Bihar Cooperative Societies Act, 1935
Bihar Cooperative Societies Act, 1935
[ACT VI OF 1935] 1
[29th May, 1935]
An Act to consolidate and amend the law relating to cooperative
Societies in the States of Bihar
Preamble.- whereas it is expedient to facilitate the formation,
working and consolidation of Cooperative Societies for the
promotion of thrift, selfhelp and mutual aid among agriculturists
and other persons with common needs and for that purpose to
consolidate and amend the law relating to Cooperative Societies
in the States of Bihar.
And whereas previous sanction of the Governor-General under
sub-section (3) of section 80-A of the Government of India
Act has been obtained to the passing of this Act;
It is hereby enacted as follows –
CHAPTER -I : Preliminary
1. Short title and extent. – (1) This Act may be called
the Bihar Cooperative Societies Act, 1935.
(2) It extends to the whole of the State of Bihar.
2. Definitions. – In this Act unless there is anything
repugnant in the subject or context –
(a) “bye-laws” means the registered bye-laws
for the time being in force and includes a registered amendment
of the bye-laws:
(b) “cooperative Federation” means a registered
Society the main object of which is to co-ordinate and facilitate
the activities of other registered societies and to foster
the growth of the cooperative movement:
(bb) Cooperative Year” means a year beginning with
the I st April and ending on the 31th March;
(c) ‘financing bank’ means the State Bank of India,
a nationalized Commercial Bank, a state Cooperative Bank,
a Central Cooperative Bank, a Land Development Bank, Regional
Rural Bank or any other bank to be notified by the State Government,
the objects of which include the creation of funds out of
which money is to be lent to the Cooperative Societies or
other institutions or both;
(d) ‘Liquidator’ means a person or persons appointed
by the Registar under sub-section (1) of section 44 to wind
up the affairs of a registered society;
(e) ‘ Managing Committee’ means the committee
of management of other body to whom the management of the
affairs of a registered society is entrusted;
(f) “member’ includes a person Joining in the
application for the registration of a society and a person
admitted to membership after registration in accordance with
the rules and the bye-laws of such society;
(ff) ‘ Multi-purpose Cooperative Society” is
a primary society formed for providing more than one type
of service to its members and includes a society registered
as a Cane-growers’ Cooperative Society;
(fff) ‘ nominal or associate member’ means a
member who possesses such privileges of rights of member of
a member of society, and who is subject only to such liabilities
of a member as may be specified by the bye laws;
(g) ‘ Officer’ includes a chairman, secretary,
treasurer, member of a managing committee of any other person
empowered by or under this Act, or rules of the bye-laws of
registered society to give direction in regard to the business
of the society;
(gg) ‘ Officer- bearer of a managing committee’
means and includes the Chairman, the Vice-Chairman, the Secretary,
the Joint Secretary, the Treasurer of any such functionary
by whatever name he may be designated;
(ggg) ‘ Primary society’ is a society of which
no member is a registered society’
(gggg) ‘Primary agricultural credit Society” means
a Cooperative Society, the primary object of which is to render
assistance, financial or otherwise, to farmers, rural artisans
and agricultural labourers and includes farmers service society
and multipurpose Cooperative Society;
(h) ‘Registered society’ means a society registered
or deemed to be registered under this Act;
(i) ‘ Registrar’ means a person appointed to perform
the duties of Registrar of Cooperative societies under this
Act.
(j) ‘rules’ means rules under this Act.
(K) “Family” means husband, wife and their dependent
sons and unmarried daughers as unit.”
3. Indian Companies Act. 1913 not to apply. – The provisions
of the Indian Companies Act, 1913 (7 of 1913) shall not apply
to registered societies.
4. Saving of existing Societies. – (1) Every society
now existing which has been registered under the Cooperative
Societies Act. 1912 (2 of 1912), shall be deemed to be registered
under this Act and its bye-laws shall, so far as they are
not inconsistent with the express provisions of this Act,
continue in force until altered or rescinded.
(2) All appointments, rules and orders made, notifications
and notices issued, all transactions entered into, suit and
other proceedings instituted under the said Acts, shall be
deemed, so far as may be, to have been respectively made,
issued, entered into and instituted, under this Act.
5. Construction of reference to Cooperative Societies Act,
1912 in enactments. – All references to the Cooperative
Societies Act, 1912 (2 of 1912) occurring in any enactment
made by any authority in India and for the time being in force
in the State of Bihar 2 [x x x] shall, in the application
of such enactment to the said States be construed as references
to this Act.
CHAPTER II : Registration of Societies
6. The Registrar. – (1) The State Government may appoint
a person to be Registrar of Cooperative Societies for the
State of any portion of it, and may appoint persons to assist
such Registrar.
(2) The State Government may, by general or special order
published in the official Gazette. Confer –
(a) on any person appointed under sub-section (1), to assist
the Registrar, all or any of the powers of the Registrar under
the Act except the powers under section 26, and
(b) on any Cooperative Federation or Financing Bank. all
or any of the powers of the Registrar under section 20, sub-section
(3) of section 28 and section 33, Section 34, Section 35,
and Section 36,
(3) Where the State Government is of opinion that the Registrar
needs the assistance of Additional Registrar for speedy disposal
of business, it may by order published in the official gazette,
appoint such number of Additional Registrars as it may deem
fit.
