The Assam Co-operative Societies  Act, 2007
Registered No.-768/97

I

# THE ASSAM GAZETTE

#### S I W 5!

##### EXTRAORDINARY

###### PUBLISHED BY THE AUTHORITY

58 4 C W ^ t,2 0 1 2 , 15^M, 1933 (*R?)

No. 58 Dispur, Saturday, 4th February, 2012,5th Megha, 1933 (S.E.)

GOVERNMENT OF ASSAM

ORDERS BY THE GOVERNOR

LEGISLATIVE DEPARTMENT, LEGISLATIVE BRANCH

###### NOTIFICATION

 The 4th February, 2012

 No. LGL.6/2005/60.- The following Act of the Assam Legislative Assembly which received

the assent of the President is hereby published for general information.

###### ASSAM ACT NO. IV OF 2012

 (Received the assent of the President on 18-1-2012)

 THE ASSAM COOPERATIVE SOCIETIES ACT, 2007


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###### 370 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

**AN**

**ACT**

to consolidate and amend the law relating to cooperative societies in the

State of Assam to facilitate the voluntary formation and democratic functioning of
cooperative societies as people's institutions based on self-help and mutual aid
and to enable them to promote their economic and social betterment.

Whereas it is expedient to consolidate, and amend the law relating to

Preamble

cooperative societies in the State of Assam to facilitate the voluntary formation and
democratic functioning of cooperative societies as people’s institutions based on
self help and mutual aid and to enable them to promote their economic and social
betterment and for matters connected there with or incidental thereto;

It is hereby enacted in the Fifty-eighth Year of the Republic of India as

follows

**CHAPTER - 1**

**Preliminary:**

1. (1) This Act may be called the Assam Cooperative Societies Act, 2007

(2) It extends to the whole of Assam.

Short title,

(3) It shall come into force on such date as the State Government may, by

extent and

notification in the Official Gazette, appoint.

commencement

###### 2. In this Act, unless there is anything repugnant in the subject or context,-

(a) **"Administrative Council"** means a body intermediary between a

###### Definitions

managing body and the General Assembly of a registered society;

(b) **"Affiliating Society"** means the registered society of which a

particular society is **a** member and **"Affiliated Society"** means the
particular society which is a member of the affiliating society;

(c) **"Arbitrator”** means a person appointed under the provisions of this

Act to decide any dispute referred to him;

(d) **"Audit Officer"** means a person appointed under the provisions of

this Act to audit the accounts of a registered society;

(e) **“area of operation” means the area from which the membership is**

drawn;

(f) **"bye-Law" refers to the registered bye-laws of a Society for the time**

being in force and includes a registered amendments of bye-laws
of a society;

(g) **“Board”** means the Governing body of a co-operative society to

which the management of the affairs of the co-operative society is
entrusted under the bye-laws and includes Managing Committee of
a co-operative Society

(h) **"Cooperative Year"** means the period beginning and ending on

such dates as may be fixed by the Registrar for the purpose of
drawing up the Balance Sheets of registered societies and for all
other purposes under this Act;


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THE ASS AM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 371

(i) **"Cooperative** **Demand** **Certificate"** means a certificate as

mentioned in subsection (4) of section 103 or sub section (1) of
section 114;

(j) **“Co-operative Society”** or **“society"** means a co-operative society

registered under this Act and includes a society formed after
amalgamation of such two or more societies or by division of an
existing society;

(jj) **“Co-operative Bank”** means a Co-operative Society registered under

.Act No. 10

this Act carrying on the business of Banking as defined under

of 1949

section 5(b) of the Banking Regulation Act, 1949, which shall also
include Central Co-operative Bank and a State Co-operative Bank
as defined under clauses (d) and (u) of section 2 of the National Act No. 61
Bank for Agriculture and Rural Development Act, 1981 and a of 1981
Primary Co-operative Society carrying on the business of Banking;”

(k) **“Co-operative”** where used as a noun means an autonomous

association of persons united voluntarily to meet their common
socio-economic need through a jointly owned and democratically
controlled enterprise formed on co-operative principles and
registered under this Act;

(l) **“Chief Executive"** means the individual, in paid or honorary

capacity, nominated or elected or appointed by the Board from
among members, Directors or others, in accordance with the bye­
laws of the society who shall perform such functions, and
responsibilities and exercise such powers as specified in the Act,
bye-laws and assigned by the Board:

(m) **“common need"** means the economic and social need which is

common to all who wish to form a cooperative society;

(n) **“Chief Auditor’** shall mean the senior most cooperative officer

posted at the office of the Registrar;

(o) **“delegate"** means a person elected by a group of individual

members of a society to represent them in the genera! body of the
cooperative society in accordance with the bye-laws of the society;

**(p) “Director"** means the director of the Board which shall be construed

as member in case of Managing Committee;

(q) **“Delegate General Body"** in relating to a cooperative society

means all its delegates;

(r) **"Delegate General Body Meeting"** means a meeting of the

delegates, called and conducted in accordance with the provisions
of this Act and the bye-laws;

(s) **"employee"** means a person, not being an office bearer employed

by a registered society on a salary or similar form of remuneration
other than advance patronage dividend or payment for goods sold
to or through such society;

(t) **"family"** means a person, his spouse, his children and parents

dependent on him and jointly residing with him;

(u) **"General Assembly"** in relation to a cooperative society means the

highest authority of a registered society;

(v) **“General Meeting"** means a meeting of the General Assembly

called and conducted in accordance with the provisions of this Act
and the bye-laws;

(w) **"member"** means a person who is admitted as a member of the

cooperative society in accordance with the provisions of this Act
and bye-laws of the society and shall include a co-operative self­
help group and an institution,


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###### 372 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(x) **“office bearer"** means a member duly elected by the appropriate

body of a registered society according to its bye-laws to any office
of such society, including the office of President, Chairman, Vice-
President, Vice-Chairman, Secretary, Managing Director &

Treasurer;

Provided that any officer appointed or nominated by the

State Government to hold charge of any office of a registered
society shall be deemed to be an office bearer unless specifically
stated to the contrary;

(y) **"Primary Cooperative Society"** means a Cooperative Society

whose membership is available only to individual and self help
groups and voluntary institutions other than cooperative societies;

(z) **“patronage dividend”** means the dividend paid to members in

relation to their participation in the business of the society in
accordance with the provisions of the bye-laws;

(aa) **“prescribed” means prescribed by rules made under this Act;** _

(bb) **"Registered Society"** means a cooperative society registered

under this Act and includes a society formed after amalgamation of
such two or more societies or by division of such an existing /
society;

(cc) **"Registrar"** means the officer appointed by the State Government

under section 3 to perform the duties of Registrar of Cooperative
Societies under this Act;

(dd) **"rules" means rules made under this Act;**

**(ee)** **"Secondary** **Cooperative Society** **or Federal** **Cooperative**

**Society”** means a cooperative society whose members are

cooperative societies as well as individuals;

(ff) **“surplus"** means the excess of income over expenditure of a

cooperative society arrived at the end of a financial year after the
payment of interest, if any, on share capital and before the
payment of surplus refund and allocation of reserves and other

funds;

(gg) **"self help group (SHG)”** means a homogeneous group of persons

voluntarily formed to save small amounts of their earnings and also
to raise loans to be lent to its members on terms, as mutually                    -

agreed upon;

(hh) **"services"** means the main services provided to members, through

which a co-operative society intends to meet the need common to
all members for the fulfillment of which the co-operative society
was formed;

(ii) **“Schedule” means the schedule appended to this Act;**

THE
REGISTRAR

###### CHAPTER-II

**REGISTRATION OF SOCIETIES**

(1) The State Government may appoint an officer to be the Registrar of

Cooperative Societies for the State or any portion of it for the
registration, supervisions, assistance, counsel and for the all-round
development of the Cooperative movement in the State with such
other powers and responsibilities as may be provided under this Act
or rules or bye-laws framed thereunder.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 373

(2) The State Government may also appoint any other person or persons

to assist the Registrar and may by general or special order in writing
delegate to any such person or persons all or any of the powers and
responsibilities of the Registrar under this Act.

SOCIETIES **4.** (1) Subject to the provisions hereinafter contained, a society which has as
WHICH MAY BE its chief object the promotion of the economic interest and general

REGISTERED welfare of its members in accordance with cooperative principles laid

down in Schedule 'A' may be registered under this Act, provided that
a society established with the object of facilitating the operation of
such a society including a society formed by the division of an
existing registered society or amalgamation of existing two or more
societies, may be registered under this Act with limited liability.

(2) No cooperative society with unlimited liability shall be registered after

commencement of this Act.

(3) Where a cooperative society with unlimited liability was functioning
before the commencement of this Act such society shall exercise the
option within a period of one year from such commencement either to
continue to function as such or to convert itself into a cooperative
society with limited liability by following the procedure of amendment
as specified in section 12.

**EXPLANATION**

For the purpose of this sub section cooperative society with

limited liability means a cooperative society in which the liability of its
members for the debts of the cooperative society is limited by its bye­
laws, to such form and extent as they may undertake to contribute to
any deficit in the assets of the cooperative society in the event of its
being wound up.

(4) Where a cooperative society is ordered to be dissolved under any

provision of this Act, the liability of a past member or of the estate of
a deceased member, who ceased to be member or died during the
period of two years immediately preceding the date of order for

dissolution, shall continue unt». completion of the entire liquidation
proceedings, but such liability shall be limited only to the debts of the
cooperative society as they stood on the date of cessation of his

C - membership or his death, as the case may be.

(5) No society shall be registered if in the opinion of the Registrar its

>' declared objects are not likely to be achieved or if it is economically

unviable, technically and cooperatively unsound or if it may have an
adverse effect upon any registered co-operative society or the
cooperative movement as a whole or if the members or the applicants
do not need the services or are not in a position to use the services of
the co-operative society:

Provided that no other organization, entity or societies

registered under any other Act existing for the time being in force
other than this Act shall be registered or converted or merged as a
cooperative society.

“(6) The Co-operative Society to be registered as a Co-operative Bank shall

specifically indicate in its byelaws submitted before the Registrar at
the time of registration, that the society shall be a Co-operative Bank
which shall carry on the business of banking as defined under section
5(b) of the Banking Regulation Act, 1949 on the basis of which the
Registrar shall register the said society as a Co-operative Bank as
defined under this Act.


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###### 374 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(7) The existing Co-operative Societies carrying on the business of
banking as defined under section 5(b) of the Banking Regulation Act, Act No. 10

1949 on the date of coming into force of this Act, shall amend their o f 1 9 4 9

Bye-laws indicating that the said societies have been carrying on the
business of banking in the State of Assam and shall file a copy of the
amended bye-laws before the Registrar for getting the societies
registered as a Co-operative Bank and Registrar shall register the
said societies accordingly under this Act.

Explanation For the purposes of this sub-section the term “existing A ssam A ct

Cooperative Societies" means the Co-operative Societies registered ^ 01 of

under the Assam Co-operative Societies Act, 1949, and carrying on
the business of banking at the commencement of this Act.”

4A A Cooperative Society registered as a Co-operative Bank under this

“CO­
OPERATIVE Act shall be an eligible Cooperative Bank within the meaning of clause Act No

47 of 1961

BANK TO BE (gg) of section 2 of Deposit Insurance and Credit Guarantee X
ELIGIBLE CO­ Corporation Act, 1961 and shall be bound by the following -
OPERATIVE
BANK (a) If so required by the Reserve Bank in the public interest or for

preventing the affairs of the Cooperative Bank being conducted in a
manner detrimental to the interests of the depositors or for securing

the proper management of the bank, an order shall be made for the
supersession of the committee of management or other managing
body (by whatever name called) of the Co-operative Bank and the
appointment of an administrator therefore for such period or periods
not exceeding five years in the aggregate as may from time to time
specified by the Reserve Bank.

(b) An order for the winding up of the Co-operative Bank or an order

sanctioning a scheme of compromise or arrangement or of

amalgamation or reconstruction or an order for the supersession of
the committee of management or other managing body (by whatever
name called) of the Co-operative Bank and the appointment of an
administrator therefore made with the previous sanction in writing or
on the requisition of the Reserve Bank shall not be liable to be called
in question in any manner.

(c) The liquidator or the insured Co-operative Bank or the transferee Co­

operative Bank, as the case may be, shall be under an obligation to Act No. 47

repay the Corporation in the circumstances, to the extent and in the o f 1961

manner referred to in section 21 of the Deposit Insurance and Credit
Guarantee Corporation Act, 1961 ”

**5.** No person may become an individual member of a registered cooperative

AGE society unless he is above eighteen years of age, provided that the bye­
QUALIFICATION laws of a society may prescribe a higher minimum age and he is not
OF A MEMBER

otherwise disqualified under this Act.

(1) No society other than a society of which a member is a registered

CONDITIONS

society shall be registered under this Act which does not consist of

OF
REGISTRATION at least such number of eligible persons as may be prescribed by

the Registrar of Cooperative Societies:


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 375

Provided that the number of members for the above purpose

shali not in any case be less than 10 members competent to IX of
contract under section 11 of the Indian Contract Act,1872 and 1872
belonging to ten different families.

(2) The word limited shall be the last word in the name of every society

registered under this Act.

(3) No society shall be registered under this Act in an area where there

already exists another cooperative society with similar objectives:

Provided that Registrar may allow registration of more than

one cooperative societies in the same area of operation in case the
need or necessity, demand for organization of such types of
societies requires registration of more such types of societies in the
same area of operation e g. transport cooperative, labour contract
cooperative, trading cooperative, housing cooperative.

However, in doing so proper justification must be obtained

before allowing registration of such societies.

RESTRICTIONS 7. (1) No member of a registered society shall hold more than such

ON ACQUISITION portion of the share capital of the society as may be prescribed by
(TF SHARES IN A the rules, or the bye-laws of the society.
COOPERATIVE (2) No member shall be allowed to acquire an additional share until he
SOCIETY

has paid in full the value of the whole of that portion of his share

holding which he is required to pay in accordance with the bye-laws
of the society

POWER OF All disputes regarding formation, registration or continuance of a

T REGISTRAR TO

society under this Act shall be decided by the Registrar.

DECIDE CERTAIN
QUESTIONS

BYELAWS **9.** (1) A cooperative society shall frame their own bye-laws and the affairs of

the cooperative society shall be managed in accordance with the
terms, conditions and procedure specified in the bye-laws.

(2) Subject to the provisions of this Act, the functioning of every cooperative

society shall be regulated by its bye-laws.

(3) The bye-laws may contain such matters as decided by the General

Assembly and shall be specific and confined only to the matters

provided in Schedule B. However, the bye-laws of a society shall in no

case supersede the provisions of the Act.

**10.** (1) For the purpose of registration, an application thereof shall be submitted

APPLICATION
FOR to the Registrar in the form as may be prescribed, by hand or by
REGISTRATION registered post signed by at least ten persons or such number of persons

as may be fixed by the Registrar, qualified under section 5 of the Act,
read with sub section (5) of section 4 who wish to form a primary
cooperative society or by a duly authorized person on behalf of atleast
three such registered cooperative society who wish to form a secondary
cooperative society. The person by whom or on whose behalf such
application is made, shall furnish such information in regard to the
proposed cooperative society as the Registrar may require. Every such
application shall be accompanied by the original declaration signed by
applicants expressing commitment to the cooperative principles specified
in Schedule-A and the following:-


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###### 376 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(a) four copies of the proposed bye-laws of the cooperative society as

adopted by the applicants;

(b) a true copy of the resolution passed at a meeting by the applicants

adopting the bye-laws.

(c) a list of names of the applicants with their complete address,

occupation and equity participation and other details.

(d) a scheme regarding viability of the proposed society, economically,

financially technically and cooperatively;

(e) a copy of a treasury challan in support of payment of registration fee

calculated in accordance with the provisions of sub-section(l) of
section 17 which shall be non refundable and shall furnish such other
information in regard to the society as the Registrar may require.

(2) On receipt of the application for registration and after due consideration,
the Registrar may register the bye-laws with such modification as he
thinks necessary to bring about conformity with the provisions of the
bye-laws of any society having similar objects and functions or for any \
other grounds he deems necessary for the interest of cooperative
society in particular and the cooperative movement in general. If the
conditions laid down in sections 4 and 6 are not fulfilled, the Registrar
shall communicate by registered post the order of refusal for
registration together with the reasons thereof, within sixty days from the
date of submission or receipt of application for registration, as the case
may be, to the applicants. However, in case of registration of a

Cooperative bank clearance from NABARD or Reserve Bank of India
as the case may be shall have to be obtained before considering for
according permission for registration of such societies:

Provided that no order of refusal shall be made without

giving an opportunity of being heard to the applicant. The certificate of
registration signed and sealed by the Registrar shall be conclusive
evidence that the society mentioned therein is a cooperative society
duly registered under this Act, unless it is proved that the registration of
the society has been subsequently cancelled: No cooperative society
shall commence business unless it has obtained a certificate of
registration under section 11 and after obtaining prior

license/permission if necessary under any State or Central Act in such
business and every member of such cooperative society carrying on
business in contravention of this sub-section shall be severally liable for
all liabilities incurred in such business.

11. The Registrar shall register the society and also take on record its bye­

CERTIFICATE
OF laws and communicate by registered post a certificate of registration and
REGISTRATION the original bye-laws signed and sealed by him within sixty days from the

date of submission or receipt of the application for registration, as the
case may be to such person specified in the application for the purpose
subject to the fulfillment of the following conditions, namely:-

(a) the application is in conformity with the requirements laid down

under this Act;

(b) the object of the proposed cooperative society is the economic

and social betterment of its members through the provision of
services to fulfill such common need as specified in the proposed
bye-laws;

(c) the proposed bye-laws are not inconsistent with the provisions of

this Act and are not against the aims and objects of the cooperative
society:


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THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 377

Provided that where within sixty days of submission of the

application for registration the society is not registered or the certificate
of registration has not been issued or refusal of registration has not
been communicated, the society shall be deemed to have been
registered under this Act.

