regard to the salary structure of the employees of the Government and the local authorities of comparable level and status in the State.
(2) Where a dispute regarding terms of employment, working conditions and disciplinary action taken by a society, arises between a society and its employees, the Registrar or any officer appointed by him shall decide the dispute and his decision shall be binding on the society and its employ
No part of the funds of a society shall be divided by way of bonus or dividend or otherwise among its members:
Provided that after at least one-fourth of the net profit in the year has been transferred to the reserve fund, payments from the remainder of such profits and from any profits of past years, if any, available may be made to the members by way of dividend or bonus to such extent and subject to such conditions as may be prescribed by the rules or bye laws.
A society may, with the sanction of the Registrar and after one-fourth of the net profits of the year has been transferred 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 (6 of 1890).
A society shall, out of its net profits in any year, contribute such portion of the profits not exceeding five per cent as may be prescribed to the Cooperative Education Fund constituted under the rules.
(1) A society may invest or deposit its fund-
(1) A 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 society may make loan to another society.
Provided further that a society may make such loans as may be specified in the bye-laws to any of its paid employees.
(2) Notwithstanding anything contained in sub-section (1), a society may make a loan to depositor on the security of his deposit.
A society snail 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 61 and 62 the transactions of a society with any person other than a member shall be subject to such prohibitions or restrictions, 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 society at least once in each co-operative year.
(2) The audit under sub-section (1) shall include an examination of overdue debt, 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 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, administrators and other officers-of the society shall furnish to the person auditing the accounts of a society all such information as to the society's transactions and working as such person may require.
(5) The Registrar or the person authorised by him under sub-section (1) to audit the accounts of a
The Registrar, or any person authorised by general or special order in this behalf by him, may inspect a society. For the purpose of inspection, the Registrar or the person so authorised by him 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 to call a committee meeting or a general meeting as he may deem necessary in the circumstances. Every officer or a 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.
(i) The Registrar may of his own motion or on application of a majority of the members of the committee or of not less than one-third of the members of the society, hold an inquiry or direct a person authorised by him by order in writing in this behalf to hold an inquiry into the constitution, working and financial condition of a society.
(2) The Registrar or the person authorised by him under sub-section (1) shall have the following powers, namely:
(1) The Registrar shall, on the application of a creditor of a 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
(2) The Registrar shall communicate the result of any such inspection to the creditor.
Where an inquiry is held under section 66, or an inspection is made under section 67, the Registrar may apportion the costs, or such of the costs, as he may think fit, between the society, the members or creditors demanding an inquiry or inspection, and the; officers or former officers and the members or past members of the society as the case may be:
Provided, however, that-
Any sum awarded by way of costs under section 68 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) Where in the course of an audit, inquiry, inspection or the winding up of a 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 willful default or negligence or has misappropriated 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, inquire himself or cause an inquiry to be made by any person authorised by him, by an order in writing in this behalf.
(2) Where an inquiry is made under sub-section (1), the Registrar or the person authorised by him may, after giving the person concerned an Opportunity of being heard, make an order, requiring him to, repay or r
(1) Where in the course of an audit under section 64 or an inquiry under section 66 or an inspection under section 65 or section 67, it is brought to the notice of the Registrar that a paid officer or employee of the society has committed or has been otherwise responsible for misappropriation, breach of trust or other offence, in relation to the society, the Registrar may, if he is satisfied that there is prima facie evidence against such paid officer or employee and the suspension of such paid officer or employee is necessary in the interest of the society, direct the committee of the society, pending the investigation and disposal of the matter, to place or cause to be placed such paid officer or employee under suspension from such date and for such period as may be specified by him.
(2) On receipt of a direction from the Registrar under sub-section (1), the committee of the registered society shall, notwithstanding any provision to the contrary in the bye-laws, place or c
(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 society arises:-
(1) The Registrar may, on receipt of the reference of dispute under section 72-
(2) Where the reference relates to any dispute involving immovable property the Registrar or such person or arbitrator, may order that any person be joined as a party who has acquired any interest in such property subsequent to the acquisition of interest therein by a party to the reference and any decision that may be passed on the reference by the Registrar, or the person or the arbitrator aforesaid, shall be binding on the party so joined as if he were an original party to the reference.