(4) Notwithstanding anything to the contrary contained in
any other provisions of the Act, Registrar may delegate, transfer
of assign to the Additional Registrar such of his powers and
functions and duties as he may consider necessary including
the power under Sections 26 and 50 and the Additional Registrar
shall, thereupon have powers of registrar in matters so delegated,
transferred of assigned to him.
7. Societies which may be registered - (1) Subject to the
provisions of this Act, a Cooperative Society constituted
in accordance with the provisions of the said Act as amended
form time to time, which has as its object the promotion of
the common interest of its members in conformity with the
Cooperative principles and securing the fulfillment of any
of all directives contained in Part IV of the Constitution
of India, may be registered under this Act with or without
limited.” common interest of its members and securing
the fulfillment of any all directive contained in Part IV
of the Constitution of India, may be registered under this
Act with or without limited liability:
Provided that, unless the State Government by general or
special order otherwise directs-
(a) The liability of society of which a member is a registered
society shall be limited, and
(b) the liability of a society of which the primary object
is the creation of fund to lent to its members, and of which
the majority of the members are agriculturists, and of which
on member is a registered society, shall be unlimited.
(2) Where the liability of a society is limited, the liability
of each member, past member, of the estate of a deceased member
shall on liquidation, be limited to the amount, if any, unpaid
on the shares held by such member, or where the liability
limited by guarantee, to the amount of such guarantee, or
where it is limited in an other manner, then as may be determined
by the rules or bye laws subject, however to section 32.
(3) Where the liability of a society is unlimited, all members,
past members and the estates of deceased members shall on
liquidation be jointly and severally liable of and in respect
of all its obligations, subject, however, to the provisions
of section 32.
8. Conditions of registration – (1) No society, other
than a society of which a member is registered society, shall
be registered under this Act which does not consist of at
least ten persons above the age of eighteen years and, where
the primary object of the society is the creation of funds
to be lent to its members, unless such persons-
(a) reside in the same town or village or in the same group
of villages; or
(b) save where the Registrar otherwise directs, are members
of the same tribe, class or occupation.
(1A) The State Government may by notification in the official
Gazette reduce the minimum number of membership of 10 persons
for particular class of Cooperative Societies.
(2) The word ‘limited’ shall be the last word
in the name of every society with limited liability registered
under this Act.
9. Application for registration. - (1) An application for
the registration of a society shall be made to the Registrar,
and shall be accompanied by a copy of the proposed bye-laws
of the society; and the persons by whom or on whose behalf
such application is made shall furnish such information in
regard to the society as the Registrar may require.
(2) The application shall be signed –
(a) if none of the applicants is a registered society by at
least ten persons or less number of persons qualified in accordance
with the requirements of sub-section (1) or sub-section (1A)
of Section 8;
Provided that applicants, either male of female, shall be
form different families:
(b) If any of the applicants is a registered society, by
a duly authorised person on behalf of every such registered
societiey, and where all the members of the society are not
registered societies, by ten other members or, where there
are less than ten other members, by all of them.
(3) The following shall be attached to such applications
:-
(a) Four copies of the proposed bye-laws of the Cooperative
Society as adopted by the founder members
(b) A list containing names of members with their address,
occupation and share participation.
(c) A list containing names of the persons of first Board
as elected by the founder members.
(d) True copy of the resolution of the meeting duly signed
by the Chairman in which the Bye Laws have been adopted.
10. Power of Registrar to decide certain questions. –
When any questions arises whether for the purposes of this
Act a person is an agriculturist, or whether any person is
resident in a particular town or village or group of village,
or whether to or more villages shall be considered to form
a group or whether any person belongs to any particular tribe,
class or occupation, the question shall be decided by the
Registrar, whose decision shall be final.
11. Registration. – 4 (1) If the Registrar is satisfied
that a society has complied with provisions of this Act and
Rules and that its proposed bye-laws are not contrary to this
Act, or the Rules, he may register the Society and its bye-laws.
And he will send by registered post of organizer/ promoter
of the Society, within 90 days from the date of submission
of application, a registration certificate and original copy
of the registered bye-laws duty sealed and signed by him.
(2) If in the opinion of the Registrar, the conditions stipulated
under sub-section (1) above appear not have been complied
with within 90 days of presentation of the application before
him, he shall record reasons for refusal and refuse to register
the society and send this decision by registered post to the
organiser/ promoter. In the event of the refusal not being
sent within the stipulated period, the Society shall be deemed
registered and in such a situation the Registrar within one
month thereafter shall send by registered post, the registration
certificate for deemed registration alongwith original copy
of the registered bye-laws duly sealed and signed.
(3) In the event where the organiser/ promoter has received
the refusal order in accordance with the provisions of sub-section
(2) or has not received registration certificate of deemed
registration an appeal shall lie to the Registrar if the refusal
order has been passed by an officer appointed to assist the
Registrar under sub-section 2 (a) of section 6 of this Act
and to the State Government if such order has been passed
by the Registrar himself:
Provide that such appeal shall lie within sixty days from
the receipt of the refusal order of within sixty days from
the expiry of the prescribed period of communication in case
of deemed registration.
(4) If in the opinion of the Registrar, the organiser/ promoter
has got society registered by mistake, then the Registrar
shall appeal to the State Government for cancellation of the
said registration.