AMENDMENT

12. (1) No amendment of the bye-laws of a registered society, whether by way

OF THE BYE­

of addition, alteration or change of name shall be valid until such

LAWS OF A

amendment has been registered under this Act.

REGISTERED

(2) Every proposal for such amendment shall have to be approved by a

SOCIETY

resolution at a meeting of the General Assembly in accordance with the
bye-laws of the society and be forwarded within a month from the date of
the resolution to the Registrar; and if the Registrar is satisfied that the

proposed amendment is not contrary to the provisions of this Act or Rules,
he shall unless for reasons to be. recorded in wnting^he
refuse, register the amendment.,

(3) When the Registrar registers an amendment of the' byd-laws

registered society, he shall issue to the society a copy of the amendment
certified by him which shall be conclusive evidence that the same has
been duly registered, unless it is proved that the registration of the society
has been cancelled or that further amendments have been registered or

that the society's copy of the amendments have been tempered with, the
amendment shall be binding upon the society with effect from the date of
registration.

(4) A copy of the resolution of an amendment of the bye-laws of the society

by the General Assembly shall be forwarded by the cooperative society to
the Registrar within a period of thirty days from the date of the general
meeting at which the resolution was passed.

(5) A copy of the resolution of an amendment forwarded to the Registrar shall

be signed by the president and two Directors and shall be accompanied by
the following particulars:-

(a) a copy of the resolution adopting the amendment;
(b) the date of the general meeting at which the amendment was

adopted and the total number of members of the society on that
date;

(c) a list of members who attended such general meeting and a list of

members who voted for or against the resolution in such general
meeting.

(6) The Registrar shall consider the amendment of the bye-laws under sub­

section (2) subject to the fulfillment of the following conditions, namely :-

(a) the amendment is not inconsistent with the provisions of the Act or

any of the existing societies with similar objectives or is not against
the aims and objects of the cooperative society; and

(b) the amendment is in conformity with the cooperative principles

specified in Schedule-A.

(7) The Registrar may by order refuse registration of the amendment if any

of the conditions specified in sub-section(6) is not fulfilled:

Provided that no such order of refusal shall be passed by the

Registrar without giving a reasonable opportunity to the cooperative
society to reconsider the amendment in the light of the direction of the
Registrar within a period specified by him.


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###### 3 78 THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012

(8) The Registrar may after considering the reply received in response to the

opportunity given under sub-section (7) if satisfied that the directions to

reconsider the amendment has been complied with or satisfied with the
reply, he shall register the amendment. If no reply is received from the
cooperative society within the period specified by the Registrar under the
proviso to sub section (7) or the reply is not in accordance with the
direction of Registrar, the Registrar may refuse the amendment and shall
communicate the decisions within thirty days of the receipt of such reply or
on the expiry of the period referred to above, as the case may be

DIVISION OF 13. (1) A cooperative society may by a special resolution passed at a meeting of

COOPERATIVE its General Assembly decide to divide itself into two or more cooperative
SOCIETIES societies.

(2) Where a special resolution is passed under sub-section(l), the cooperative

society shall give notice thereof together with a copy of the resolution
passed by it to all its members and creditors and any member other than \
those who voted in favour of the proposed division and any creditor shall t

during a period of thirty days from the date of service of notice upon him
have the option of withdrawing the shares .deposits or loans from the <

cooperative society, as the case may be, subject to the discharge of his
obligations to the cooperative society.

(3) Any member or creditor who fails to exercise the option within the period

specified in sub-section(2) shall be deemed to have assented to the
division.

(4) The special resolution passed under sub-section(1)shall not take effect

until -

(a) all claims of the members and creditors of the cooperative society who

have exercised the option under sub-section (2) have been met in full
or otherwise satisfied;

###### (b) information of the intended division and settlement of claims of

members and creditors is sent to the Registrar and his approval is
obtained; and

(c) the certificates of registration and the original bye-laws of the resultant

cooperative society signed and sealed by the Registrar are issued
under section 11.

(5) When a cooperative society divides itself into two or more cooperative

societies under this section the registration of such cooperative society
shall stand cancelled and it shall be deemed to have been dissolved and
shall cease to exist as a corporate body and the Registrar shall delete the
name of such cooperative societies from the register of cooperative
societies .

(6) When a cooperative society divides itself into two or more cooperative

societies such member who has assented or deemed to have assented to
the division shall be deemed to have become a member of that newly
formed cooperative society to which his interest were transferred ,in
accordance with the scheme of division approved by the general body of
such cooperative society notwithstanding anything contained in this A ct.

14. (1) Any two or more cooperative societies having similar objectives may, by

AMALGAMATION special resolutions passed in the respective General Assembly, decide to
OF
COOPERATIVE amalgamate themselves and form a new cooperative society .
SOCIETIES


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###### 379

(2) Where special resolutions are passed under sub-section(l) each

cooperative society shall give notice thereof together with a copy of the
resolution passed by it to all its members and creditors and any member
other than those who voted in favour of the proposed amalgamation and
any creditor shall, during a period of thirty days from the date of service of
notice upon him, shall have the option of withdrawing his shares, deposits
or loans from the Cooperative Society, as the case may be, subject to the
discharge of his obligations to the cooperative society concerned.

(3) Any member or creditor who fails to exercise the option within the period

specified in sub-section(2) shall be deemed to have assented to the
amalgamation.

(4) The special resolution passed under sub-section(l) shall not take effect

until , -

(a) all claims of the members and creditors of each cooperative
society who have exercised the option under sub-section(2)

## i (b) information of the intended amalgamation and settlement of have been met in full or otherwise satisfied;

claims of members and creditors is sent to the Registrar and
his approval is obtained; and

(c) the certificate of registration and the original bye-laws of the

cooperative society which is formed as a result of

amalgamation, signed and sealed by the Registrar, is issued
under section 11.

(5) When two or more cooperative societies amalgamate themselves into a

new cooperative society under this section the registration of the
cooperative society, so amalgamated, shall stand cancelled and they shall
be deemed to have been dissolved and shall cease to exist as corporate
bodies, and the Registrar shall delete the name of the cooperative societies
so amalgamated from the register of cooperative societies .

(6) When two or more cooperative societies amalgamate themselves into a

new cooperative society under this section, all the members of the
cooperative societies who have assented or deemed to have assented to
the amalgamation shall be deemed to have become members of the new
cooperative society notwithstanding anything contained in this Act.

MERGER OF 15.(1) A cooperative society may, by a special resolution passed in the meeting of
COOPERATIVE the General Assembly, decide to merge itself into any other cooperative
SOCIETIES society having similar objects and the said society by special resolution,

agrees to such merger.

(2) Where special resolutions are passed under sub-section (1) each

cooperative society shall give notice thereof together with a copy of the
resolution passed by it to all its members and creditors, and any member
other than those who voted in favour of the proposed merger and any
creditor, shall during a period of thirty days from the date of service of
notice upon him, have the option of withdrawing his shares, deposits or
loans from the cooperative society, as the case may.

16. (1) Every cooperative society shall specify the full address of its head office in

LOCATION OF

its bye-laws.

HEAD OFFICE

(2) The Board may, subject to approval of the General Assembly, change the

address of its head office at any time and shall make such amendment in
its bye-laws as per provision laid down in section 12.


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380 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

FEES ETC. 17.(1) Registration fees amounting to one percent of the proposed authorised

share capital of the proposed cooperative society shall have to be
deposited by Treasury ChallanCajorTg with the application for registration of
the proposed cooperative society. )The Registrar may, however, revjse vise [{]
fees fro.m time to time & ‘gag

(2) Subject to the provisions of sub-sectiorf"(3) of section 81 and sub-stection (2)

and (6) of section 87 respectively, the Registrar may by order prescribe a
scale of fees to be paid by a cooperative society for various services
rendered by him under this Act.

###### CHAPTER - III

 MEMBERSHIP

18. (1) Any person who needs the services of a cooperative society and

ELIGIBILITY OF

expresses his willingness to accept the responsibilities of membership,

MEMBERSHIP IN
COOPERATIVE meets such other conditions as may be specified in the bye-laws of the
SOCIETY cooperative society and is in a position to use the services of the co­

operative society , may seek membership and if the cooperative society
is in a position to extend its services to the applicant, it may admit him as
a member.

(2) Every applicant for membership and every member of a cooperative

society shall keep each cooperative society of which the person is a
member ,informed of membership in other cooperative society and in
case of conflicting membership, the Board may, by resolution, refuse
admission under section19 or terminate from membership under
section23, as the case may be :

Provided that no such resolution to refuse admission shall be

passed without giving the applicant, as the case may be, a reasonable
opportunity to make representation to the Board as to why he should not
be refused admission.

Explanation:-For the purpose of this sub-section the expression,“conflicting

membership” means membership of the common objective co-operative
societies functioning within the jurisdiction of a cooperative society of
which the membership is sought.

19. No person shall be eligible for admission as a member and a member

DISQUAL.IFI -

shall cease to be a member of a cooperative society if he incurs

CATION OF

disqualification of membership prescribed in the bye-laws.

MEMBER

ADMISSION OF **20.** (1) The Board may admit a person for membership in accordance with the
MEMBER procedure laid down in the bye-laws within sixty days from the date of

receipt of application for membership if he is eligible for membership
under section 18 or refuse admission to the applicant if he is not eligible

for membership under section 19 and communicate the same to the
applicant by post or by hand.


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###### THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 381

(2) Where admission for membership is refused under sub section (1), the

decision with the reasons thereof, shall be communicated to such
applicant within ninety days from the date of application. If nothing is

communicated within the period of ninety days specified above the
admission shall be deemed to have been accepted by the

Board .

(3) Where an application has been refused by the Board the applicant may

appeal to the General Assembly within a period of sixty days from the
date of receipt of the order of the refusal. The decision of the General
Assembly shall be final and binding on all concerned parties:

Provided that no decision of refusal of admission shall be

taken by the General Assembly without giving the applicant an

opportunity of being heard.

21. (1) Subject to the provisions of sub-section(2) of section-66, a member may,

W<n~~AWAL OF
MEMBERSHIP at any time after expiry of one year from the date of accepting

membership, withdraw from membership in a cooperative society in
accordance with the procedure laid down in bye-laws.

(2) The withdrawal from membership shall not require the person to fulfill

such obligations as were undertaken or assumed as a member, under
the provisions of the Act, the bye-laws or any agreement.

22. (1) If any person having been admitted as a member of a cooperative society

CESSATION OF

dies or subsequently becomes subject to any of the disqualifications

MEMBERSHIP

specified in the bye-laws shall cease to be a member of the cooperative
society.

(2) Every cooperative society shall inform, in the event of receipt of

information of the death of the member ,the nominee of the member and
in every other instance ,the member,about the cessation of membership
for the settlement of accounts.

23.(1) The Board may, by a resolution passed by three fourth majority of the

y*^RMlNATION

directors present and voting at a meeting held for the purpose .terminate

EMBERSHIP the membership of a member if he —

(a) intentionally does any act likely to injure the creditability of the

cooperative society or bring it to disrepute ;or

(b) willfully deceives the cooperative society; or
(c) has acted adversely to the objects or his act is detrimental to

the interest of the cooperative society; or

(d) persistently makes default in payment of his dues or fails to

comply with the provisions of the bye-laws; or

(e) having been admitted as a member subsequently becomes a

member of any other society having common objective
cooperative functioning within the jurisdiction of the cooperative
society of which he is member; or

(f) does not use the services of the cooperative society or he

ceases to be a resident of the area of operation of the society:

Provided that no such resolution shall be passed without giving the

member concerned a reasonable opportunity to make representation at
the Board meeting.


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382 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(2) Any member aggrieved by the resolution passed under sub-section(l)

may appeal to the General Assembly within thirty days of the receipt of
such resolution.

(3) No member of a cooperative society whose membership has been
terminated under sub-section (1) shall be eligible for readmission as a
member of the cooperative society for a period as may be specified in
the resolution but not exceeding five years, subject to the condition that
his conduct during the period of expulsion sufficiently justified his fair
conduct in the event of his enrolling membership again.

REGISTER OF 24. (1) Every cooperative society shall maintain a register of members. The
MEMBER name of every person admitted as a member of the cooperative society

shall be entered in the register along with such particulars as may be
deemed necessary by the Board.

(2) The name of a person -

(i) whose admission is refused under sub-section (2) of -»

section 20; or

(ii) who has withdrawn from membership under section21;
(iii) who ceased to be a member under section22 ; or
(iv) whose membership has been terminated under section23

shall be deleted from the register of members :

Provided that the name of a person referred to in clause (i) or

clause (iv) shall not be deleted from the register of members till expiry of
30 days from the date of the decision of the Board or Annual General
Meeting, as the case may be, and in case an appeal is preferred under
sub-section(2) of section23,as the case may be.

The register maintained under sub-section(l) shall be prima facie

evidence of the date on which any person was admitted to the cooperative
society as a member and of the date on which he ceased to be a member.

EDUCATION OF OF 25.(1) Every cooperative society shall include a certain amount in its budget s

annually, as provision for expenses on education of member and /

MEMBER ETC.

potential member, education and training of staff and directors for the
development of their cooperative societies in accordance with the
cooperative principles specified in Schedule A and practices of
cooperation, besides contributing at least 1% of profit or an amount
specified by the Registrar in case of societies not earning profit ,to State
Cooperative Union for cooperative education and training.

26.(1) Every member of a registered society and every ex-officio member of

RIGHTS AND

the Administrative Council or Managing Body of such society, unless

LIABILITIES OF
MEMBERS OF under some temporary disqualification, shall have the right to attend any
REGISTERED general meeting of the society and to exercise vote at such meeting.
SOCIETIES
AND EXERCISE (2) No member of a cooperative society shall exercise the right of a member
OF RIGHTS

including the right of vote unless he has made such payment to the

THEREOF

cooperative society in respect of membership or has acquired and
continues to have such interest in the cooperative society as may be
specified in the bye-laws.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 383

(3) The Chief Executive of every cooperative society within twenty days of

closure of the previous cooperative year, shall prepare a list of members
with the right of vote, and a list of members without the right of vote

,valid for the current financial year. The list shall be affixed on the notice
board of the head office of the cooperative society for information of all
members and any member not satisfied with specific instances of

inclusion or non-inclusion of members in the lists, may appeal to the
Board within ten days from the date of the affixing of the lists on the
notice board, for re-examination of the records, and the Board shall

within forty days of closure of the previous cooperative year, review the

lists, finalise it, and have it affixed on the notice board of the head office
of the cooperative society:

Provided that a member who is an employee or member of

Employees Union of such society shall not be entitled to vote -
(i) at the election of a member of the Board of such society;

(ii) in any general meeting convened for framing the bye-laws of
such society or any amendments thereto.

(4) In the case of equality of votes the Chairperson shall have a casting vote.

27 (1) In primary cooperatives societies, irrespective of the shares held in the

VOTES OF

society and subject to temporary disqualification .each member shall

MEMBERSAND
MANNER OF have equal voting right (one member one vote). Similarly in case of
EXERCISING Secondary Cooperative Society, the representative of such cooperative
VOTE society shall have same voting rights (one representative one vote).

Every member of cooperative society or the representative referred
herein shall exercise his vote in person and in the manner specified in
the bye-laws and no member or representative shall be permitted to vote
by proxy :

Provided that a person shall have been a member for at least

one full financial year, before being eligible to vote or to seek
election to managing body:

Provided further that the condition of one year membership

shall not apply to the members who join at registration or at any
time after the registration of a cooperative society but before the first

day of the next co-operative year.

(2) Every member of a cooperative society shall exercise his vote in the
manner specified in the bye-laws.

LIABILITIES OF 28. The liability of a past and of the estate of a deceased member for the debt
PAST MEMBER of a registered society as they existed at the date of his ceasing to be a
AND HIS ESTATE

member or on his death, as the case may be, shall continue for a period
of five year from the said date.

###### CHAPTER -IV

**MANAGEMENT**

29(1) The General Assembly of a cooperative society shall consist of all the

GENERAL
ASSEMBLY members of such cooperative society who are eligible to vote at the

general meeting of the society.


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384 THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012

(2) (a) Every member of a registered society and every ex-officio member

of the Administrative Council or managing body of such society,
unless under some disqualification, shall have the right to attend
any general meeting of the society and to exercise his vote at such
meeting:

Provided that the bye-laws of a registered society may prescribe-

(i) that a registered society affiliated to such society may

have more than one representative entitled to vote at
general meetings of the society; and

(ii) that only one third of the members of the General

Assembly, excluding ex-officio members, may be

individual members and the other two thirds being
representatives of affiliated registered societies;

(b) if the number of individual members exceeds one third of the
total membership of the society the individual members shall
elect at a special meeting to be called by the Secretary of the
society not more than thirty days before the Annual General
Meeting in the manner prescribed in the bye-laws to represent in
the Annual General Meeting, those individual members who, as
the representative of the body of individual members shall form
the one third membership of the General Assembly for the
purpose of voting at the Annual and other meetings of the
General Assembly during the ensuing year. Only such elected
representatives shall have the right to attend and vote at such
general meeting.

(3) If the general body of a cooperative society decides that the size .area or
types of its membership requires a representative body of delegates for
more effective decision making, its bye-laws shall provide for a smaller
body, called “delegate general body” elected from the members, in the
annual general meeting in accordance with the bye-laws, to exercise
such powers and to discharge such duties of the general body as may
be specified in the bye-laws.