(3) The Registrar may withdraw any reference transferred under clause (b) of sub-section (1) or referred under clause (
(1) If a society is unable to pay its debts to the State Co-operative Bank by reason of its members committing default in the payment of the moneys due by them, the State Co-operative Bank may direct the committee of such a society to proceed against such members under section 72 and if the committee fails to do so within a period of ninety days from the date of receipt of such direction, the State Co-operative Bank itself may proceed against such members in which case the provisions of this Act, the rules or the bye-laws shall apply as if all reference to the society or its committee in the said provisions were references to the State Co-operative Bank.
(2) Where the State Co-operative Bank has obtained a decision or award against a society in respect of moneys due to it from the society, the State Co-operative Bank may proceed to recover such moneys firstly from the assets of the society and secondly from the members to the extent of their debts due to the society.
(i) If the Registrar, after an inquiry has been held under section 66 or an inspection has been made under section 67, or on receipt of an application made by not less than three-fourths of the members of a society, is of opinion that the society ought to be wound up, he may in consultation with the State Co-operative Bank 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 society-
(3) The Registrar may cancel an order for the winding up of society, at any time, in any case, where, i
(1) Where the Registrar has made an order under section 75 for the winding up of a society, the Registrar may appoint a liquidator for the purpose and fix his remuneration and may remove such person and appoint another in his place.
Provided that it shall not be necessary to appoint any liquidator for winding up of a society which has not commenced working, or has share capital and members' deposits not exceeding five hundred rupees.
(2) A liquidator shall, on appointment, take into his custody or under his control all the property, effects and actionable claims to which the society is or appears to be entitled and all books, records and other documents pertaining to the business of the society 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)
(1) Subject to any rules made in this behalf, the whole of the assets of a society, in respect of which an order for winding up has been made, shall vest in the liquidator appointed under, section 76 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-
Notwithstanding anything contained in any law relating to insolvency as may for the time being in force, the contribution assessed by a liquidator shall rank in order of priority next to debt due to the Government or to any local authority in solvency proceedings.
(1) The Registrar may, after considering the report of the liquidator made to him under sub-section (3) of section 77 order the registration of the 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 federal society, if any, and to the State Co-operative Bank, 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, the Registrar or any person subordinate to him empowered by the Registrar in this behalf may, on the application of a 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 42:
Provided that no order shall be made under this section unless the member, past member or the nominee, him or legal representative of the deceased member, has been served with a notice in the manner prescribed and has failed to pay the debt or outstanding demand within the time specified in the notice which shall not be less than thirty days;
Every decision, award or order duly passed by the Registrar or arbitrator under section 32, section 33, section 70, section 73, section 80 or section 98 shall, "if not carried out-
Provided that an application for the recovery of any sum in the manner aforesaid accompanied by a certificate signed by the Registrar or any person subordinate to him and empowered by the Registrar in this behalf shall be made to the competent revenue authorty that may be prescribed within twelve years from the date of the order; and
The orders of the liquidator under section 77 shall be executed in accordance with the Act and 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 him under section 72 with intent to defeat or delay the execution of any decision that may be passed thereon is about to-
Provided that the powers of the Registrar under this section shall not be delegated to any officer below such rank as may be prescribed.
Provided further that immovable property shall not be sold in execution of a decree unless such property has been previously attached.
Provided further that where the decree has been obtained on the basis of a mortgage of such pr
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 attachment and sale or by sale without attachment of any property, or when passing any orders on any application made to him for such recovery to be a civil court for the purposes of any law relating to limitation.
(1) All sums due from a society, or from an officer or member or past member of a society as such, to Government, including any costs awarded to Government under any provision 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 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 section 29.
Notwithstanding anything contained to the contrary in this Act or rules, the provisions of this Chapter shall apply to the State-Co-operative Bank that may be registered in the State under this Act.
Notwithstanding anything contained in this Act, a society shall not be registered as the State Co-operative Bank unless the application for registration thereof is signed by at least 10 persons of whom one shall be the Government and the rest shall consist of not less than 5 societies.
It shall be lawful for the State Co-operative Bank to carry on all or any of the following business viz.:-
The Government shall contribute not less than 51 per cent of the total issued capital of the State Co-operative Bank.
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