Provide that such appeal may be filed within sixty days from
the registration order.
12. Evidence of registration – A certificate of registration
signed by the Registrar shall be conclusive evidence that
the society therein mentioned is duly registered unless it
is proved that the registration of the society has been cancelled.
CHAPRER III : Incorporation, Duties and Privileges of Registered
Societies
13. Societies to be bodies corporate. – The registration
of a society shall render it a body corporate by the name
under which it is registered, with perpetual succession and
a common seal and with power to acquire and hold property,
to enter into contract, to institute and defend suits and
other legal proceedings and to do all thing necessary for
the purposes for which it is constituted.
13 A. Promotion of Cooperative movement by Government. –
(1) It shall be the duty of the State Government to encourage
and promote the Cooperative movement in the State and to take
such steps in this direction as may be necessary. (2) Without
prejudice to the generality of the provisions contained in
sub-section (1), the State Government may –
(a) With a view to aid the growth of a registered society
in general or of any class of registered societies subscribe
directly to the share capital of a registered society;
(b) assist indirectly in the formation and augmentation of
the share capital of a registered society;
(c) give loans of make advances to a registered society or
guarantee repayment of principal and payment of interest on
debentures issued by a registered society or guarantee repayment
of principal and payment of interest on loans or advances
to a registered society.”
13 B. Display of Name. – Every Cooperative Society shall
display name and address of its registered office as registered
under the Bihar Cooperative Societies Act, 1935 in legible
letters and as such conspicuous places of every such office
where it carries its business and in the following also.
(a) Every information and authorised publication.
(b) All contracts, business, letters indents, Invoice, Statements
of accounts, Money receipts, Vouchers etc.
(c) All Bills of Exchange, Promissory Notes, Endorsements,
Cheques and pay orders which are signed by or on its behalf.
(2) Every registered Society must have the word/ words “
Cooperative” and “Limited/ unlimited” in
its name in State language of synonymous words of other languages
recognised in the State List.
14. Registered Societies to have a managing committee etc.-
(1) Every registered Society shall have an address, registered
in accordance with rules, to which all notices and communications
may be sent and send notice, in writing to the Registrar and
to the financing Bank, if any, of which it is a share holder
and to the Cooperative Federation, if any, of which it is
a member, of any change in the said address within fifteen
days of such change.
(2) The management of registered society shall be vested
in a managing committee constituted in accordance with the
provisions of this Act and rules/ byelaws of the society made
under this Act.
Notwithstanding any thing contained in any provision of this
Act or Rules Byelaws of the Society the Maximum number of
members including office bearer of office bearers in a managing
committee of Society shall be seventeen in Apex and State
level Society, fifteen in Central Cooperative Society and
thirteen in Primary Society:
Provided that in the Managing Committee of such societies
or of class of societies and in such areas as the State Government
may by general or special order direct, at least two seats
shall be reserved for the members belonging to the Scheduled
Castes or Scheduled tribes two seats for the ladies and one
seat each for backward caste. The seats so reserved shall
be filled up from amongst the members of scheduled castes
or scheduled tribes, ladies and backward and other backward
castes members either by election or/ and by cooption. The
provision shall apply to all Sacieties form the primary Society
and up to the Apex Society.
(3) An Officer of the State Government if deputed to a registered
society either as a Managing Director, Executive Officer or
in similar position shall be the chief Executive there of
and subject to general direction and control the Managing
Committee, shall have the following powers and functions :-
(i) to have genera control over the administration of the
registered society;
(ii) to convene meeting of the Managing Committee;
(iii) to receive all moneys and securities on behalf of registered
society and to make arrangement for the proper maintenance
and custody of cash balances and other properties of the registered
society;
(iv) to endorse and transfer promissory notes, Government
and other Securities and to endorse, sign and negotiate cheques
and other negotiable instrument on behalf of the registered
society,
(v) to be responsible for the general conduct, supervision
and management to the day-to-day business and affairs to the
registered society;
(vi) to sign all deposits receipts and operate the accounts
of the registered society with Bank;
(vii) to sign all bonds and agreements on behalf of the registered
society;
(viii) to determine the powers, duties and responsibilities
of the employees of the registered society;
(ix) to appoint, promote, transfer, punish, suspend, remove
or dismiss any paid employee of the registered society except
to the extent of the powers vested in the Managing Committee
under the bye-laws of the registered society;
(x) to institute, conduct, defend; compound or to withdraw
any suit or other legal proceedings for or against the registered
society and also to compound and allow time for payment or
satisfaction of any claims;
(xi) to delegate all or any of the powers to an employee or
employees of the registered society subject to his control
and supervision;
(4) Notwithstanding any thing contained in any provision
of this Act, or of rules framed there under or the bye-laws
of any registered Society where the State Government has Subscribed
directly to the Share Capital or a registered Society an amount
exceeding Rupees Thirty Lakh, in that case the State Government
Shall have the right to nominate three persons as members
on the Managing Committee of that Society:
Provided that among the members so nominated two will be
from the Government service the third one will be an officer
of Cooperative/ Financing Institution connected with the affairs
of the Society.
Provided further that those ex-officio members as provided
in the bye-laws of the society shall be counted in the quota/
numbers fixed/ provided for nomination.