(4) Subject to the provisions of this Act and the bye-laws ,the ultimate power
of a cooperative society shall vest in the general body. The supreme
authority shall however vest with the State Government or the Registrar
of Cooperative Societies, as the case may be, during the pendency of
any loan or service to the society from the Government.

(5) Any power, function or responsibility, falling within the scope of a

cooperative society as a corporate body, which has not been specifically
entrusted by this Act or the bye-laws, to any authority of the cooperative
society may be dealt with by the General Body or by the State

Government during the pendency of any loan or services to the society
from the Government.

MATTERS TO BE 30 (1) The following matters in addition to others as are considered necessary
DEALT WITH IN by the Board shall be dealt with by the Annual General Meeting,

THE ANNUAL namely:-
GENARAL

(a) election of the Directors or delegates if fallen due;

MEETING


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 385

(b) consideration of the long term plan and budget, when

required;

(c) consideration of the annual operational plan and budget for

the current financial year;

(d) consideration of the annual report of activities for the

previous financial year including provisional financial

statements of accounts if not audited;

(e) consideration of the audited financial statements of

accounts, and the auditor’s report relating to the previous

financial year or years;

(f) consideration of the report on deviations, if any from the

approved budget relating to the previous financial year;

(g) disposal of surplus, if any, of previous financial year;
(h) management deficit, if any, of previous financial yeat;
(i) creation of specific reserves and other funds;
(j) review of actual utilisation of reserves and other funds;
(k) review of the report on the attendance at meeting by

Directors;

(l) review of the use of the cooperative societies’ services by

the directors;

(m) appointment of internal auditor, fixation of remuneration paid

to any Director or member of any committee or internal
auditor in connection with his duties in that capacity or his
attendance at concerned meetings;

(n) review of quantum and percentage of service provided to

non members vis-a-vis services provided to the members;

(o) report of activities and accounts related to education of

member and Director and staff training;

(p) consideration of any other matter which may be brought

before the meeting of the general body in accordance with
the bye-laws;

(q) expulsion of members;
(r) disposal of appeals;
(s) formulation of code of conduct for the members of Board of

Directors and officers appointed by the Board;

(2) The following matters among such other matters as considered

necessary by the Board or which are specifically assigned to the
general body_under any other provision of this Act may be dealt
with by the general body at its annual or any general meeting,
namely

(a) amendments of bye-law§,
(b) removal of Directors and election of new Director;
(c) membership of the cooperative society in secondary

cooperative society;

(d) partnership with other cooperative societies;
(e) amalgamation, division, merger, transfer of assets and

liabilities;

(f) dissolution of the cooperative society;
(g) consideration of the Registrar's report of inquiry and

action taken thereon or reasons for the non completion of
the inquiry;


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386 THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012

(3) If the bye-laws of the cooperative society provide for election of one

or more Directors on territorial basis, such Director shall be elected
from the areas, in a meeting of the members of that area in
accordance with the provision of the bye-laws on a date prior to that
of annual general meeting. The result thereof shall be affixed on the
notice board of the head office of the cooperative society and also
at the place of the annual general meeting prior to the
commencement of the proceedings of the annual general meeting.

(4) All Directors shall cease to be Directors on the date of the Annual

General Meeting, if the annual financial statement of accounts and
annual report of activities for the previous financial year were
willfully not prepared before 15 days of the Annual General Meeting
for inspection of the members or for placing before the Annual

a -x General Meeting.

31. The term of the Board shall be three Cooperative years.

TERM OF THE
BOARD

GENERAL 32. The Board may, at any time, call a general meeting of the members of
MEETING the cooperative society . However, one general meeting in every

cooperative year must be convened by the Board.

SPECIAL 33 (1) The Board may call a special general meeting and shall be bound to do
GENERAL so within forty five days of the date of receipt of a written requisition.
MEETING

(a) signed by not less than twenty five percent of the members having right

to vote; or

(b) from the Registrar. ,

(2) Such requisition shall contain the reasons why the meeting is felt

necessary and the proposed agenda and no subject other than the
subjects included in the proposed agenda shall be discussed at the
special general meeting.

(3) If the Board fails to hold a special general meeting on requisition under
sub-section (1) or any of the Annual Genera! Meeting under section 32 . \
within the period specified therein all directors shall cease to be directors
on the date of expiry of the said specified period.

(4) Any meeting of the General Assembly other than the Special General

Meeting may, with the consent of the majority of the members present,
be adjourned from time to time to a later hour on the same day or to any
other date as may be provided in this bye-laws, but no business other
than that left over at the adjourned meeting shall be transacted at the
next meeting.

A notice of such adjournment posted in the notice board of the

head office of the cooperative society on the day on which the meeting is
adjourned shall be deemed sufficient notice of the next adjourned
meeting.

QUORUM OF
MEETINGS OF 34. (1) The quorum for a meeting for the General Assembly shall be specified in
GENERAL the bye-laws, but shall not be less than ten percent of the members
ASSEMBLY

eligible to vote at the meeting.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 387

(2) If within one hour from the time fixed for meeting of the General
Assembly a quorum is not present, the meeting shall stand adjourned
ordinarily to the same day in the next week at the same time and place.
But the Chairman of the meeting may, however, decide to adjourn the
meeting to a later date not later than fifteen days or as may be specified
in the bye-laws of the society:

Provided that a meeting of the Special General Assembly

called on the requisition of members under sub-section (1) of section-33
shall not be adjourned but dissolved.

(3) If at any time in a meeting there is no quorum the presiding
authority shall adjourn it to such time or date as it thinks fit and
announce the same at once and the business set down for the meeting
shall be brought forward at the subsequent meeting whether at such
meeting there is a quorum or not.

(4) No business other than the business fixed for the original meeting

shall be transacted at such subsequent meeting.

(5) A notice of such adjournment posted in the notice board of the head

office of the cooperative society on the day on which the meeting is
adjourned shall be deemed sufficient notice of the next subsequent
meeting.

(6) The quorum for a delegate general body meeting shall not be less

than twenty five percent of the delegate eligible to vote at the delegate
general body meeting .If at any time in the meeting of delegate general
body meeting there is no quorum, the procedure laid down in sub-
section(1) to (5) shall be followed.

(7) At the meeting of the General Assembly, the President shall preside
over the meeting. If the President is absent the Vice-President shall
preside. If both the President and the Vice-President are absent from
the meeting of the General Assembly, the members present shall
choose one of them to preside the meeting.

35. (1) There shall be a Board for the management of every cooperative
BOARD

society registered under this Act. The Directors shall be elected in
accordance with the provisions of the bye-laws, The management of
every cooperative society constituted in accordance with the provision of
this Act and the bye-laws shall vest in the Board:

Provided that in the case of a cooperative society

newly registered under this Act, the persons who have signed the
application for the registration of the cooperative society may appoint a
promoter Board, for a period not exceeding one year from the date of
registration to direct the affairs of the cooperative society and it shall
cease to function as soon as a regular board is constituted in
accordance with the provisions of this Act and the bye-laws.

(2) The promoter Board appointed under the proviso to sub-section (1)

shall conduct the election of Directors within the period mentioned

therein.

(3) Every Director while exercising the powers and discharging duties

shall act honestly and in good faith and in the best interests of the
cooperative society and exercise such care, diligence and skill as a
reasonably prudent person would exercise in similar circumstances.


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388 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(4) A Director who is guilty of misappropriation, breach of trust or

dishonesty resulting in loss or shortfall in revenue of the cooperative
society and is found guilty after an enquiry or inspection under section
87 and section 88 or after audit under section 81, shall be personally
liable to make good that loss or shortfall, without prejudice to any
criminal action to which the director may be liable under any law.

36. (1) There shall be a President and Vice-president in a cooperative society to

PRESIDENT AND
VICE-PRESIDENT be elected by the Board from amongst its Directors in accordance with
OF the provisions of the bye-laws. The term of President and Vice-president
COOPERATIVE elected by the Board shall be coterminous with the term of the Board.
SOCIETY

(2) Vacancy in the office of the President or Vice-president shall be filled in

by the Board in accordance with the provisions of the bye-laws and the
President or Vice-president so elected shall hold office for the unexpired
term of his predecessor.

(3) The Vice-President may resign his office at any time by notice in writing

to the President and the President may resign his office at any time by
notice in writing to the Vice-President. Such resignation shall take effect

from the date of its acceptance by the Board.

(4) The Board may, by a resolution passed by three- fourth majority of the

Directors present and voting at a meeting held for the purpose, remove
the President or Vice-president. Such meeting shall not be presided over

by the President or Vice -President against whom such resolution is to be
considered.

(5) The President or Vice-president as the case may be aggrieved by the

resolution passed under sub-section(4) may appeal to the Registrar

within thirty days from the date of passing of such resolution whose
decision thereon shall be final.

(6) In the event of the occurrence of any vacancy in the office of the ' \

president by reason of his death, resignation or removal or otherwise, the
Vice-President shall act as President until the date on which a new
president is elected in accordance with the provisions of this Act and the
Bye-laws to fill such vacancy.

(7) When the President is unable to discharge his functions owing to

absence, illness or otherwise the Vice-President shall discharge the
functions of the President until the date on which the President resumes
his duties.

37. A member shall not be eligible for being chosen or for being appointed, as

DISQUALIFICATIO
N OF THE a member of the Board or Administrative Council of a society or another
MEMBERS OF society to which the society is affiliated if such member -
THE BOARD AND (a) is adjudged by a competent court to be insolvent or of unsound
ADMINISTRA­

mind;

TIVE COUNCIL

(b) has been punished with imprisonment for an offence involving

moral turpitude or criminal activities;

(c) is concerned or participates in the profit of any contract with the

society;


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 389

(d) in a credit society, failed to pay in three consecutive years

immediately preceding the election at least an amount
equivalent to any installments fixed for repayment of any loan or
advance or credit or become defaulter to any other cooperative
society ;

(e) has acted in a manner prejudicial to the interest of the

cooperative society in particular or the cooperative movement in
general.

38. The Board shall discharge such functions, perform such duties and

POWERS AND exercise such powers as may be specified in the bye-laws and in
FUNCTIONS OF

accordance with the terms, conditions and procedure laid down therein and

THE BOARD

in particular the Board shall have the following powers, functions and
duties, namely

Z “ €

           - (1) to interpret the organisational objectives, to set up specific goals

towards achieving such objectives and to make periodic appraisal
of operations ;

(2) to nominate, elect or appoint and remove the Chief Executive
provided he is not a Government appointee ;

(3) to make provisions for the matters mentioned in section 49 in

respect of the staff of a cooperative society ;

(4) to finalise long term perspective plan, annual plan and budget and
to direct the affairs of the cooperative society in accordance with the
plan and budget approved by the general body ;

(5) to arrange for funds ;

(6) to authorise acquisition and disposal of immovable property :

(7) to frame, approve and amend regulations relating to services ;

funds, accounts and accountability and information and reporting
systems ;

(8) to elect President and Vice-President in accordance with the

provisions of the bye-laws ;

(9) to prepare the annual financial statement of accounts ;

(10) to hold Annual General Meeting in stipulateo time ; and
(11) to remove President or Vice President in accordance with sub­

section (4) of section 36 ;

ANNUAL 39. A general meeting to be termed as Annual General Meeting of the General
GENERAL Assembly of a registered cooperative society shall be held atleast once in
MEETING every cooperative year within a period of 120 days from the date of expiry

of every cooperative year. The Board shall automatically stand dissolved
for not holding Annual General Meeting in accordance with the provisions
of the Act and bye-laws within 120 days from the date of expiry of every
cooperative year.

ELIGIBILITY FOR

A DIRECTOR IN

40. Subject to such other conditions as may be specified in the bye-laws a

COOPERATIVE
SOCIETY member of a cooperative society shall be eligible for being chosen as a

Director of the cooperative society, if -

(1) such member has the right to vote in the affairs of the cooperative
society ;


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390 THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012

(2) such member has patronised the services of the cooperative society
during the previous financial year to the extent and in the manner
specified in the bye-laws and has attended at least two Annual
General Meetings in the previous five years:

(3) such member has no pecuniary interest in any subsisting contract
made with, or work being done for the cooperative society except as
otherwise specified in the bye-laws.

(4) the period of three years has elapsed from the date such member
ceased to be a Director for the following reasons

(a) not conducting or wrongly conducting the Annual General

Meeting under section 39 or special general meeting under sub­
section (3) of section33 and Board meetings under sub-section
(3) of section43; zs

(b) non submission of annual report of activities, annual financial

statement of accounts to the general body under sub-section (4)
of section-30.

(c) not conducting the meeting of the Board under sub-section (3)

of section 43 or delegates or representative under sub-section
(3) of section 41;

(d) absence from Board meetings under sub-section(7) of section

43 ;

(e) automatic dissolution under sub-section (3) of section 41;

(f) for failure to take follow up action on audit report as specified in

section 85.

(5) such member is free from default of any payment due to the society.

ELECTIONS 41. (1) It shall be the duty of the incumbent Board to prepare the voter's list with

eligible members and to conduct elections of Directors, delegates to the

r [ -x] delegate general body and representative, of the society, if fallen vacant.

(j k ) _r_

(2) The elections shall be conducted in the manner specified in the bye-laws.

before the expiry of the term of office of the outgoing Directors,delegates
or representatives, as the case may be.

(3) Where a Board fails to conduct elections of the Directors or delegates as

the case may be, before the expiry of the term of their office in
accordance with the Act and bye-laws, all Directors shall cease to be
Directors on the expiry of the period as specified in section 39.

(4) The elections of Directors and delegates shall take place at the Annual

General Meeting.

(5) Where a Board fails to conduct elections before the expiry of term of the

Board or delegates or where there are no Directors remaining on the
board, the Registrar shall convene a general meeting by appointing an
officer of the cooperative department for constitution of Board within
ninety days from date of such appointment and to perform all functions
of the board during the said period of ninety days at the cost of the
society.


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(6) The Directors shall hold office for the period for which they were elected

and the newly elected Directors shall assume office on the date of expiry
of said period.

(7) The Directors shall not be eligible for re-election, if so specified in the
bye-laws .

(8) Where there are vacancies in the office of the directors and where there

are no sufficient number of Directors to constitute a quorum for Board
meeting, the remaining Directors shall, notwithstanding anything

contained in this Act or the bye-laws, call a general meeting for the
purpose of electing Directors to fill the vacancies for the un-expired term
of the Board. However, the Board may co-opt maximum three eligible
members for constituting quorum.

(9) Notwithstanding anything contained in this Act ,no person shall be eligible

to hold, at the same time, office of a Chairperson or President, Vice­
Chairperson or Vice-President on the Board of more than two
cooperative societies.

42. (1) The term of office of the Directors shall be three cooperative years.

TERM OF (2) The term of representative of an affiliated society shall be co- terminus

DIRECTORS

with the term of Board of such cooperative society :

Provided that the said representative shall cease to be a

representative if the Board of the society which he represents is

dissolved. :

Provided further that a director representing a credit society or a

finance society to a higher tier of such society shall be disqualified to
continue in the board in the event of the society which he represents

commits default in repayment for a period exceeding 90 days.

(3) Any causal vacancy in the office of the Director shall be filled in

accordance with the provisions of the bye-laws and the Director so
elected shall hold office for the unexpired term of his predecessor.

43. (1) A meeting of the Board may be called at any time by the President or

BOARD MEETING

Chairman, as the case may be, and in the event of his being incapable
of acting, then by the Vice-President or Vice Chairman but at least four
meetings of the Board shall be held in a financial year and the period
between two consecutive meetings shall not exceed one hundred and
twenty days.

(2) The President or Chairman and in the event of his being physically

incapable of acting, the Vice President or Vice Chairman may, whenever
he thinks fit, call a special meeting of the Board and shall be bound to do
so within fifteen days of the date of receipt of a written requisition-

(a) signed by not less than one third of the Directors of the

Board ; or

(b) from the Registrar; or
(c) from the auditor.

Such requisition shall contain the reasons as to why the meeting

is felt necessary and the proposed agenda and no subject other than
the subjects included in the proposed agenda shall be discussed at the
special meeting of the Board.


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392 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(3) If the President or Chairman, Vice-President or Vice Chairman, as the

case may be, fails to hold the meeting of the Board under sub-section
(1) or the special meeting of the Board under sub-section (2) within the
period specified therein, he shall cease to be President or Chairman,
Vice-President or Vice Chairman, as the case may be, on the date of
expiry of the said specified period, In which case the remaining Board

members shall elect a new President or Chairman, Vice President or
Vice Chairman, as the case may be, from among themselves.

(4) A person who ceases to' be the President or Chairman, Vice-President

or Vice -Chairman, as the case may be, under sub-section (3) shall
not be eligible to hold the office of President or Chairman, Vice-
President or Vice Chairman, as the case may be, for a period of three
years from the date of such cessation.

(5) The quorum for a meeting of the Board shall be such as may bfe

specified in the bye-laws but shall not be less than fifty percent of the
total number of Directors of the Board.

(6) Subject to the provisions of this Act, the procedure to convene and

conduct the meeting of the Board shall be such as may be specified in
the bye-laws.

(7) If a Director fails to attend three consecutive meetings of the Board

without the permission of the President or Chairman he shall cease to
be a Director, from the date of the fourth meeting.

(8) The State Government and Registrar may appoint nominee to the

Board or any sub-committee of a cooperative society on its own motion

when the Government has subscribed more than 50% of the paid-up
share capital or when there is provision of Government nominee in its
bye-laws.

(9) The financial institution may also appoint its nominee when it

participates in its capital by way of share or other financial assistance

as per bye-laws of the cooperative society.

44. Except as otherwise provided under this Act, or the bye-laws, all questions

DECISION BY brought before any meeting under this Act shall be decided by majority of
MAJORITY OF the votes of the members present and in the case of any equality of votes
VOTES

the presiding authority of the meeting shall have a second or casting vote:

Provided that in the case of equality of votes at the election of the

President or Chairman, Vice-President or Vice Chairman, Directors,
delegate, the presiding authority shall not exercise his casting vote and the
result shall be decided by lot.

45. (1) Every cooperative society shall record in the minutes books, in the

MINUTES OF official language of its station or in English or in any other language
PROCEEDINGS prescribed in the bye-laws, proceedings of every general meeting, delegate
OF MEETINGS general body meeting and Board meeting and the names of the members

or delegates present thereat and shall be confirmed at the same or the next
meeting. The proceedings of all General Meetings and Special General
Meeting of every cooperative society complete in all respects as provided
in the Act and bye- laws shall be sent to the Registrar within fifteen days

from the date of completion of such meeting with due acknowledgement.
The Registrar shall give his approval on the resolutions within fifteen days
of receipt of the proceedings. If no approval is received within the

aforesaid period, the proceeding shall be deemed to have been approved.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 393

(2) The minutes so recorded shall be signed -

(a) in the case of a general meeting or delegate general body meeting,

by the person who presided the said meeting, or in the event of his
death, unwillingness or incapacity to sign the minutes within the time
required, by the Chief Executive of the cooperative society for the
purpose of submission of proceedings for approval and which shall
be confirmed in the following meeting ;

(b) in the case of a Board meeting by the person who presided the said

meeting or by the person who presides the following meeting,
wherein the minutes are confirmed

(3) In the matter of inclusion of any matter in the minutes of general meeting

or Board meeting, which in the opinion of the Chairman of the meeting, -

(a) is or could reasonably be regarded as defamatory of any

person;

(b) is irrelevant or immaterial to the proceedings or,
(c) is detrimental to the interest of the society, the Chairperson

shall exercise discretion in regards to inclusion or deletion in
the minutes on the grounds specified above.

VACANCIES ETC 46. No act or proceeding of the cooperative society, Board or of any office
NOT TO constituted or appointed under this Act shall be questioned on accounts of
INVALIDATE

any vacancy in the membership or any defect in the election or qualification

PROCEEDINGS

of the President _I Chairman, Vice-President / Vice Chairman, Director,_
delegate or representative or any defect or irregularity in such act or
proceeding not affecting the merit of the case.

PROCEEDING OF 47. Unless contrary is proved every meeting of the general body or the Board

MEETING TO BE shall be deemed to have been duly convened and held and, all members of
DEEMED TO BE the meeting shall be deemed to have been duly qualified when the minutes
GOOD AND VALID

of the meeting have been signed in accordance with the provisions of this

Act. However, the proceedings of the Annual General Meeting and all
general meetings shall require approval of the Registrar as provided under
section 45.

48 The State Government may, on application supported by a resolution of

POWER TO
V ' - ' DEPUTE GOVT the Board of a registered cooperative society and on such terms and
SERVENTTO conditions, depute Government, officials to the service of the
MANAGE THE cooperative society for the purpose of managing the affairs of the
AFFAIRS OF A
COOPERATIVE cooperative society and the official shall exercise such powers and
SOCIETY such duties as may be determined by the State Government and

acceptable by the borrowing cooperative society.

49. (1) (a) There shall be a Chief Executive, by whatever designation called

CHIEF

of every cooperative society to be appointed by the Board or by

EXECUTIVE, HIS
POWERS AND the State Government and shall be a full time employee of such
FUNCTIONSAND society.
STAFF (b) The Chief Executive shall be the ex-officio member of the Board.

(c) Where the State Government stands guarantee for repayment of

any loan secured from any financial institution the Chief Executive
may be appointed by the State Government and salary and

allowances payable to and other terms and conditions of service
including pension, gratuity and other benefits of the Chief Executive
shall be prescribed by the Government.


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394 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(d) Notwithstanding anything contained in any law in force or bye-laws

of the society, the Chief Executive appointed by the Government
shall have full administrative control over the employees of the
society in all matters including transfer, posting and disciplinary
action. However, in case of dismissal of employees approval of the
Board shall be necessary.

(2) The Chief Executive shall be under the general superintendence,

direction and control of the Board and exercise the following powers
and the functions, namely

(a) day-to-day management of the business of the co-operative

society ;

(b) operating the accounts of the co-operative society and be

responsible for making arrangements for safe custody of cash ;

(c) signing on the documents for and on behalf of the co-operative

society;

(d) making arrangements for the proper maintenance of various

books and records of the co-operative society and for the

correct preparation, timely submission of periodical

statements and returns, in accordance with the provisions of
this Act, the rules and the bye-laws ;

(e) convening meetings of the general body of the co- operative

society, the Board and the Executive Committee and other

committees or sub-committees constituted under provision of
the Act and bye-laws and maintaining proper records for such
meetings;

(f) making appointments to the posts in the co-operative society

in accordance with the bye-laws ;

(g) assisting the Board in the formulation of policies .objectives

and planning ;

(h) furnishing to the Board periodical information necessary for

appraising the operations and functions of the co-operative
society ;

(i) to sue or be sued on behalf of the cooperative society;

(j) present the draft annual report and financial statements for the

approval of the Board within thirty days of closure of the
cooperative year;

(k) performing such other duties, and exercising such other

powers, as may be specified in the bye-laws of the co-operative
society ;

(l) in case of dispute between the Chief Executive and the Board
in any matter, the decision of the Registrar shall be binding on
the both.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 395

(3) Subject to other laws regulating employer- employee relations all

employees of a cooperative society shall be appointed, regulated and
removed by and be accountable to authorities within the cooperative
society in accordance with the service conditions approved by the
Board Provided that in case of cooperative societies where State
Government holds more than fifty percent of Share Capital or
guarantees repayment of loan secured from any financial institution, any
upward revision of pay and allowances of staff, shall require prior
approval of the State Government. The controlling authority of all staff
shall be the Chief Executive of the society.

VOTES OF 50. (1) Irrespective of the shares he holds in the society and subject to
MEMBERS any temporary disqualification from voting which may be prescribed in

bye-laws and to the provisions* of section27 relating to voting by
representatives, a member of a registered society shall have one vote
only in the affairs of the society:

Provided that in the case of an equality of votes the President

or Chairman at any meeting shall have a second or casting vote
subject to the provision as laid down in section 44 :

Provided further that the bye-laws of a society may provide for

more than one vote in the case of an affiliated society

(2) Either the President or Chairman or the Chief Executive of a
registered society which is a member of another registered society, as
may be decided by Board shall represent the society in the affairs of
such other society as its representative :

Provided that the Annual General Assembly of the society

may nominate any other member other than President or Chairman or
Chief Executive to represent the Society.

(3) Voting by proxy shall not be allowed.

(4) Notwithstanding anything contained in this Act, a registered society

may by specific provisions made in its bye-laws, admit certain class
of members without any voting right.

51. The loan advanced by a registered society to a member thereof shall be

w LOAN TO BE utilised by him for the purpose for which it was advanced and for no other
UTILISED FOR
THE PURPOSE purpose. The society shall have power to recover the advance as
FOR WHICH prescribed if the member does not so utilise it.
ADVANCED

RESTRICTIONS 52. The transfer or change of the share or interest of a member in the capital of
ON TRANSFER a registered society shall be subject to such conditions as to maximum
OF SHARE OR holding as may be prescribed.
INTEREST

VALIDITY OF 53. Except otherwise provided in this Act no transfer or charge of his share or
TRANSFER OR interest by a member of a society with unlimited liability shall be valid
CHARGE OF unless-
SHARE OR (a) he has held such share or interest for not less than one year;
INTEREST

and

(b) the transferer or mortgager is either a member of such society

or a person where application for membership has been
accepted


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396 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

SHARE OR 54 Notwithstanding anything contained in any other law for the time being 5 of
INTEREST NOT

in force and subject to the provision of section56, the share or interest

LIABLE TO 1920
ATTACHMENT of a member in the capital of a registered society or in any fund under

section65 shall not be liable to attachment or sale under any decree or
order of a court in respect of any debt or liability incurred by such
member nor be subject to any claim by a receiver under the Provincial
Insolvency Act,1920.

NOMINATION OF 55. If the bye-laws of a registered society so permit, any member of the
TRANSFEREE society may, in accordance therewith, nominate a person in whose

favour the society shall dispose of the shares or interest of such

member on his death.

TRANSFER OF 56. When a member of a registered society dies, his shares and interest in
INTEREST ON

the society shall, subject to the provisions of this Act, be transferred -

DEATH OF
MEMBER (a) to the person, if any nominated in accordance with the A

provision of section55 ; or

(b) if there is no such nominee or if the nominee is not available, or

is difficult to be ascertained by the managing body, or if for any
other cause such transfer cannot be made without

unreasonable delay, the transfer of interest on death of a
member shall be made to the person as may appear to the
managing body to be the legal heir or legal representative of

the deceased member, provided that ninety days have elapsed
from the date of the member’s death and no new claim shall be
entertained after the said period of ninety days.

DISPOSAL OF 57 When a member of a registered society is expelled or withdraws or
SHARES OR otherwise ceases to be a member under this Act, rules or bye-laws ,his
INTEREST OF share or interest shall be transferred to his nominee or to another
CEASED eligible person, and the value thereon, determined in accordance with Central
MEMBERS

the rules, shall be paid to such ceased member if his share or interest Act IV
is not forfeited under the provisions of this Act, rules or bye-laws or if he of 1 ^2
is insane, to any person appointed to manage his properties under the
Indian Lunacy Act,1912 , provided that if there is no eligible transferee Central

and if the bye-laws of the society so provide, the value of his share or

Act IV

interest determined in accordance with the bye-laws shall be paid to

of 1912

him or, if he is insane, to any person appointed to manage his
properties under the Indian Lunacy Act, 1912.

LIABILITY OF 58. The members of a registered society shall, in the winding up of the
MEMBERS ON society, jointly and severally liable to contribute towards any
WINDING UP OF deficiency in the assets of the society -
SOCIETY

(a) in the case of a society with unlimited liability, without limit; and,

(b) in the case of a society with limited liability, subject to such

                      - limitation of amount as may be provided in the bye-laws.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 397

59.(1) Notwithstanding anything in any other law for the time being

RESTRICTION ON
TRANSFER OF in force, a member of a registered society the object of which is to
POSSESSION OF develop cooperative of collective farming, shall not be entitled to
LAND HELD transfer his possession or interest in any land held by him under the
UNDERA society except to the society or with the previous approval of the
SOCIETY

managing body and in accordance with its bye-laws, to a member
thereof or to a person who will be admitted as a member of the society.

(2) On the death of such a member his possession of an interest in any

such land held by him under the society shall come to his nominees in
accordance with the provisions of section56 or to the first eligible heir
according to seniority in age willing to become a member of the
society.

(3) If no nominee or heir becomes a member the possession of an interest

in such land of the deceased shall vest in the society which shall pay
to the nominee or the heir a sum equivalent to the value of the share
and interest of the deceased member and any other sum due from the
society as determined in accordance with this Act or rules framed
thereunder, after deducting all dues of the deceased member owing to
the society.

(4) If there is no person qualified to succeed to the share or interest of the

deceased member the society shall pay to his heir, executor or the
legal representative, as the case may be, a sum equivalent to the
value of the share and interest of the deceased member as determined
in accordance with the rules, after deducting the dues of the deceased
to the society.

(5) When in any other case a member ceases to be a member of such a

society under this Act, rules or bye-laws his possession of and interest
in any such land held by him under the society shall come to the
society. If the bye-laws allow and if the share and interest of the

members is not forfeited under this Act or rules framed thereunder, the
society shall pay to the ceased member a sum equivalent to the value
of the share and interest of such member and any other sum due to
him from the society after deducting his debts to the society, if any.

(6) No land held under a registered society specified in sub-section (1) by a

member thereof, or vested under sub-section (2) in the heir or nominee
of such member shall be attachable in any suit or proceeding for the
recovery of any debt other than a debt due to the society or to a
member thereof.

(7) No land shall vest in such a society by reason of the provisions of

this section unless it is owned by the society or has been leased to the
society and, if the society holds the land by lease or contract the land
shall vest in the society only during the pendency of lease or contract.

60. (1) Where a mortgage is executed in favour of a registered society for

RIGHT OF A payment of prior debts or part thereof, the mortgagor secured on the IV of
REGISTERED

mortgaged property, the registered society may notwithstanding under 1882

SOCIETY TO PAY
PRIOR DEBTS OF the provisions of section83 and 84 of the Transfer of Property Act, 1882
A MORTGAGOR by notice in writing and served by registered post with acknowledgement

due, require any person to whom any such debt is due to receive
payment of such debt or part thereof from the society at its registered
office within such period as may be specified in the notice.


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(2) The person on whom such notice is served shall be bound to receive

payment of the amount offered by the society, but where there is
disagreement or dispute between the mortgagor and such person as
regards to the amount of the debt or where the society tenders less than
the agreed amount of debt the receipt of the sum offered by the society
shall not debar such person from enforcing his right to recover the
balance amount claimed by him.

(3) If any such person refused to receive such notice or such payment,

such debt or part thereof, as the case may be, shall cease to carry                  -

interest from the expiry of the period specified in the notice and the

property mortgaged under sub-section (1) shall be deemed to have
been freed from the encumbrance of such prior mortgage.

(4) No society shall advance any loan on any mortgage without taking a

declaration from the prospective mortgagor as to the names of prior
mortgagees of the property in question, if any.

RESTRICTION ON 61. (1) Where land is mortgaged to a registered society, the mortgagor shall
MORTGAGED not be entitled without the approval of the society to transfer or
PROPERTY

mortgage as equity of redemtion or to create a charge upon or lease
out such property during the pendency of the mortgage.

(2) If the mortgaged property is at any time is wholly or partially
destroyed or the security rendered becomes insufficient due to fall
in value or for any other reason and the mortgagor having been
given a reasonable opportunity by the society of providing for
further security sufficient to cover the loan or for repaying the loan
with interest or such portion of the loan as may be determined by
the supervisory, managing or controlling body and the mortgagor
having failed to provide such security or repay such portion of the
loan, the whole of the loan or such uncovered portion shall be
deemed to fall due at once and recoverable through a cooperative
demand certificate.

(3) Notwithstanding anything contained in the Transfer of Property Act, Cen&d
1882, the mortgaged property, in case of default of payment of Act Iv

mortgage money or any part thereof, may be sold by the society as o [f 1882“ ]

prescribed by rules in addition to any other remedy available,

without the intervention of court if expressly conferred by the
mortgage deed:

Provided that the society serves a notice in writing by

registered post demanding payment of the mortgage money with
interest, or part thereof upon the mortgagor or, any person having
any interest in or charge upon the mortgaged property or the equity
of redemption who has previously notified the society of such
interest or charge in writing or any surety, and if default has been
made in payment of the loan or part thereof for three months after
such service of notice:

Provided further that any party aggrieved by an action

taken by a registered society under this section may prefer an
appeal to the Registrar within thirty days from the date of the sale
and. his decision shall be final.


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BAR TO CERTAIN 62. All payment and transfer made by a registered society under this
CLAIM Chapter shall be valid and effectual against any demand made upon the

society by any other person

###### CHAPTER - V

**FINANCE**

63. (1) A cooperative society may raise funds in the shape of equity

MOWLISATION OF capital, deposit and loans from its members to such extent and
FUNDS under such conditions as may be specified in the bye-laws.

(2) A cooperative society may borrow funds from non- member/

individuals and institutions including Government to such extent and
under such conditions as may be specified in the bye-laws.

64. (1) The funds mobilized by a cooperative society shall be deployed

DEPLOYMENT OF primarily for the furtherance of its objectives.
FUNDSAND
PROFITS (2) No part of the funds of a cooperative society other than the net profits

shall be paid by way of bonus or dividend or otherwise distributed
among its members.

(3) A cooperative society may out of its net profits in any year, pay on the

paid up share capital of members a dividend at a rate fixed by the
general body in the annual general meeting.

(4) Such of its funds as are not needed for use in its business, a

cooperative society may invest or deposit, outside its business in any

non speculative manner.

65. (1) The surplus, if any .arising out of the business of a cooperative society in

DISPOSAL OF a financial year shall be used for the purpose as mentioned under
SURPLUS

clause (a) (d)( h)and ( j ) and in one or more of the following purpose as-

(a) towards a deficit cover fund;

(b) to be distributed as surplus refund among its members;

(c) to develop its business;

(d) towards reserves funds constituted in accordance with the
bye-laws;

(e) to provide common services to its members;

(f) to provide rewards or incentives to staff;

(g) towards payment of bonus under the payment of Bonus 21 of
Act, 1965 to the employees; 1965

(h) towards writing off bad debts and losses not adjusted;

(i) towards such purposes as may be specified in the bye-laws

; and

(j) to cooperative development fund.

(2) Surplus arising out of the business of a cooperative society shall be fully
disposed of at the annual general meeting in which the audited annual
financial statement of accounts for the year in which the surplus arose is
presented for the consideration of the general body.


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400 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

MANAGEMENT 66. (1) The deficit, if any, arising out of the operation of the business of a
OF DEFICIT

cooperative society during any given financial year, shall be fully settled
by debiting a part or whole of the deficit to the deficit cover fund, if any,
or as charge among its members:

Provided that where such amounts are recovered the

general body may resolve to credit a part or whole amount to the deficit
cover fund or to account of each member in proportion to the deficit
charge levied on him.

(2) No member shall be permitted to withdraw from the membership of a
cooperative society without paying his share towards clearing the
deficit, if any.