Provided further also that such nominated members shall participate
in any meeting of the managing committee of ordinary general
meeting of the share holders of the registered Society, convened
in accordance with the provisions of the Act and Rules framed
thereunder and its bye laws. They shall have right to vote
in the meeting of the managing committee but shall have no
right to vote in the ordinary general meeting of the share
holders.”
(5) Notwithstanding any thing contained in any provision of
this Act, Rules made there under and the bye-laws of the society
the existing members and office bearers nominated by the Government
shall cease to be a member of the managing committee within
ninety days of the publication of this Amendment Act in the
Official gazette; and such registered society shall have elections
to the vacant posts for the remaining period of its term;
Provided further that in superseded societies the Administrator
of the society shall constitute new managing committee by
election within twelve months from the date of publication
in the official gazette of this Amendment Act 2002; otherwise
the Registrar shall appoint a new Administrator for a further
period f three months and get the managing committee constituted
by election.
(7) Notwithstanding the provisions of sub-section (9) the
nominated members of the managing committee shall hold office
during the pleasure of the State Government.
(9) Notwithstanding anything contained in the Rules or Bye-laws
of any Registered Society, the term of the members and the
office-bearers of the managing committee of a registered society
shall not exceed five years form the date of election.
(10) If, for any reason, elections are not held within the
said period after expiry of the term of the managing committee
the committee shall be deemed to have been superseded with
effect from the said date and the Registrar Cooperative Societies
shall appoint any government servant as administrator for
a period not exceeding six months for constitution of managing
committee in accordance with law.
Provided that if for certain special circumstances the election
of the members an office bearer of the managing committee
is not held within the stipulated period of six months, the
Registrar after obtaining explanation from the administrator
and after recording reasons in writhing may extend the period
of supersession for a period not exceeding three months:
Provided further that the term of the Managing Committee
as provided in sub- section (9) shall be effective if the
election of the Managing Committee has been held after coming
into force of this Amendment act.
Provided further that the administrator appointed for superseded
society prior to the commencement of this Amendment Act shall
Continue to hold tution of a new managing committee by election
whichever is earlier.’’
(11) Every registered society shall keep open to inspection
free of charge at all reasonable times at its registered address-
(a) a copy of this Act.
(b) a copy of the rules governing such society.
(c) a copy of the bye-laws of such society, and
(d) a register of its members;
15. Restrictions on borrowing. –A registered society
shall receive deposits and loans from members and non-members
only to such extent and under such conditions as may be prescribed
by the rules or bye-laws.
16. Restrictions on lending. – (1) Except with the
general of special sanction of the Registrar and subject to
such restrictions as he may impose, a registered society shall
not –
(a) make a loan to any person other than a member, or
(b) lend money on the security of movable property,
“Provided if any reference is received, the Registrar
shall dispose off the reference within three months of its
receipt.”
(2) The State Government may, by general or special order,
prohibit or restrict the lending of money or mortgage of immovable
property by registered society or class of registered societies.
(3) Where the Registrar has accorded sanction to a financing
Bank under the provisions of sub-section (1), a registered
society which is member of such financing Bank may, subject
to the terms of the sanction and such other terms and conditions
as may be prescribed by the Registrar, act as agent for the
financing Bank and as such agent carry out, with or without
any commission, all or any transactions connected with loans
or advances made or to be made by the financing Bank.
17. Restrictions on other transactions with non-member.- The
transactions of a registered society with persons other than
members shall be subject to such further prohibitions and
restrictions. If any, as the State Government may by rules
prescribe.
18. Reserve fund. – (1) At least twenty five percent
of the net profits of a registered society shall each year
be deposited to reserved provided that the State Government
may by rule increase or decrease this proportion for any work
of any society or class of societies.
(2) The reserve fund shall not be used in the business of
the society except to such extent and in such manner as may
be prescribed by the rules.
(3) At least ten precent of the net profit shall be transferred
to “Cooperative Education & Development fund”
by all registered societies.
(4) In such registered societies where there is State contribution
to share capital, at least ten percent of the net profit shall
be transferred to an “Equity Redemption Fund”
till such time the amount of this fund becomes equal to the
share capital.
(4) Any portion of the reserve fund not sued in the business
of the society shall be invested of deposited in one more
of the ways specified in section 19 subject to such rules
as the State Government may make in this behalf.
19. Investment of funds. - Subject to the provisions of sub-section
(2) of section (16) a registered society shall invest or deposit
its funds-
(a) in a Government Saving Bank: or
(b) in its own financial Bank or
(c) in any of securities specified in section 20 of Indian
Trust Act, 1882 (2 of 1882)
(c) in sanction specified by reserve Bank of India, or
(e) with the general or special sanction of the Registrar
and on such conditions as he may impose.
(i) in shares or securities of any other registered society.
(ii) in any scheduled Bank or with the sanction or Registrar
in other registered societies carrying Banking business.
(f) may invest or deposit in any other mode permitted by the
rules.
20. Contribution to charitable purpose. – Any registered
society may, after the amount required by sub-section (1)
of section 18 or by any rule has been carried to the reserve
fund, contribute an amount not exceeding ten percent of the
net profits to any charitable purpose, as defined in section
2 of the Charitable Endowments Act, 1890 (6 of 1890) :
Provided that the Registrar may, by general or special order,
prohibit any society or class of societies from making any
condition under this section.
21. Restrictions on division of funds. – No part of
the funds of a registered society shall be divided by law
or dividend or otherwise among its members:
Provided that after the amount required by sub-section (6)
of section 18 or by any rule has been carried to the reserve
fund, the balance of the net profits, if any, together with
any available profits of past years, may be distributed as
dividend among members or paid as bonus or remuneration to
a member for any specific service rendered to the society
or used for the common benefit or members to such extent and
under such conditions as may be prescribed by the rules or
bye-law.
22. Charge and set off in respect of shares of interest of
member. – A registered society shall have a charge upon
the share or interest in the capital and on the deposits or
contribution of a member, past member or deceased member and
upon any amount payable out of profits to a member or past
member or to the estate of a deceased or the estate of such
deceased member to the society, and may set-off any sum credited
or payable to a member, past member of the estate of a deceased
member in or towards payment of any such debt.
23. Prior claim of society. – subject to claim of the
Government in respect of land revenue or any money recoverable
as land revenue or as a public demand or any claim of landlord
in respect or rent or any money recoverable as rent, any debt
or outstanding demand due to a registered society from any
member, past member, or the estate of deceased member, shall
be a first charge –
(a) If the demand as due in respect of the supply or any loan
grant for the purchase of seed or manure upon the crops or
other agricultural produce of such member or past member or
belonging to the estate of such deceased member, at any time
within two years from the date on which the last installment
of such supply or loan shall become re-payable;
(b) If the demand is due in respect of the supply of or any
loan granted for the purchase of cattle, fodder for cattle,
agriculture or industrial implements or machinery or raw materials
for manufacture upon any cattle or things so supplied, or
purchased, the whole or any part from any such loan or upon
any articles manufactured from raw materials so supplied or
purchased.
23 A. Application of section 23 to non-members.- Any debt
to outstanding demand due to a registered society, authorised
under clause (a) of
sub-section (1) of section 16, from any non-member or estate
of a deceased non-member, shall be a first charge on the property
of the non-member or belonging to the deceased non-member
to the same extent and subject to the same claims, conditions
and restrictions as debt or outstanding demand due to a registered
society from any member or the estate of a deceased member
is under section 23 a first charge on the property of the
member or belonging to the estate of the deceased member.]
24. Transfer of interest on death of member.- (1) A registered
society may on the death of a member, transfer his share of
interest in the capital of the society to the person nominated
in accordance with the rules or, if there is no person so
nominated, to such person as may appear to the society or,
managing committee to be the heir or legal representative,
as the case may be, a sum representing the value of such member’s
share or interest, as ascertained in accordance with the rules
or bye-laws :
Provide that –
(i) In the case of society with unlimited liability, such
nominee, heir of legal representative as the case may be,
may require payment by society or the value of the share or
interest of the deceased member ascertained, after deduction
the amount of any charge existing under section 22:
(ii) in the case of a society with limited liability, the
society shall transfer, subject to any charge existing under
section 22 , the share or interest of the deceased member
to such nominee, heir of legal representative, as the case
may be, being qualified in accordance with the rules and bye-laws
for membership of the society or in his application within
three months of the death of the decease member, to any person
specified in the application who is so qualified :
Provided further that no payment of sum in excess of rupees
one hundred shall be made to any such heir or legal representative
who has not been nominated in accordance with the rule, until
after the decision under section 48 of any claim which may,
within that period, be made by any other person.
(2) Subject as aforesaid, a registered society may pay all
other money due to deceased member from the society to such
nominee heir or legal representative, as the case may be.
(3) All transfers and payments, made by a registered society
in accordance with the provisions of this section shall be
valid and effectual against any demand made upon the society
by any other person.
24A , Power of Registrar to sanction compromise between a
registered society and its creditors. – (1) Notwithstanding
anything contained in this Act, where a compromise or arrangement
is proposed between a registered society and its creditors
or any class of them, the Registrar may on the application
in a summary way of the society or of any creditor, or in
the case of a society in respect of which an order of winding
up has been passed, if the liquidator, order a meeting of
the creditors or class of creditors as the case may be, to
be called, held and conducted in such manner as may be prescribed
by rules.
(2) If a majority in number representing three-fourth in
value of the creditors, of class of creditors, as the case
may be present either in person or by proxy at the meeting,
agree to any compromise or arrangement, the compromise or
arrangement shall, if sanctioned by an order of the Registrar,
be binding on all the creditors or the class of creditors
as the case may be and also on the society, in the case of
a society in respect of which an order of winding up has been
passed, on the liquidator and on all persons who have been
or may be required by the
liquidator acting under clause (c) of sub-section (3) of section
44 to contribute to the assets of the society.
(3) If at any time it appears to the Registrar that it is
expedient that any compromise or arrangement between a registered
society and its creditors or any class of them, which has
become final in accordance with the law in force on the date
of the commencement of the Bihar Cooperative Societies (Amendment)
Act, 1942 (Bihar Act 7 of 1942) or which was, after the date
sanctioned by the Registrar under sub-section (2) of this
Section, should, in the interest of society or of its creditors
or of the said class of creditors, be revised or replaced
by a fresh compromise or arrangement, he may either of his
own motion or on the application of the society, order a meeting
of the creditors or class or creditors as the case may be,
present either in person or by proxy at the meeting, agree
to the revision of the previous compromise or arrangement,
or to any fresh compromise or arrangement, the Registrar may
sanction such revised compromise or arrangement or such fresh
compromise or arrangement.