OPERATION OF 67. (1) A cooperative society may create reserves and such other funds as in
SPECIAL FUNDS the interest of members or the cooperative society and which are

specified in the bye-laws: x

Provided that where a contributory provident fund is created for

the benefit of employees such fund -

(a) shall not be used in the business of the cooperative society.

(b) shall not form part of the assets of the cooperative society.

(c) shall not be liable to attachment or be subject to any other
process of any court or other authority ; and

(d) shall be administered in such manner as may be provided in
the bye-laws.

(2) In any financial year if the fund is not applied in part or whole for the

purpose for which it was created, the cooperative society shall

credit to the account of such fund an annual interest on the amount of

balance of such fund at a rate not less than the rate paid by scheduled
banks on long term fixed deposits, debiting such interest as operational
expenditure.

68. Every registered society shall have a registered address to which all

ADDRESS OF
SOCIETY notices and communications may be sent and shall send notice in --\

writing of every change thereof within thirty days of such change to the
Registrar and to the affiliating society, if any.

MAINTENANCE 69. (1) Every registered society shall keep the following documents and allow
AND INSPECTION inspection free of charge by any member of the society and such other
OF DOCUMENTS persons as may be prescribed at all reasonable times at the office of the

society :

(a) a copy of this A ct;
(b) a copy of the rules framed under this A ct;
(c) a copy of the bye-laws of society ;
(d) a copy of all rules framed under the bye-laws of the society;
(e) annual Balance Sheet authenticated by the audit Officer;
(f) Such other books, forms, register or other documents as

may be prescribed by the Registrar.

(2) A society shall deliver to every member on payment of a sum

prescribed by the society's bye-laws or rules, copies of documents
certified to be true copies.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 401

RESTRICTIONS 70. A registered society may receive deposits and may borrow from its
ON BORROWING members and from persons who are not members to such extent and on

such conditions as may be provided in the Act and bye-laws :

Provided that no cooperative society shall, by accepting deposits,

or loans or in any other way, incur liabilities exceeding 25 times the sum

of the paid up share capital and the accumulated reserve fund during
any financial year:

Provided further that while calculating the total sum of

subscribed share capital and accumulated reserve fund the accumulated
losses shall be deducted.

71. Notwithstanding anything contained in any other law for the time being

POWER OF
GOVERNMENT in force, the State Government may, on the request of the cooperative
TO GIVE society, supported by a resolution passed by the General Assembly of the
FINANCIAL cooperative society, grant loans ,to take shares or guarantee the principal

ASSISTANCE or the interest or both in respect of debentures issued by any cooperative

society or give financial assistance in any other form to any registered
society which puts forwards a satisfactory schemes for the utilisation of the
funds so raised. The State Government may recover from any society out
of its net profit in any year all or any part of such financial assistance.

RESTRICTION ON 72 (1) A registered society shall not give loans -
LOANS (a) to any person other than a member except with the general

or special sanction of the Registrar, provided that a loan may
be given to a depositor of the society out of his deposit; or

(b) to a member in excess of his normal credit limit fixed for that
member by the society in accordance with the provision of
the bye-laws, provided that in assessing normal credit limit
the managing body shall take a full statement as to the
member's means of earning.,

(c) to a member on the security of movable property or future
movable property, unless the movable property is charged,
hypothecated or pledged with the society;

(d) on personal security without sureties, unless the borrowing
member has unencumbered immovable property or

attachable funded assets sufficient to cover the loan and a
full statement of such securities is submitted by the borrower
and the truth of the statement is ascertained by the
managing body ;

(e) on personal security with sureties unless, the borrowing
member and his surety together have unencumbered

immovable property or attachable funded assets sufficient to
cover the loan and a full statement of such securities is
submitted by the borrower and the sureties separately and
the truth of the statements is ascertained by the managing
body;

(f) to a member on personal security, with or without sureties,
unless the loan is for a short period not exceeding the time
required to reap the benefit of the loan and in no case
exceeding three years.


-----

(2) (a) Notwithstanding the provisions of sub-section (1), a loan may
be given on personal security provided that the managing

body of the society is satisfied as to the borrowers capability
and has taken from him a scheme for the utilisation of the

loan and has ascertained the truth of the statements
contained in the scheme and the bonafides of the borrowing
member;

(b) the resolution of the managing body granting a loan under this
section shall contain the names of all assenting members, and
all the assenting members and secretary shall be held jointly
and severally responsible for the issue of the loan and its
recovery;

(c) Notwithstanding the provisions of clauses (b) (c) (d) (e) and

(f) of sub-section (1) and clauses (a) and (b) of this sub­
section a registered society may issue a loan on mortgage of
valuable security.

(d) no person shall be accepted as a surety for any borrower unless

he is also a member of the same registered society.

(3) A registered society, the primary object of which is not the issue of

loans, shall open a separate accounting or finance or banking branch
in accordance with its bye-laws and frame rules for the conduct of
business in such branch before it issues any loans and such rules
shall first be approved by the Registrar.

73.(1) Every office bearer of a registered society shall produce documents

OFFICE BEARER and books of account and cash balance in his custody and appear before
OF SOCIETY IS

and furnish such information in regard to the transactions or working of the

REQUIRED TO
FURNISH society as may be required of him by the Registrar or persons authorised
INFORMATION by the Registrar in this behalf and auditing officer, arbitrator, liquidator or

AND PRODUCE any persons conducting inspection or an inquiry under the provisions of this
DOCUMENTS

Act and the rules made thereunder.

(2) (a) At any sale of property, movable or immovable, held under

this Act or rules framed thereunder, no office bearer of the

registered society concerned or any person having any duty to
perform in connection with such sale, shall either directly or
indirectly bid for, acquire or attempt to acquire any interest in such
property.

(b) any office bearer of a society or a liquidator may, on behalf of the

society bid and purchase at a sale of mortgaged property.

**CHAPTER - VI**

**ACCOUNTABILITY AND PRIVILEGES OF REGISTERED SOCIETY.**

PRIOR CLAIMS 74. (1) Notwithstanding anything contained in sections 60 and 61 of ,
OF SOCIETIES the Code of Civil Procedure, 1908 any debt or outstanding demand e 1 1 ’ ll

due to a registered society by any member, surety .past member or A e t c

the estate of any deceased member shall be a first charge -


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 403

(a) if such debt or the demand is due in respect of the supply, or
any loan to provide the means of such supply, of seed,
manure, labour, fodder for cattle or any other thing incidental
to the conduct of agricultural operations upon the crops or
agricultural produce of such member, past member, or
belonging to the estate of such deceased member, at any
time within two years from the date of such supply or loan or
from the days on which the last installment of such supply or
loan became repayable ;

(b) if such debt or demand is due in respect of the supply of or
any loan for the purchase of cattle, agricultural implements
or warehouses for the storage of agricultural produce in the
manner and to the extent aforesaid upon the crops or

agricultural produce of such member, past member or
belonging to the estate of such deceased member and also
upon the cattle, agricultural implements or warehouse thus
supplied or purchased wholly or in part from any such loan;

(c) if such debt or demand is due in respect of the supply of
loan for the purchase of raw materials, industrial

implements, machinery, workshop, warehouses or business
premises upon the raw materials or other things supplied or
purchased by such member, past member or the deceased
member wholly or in part from any such loan and also upon
any articles manufactured from raw materials or with
implements or machinery so supplied or purchased wholly
or in part from any such loan ;

(d) if such debt or demand is due in respect of any loan for the
purchase, improvement or redemption of land or for the
purchase or construction of any house, building or any
portion thereof, upon the land purchased, improved or
redeemed or the house or building so purchased or
constructed by such member, past member or the deceased
member from any such loan ;

(2) Notwithstanding anything contained in this Act or any other law for

the time being in force ,-

(a) a member who makes an application for a loan to a
cooperative society of which the majority of the
members are agriculturists shall, if he owns any land
or has any interest in any land as a tenant, make in
such forms as may be prescribed, a declaration that
he thereby creates a charge upon such land or such
interest, or such portion thereof, as may be specified
in the declaration for securing the repayment of the
loan which the society may make to the members on

the application and of future loans ,if any, that may

be made to him, from time to time by the society
together with interest on such loan or loans ;


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404 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4,2012

(b) a declaration made under clause (a) may be varied
or cancelled at any time by the members making it,
with the consent of the society in whose favour it is

made;

(c) any land or interest in land in respect of which a
declaration has been made under clause (a) or any
part of such land or interest, shall not be sold or
otherwise transferred by the member making the
declaration until the entire amount of the loan or
loans taken by the member from the society together
with interest thereon is paid to the society :

Provided that nothing in this

clause shall apply to any such part of such land or
interest as may have been released from the charge
created under this section under the proviso to
clause (d );

(d) subject to any claim of the State Government in
respect of land revenue or any sum recoverable as
land revenue or as public demand, there shall be a
first charge in favour of the society on the land or
interest in land specified in the declaration made
under clause (a) for and to the extent of the dues
recoverable from the member making the declaration
on account of the loan or loans together with any
interest thereon made to him by the society :

Provided that if a part of such dues is paid

by the member, the society may ,on the application
of the member and with the approval of the financing
bank to which it may be indebted, release from the
charge such part of the land or interest in the land
specified in the declaration made under clause (a) as
the society may, having due regard to the security of

A .

the outstanding amount of the loan or loans made to \ -
the member deem proper;

(e) every record of rights prepared and maintained Regula­
under the Assam Land and Revenue Regulation, tion I of
1886 or any other law for the time being in force shall

###### 1886

also include the particulars of every charge on any
land or any interest thereon created under clause
(a).

CHARGE AND 75. A registered society shall have a charge upon the share or interest in
SET OFF IN the capital and on the deposits of a member or past member or
RESPECT OF

deceased member and upon any dividend, bonus or surplus payment

SHARES OR
INTEREST OF to a member or past member or the estate of a deceased member in
MEMBERS respect of any debt due from such member or past member of estate

of such deceased member to the society, and may set off any sum
credited or payable to a member or past member or estate of a
deceased member in or towards payment of any such debt.


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THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 405

DEDUCTION OF 76. If a member of a registered society, who is an employee of the
DUES FROM

Government or any local authority, takes a loan from a society and

SALARY OF
MEMBERS contracts to repay it by installments, and authorises the society to

recover such installments by deduction from his salary, the person who
disburses any amount payable to such member as salary or
remuneration in respect of such employment shall on demand from the
society, deduct the amount of such installment from the amount

disbursed to such members as salary and shall forthwith remit to the
society the amount so deducted.

EXEMPTION 77. Nothing in clauses(b) and (c) of sub-section (1) of section 17 of the Central
FROM Indian Registration Act, 1908 shall apply to - Act XVI
COMPULSORY
REGISTRATION of 1908
AND (1) any instrument relating to share in a registered society,

PERSONAL notwithstanding that assets of such society consists in whole or in part
ATTENDANCE of immovable property ; or

REGISTRATION

OF (2) any debenture issued by any such society and not creating, declaring,
INSTRUMENTS assigning .limiting or extinguishing any right, title or interest to or in

immovable property, except ,in so far as it entitles the holder to 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 holder of such debentures;

(3) any endorsement upon or transfer of any debenture issued by any such Central

society;

Act XVJ
of 1908

(4) notwithstanding anything contained in the Indian Registration Act, 1908,

it shall not be necessary for any office bearer of a registered society or
a liquidator of a society to appear in person or by agent at any
registration office in any proceeding connected with the registration of
any instrument executed by him in his official capacity or to sign as
provided in section58 of that Act.

EXEMPTION 78. (1) Notwithstanding anything contained in the Indian Registration Act, 1908, Central

,r ROM

it shall not be necessary to register mortgages executed in favour of the Act XVI

REGISTRATION
OF MORTGAGE Cooperative Land Development Bank or a primary society of which the of 1908
DEEDS majority of the members are agriculturists, for the purpose of securing
EXECUTED IN the repayment of a loan provided that ;the Land Development Bank or

FAVOUR OF the primary society concerned send within such time and in such

COOPERATIVE manner as may be prescribed, a copy of the instrument whereby
LAND
DEVELOPMENT immovable property is mortgaged for the purpose of securing
BANK OR repayment of the loan to the registering officer with the local limits of
PRIMARY whose jurisdiction the whole or any part of the property mortgaged is
SOCIETY situated.

(2) On receipt of the copy of the instrument under the preceding sub-section, Central

the Registering Authority shall file a copy or copies as the case may be in Act XVI

Book No.1 prescribed under section-51 of the Indian Registration of 1908

Act, 1908.


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406 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(3) The mortgages executed in favour of and all other assets transferred to a

cooperative Land Development Bank or a primary society of which the
majority of members are agriculturists, by the members thereof, as
security for repayment of loan, before or after commencement of this Act
shall, with effect from the date of such execution or transfer be deemed to

have been executed or transferred by such society in favour of or to the
financing bank,

POWER TO 79. (1) The State Government may , by general or special order in the case of a
GRANT' registered society or class of registered societies, remit any tax, cess or fee
REMISSION OF

payable under any law for the time being in force or the rules thereunder in

CERTAIN DUTIES,
FEES ETC respect of which they are competent to exempt remission of such tax or

fee.

(2) The State Government may, in respect of any registered society or class of

registered societies by notification in the Official Gazette, grant remission
of-

(a) the stamp duty other than stamp duties falling within item 91 or

item 96 in List -I of Seventh Schedule to the Constitution of
India in respect of any instrument executed by or on behalf of a
member thereof, and relating to the business of such society or
any class of such instruments, cooperative demand certificates
or decisions, awards or orders of Registrar or arbitrators under
this Act, in cases where, but for such remission, the registered
society, Officer or member thereof, as the case may be, would
be liable to pay the stamp duty chargeable under any law for

the time being in force, in respect of such instrument, and

(b) any fee payable by a registered society under any law for the

time being in force for the registration of documents or of court
for the time being in force.

ACCOUNTS, 80. (1) Every cooperative society shall keep at its head office the following
RECORDS AND accounts, records and documents, namely

DOCUMENTS TO

(a) a copy of this Act with amendments made therein from time to

BE MAINTAINED

time ;

(b) copies of other laws and regulations to which the cooperative

society is a subject;

(c) a copy of its bye-laws, with amendments made therein from

time to time ;

(d) a copy of the Regulations framed under clause(7) of section-38

and amendments made therein from time to time ;

(e) the minutes books ;
(f) accounts of all sums of money received and expended by the
cooperative society and their respective purposes ;

(g) account of all purchases and sales of goods by the cooperative

society ;

(h) account of the assets and liabilities of the cooperative society ;
(i) a list of members, their fulfillment of responsibilities over the
previous financial year, their eligibility to exercise their rights for
the current twelve month period updated within sixty days of
closure of the cooperative year; and


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 407

(j) all such other accounts, records and documents as may be

f required by this Act or other laws and regulations or byelaws of
the cooperative society :

Provided that where a cooperative society has branch

offices, summarised statements of accounts relating to such
branch office, shall be available at the head office for each
quarter of financial year within fifteen days of the end of that
quarter.

(2) The books of account and records shall be open to inspection by any

Director during office hours of the cooperative society.

(3) The copies of this Act, bye-laws, regulations, minutes book of the

general body, voters list and such accounts and records of transactions
that relates to a member shall be made available to any member during
office hours of the cooperative society for inspection .

(4) The books of accounts relating to a period of at least ten years before

the current financial year together with supporting records and
vouchers shall be preserved unless otherwise require for a longer
period.

**CHAPTER VII**

**AUDIT**

-AUDIT 81. (1) The Registrar shall audit or cause to be audited by auditors of the

department or by some person authorised by him, by a general or
special order in writing in this behalf, the accounts prepared by every
registered society and society under liquidation once at least in every
year:

Provided that State Government, shall also maintain a panel

of auditors consisting of Chartered Accountants and any cooperative

society shall have the option to get the accounts audited by an auditor

out of this panel, subject to the condition that accounts of such
cooperative society shall have to be audited by departmental auditors

atleast once in every three years.

(2) The Registrar or the person authorised by him in this behalf shall at all
reasonable times have free access to the books, accounts, documents,
securities, cash and other properties belonging to or in the custody of
the society and may summon any person in possession or responsible

Central

for custody of any such books, accounts, documents, securities, cash or

Act V of

other properties to produce the same and furnish such information in

1908

regard to the transactions and working of the society at any convenient
place or at the head quarters of the society or any branch thereof by.the
same means and so far as may be in the same manner as provided in
the Code of Civil Procedure, 1908 .

(3) In respect of every audit of the accounts a registered society shall pay such

audit fee as may be prescribed by the Registrar of Cooperative Societies
and such fee shall be deemed to be outstanding dues from the society.


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###### 408 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

POWER OF THE 82. If at the time of the audit the accounts of a registered society are not
REGISTRAR TO complete the Registrar or with his sanction the audit officer may cause the
HAVE THE

accounts to be written up at the expense of the society.

ACCOUNTS
WRITTEN UP Such expenses shall be realised by the auditor from the

society concerned along with the audit fee.

83. (1) The audit shall include among others -

NATURE OF
AUDIT

(a) a verification of the cash balance and securities ;
(b) a verification of the balance at the credit of the depositors and

creditors and the amounts due from the debtors of the society ;

(c) an examination of overdue debts, if any;
(d) the valuation of the assets including stock verifications, and

liabilities of the society;

(e) an examination of the statement of accounts and balance

sheets to be prepared by the managing body of the society in
such forms as may be prescribed ;

(f) a certification of the realised profits ; and
(g) any other relevant matter.

(2) The auditor's report among others shall include

(a) statement whether the auditor has obtained all the information and

explanations which to the best of his knowledge and belief were
necessary for the purpose of the audit;

(b) statement whether the balance sheet of cooperative society and

income and expenditure account dealt with by the report are in
agreement with the books of accounts ;

(c) statement indicating the basis on which each asset and liability was

valued and mentioned specifically any change in the manner in

which such valuation was done in the financial year under

examination and its effect on surplus or deficit;

(d) statement indicating the amount of surplus earned or deficit

incurred from provision of services to non-members as distinct from
surplus earned or deficit incurred because of service to members

or in normal course of business ;

(e) statement indicating every deviation in actual expenses and income

from the estimated expenses and income in the approved budget;

(f) statement whether or not any of the Directors had at any time

during the financial year under review, become ineligible under this
Act to continue in office as a Director, and

(g) statement whether the decisions on disposal of surplus or

assessment of deficit of the general body at its previous Annual
General Meeting were implemented correctly and completely or
not.

84. The audit officer shall within a fortnight from the date of completion of

AUDIT REPORT audit, submit to the registered society and to the Registrar, together with

the statement of accounts audited, audit report including a statement of -


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THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 409

(a) every transaction which appears to him to be contrary to law or to

the rules or bye-laws ;

(b) every sum which ought to have been brought but has not been

brought into account;

(c) the amount of deficiency or loss which appears to have resulted

from any negligence or misconduct that requires further

investigation ;

(d) any money or property belonging to the society which appears to

have been misappropriated or fraudulently retained by any person ;

(e) any of the assets which appears to him to be bad or doubtful;

(f) any irregularity in maintaining the account; and

(g) any other relevant matter under section 83.

RECTIFICATION 85. (1) A registered society shall be afforded by the Registrar an opportunity of
OF DEFECT explaining any defects, or irregularities pointed out and objected to by the

audit officer and thereafter, the society shall within such time and in such
manner as the Registrar may direct, remedy such defects and
irregularities and report to the Registrar, the action taken by it thereon.

(2) The Boards of all societies shall take follow up action on the

audit report and shall submit a report to the Registrar within 3 months of
acceptance of report by the Annual General Meeting of the society. The
non compliance of above shall disqualify the Board in office after expiry

of three months period.

86. If the chief auditor on appeal or on inquiry and detail checking of accounts

RE-AUDIT/

satisfies himself that the audited accounts need recasting or re-audit he

RECASTING OF
AUDIT REPORT shall give order for such recasting or re-audit. Provided that no such

recasting or re-audit shall be taken up after 3 years from the date of
acceptance of Balance Sheet by the General Assembly in their Annual
General Meeting. If recasting or re-audit is required to be undertaken due
to non compliance of the procedure of audit the cost of recasting or re-audit
shall be recovered from the auditor auditing the accounts in addition to
facing disciplinary action under the Assam Government Services and
Conduct Rules or action under appropriate law as the case may be. If the
same has to be undertaken due to non furnishing of adequate records,
reports etc, the cost of such recasting or re-audit shall be recovered from
the respective office bearer or officer of the society . He will also be liable

to disciplinary action under appropriate law, rules applicable for the

purpose. The cost of re-audit or recasting of audit report shall be
determined by the Registrar.

INQUIRY 87. (1)The Registrar shall on the application of a federal or a secondary

cooperative society to which the cooperative society concerned is
affiliated, or of a creditor to whom the cooperative is indebted, or of not
less than one third of the Directors, or of not less than one-tenth of the
members, hold an inquiry or cause an inquiry into any specific subject
relating to any violation of any of the provisions of this Act or bye-laws.


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410 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(2) The Registrar shall order an inquiry only after the receipt of a fee as

determinec by him from the applicant or the applicants. The fee should

be sufficient to meet the costs of the inquiry to be conducted.

(3) The inquiry shall be completed within a period of thirty days from the date

of order of the inquiry :

Provided that where the inquiry cannot be completed within a

period of thirty days the reasons thereof shall be recorded in writing.

(4) The Registrar shall --

(a) within a period of thirty days from the date of the completion of the
inquiry, communicate the report of the inquiry -

(i) to the cooperative society concerned ; and
(ii) to the applicant secondary cooperative society ; or
(iii) to the applicant creditor; or

(iv) to the person designated by the applicant Directors ; or
(v) to the person designated by the applicant members, as the

case may be ;                        -

(b) within a period of fifteen days from the date of expiry of the period

mentioned in sub-section (3) communicate the reasons for the non­
completion of the inquiry within the specified period along with the
period which is likely to be taken for completion of inquiry, to the
parties concerned under sub section 4(a).

(5) The cooperative society concerned shall, on receipt of the report, place it

before the next general meeting or in a special general meeting to take
such action thereon as the general body may think fit .which may include
removal of all or any directors and election of new directors or any other

action on any employees as required.

(6) A copy of report shall be supplied to any other member of the cooperative

INSPECTION OF society, on payment of such fee as determined by the Registrar
SOCIETY

88. (1) Every registered society shall be liable to inspection at any time by the

Registrar or any person authorised by him by general or special order and
by any affiliating society if so provided in its bye-laws.

(2) An inspection of a registered society snail also be made by the Registrar

or any person authorised by him in this behalf by an order in writing at any
time on the application of a creditor of a registered society :

Provided that no inspection shall be made under sub-section unless -

(I) the creditor deposits with the Registrar such sum as security
for the cost of the proposed inspection as the Registrar may
require ; and

(II) the creditor satisfies the Registrar that the alleged debt is a
sum then due and that he has demanded payment thereof
and has not received satisfactory response within a

reasonable tim e:

Provided further that no inspection shall be conducted under this

sub-section without giving the society an opportunity of being heard.

<fe The result of an inspection under this section shall be

communicated to the society and if held at the instance of a creditor, to the
creditor.


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THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 411

(3) (a) A financing bank shall have the right to inspect the books of any

cooperative society which has either applied to the bank for financial
assistance or is indebted to the bank on account of financial
assistance granted earlier;

(b) the inspection may be carried out by an officer or any other member

of the paid staff of financing bank.

(c) the officer or any other member of the paid staff of the financing bank

undertaking such inspection, shall at all reasonable time have access
to the books of account, documents, securities, cash and other

properties belonging to or in the custody of the cooperative society
for inspection by him. Such information, statements and returns as
may be required by him to assess the financial conditions of the
society and the safety of the financial assistance to be made to the
society or already made to it.

(4) The cooperative society concerned shall on receipt of the report, place it

before the next . Annual General Meeting or Special Annual General
Meeting with action taken report and to take such action thereon as the

General body may think fit which may include removal of all or any
directors or any other action on employee as required.

(5) A copy of the report shall be supplied to any member on requisition and on

payment of fees to be determined by the Registrar.

COST OF 89. (1) When an inquiry is held under section87 or an inspection is made under
INQUIRY AND section-88, the Registrar may , after giving the parties an opportunity of
INSPECTION

being heard, apportion the cost or such part of the cost as he may deem fit
, between the society , the members thereof or the affiliating society or the

creditor or creditors applying for such inspection or inquiry, as the case
may be, and the officers, former officers, members and past members of
the society.
## r-

(2) No expenditure from the fund of registered society shall be incurred for the

purpose of defraying any cost in support of any appeal preferred by any
person other than the society itself against an order under sub-section(l).

(3) Any person authorised by the Registrar for the purpose of inquiry and

inspection under section87 and 88 shall have ail the powers of the
Registrar when acting under these sections.

(4) Any sum awarded by way of cost under this section shall be recoverable as

the fees for inquiry or inspection in the manner of realisation of audit fees
or through a Cooperative Demand Certificate.

90. (1) No person.other than a cooperative society registered under this Act shall,

PROHIBITION OF
USE OF WORD without the permission of the State Government, function, trade or carry on
"COOPERATIVE" business under any name or title of which the word" cooperative" or its
AND PENALTY equivalent in any Indian language forms part.


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###### 412 THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012

(2) Every person who is a member of a cooperative society formed in

contravention of section4 and section6 of this Act and every person
contravening the provisions of sub-section (1) shall be punishable with a
fine which may extend to five hundred rupees and in the case of a
continuing offence with further fine of two hundred rupees for each month
on which the offence is continued after conviction thereof.

OFFENCE 91. (1) A person who makes or assists in making a report, return, notice or other

documents required under this Act to be published or sent to the Registrar
or to any other person that --

(a) contains an untrue statement of a material; or
(b) omits to state a material fact required in the report or makes a

statement contained in the report misleading in the light of the
circumstances in which it was made;

shall be guilty of an offence and shall on summary conviction, be

punishable -

_''*r '_

(a) in case of an individual, with imprisonment for a term which
may extend to ninety days or with fine which may extend to
rupees ten thousand or both;

(b) in the case of juristic person other than an individual, with a fine
which may extend to rupees ten thousand.

(2) (a) If the person committing an offence under sub-section(l) is a

cooperative society which is a body corporate, the

cooperative society as well as every person in charge of and
responsible to the cooperative society for the conduct of
its business at the time of commission of the offence shall be
deemed to be guilty of the offence and shall be liable to be
proceeded against and punished accordingly.

(b) Notwithstanding anything contained in clause (a) where an

offence has been committed by a cooperative society, and it
is proved that the offence has been committed with the consent
of and connivance of or that the commission of the offence is
attributable to any neglect on the part of any Director,
Manager, Secretary or other officer of the cooperative society,

such Director, Manager, Secretary or other officer shall also be
deemed to be guilty of that offence and shall be punishable
with imprisonment for a term which may extend to ninety days
or with fine of one thousand rupees or with both.

(3) No person shall be guilty of an offence under sub-section (1) or sub­

section (2) where the untrue statement or omission --

(a) was not known to him and
(b) after exercising reasonable diligence fact could not have

been known to him.

(4) Every person who --

(a) without reasonable cause, contravenes a provision of this

Act for which no penalty is otherwise provided, or


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THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 413

(b) fails to file or furnish return or to give any notice or to send

any document required by the provisions of this Act --

shall be guilty of an offence and shall, on summary conviction, be

punishable with a fine which may extend to two thousand rupees.

(5) Where a person is convicted of an offence under this Act the Court may,
in addition to any punishment imposed, order the person to comply with
the provisions of this Act for the contravention of which he has been
convicted.

(6) No prosecution for an offence under this Act shall be commenced after

five years from the date when the subject matter of the complaint arose.

(7) No civil remedy for an act or omission under this Act is suspended or

affected by reason that the act or omission is an offence under this Act.

**CHAPTER VIII**

**SETTLEMENT OF DISPUTES**

REFERENCE OF 92. Any dispute touching the business of a registered society, other than a
DISPUTE

dispute regarding disciplinary action taken by a society against an
employee of the society, or of the liquidator of a society shall be referred
to the Registrar for decision if the parties thereto are among the
following

(a) the society, its past or present controlling or managing body any
past or present officer, agent or employee or the liquidator of the
society, or

(b) member, past member or persons claiming through a member,
past member or deceased member of the society, or

(c) a surety of a member, a past member or deceased member of a
society, or

(d) any other registered society or the liquidator of the society,

(e) a registered society and a financing bank.

SETTLEMENT OF 93. (1) The Registrar shall on receipt of a reference under section92-
DISPUTE

(a) decide the dispute himself or authorise any other

Government officer to decide the dispute ; or

(b) refer it for disposal to an arbitrator appointed by the

Registrar or to three arbitrators one to be nominated by
each of the parties to the dispute and the third who shall be
nominated by the Registrar to act as Chairman. Where any
party to the dispute fails to nominate an arbitrator within
fifteen days after the communication of this notice, the

Registrar may himself make the nomination. No legal
practitioner may be nominated as an arbitrator by any party
to a dispute or by the Registrar;


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414 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(c) an arbitrator appointed under the previous sub-clause shall x of
be governed by the Indian Arbitration Act, 1940, with such 1940

statutory re-enactment or modification thereof as shall from
time to time be made.

(2) The Registrar may withdraw any reference of such dispute referred to

under sub-section (1) and may deal with it himself under the said sub­
section.

(3) Where the Registrar is satisfied that a party to any reference made to

him under section -92 with intent to defeat or delay the execution of any
decision that may be passed thereon -

(a) Is about to dispose of the whole or any part of his property,
or

(b) is about to remove the whole or any part of his property from
the local limits of the jurisdiction of the Registrar;

the Registrar may direct the conditional attachment of the said

property or such part thereof as he deems necessary, and such attachment
shall have the same effect as if it had been made by a competent Civil
Court.

###### CHAPTER IX

**DISSOLUTION OF A SOCIETY**

CANCELLATION 94. (1) If the Registrar, on receipt of an application made upon resolution adopted
OF

in a meeting of the General Assembly by a three-fourth majority of the

REGISTRATION

members present in the meeting, provided that the notice of dissolution

was included in the circulated agenda of the meeting, is of opinion that the
society ought to be dissolved, he may, by an order in writing, cancel the
registration of the society.

(2) The Registrar after an enquiry has been held under section 87 or after the

inspection has been made under section 88 may cancel the registration of
a society which -

(i) has not commenced working ; or

(ii) has ceased working ; or

(iii) has ceased to comply materially with any condition as to
registration in this Act, rules or bye-laws ; and

(iv) in his opinion ought to be dissolved .

(3) A copy of the order canceling the registration of a society shall forthwith be

published in the official Gazette by a notice, which shall be communicated
to the society and to any affiliating society concerned by registered post.
The notice shall contain the name of the liquidator appointed under Section
95 who shall take full charge of the society forthwith and shall require all
claims against the said society to be made to the liquidator within two
months of the publication of the notice. All liabilities recorded in the account
books of the society shall be deemed ipso facto to have been so claimed.


-----

(4) When the cancellation of the registration of a society takes effect, the

society shall cease to exist as a corporate body, but shall vest in the
liquidator

(5) Any member of the society may, within two months from the date of

publication of the order of cancellation, appeal to the State Government
from such order.

(6) Where an appeal is presented within two months from the publication

of on order canceling the registration of the society, the order shall take
effect on the expiry of the period.

(7) When an appeal is presented within two months of an order of cancellation,

the order shall not take effect until it is confirmed by the State
Government and such confirmation is communicated to the society by

registered post.

95. (1) When an order of cancellation of the registration of a society is made by the

WINDING UP, Registrar under Section 94, he may appoint any person to be the liquidator
APPOINTMENT

of the society and may remove such person and appoint another in his

OF LIQUIDATOR
AND HIS POWERS place.
AND FUNCTIONS

(2) The liquidator appointed under sub-section (1) shall have power from the

date of his appointment to take immediate possession of all assets,
properties, effects and actionable claims of the society or to which the
society is entitled and all books, records, case and other documents
pertaining to the business of the society and. in the interest of the society,
shall hold charge of the society notwithstanding the provisions of section 94
provided that no steps shall be taken for the winding up of the society
during the pendency of any stay order.

(3) The liquidator shall, under the general control of the Registrar, have power,

so far as is necessary for the winding up of the society, on behalf of the
society to carry on the business thereof and to do all acts and execute all
documents necessary to such winding up, and in particular shall exercise
the following powers

(a) to institute, compromise and defend suits and other legal

proceedings on behalf of the society;

(b) to make any compromise or arrangement with any person

between whom and the society there exists any dispute;

(c) to determine the debts due to the society by a member, past

member or estate, nominees, heirs or legal representatives of
deceased members ;

(d) to determine from time to time the contribution to be made or

remaining to be made by the members, past members or by the
estate or nominees, heirs or legal representative of deceased
members or by any officers or former officers, to the assets of
the society and to determine the debts due from such members
or persons and the cost of liquidation;


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###### 416 THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012

(e) to calculate the cost of liquidation and to determine by what

persons and in what proportion they are to be borne;

(f) to investigate all claims against the society and subject to the

provisions of this Act to decide questions of priority arising
between claimants;

(g) to pay claims against the society including interest up to date of

cancellation of registration according to their respective
priorities, if any, in full or rateably as the assets including the
reserve fund of the society, permit; the surplus, if any,
remaining after payment of claims being applied in payment of
interest from the date of such cancellation at the rate fixed by
him but not exceeding the contract rate in any case;

(h) to take step to recover dues according to the provisions of

section 102, if necessary; and

(I) to dispose of the surplus, if any, remaining after paying the

claims against the society in accordance with section 96.

(4) Subject to the provisions of this Act and rules made there under,a liquidator

appointed under section 95 shall, in so far as such powers are necessary
for carrying out the purpose of this section, have power to summon and
enforce the attendance of witnesses and to compel the production of any
books, accounts, documents, securities, cash or other properties belonging v

to or in the custody of the society by the same means and so far as may be 1908

in the same manner as is provided in the case of a Civil Court under the
Code of Civil Procedure, 1908.

(5) Notwithstanding anything contained in any law for the time being in force, if

any landed property is held by a liquidator as such the title over the land
shall be complete as soon as the mutation of the name of his office is
effected and no court shall question the title on the ground of
dispossession, want of possession or physical delivery of possession.

DISTRIBUTION OF 96. On dissolution of a society the reserved fund and any undisbursed cash in
FUND OF A

hand shall be applied to discharging liabilities of the society and the

DISSOLVED
SOCIETY repayment of the share capital. Any sum that may remain may be applied

to such object of local and public utility as may be selected by the members
of the dissolved society and approved by the Registrar. If, within three
months of the notice published in the Official Gazette under Section 97,
notifying the closing of the liquidation proceedings of the society, the
members fail to select any object as aforesaid, the Registrar shall, with the
approval of the Government, apply the fund to such local public utility as
may be determined by him or credit the remaining sum to the reserve fund
of a society to be formed to replace the dissolved society or if there be no
such society to any other deserving society existing within the same area of
operation and having objects similar to those of the dissolved society or if
there be no such society to any other registered society in Assam as may
be determined by the Registrar.