(4) Any revised compromise or arrangement or fresh compromise
or arrangement sanctioned under sub-section (3) may be revised
or replaced by a fresh compromise or arrangement in the like
manner and subject, to the like conditions as a compromise
or arrangement any be revised or replaced by a fresh compromise
of arrangement under sub-section (3).
(5) Any revised compromise or arrangement or fresh compromise
or arrangement sanctioned by the Registrar under sub-section
(3) or sub-section (4) be binding on all the creditors or
the class of creditors, as the case may be, and also on the
society.
(6) A compromise or arrangement under sub-section (2) or
a revised compromise or arrangement or a fresh compromise
or arrangement under sub-section (3) or sub-section (4) shall
not be liable to be challenged, set aside, modified, revised
or declared void in any Court, upon merits or upon any ground
whatsoever except want of jurisdiction.
(7) The order of the Registrar calling a meeting of creditors
or class of creditors, as the case may be, under sub-section
(1) or sub-section (3), and the order of the Registrar sanctioning
a compromise or arrangement under sub-section (2) or a revised
compromise or arrangement or a fresh compromise or arrangement
under sub-section (3), or sub-section (4) shall be published
in the official Gazette.]
25. Amendment of the bye-laws of a registered society. –
(1) No amendment of the bye-laws of a registered society shall
be valid until the amendment has been registered under this
Act.
(2) If the Registrar is satisfied that an amendment to the
byelaws is not contrary to this Act or to the rules, he shall
register the amendment within ninety days from the date of
submission of the proposal for amendment.
(3) When the Registrar registers an amendment of the bye-law
of a registered society, he shall issue to the society a copy
of the amendment certified
by him, which shall be conclusive evidence that the amendment
has been duly registered.
(4) If the conditions specified in sub-section (2) have not
been fulfilled the Registrar shall dispatch refusal order
with reasons by registered post within ninety days from the
submission of the proposal
(5) In case of non-dispatch of the refusal order within ninety
days, the amendment shall be deemed registered. In such cases
it will be essential for the Registrar to issue the certificate
of registration under his seal and signature, which will be
conclusive evidence that amendment has been duly registered.
(6) On receipt of the refusal order under sub-lection (4)
and on non-receipt of the conclusive evidence relation to
the amendment as specified under sub-section (5) an appeal
shall lie before the Registrar if the conclusive evidence
or refusal order relates to the Registrar having been delegated
with the power of Registrar and if such order has been passed
by the Registrar Cooperative Society himself then appeal shall
lie before the state Government:
Provided that such appeal shall be filed within two months
from the receipt of order or non receipt of conclusive evidence.
26. Power of Registrar to direct amendment of the bye-laws
of a registered society.- (1) If it appears to the Registrar
that an amendment of the byelaws of a registered society is
necessary or desirable in the interest of such society, after
taking the opinion of affiliating society/federation of that
society, he may, by order in writing to be issued to the society,
by registered post, require the society to make the amendment
within such time as he may specify in such order.
(2) If any society fails to make any such amendment within
the time specified, the Registrar may, after giving the society
an opportunity of being heard, register such amendment, and
issue to the society by registered post a copy of the amendment,
certified by him, which shall be conclusive evidence that
the amendment has been duly registered, and such amendment
shall be binding on the members of such society.
(3) An appeal shall lie to the State Government from any
order of the Registrar passed under sub-section (2) within
two months from the date of the issue of such order. The order
of the State Government on appeal and, subject to the result
of such appeal, if any, the decision of the Registrar shall
be final.
CHAPTER IV : Rights and Liabilities of Members of Registered
Societies.
27. Member not to exercise rights till due payment made. –
No member of a registered society shall exercise the rights
of a member unless or until he has made such payment to the
society in respect of membership as may be prescribed by the
rules of bye-laws:
Provided that notwithstanding any thing contained in any
provisions of this Act, the member of a registered Society
shall exercise the right to vote at the
election of members of the managing committee of society only
after acquiring such interest in the society, as may be prescribed
by the rules of bye-laws.]
28. Votes of members. - (1) Subject to the provisions of
sub-section (2) of this section and of sub-section (4) of
Section 14 each member of a registered society shall have
one vote only as a member in the affairs of the society, provided
that in the case of an equality of votes, the Chairman shall
have a casting vote.
(2) A registered society which is a member of any other registered
society shall have as many voters as may be prescribed by
the bye-laws of such other society, and may, subject to such
bye-laws, appoint any number of its members, not exceeding
the number of such votes, to exercise its voting power, provided
that no member who is disqualified for such appointment under
any rule shall be so appointed.
(3) Save as provided in sub-section (2), voting by proxy
shall not be allowed except with the general of special sanction
of the Registrar for any society or class of societies.
29. Restriction on holding of members. – No member
of a registered society other than the State Government of
another registered society, shall have or claim any interest
in the capital of a registered society exceeding one- fifth
of the total capital or such smaller proportion as may be
prescribed by the rules.
30. Share or interest not liable to attachment. – Subject
to the provisions of section 22, the share or interest of
member in the capital of, or contribution to, a registered
society shall not be liable to attachment or sale under any
decree or order of a Court of justice in respect of any debt
or liability incurred by such member and neither the Official
Assignee under the Presidency-towns insolvency Act, 1909 (3
of 1909) nor a Receiver under the Provincial Insolvency Act,
1920 (5 of 1920) shall be entitled to, or have any claim on,
such share, interest or contribution.