LIQUIDATOR TO 97. When the affairs of a registered society have been wound up, the liquidator
DEPOSIT THE shall make a report to the Registrar, who, when satisfied shall order the
BOOKS AND

liquidation proceedings to be closed and direct the liquidator to deposit the

SUBMIT A FINAL
REPORT records whatsoever the Registrar thinks fit and the Registrar shall issue a

notice in the Official Gazette, notifying the closing of the liquidation
proceedings of the society.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 417

DISPOSAL OF 98. After all the liabilities including the paid up share capital of a wound up
SURPLUS cooperative society have been met, the surplus assets shall not be divided
ASSETS OF
LIQUIDATED CO­ among its members but they shall be applied to any object described in the
OPERATIVE bye-laws and when no object is so prescribed in the bye-laws, to the
SOCIETIES cooperative development fund.

99. When an order to wind up the cooperative society has been made or the

BAR OF SUITS OR
LEGAL liquidator has been appointed a suit or other legal proceeding relating to
PROCEEDINGS business of such cooperative society shall be proceeded with or instituted

against the liquidator as such or against the cooperative society or any
member thereof except with the leave of the Registrar and subject to such
conditions as he may impose.

100.(1) A liquidator shall pay the costs of liquidation out of the property of the

FINAL ACCOUNTS cooperative society and shall pay or make adequate provision for all

claims

against the cooperative society.

(2) Subject to the provisions of section-60 after paying or making adequate

provision for all claims against the cooperative society, the liquidator
shall apply to the Registrar for approval of his final accounts and for
permission to distribute in cash or in kind the remaining property of the
cooperative society in accordance with the bye-laws.

(3) Where the Registrar approves the final accounts rendered by a

liquidator under sub-section(2), he shall -

(a) issue direction with respect to the custody or disposal of the

documents and records of the cooperative society; and

(b) discharge the liquidator.

(4) Where the Registrar discharges a liquidator under sub-section(3) the
Registrar shall dissolve the cooperative society, issue a certificate of
dissolution and delete its name from the Register of Co-operative.
Societies

(5) The cooperative society ceases to exist on the date shown in the

certificate of dissolution,, which shall not be later than eight years after

the appointment of the liquidator.

101. Save in so far as is expressly provided in this Act, no Civil Court shall
BAR OF SUIT

take cognizance of any matter concerned with the winding up or
dissolution of a society under this Act and when a liquidator has been
appointed no suit, order or legal proceedings shall lie or be proceeded
with against him except by leave of the Registrar and subject to such

terms as he may impose.

###### CHAPTER X

**RECOVERY OF SUMS DUE**

RECOVERY OF 102. (1) Notwithstanding anything contained in this Act, the Registrar or such
SUMS DUE AND other person as may be authorised in this behalf, may, on his own
ENFORCEMENT motion when the interest of the Government is involved or on the written
OF OBLIGATIONS requisition of a registered society , an affiliating society or financing bank

for the recovery of any loan or any other sum due by a defaulting

member after due inquiry as he may deem fit and after giving a
reasonable opportunity of being heard, grant a Cooperative Demand
Certificate for recovery of any amount found to be due.


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418 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

2. (a) If any installment of loan or interest payable by a member of a
cooperative society or any part of such installment has

remained unpaid for more than 30 days from the date on which it

fell due, the Board may , in addition to any other person authorised

for the recovery of such installment or part thereof, recover the
installment or such part thereof by distraint and sale of the produce
of the charged land including the standing crop;

(b) On receipt of such application the Registrar or the person
authorised by him may, notwithstanding anything contained in the
Transfer of Property Act, 1882, take action in the manner as

prescribed for the purpose of distraining and selling such produce .

Provided that no distraint shall be made after the expiry of

twelve months from the date on which the installment fell due ;

(c) The value of the property distrained shall be, as nearly as possible

equal to the amount due and the expenses of the distraint and the
costs of the sale.

CHARGE AND 103. (1) Where, as the result of an audit under section-81 or an inquiry under
SURCHARGE section-87 or an inspection under section-88 or a report made in the

course of the winding up of a registered society, it appears to the
Registrar that any member, officer or employee past or present, of the
society has at any time within a period of four years prior to the date of
such audit .inspection, inquiry or report, as the case may be, -

(a) intentionally, whether individually or as an assenting member

of any managing or other controlling body, made or authorised
any payment or granted any loan which is contrary to the
provision of this Act or to the rules or bye-laws or failed to take

timely steps to recover any loan at the due date or it was being
improperly utilized ; or

(b) was grossly negligent in respect of any loss or deficiency,

(c) failed to bring into account any sum which ought to have been

brought into account; or

(d) misappropriated or fraudulently retained any property of the

society ; or

(e) committed breach of trust in relation to the society, the

Registrar may inquire into the conduct of such officer or
members of the managing or other controlling body.

(2) The Registrar may similarly inquire into the conduct relating to the

affairs of the society or of any member, officer or employees, past or
present, of a registered society on the application of the present
controlling or managing body of the society or liquidator, or any creditor,
or any other registered society to which the society is affiliated or any
contributory.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 419

(3) Upon such inquiry giving such member, officer or employee an

opportunity of being heard and in the case of payment made contrary to
the provision of this Act or rules or Bye-laws after affording such

member, officer or employee time to recover the amount of such
payment from the payee and credit it to the funds of the society, if such
member, officer or employee fails to recover the amount then the

Registrar may by an order in writing require such member, officer or
employee to pay such sum with interest at such rate as the Registrar
may direct, to the society by way of compensation in respect of such
payment or loss or to restore such property as the Registrar thinks fit,
and to pay such sum as the Registrar may fix to meet the cost of the
proceedings under this section.

(4) Any award made by the Registrar under sub-section(3) shall be reduced

to the form of a Cooperative Demand Certificate by the officer authorised
to issue such certificates.

(5) This section shall apply notwithstanding that such member, officer or

employee may by his act or omission have incurred in addition to
criminal liability under this Act or any other law for the time being in
force.

**CHAPTER - XI**

###### PENALTY

104. If a registered society or an officer or member thereof or any liquidator/

PUNISHMENT
FOR FALSE

(a) willfully makes a false return or furnishes false information or willfully

RETURN,FALSE
INFORMATION,DI neglects or refuses to do any act required by this Act or any rules or
SOBEYING bye-laws or does anything contrary to this Act or any rules, or bye­
SUMMONS, laws or fails to submit returns; or
ORDER ETC. (b) any person willfully or without reasonable excuse disobeys any

summons, requisition or lawfully written order issued under the
provisions of this Act or does not produce document or cash balance
of the society or does not furnish any information lawfully required
from him by a person authorised in this behalf under the provisions of
this Act or fail to maintain up-to-date account, record and other
documents of the society required to be maintained by him under this
Act or rules or bye-laws he shall be punishable with fine which may
extend to five thousand rupees, and in the case of a continuing
offence a further fine of fifty rupees for each day on which the offences
are continued after conviction thereof.

105. Any member, past member or the nominee, heir or legal representative of

PUNISHMENT
FOR DISPOSING a deceased member removing or otherwise disposing of any property on

PROPERTY IN which a registered society holds a charge under section-61 with intent to

CONTRAVENTION defraud the society or with such intents doing any other act to the
OF SECTION-61

prejudice of the society's charge, shall be punishable with fine which may

extend to five thousand rupees.


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###### 420 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

PENALTY FOR 106. Where it appears to the Registrar that any person has contravened the
CERTAIN provisions of this Act or rules or bye-law -
MISDEMEAN -

(a) by sitting or voting or exercising his rights as a member, or as a

OURS

member of any managing or controlling body, or voting in the
affairs of a registered society as a representative of another
society which is a member of such society, when such person
was not entitled so to sit, vote or exercise such rights, as the
case may be ; or

(b) by utilising a loan for a purpose different from that for which it

was granted.; the Registrar may, after affording such person

an opportunity to be heard by an order in writing, direct him

to pay to the assets of the society by way of penalty such sum
not exceeding five thousand rupees as the Registrar thinks fit.

POWER TO 107. Notwithstanding anything contained in this Act, where any registered
ENFORCE society is required to take any action under the Act, the rules or bye-laws
PERFORMANCE and such action is not taken within the time provided in this Act, the rules or
OF OBLIGATIONS

bye-laws or within such time as the Registrar may specify by a notice in
writing where no time is so provided, the Registrar may call upon any officer
of the society whom he considers to be responsible for carrying out the
directions, and after giving such officer an opportunity to be heard may
require him to pay to the assets of the society such sum not exceeding
rupees five thousand as the Registrar may think fit for each day until the
Registrar's directions are carried out.

108.(1) No court inferior to that of a Magistrate of the first class shall try any

COGNIZANCE OF
OFFENCE offence under this Act.

(2) No prosecution for an offence under this Act shall be instituted without the

previous sanction of the Registrar.

(3) Offences under this Act may be tried summarily.

**CHAPTER-XII**

###### JURISDICTION

109. No suit, proceeding or prosecution whatsoever shall lie against the

INDEMNITY Registrar or any person acting on his authority, or against any liquidator

in respect of anything done or purporting to be done in good faith under

this Act.

110.(1) Save as provided in this Act, no Civil or Revenue Court shall have any

BAR TO

jurisdiction in respect of --

JURISDICTION -
CIVIL OR
REVENUE (a) registration of a society or its bye-laws or amendments of bye­
COURTS laws ; or

(b) the dissolution of a managing or controlling body and the

management of the affairs of the society on dissolution thereof;
or

(c) any dispute referred to the Registrar; or
(d) any matter in relation to the winding up and dissolution of a

registered society.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 421

(2) Save as provided in this Act, no order, decision or award under this

Act, or working of the affairs of a registered society shall be liable to

be challenged, set aside, modified , revised declared void in any
court on any ground whatsoever.

APPEAL OR 111. (1) Except where otherwise expressly provided to the contrary an appeal
REVIEW shall lie to the Registrar from the decisions made under this Act or rules

framed thereunder by any Government officer, liquidator appointed under
section 95.

(2) The Registrar may review any order passed by him at any time within

sixty days from the communication of such order.

(3) Save as otherwise provided in this Act or rules, no appeal shall lie to the

State Government against any order of the Registrar, except on a
question of law, and provided such appeal is preferred within sixty days of
the communication of such order

(4) Any appellate authority and the Registrar in case of review may pass any

stay order pending any appeal or review before such an authority, and
may award costs against any party appealing or petitioning for review if
such appeal or review petition is considered false, vexatious or frivolous
by the authority concerned.

(5) Notwithstanding anything contained in this Act where with the previous

sanction in writing or on requisition by the Reserve Bank of India, a
Cooperative Bank -

(a) is being wound up ; or

(b) in respect of which a scheme of amalgamation or re­

organisation is given effect, no appeal thereof shall lie or
be permissible without the sanction or requisition of the

Reserve Bank and that shall not be liable to be called in
question.

112. Where the Registrar or such Gazetted officer as may have powers

POWER OF

delegated to him under section 114 is satisfied that any person holding

ATTACHMENT OF

PROPERTY property within his jurisdiction with intent to defeat or delay the execution

of any order, under a Co-operative Demand Certificate for recovery of
dues, or with intent to avoid payment of dues from such person under
this Act, rules or bye-laws -

(a) is about to dispose of the whole or any part of such

property ; or

(b) is about to remove the whole or any part of such

property from the local limits of the jurisdiction of the
Registrar or of such Gazetted officer, may unless
adequate security is furnished ,as he may require, direct
the conditional attachment of the said property or such
part thereof as he thinks necessary, notwithstanding that
the claimant or owner of the property may reside
elsewhere, and such attachment shall have the same
force and effect as if it had been made by a competent
Civil Court _and shall continue in force until withdrawn or_
cancelled.


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422 THE ASSAM GAZETTE, EXTRA ORDINARY. FEBRUARY 4, 2012

REGISTRAR TO 113. The Registrar or any person empowered by him in this behalf shall be IX of
BE CIVIL COURT deemed, when exercising any power under this Act for the recovery of 1908
FOR CERTAIN

any amount by attachment or sale without attachment of any property or

PURPOSE

when passing any orders on any application made to him for such

recovery or to take any step-in aid of such recovery, to be a Civil Court
for the purpose of Article 182 of the First Schedule to the Indian
Limitation Act, 1908.

RECOVERY OF 114 (1) All dues recoverable under this Act or rules framed thereunder shall be
SUMS DUE reduced to the form of a Cooperative Demand Certificate, as in Regula­

Schedule C over the signature of the Registrar or of such Gazetted tion 1 of
Officers as may have powers delegated to them by the Registrar in this 1886
behalf and shall be recovered as an arrear of land revenue under Assam
Land and Revenue Regulation, 1886 and shall be paid to the certificate
holder or his authorised nominee. Such certificate shall be in the name
of the claimant and shall be delivered to him.

(2) Notwithstanding anything contained in sub-section (1), all the said dues

Bengal

shall also be recoverable as public demand in accordance with the

Act 111

procedure laid down in the Bengal Public Demands Recovery Act, 1913

o f 191t

on a written requisition sent to the certificate officer in the prescribed
form over the signature of the Registrar or of such Gazetted Officer or
officer of a cooperative society as may have powers delegated to him by
the Registrar in this behalf.

**Explanation .** “The Certificate Officer” means the officer so defined in and the Bengal *

Prescribed Form, means the form so prescribed under the Bengal Public Act 111 ’
Demands Recovery Act, 1913. of 1913.

(3) For the purpose of this section a member of an affiliated society shall be

deemed to be a member of the affiliating society and loans due to the
affiliated society shall be deemed also to be loan due to affiliating society
to the extent that loans from the affiliating society to the affiliated society
are outstanding and cannot be recovered from the affiliated society
provided that not more than one demand certificate may be executed
against a single loan.

(4) A copy of the Cooperative Demand Certificate prepared under this

section shall be served in the manner prescribed upon the person from
whom the amount is due.

(5) On receipt of a copy of the Cooperative Demand Certificate the person

from whom the amount is due shall pay the same within a period of thirty
days from the date of service of the certificate :

Provided that the period during which the payment is to be

made may be extended by the Registrar for a period not exceeding
thirty days for reasons to be recorded in writing.

(6} Any person violating the provisions of sub section(5) above shall, on

conviction be punished with imprisonment of either description which
may extend to six months or with fine which may extend to one thousand
rupees or with both.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 423

REGISTRAR MAY 115. (1) Notwithstanding anything contained in this Act, where a compromise or
ORDER A

arrangement is proposed between a registered society and its creditor or

MEETING OF
CREDITORS creditors or any class of them the Registrar, upon an application made

by a registered society or by liquidator, in case of a society in respect of
which an order has been passed for the winding up thereof, or by a
creditor or creditors or any class _of creditors may order a meeting of the_
creditors.

(2) If a majority number of creditors or the class of creditors, as the case

may be representing claims to three-fourths of the debts due by the
society to the creditor or class of creditors, at a meeting agree to any
compromise or arrangement and and if the Registrar agrees to such
compromise or agreement and gives his sanction then the compromise
or the arrangement shall be binding on all the creditors or class of
creditors and also on the society or on the liquidator in the case of a
society in respect of which an order has been passed for the winding up
thereof, and on all persons who may be required by the liquidator to
contribute to the assets of the society.

**CHAPTER -XII!**

**MISCELLANEOUS.**

PREVIOUS 116. Notwithstanding anything contained in sections 12,13,14,15 in the case
SANCTION OF of a cooperative bank or an urban cooperative bank, no conversion,

RESERVE BANK

transfer, division, amalgamation, merger, dissolution shall take place

OF INDIA OR

NABARD IN save with the previous sanction in writing of the Reserve Bank of India,
CERTAIN the National Bank for Agriculture and Rural Development Bank, as the
MATTERS case may be. Once a banking license is cancelled by the concerned

authority, it is mandatory on the part of Registrar of Cooperative
Societies to send it into liquidation.

SOCIETY TO BEA 117. Every registered cooperative society shall be deemed to be a body
BODY corporate by the name under which it is registered, with perpetual
CORPORATE

succession and a common seal, and with power to hold property, to
enter into contracts, institute and defend suits and other legal
proceedings and to do all things necessary for the purpose for which it

was constituted.

REGISTER OF
MEMBERS

118. Any register or list of members or shares kept by any registered society

shall be prima facie evidence of any of the following particulars entered
therein -

(a) the date on which the name of any person was entered in such

register or list as a member, and

(b) the date on which any such member ceased to be a member.

ENTRIES IN 119. (1) A copy of any entry in a book of a registered society, regularly kept in
BOOKS OF the course of business shall, if certified by the Chairman or Secretary of
REGISTERED

the society, be received in any suit or legal proceedings as prima facie

SOCIETY SHALL
BE RECEIVED AS evidence of the existence of such entry and shall be admitted as
PRIMA FACIE evidence of the matters, transactions and accounts therein recorded in
EVIDENCE every case where, and to the same extent as the original entry itself is

admissible.


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424 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(2) No officer or liquidator of a registered society and no officer in whose

office the books of a registered 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 the contents
of which can be proved under sub-section(l) or to appear as a witness
to prove the matters, transaction and accounts therein recorded unless
specially so directed by an order of the Court or the Arbitrator.

120. (1) Every society existing at the commencement of the Act which has been Assam

SAVINGS OF
EXISTING registered under the Cooperative Societies Act, 1949, shall be deemed Act I of
SOCIETIES to be registered under this Act, and its bye-laws shall, in so far as they 1950

are not inconsistent with the provisions of this Act, continue in force until
altered or rescinded and shall to such extent be deemed to be registered
under this Act.

(2) All appointment, rules and orders made, notification and notices issued,

all transactions entered into and all suits and other proceedings
instituted under the said Act shall continue and shall, so far as may be,
deemed to have been respectively made, issued, entered into or
instituted under this Act.

CONSTRUCTION 121. All reference to the Assam Cooperative Societies Act, 1949 occurring in Assam
OF REFERENCE any enactment made by any authority in India and for the time being in Act I of
TO ASSAM force in Assam shall in the application of any such enactment thereto , 1950
COPERATIVE be construed as reference to this Act, and anything done, or any
SOCIETIES ACT,

proceeding commenced in pursuance of such enactment on or after the

1949

commencement of this Act shall be deemed to have been done or to
have commenced and to have had effect as in the reference in such

Assam

enactment to the Assam Cooperative Societies Act, 1949 had been a

Act I of

reference to this Act, and no such thing or proceedings shall be deemed

1950

to have been invalid on the ground that such enactment did not refer to
this Act.

ACT VII OF 1913 122. The provisions of the Indian Companies Act, 1913 shall not apply to
NOT TO APPLY registered societies.

123. (1) No act of a registered society or of a managing or controlling body or

ACTS OF
SOCIETIES, ETC. of any officer or liquidator done in good faith in pursuance of the
NOT TO BE business of the society shall be deemed to be invalid by reason only
INVALIDATED BY of some defect subsequently discovered in the organisation of the
CERTAIN society or in the constitution of any such body or in the appointment or
DEFECTS

election of the officer or liquidator or on the ground that such officer or
liquidator was disqualified for appointment.

(2) No act done in. good faith by any person appointed under this

Act shall be invalid merely by reason on the fact that his

appointment has been cancelled or in consequence of any order

subsequently passed under this Act.

(3) The Registrar shall decide whether any act was done in good faith in

pursuance of the business of a society.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 425

POWER TO 124 Notwithstanding anything contained in any other law for the time being in
ORDER force the State Government may, by a general or special order, require
RECOUPMENT OF

every registered society or a class of registered societies to make

EXPENDITURE

contribution of such sum annually to be fixed by the Registrar towards the
recoupment of administrative expenditure incurred by the Government in
respect of inspection, supervision and guidance of a society or class of
societies or of any service to such society or class of societies

SUPER-SESSION 125. If in the opinion of the Registrar the Board of a cooperative society is
OF BOARD BY persistently making default or is negligent in the performance of the duties
REGISTRAR imposed on it by this Act or the rules or the bye-laws or has committed any

act which is prejudicial to the interests of the society or its members, or
has omitted or failed to comply with any directions given to it or that there
is stalemate in the constitution or functions of the Board, the Registrar
shall cause an enquiry under section 87 or an inspection under section 88
and after giving the society an opportunity to state its objections, if any and
after considering the objections, if received forward the enquiry/inspection
report to the society for placing the report before the Annual General
Meeting if due within 60 days from the date of receipt of the report by the
society, or at a Special General Meeting to be convened specially for
considering to take actions as suggested in the report under sub section
(5) of section 87 and sub section (4) of section 88. If no action as stated
above is taken by the society within the stipulated period the Registrar
shall by an order in writing supersede the Board and appoint one or more
administrators or an adhoc committee from the department to manage the
affairs of the society for such period not exceeding three months as may
be specified in the order which period may at the discretion of the State

i-r - Government be extended from time to time:

Provided that the total period of extension in any case shall not

exceed six months . Such appointed person shall call a special general

meeting and shall elect a new Board within the above period

J*?WER TO SEIZE 126. (1) If the Registrar or any person authorised by him in this behalf, while

_r '_ -CORDS OF making audit, inspection, inquiry or supervision, as the case may be

SOCIETY believe or has reason to believe that the registered society is not

keeping or maintaining the accounts, books and records of the society
properly or finds or reasonably suspects gross negligence of duties
misappropriation or misuse of fund of the society irregularity in

recording proceeding or keeping accounts or books he shall have power
to take possession of any or all books, registers or documents, cash in
hand or accounts books of the society and remove such seized property
as may be directed by the Registrar.

(2) The person seizing the property of the society under sub-section(l) shall

prepare an inventory of the properties seized in duplicate with his
signature and require the officer or member of the society from whose
possession or custody the property is seized to put his signature in

witness thereof and if such officer or member refuses to sign, then the

person seizing the property shall call upon two or more persons to sign
the seizure list. A copy of the list prepared under this section signed by
the witnesses .shall be delivered to the officer of the society.


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###### 4 26 THE ASSAM GAZETTE. EXTRA ORDINARY, FEBRUARY 4, 2012

(3) The Registrar shall take immediate steps in such case for audit or
inspection and pass such orders as he may think fit.

(4) The Administrative Head of a Civil Sub-division or administrative area

shall give police help to all officers mentioned in sub-section(l) of this
section when sought for.

POWER OF THE 127 When a registered society takes a loan from an affiliating society and
MANAGING BODY

defaults payment of the debt on any installment thereof any member of the

OF AN
AFFILIATING managing body of the affiliating society, may examine and look into the
SOCIETY TO accounts and working of such borrowing society and report the result of
ENQUIRE INTO his inquiry or examination particularly with reference to the said loan to the
THE AFFAIRS OF affiliating society and may recommend any suggestion in his report. The
A MEMBER

borrowing society shall furnish such information and produce such

SOCIETY

documents, books and accounts as the member of the managing body
may require.

128. (1) Notwithstanding any of the provisions of the Indian Limitation Act, 1908, ,, ,
LIMITATION the period of limitation for the institution of a claim to recover any sum, A 0

including the interest thereon, due to a registered society by a member

thereof shall be computed from the date on which such member dies or
ceases to be a member of a society.

(2) The Indian Limitation Act,1908, shall not apply to any debts or liability X of

due by any member, past member or deceased member to any society 1908

in respect of which an order of dissolution has been passed under this

Act.

A

INFORMATION 129. (1) Every year within thirty days of holding of the Annual General Meeting,

AND RETURNS the Board shall file the following information with the Registrar
TO BE FILED

(a) annual report of activities ;

WITH REGISTRAR

(b) annual financial statements of accounts as audited with s

auditor's report thereon ; Y v

(c) statistical statements indicating name of the cooperative

society, services offered by the cooperative society to the
members, total _number of members as on the last day of the_
financial year;

(d) Total liabilities expressed as-

(I) funds from members and surpluses;
ii) funds from other external sources as on the last day

of the financial year;

(iii) quantum of rupees or services provided to members

and non members, and surplus or deficit at the end
of the financial year; and

(e) annual disposal of surplus or management deficit.

(2) Along with the returns specified in sub section (1) every cooperative

society shall furnish the following information to the Registrar

(a) the date of Annual General Meeting at which the returns to be

filed with the Registrar were considered or approved;


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THE ASSAM GAZETTE, EXTRAORDINARY, FEBRUARY 4, 2012 427

(b) the total number of members on the rolls of the cooperative
society who were eligible to vote on the date of such Annual
General Meeting;

(c) the number of eligible members present at such Annual
General Meeting ;

(d) list of names of Directors with addresses and terms of office :

(e) name and address of the internal auditor appointed for internal
audit of the society for the current financial years accounts ;

(f) any other relevant and special information required by the

Registrar to enable him to decide whether the cooperative
society has conducted its affairs in accordance with the
cooperative principles mentioned in Schedule A and the
provision of this Act and the bye-laws.

(3) If the returns and information as specified under sub-section (1) and (2)

are not filed or furnished to the Registrar within the period specified
under sub-section (1) shall be treated as an offence under this Act and
the Board shall be penalised in accordance with provisions of this Act.

„POWER TO 130. The State Government may by a notification in the Official Gazette, exempt a Assam

EXEMPT registered society from any or all the provisions of the Assam Money Act IV

'SOCIETIES FROM

Lenders Act, 1934 for the time being in force

-THE OPERATION of 1934

OF THE ASSAM
MONEY LENDERS
ACT   -

131. (1) The State Government may, after previous publication, make rules for

POWER TO MAKE

carrying out the purpose and objects of this Act, and such rules may

RULES

provide a penalty not exceeding five thousand rupees for a breach
thereof.

(2) Every rule made under this section shall be laid as soon as may be after

it is made before the Assam Legislative Assembly while it is in session
for a total period of fourteen days which may be comprised in one
session or in two successive sessions and if before the expiry of the
session in which it is so laid or the session immediately following, the
Assam Legislative Assembly agree in making any modification in the
rule or the Assam Legislative Assembly agree that the rule should not be
made, the rule shall thereafter have effect only in such modified form or
be of no effect, as the case may be, so however, that any such

modification or annulment shall be without prejudice to the validity of
anything previously done under that rule.

Assam

REPEAL AND 132. (1) The Assam Cooperative Societies Act, 1949, is hereby repealed. Act I of
SAVING 1950

(2) Notwithstanding such repeal, anything done, any action taken, any order

passed by any authority or any penalty imposed under the said Act shall
be deemed to have been done or taken under the corresponding
provisions of this Act.


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428 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

###### • SCHEDULE-A

(see section 4(1), 25)

COOPERATIVE PRINCIPLES

The co-operative principles are guidelines by which co-operative

societies put their values into practice.

**1[st] Principle :** Voluntary and open Membership.

Co-operative societies are voluntary organisations , open to all

persons able to use their service and willing to accept the
responsibilities of membership, without gender, social, racial,
political or religious discrimination.

**2[nd] Principle :** Democratic Member Control.

Co-operative societies are democratic organisations controlled by

their members, who actively participate in setting their policies and
making decisions Men and women serving as elected

representatives are accountable to the members. In primary co­
operative members have equal voting rights (one member, one
vote) and cooperative society at other levels are also organised in
a democratic manner.

**3[rd] Principle :** Member Economic Participation .

Members contribute equitably to and democratically control, the
capital of their cooperative societies. At least part of that capital is
usually the common property of the co-operative. Members usually
receive limited compensation, if any, on capital subscribed as a
condition of membership. Members allocate surpluses for any or all
of the following purposes : developing their co-operative societies,
possibly by setting up reserves, part of which at least would be
invisible, benefiting members in proportion to their transaction with
the co-operative society, and supporting other activities approved
by the members.

**4[th] Principle :** Autonomy and Independence.

Co-operative societies are autonomous, self-help organisations
controlled by their members. If they enter into agreements with
other organisations , including Governments,or raise capital from

external sources, they do so on terms that ensure democratic
control by their members and maintain their co-operative

autonomy.

**5[th] Principle :** Education,Training and Information.

Co-operative societies provide education and training for their
members, elected representatives, managers, and employees so
they can contribute effectively to the development of their co­
operative societies.They inform the general public- particularly
young people and opinion leaders - about the nature and benefits
of co-operation.

**6[th] Principle :** Co-operation among Co-operatives Societies.

Co-operative societies serve their members most effectively and
strengthen the co-operative movement by working together
through local , national, regional and international structures.

**7[th] Principle :** Concern for Community.

Co-operative societies work for the sustainable development of
their community through policies approved by their members.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 429

###### SCHEDULE-B

 (SEE SECTION 9)

Subject matter for specific consideration when framing bye laws.

**1. Identity of the cooperative society.**

(a) the name of the cooperative

(b) the village/town/city where the head office of the cooperative
society is to be located

(c) the custody and use of the common seal

(d) the area of operation from where the membership is to be
drawn.

**2.** **Aim and services**

(a) the aim of the cooperative society explicitly stated as a common

need of the members which the cooperative society aims at

fulfilling

(b) key service and support services to members to fulfil the common

need stated in the aim

(c) the conditions under which services may be provided to non­

membership.

**3.** **Membership**

(a) eligibility .ineligibility for obtaining membership
(b) eligibility, ineligibility for continuing membership
(c) procedure for obtaining membership
(d) procedure for withdrawing membership
(e) procedure for termination of membership
(f) circumstances under which membership ceases
(g) procedure for cessation of membership

**4. Member rights and obligations**

(a) the rights of members
(b) manner of fixation of minimum performance expected annually of

each member vis-^-vis use of services, financial commitment,
participation in meetings and adherence to bye-laws ,in order to be
eligible to exercise the rights of membership including the right to
vote

(c) the consequences of performing below the minimum level fixed
(d) the consequences of default in payment of any sum due by a

member.

**5.** **General Body**

(a) the role of the general body and of the delegate General body, if

any, and subjects which must be dealt with by the general body,
and by the representative general body, if any

(b) the manner and frequency of convening general meetings, the

mode of communication of the intimation of these meetings and
quorum required

(c) the minutes of proceedings of general meetings

**6.** **Board of Directors**

(a) The size and composition of the Board of Directors
(b) Eligibility, ineligibility for becoming director
(c) Eligibility, ineligibility for retaining directorship
(d) The procedure for election including the appointment of election

officer, removal of directors, the election of the President, Vice
President, and representative and filling of casual vacancy


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430 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4. 2012

(e) The terms of office of the directors
(f) The frequency of board meetings
(g) The manner of convening board meetings, and quorum
(h) The functions, responsibilities and powers of the board
(i) The minutes of proceedings of board meetings
(j) The functions, responsibilities and powers of directors

**7. Chief Executive and staff**

(a) the person to sue or be sued on behalf of the cooperative society.
(b) the manner of appointment and removal of chief executive
(c) the functions, responsibilities and powers of the chief executive

**8. Finances**

(a) the financial year which the cooperative society wishes to adopt
(b) the manner of appointment of auditors and their duties
(c) the manner of appointment of internal auditors and their duties
(d) the nature and amount of equity capital, if any, of the cooperative

society

(e) the maximum capital which a single member can hold
(f) the types and extent of funds to be raised

(g) the purposes for which the funds raised by the cooperative

society may be applied

(h) the debt-equity ratio that the cooperative society wishes to

maintain at all times, and the maximum external debt that a
cooperative society wishes to permit itself at any point of time

(i) procedure for transfer of shares or interest by a member

(j) procedure for redemption of shares by the cooperative society

(k) procedure for transfer or payment of interest on death of member

(l) the nature and extent of the liability of the members for the debts
contracted by the cooperative society

(m) the nature and extent of the liability of the directors for the debts

contracted by the cooperative society

(n) the manner of disposal of funds if under liquidation

**9. Secondary cooperative societies**

(a) the rights, if any, which the cooperative society wishes to confer on

any secondary cooperative society of which it is a member, and

the circumstances under which these rights may be exercised by
such secondary cooperative society

(b) the procedure of appointing and changing representative to

secondary cooperative society.

**10. Other matters**

(a) the manner of making or amending bye-laws

(b) the manner of constitution and functioning of arbitration council

along with the qualification of the members for settlement of

disputes

(c) the manner of dissolution of the cooperative society
(d) the language in which the affairs of the cooperative society are to

be conducted

(e) refunding of loan, guarantee, share capital, grant or subsidy

received from Government

(f) other matters which the provisions of this Act requires to be

provided by bye- laws.


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THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012 431

**Schedule C**

Form (see Section 114)

Cooperative Demand Certificate granted under Section 114(1) of the

Assam Cooperative Societies Act, 2007

(To be realized as an arrear of land revenue by the authority within whose

jurisdiction the judgment debtor’s property is situated)

Case no.____________of 20

District/ sub- division

In the matter of

Versus

(1) Whereas as a result of my enquiry I decide that a sum of
Rs................................ (Rupees.

.......................................................................................... ) by way of
...................................................... under section 102 (1) of the Assam

Cooperative Societies Act, 2007 and a sum of

Rs.......................................( Rupees ................................................... )
by way of interest upto.....................is/ are due from you and you have
not paid.

Or

Whereas .................................................... has made a

reference in writing to me complaining/ determining that a sum of Rs
.................................. (Rupees................................................... ) by way

of .......................................... under section .............................. of the
Assam Cooperative Societies Act, 2007 and a sum of Rs.

..................... (Rupees................................................................... ) by way

of interest upto............................. is/are due from you and you have
evaded payment of the same.

(2) And whereas a notice of demand calling on you to pay the dues within

the specified time was served with notice to show cause.

(3) And whereas you have not paid up your dues specified in the notice.

(4) And whereas you have not submitted explanation/ your explanation is
unsatisfactory.

(5) Now, therefore I under the authority of the sub section (1) of Section
102/..................of the Assam Cooperative Societies Act, 2007 read with

the sub- section (1) of Section 114 of the Assam Cooperative Societies
Act, 2007 do hereby order that the above mentioned sum of

Rs................................................................. (Rupees.............................).
Is due to the above named from you and that you will pay the amount

with further interest on the principal sum at the rate of

....................................... percent........ per annum from

............................................... together with all cost till the date of
realization of the above mentioned sum.


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432 THE ASSAM GAZETTE, EXTRA ORDINARY, FEBRUARY 4, 2012

(6) I further order that the title and interest of ............................... in the

properties set out and described in the schedule below be soid as an
arrear of land revenue under the provisions of Assam Land and
Revenue Regulation Act, 1886 (Regulation I of 1886) and that, if the
sale proceeds should be found insufficient to discharge the dues with
subsequent interest at the above rate till the date of realization and costs
in full .the balance be realized by attachment and sale of the other
movable property of judgment- debtor as an arrear of land revenue

(7) Further take notice that if you fail to pay the amount as ordered above

within a period of thirty days from the date of service of Certificate you
shall also be liable to prosecution under sub section(6) of section 114 of
the Assam Cooperative Societies Act, 2007 in addition to other
measures for the recovery of the amount payable by you.

**Schedule**

Dated Guwahati/..............

The.........................

Registrar of Cooperative Societies, Assam

N.B. The irrelevant words/ portions may be struck off and the relevant entries

may be made where necessary.

MOHD.A.HAQUE,

Secretary to the Govt, of Assam,

Legislative Department, Dispur.

G uw ahatiPrinted and Published by the Dy. Director (P & S), Directorate of Ptg. & Sty. Assam, Guwahati-21.

Ex. Gazette No. 115-600 + 300+10-4-02-2012.


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