31. Restrictions on transfer of share or interest. –
(1) The transfer or charge of the share or interest of member
in the capital of registered society shall be subject to such
conditions as to maximum holding as may be prescribed by this
Act or by the Rules.
(2) in case of society registered with unlimited liability,
a member shall not transfer any share held by his interest
in the capital or property of the society or any part there
of unless -
(a) he has held such share of interest for not less than one
year; and
(b) the transfer or charge is made to the society or to a
member of society or to a person whose application for membership
has been accepted by the society.
32. Liability of a past member and of the estate of a deceased
member. – The liability of a past member or of the estate
of a deceased member for the debts of a registered society
as they existed on the date of his ceasing to be a member
or of his decease, as the case may be, shall continue for
a period of two years from such date.
CHAPTER V :Audit and inspection
33. Audit.- (1) The Registrar shall audit or cause to be audited
by some person (hereinafter referred to as the auditor ) authorised
by him by general or special order in writing in this behalf
the accounts of every registered society once at least in
very year.
(2) Every officer or member of the society shall furnish such
information in regard to the transactions and working of the
society as the Registrar or the auditor any require.
(3) The audit under sub-section (1) shall be conducted according
to the rules, and shall include an examination of over due
debts, if any, the verification of the cash balance and a
securities a valuation of the assets and liabilities of the
society.
(4) The auditor shall submit a report on such examination,
verification and valuation, and shall include in his report
a statement of –
(a) every transaction which appears to the auditor to be contrary
to law or to the rules or bye-laws of the society;
(b) the amount of any deficiency or loss which appears to
have been incurred by the culpable negligence or misconduct
of any person;
(c) the amount of any sum which ought to have been but has
not been brought into account by any person; and
(d) any money or property belonging to the society which has
been misappropriated or fraudulently retained by any person
taking part in the organization or management of the society
or by any past of present officer of the society or any other
person.
(5) The Registrar may determine the sum to be paid by any
society towards the cost of auditing its accounts under this
section, and such sum shall be paid by the society in such
manner as the Registrar may direct.
34. Inspection by Registrar. – The Registrar may from
time to time inspect a registered society himself or cause
it to be inspected by some person authorised by him in this
behalf by general or special order.
35. Inquiry by Registrar. – (1) The Registrar may,
of his own motion and shall, on the request of the Collector,
or on application of a majority or the managing committee,
or of not less than one-third of the members, hold an inquiry,
or direct some person authorised by him by order in writhing
in this behalf to hold an inquiry, into the constitution,
working and financial condition of a registered society.
(2) The Registrar of the person authorised by him under sub-section
(1) may -
(a) require an officer of the society to call a general meeting
at such time and place at the headquarters of the society,
and require the society to take into consideration such matters,
as he may direct, and
(b) if the officer of society refuses or fails to call such
a meeting or if there be no quorum at a meeting so convened,
call such meeting himself by giving notice to the members
in such a way as he may consider reasonable, notwithstanding
any rules or byelaws prescribing the period of notice for
calling a general meeting of the society. Any meeting so convened
by the Registrar of the person authorised by him under sub-section
(1) shall have all the powers of a general meeting convened
under the bye-laws of the society.
(3) When an enquiry is made under this section, the Registrar
shall communicate the results of the inquiry to the society,
the financing bank, if any, to
which the society is affiliated and to the persons or authority,
if any at whose instance the inquiry is made.
36. Inspection of books by Registrar. – (1) The Registrar
may, on the application of a creditor of a registered society,
inspect or direct some person authorised by him in this behalf
by order in writing to inspect, the book of the society.
(2) No inspection shall be made or directed under section
(1) unless the applicant –
(a) satisfies the Registrar that debt is a sum then due, and
that he has demanded payment thereof and has not received
satisfaction within a reasonable time; and
(b) deposits with the Registrar such sum as security for the
costs of the proposed inspections as the Registrar may require.
(3) Where an inspection is made under sub-section (1), the
Registrar shall communicate the results of such inspection
to the creditor, to the society and to the financing bank,
if any to which the society is affiliated.
37. Inspection of books by financing bank. – (1) A financing
bank may cause an inspection to be made of the books of any
registered society which is affiliated to it and may direct
such society to furnish such information, statement and returns
as may be required.
(2) An Inspection under sub-section (1) may be made by any
of the officers of the financial bank or by any member of
its paid staff approved by the Registrar by general or special
order.
(3) The financing bank shall communicate the result of such
inspection to the Registrar and to the society concerned.
38. Power to call for documents and to issue summons. - The
Registrar of any person authorised to audit the accounts of
a society under section 33 or to make an inspection or to
hold an inquiry under sections 34,35,36 or 37
(a) Shall at all reasonable time 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 of or responsible for the custody
of any such books, accounts, documents, securities, cash or
other properties, to produce the same at the office of the
society or at any branch thereof or except in the case of
a financing bank, at any place at its headquarters;
(b) may summon any person who, has reason to believe has knowledge
of any of the affairs of the society to appear before him
at the office of the society or at any branch thereof or,
except in the case of a financing bank, at any place at its
headquarters, and may examine such person on oath; 2[ and]
(c) may seize in presence of two persons the books, accounts,
documents, securities, cash and other properties belonging
to or in the custody of the society if he apprehends any fraud,
of damage or mutilation of any of the articles above referred
to, and the officer so doing shall grant proper receipt therefore
and, when he is an officer other than the Registrar, immediately
report the seizure to his immediate superior officer and the
Registrar:
Provided that the power under this clause shall be exercised
only by such persons as are authorised by rules made in this
behalf.
39. Cost of inquiry and inspection. – Where an inquiry
is held under section 35, or an inspection is made under section
36, the Registrar may, after giving the parties an opportunity
of being heard and after recording the reasons, apportion
the costs of such inquiry or inspection, or such part of the
costs as he may think fit, between the society, the members
of creditor demanding inquiry of inspection and the officers
of former officers of the society.
40. Surchrge.- (1) Where as the result of an audit under
section 33 or an inquiry under section 35, or an inspection
under section 34, section 36,or section 37, or the winding
up of a society, it appears to the Registrar that any person
who has taken part in the organisation or management of the
society or any past or present officer of the society has-
(a) made any payment which is contrary to law or to the rules
or byelaws of the society, 1[ or against the directions or
instructions of the financing bank for which the society is
acting as agent under sub-section (3) of Section 16], or
(b) by reason of his culpable negligence or misconduct, involved
the society, 2[ or the financing bank for which it is acting
as agent under sub-section (3) of Section 16] in any loss
or deficiency, or
(c) failed to bring into account any sum which ought to have
been brought into account, or
(d) misappropriate or fraudulently retained any property of
the society 1[ or of the financing bank, for which it is acting
as agent under sub-section (3) of Section 16.
The Registrar may inquire into the conduct of such person,
or officer and after giving such person or officer an opportunity
of being heard make an order requiring him to contribute such
sum to the assets of the society 1[ or of the financing bank,
as the case may be], by way of compensation in respect or
such payment or loss of sum, or to restore such property as
the Registrar thinks fit, together with such sum as the Registrar
may fix to meet the cost of the proceeding under this section:
Provided that, before any order requiring such person or officer
to contribute is passed in respect of a payment referred to
in clause (a) reasonable time shall be given to such person
or officer to recover the amount of such payment from the
payee and credit it to the society, or, as the case may be,
of the financing bank]:
Provided further that any order under this sub-section shall
be passed for any commission or omission specified in (a),
(b), (c) and (d) within six years from the date of occurrence
or within three years from the date of submission of surcharge
proposal whichever is earlier
(2) This section shall apply notwithstanding that such person
or officer may have incurred criminal liability under this
Act or under any other law.
(3) An appeal shall lie from an order of the Registrar under
sub-section (1) to the State Government on application made
by the person or officer against whom such order was passed
within three months from the date of the communication to
him of such order. The order of the State Government on appeal,
and subject to the result of such appeal, if any, the order
of the Registrar, shall be final.
CHAPTTER VI : Dissolution of Registered Societies.
41. Dissolution of Managing Committee. - (1) In the opinion
or the Registrar, the Managing Committee of any registered
society in which the economic interest of the Govt. is apparently
clear, is Mismanaging the affairs of the registered society
or is persistently making default or is negligent in the performance
of the duties imposed on it by this Act, the Rules, by-laws,
he may, after giving opportunity to the managing committee
to state its objection if any and after obtaining opinion-
within twenty one days from the chief executive of the affiliating
Federation/ Society, by order in writhing suspend the Managing
Committee for a period not exceeding six months. During the
period of suspension the Managing Committee of the registered
society shall there upon cease to function, Registrar shall
appoint, any Government Servant a special officer to conduct
the affairs of the society and shall fix his duties and liabilities.
Provided that the suspended managing committee, if not reinstated
earlier shall resume functioning immediately after six months.
The period under suspension shall count towards its term.”
(2) From the date of reinstatement, a maximum period of six
months shall be the period of observation of the working of
Managing Committee. If desired improvement in management is
not seen, suspension proceeding may be converted into a supersession
proceeding and, adopting a procedure similar to that prescribed
in subsection (1) for its, suspension, the Managing Committee
may be superseded for a period not exceeding six months and
it may be ordered that all or any of its members shall be
disqualified from being elected to the Managing Committee
for the period specified in the order not exceeding three
years.
Provided that if within six months from the date of reinstatement
of the committee the suspension proceeding is not converted
into supersession proceeding then that proceeding will be
barred by limitation:
Provided that if within six months from the date of reinstatement
of the committee the suspension proceeding is not converted
into supersession proceeding then that proceeding will be
barred by limitation:
Provided further that the Registrar, in special circumstances
and for constitution of Managing Committee by election, may
further extend the period of supersession by a maximum period
of three months. He may constitute a committee of three persons
for managing the affairs of the society in place of Administrator.
In such committee the powers of Managing Committee shall remain
vested.
The Registrar shall record every order passed under this
section and inform the concerned society by registered post.
(3) When a Managing Committee is 1[ superseded under sub-section
(2), the Registrar shall appoint an Administrator on such
remuneration, if any, as he may fix, to carry on the business
of the society, and the Administrator, shall subject to any
direction issued by the Registrar from time to time, exercise
all the powers and perform all the duties which may under
this Act, lthe rules and the bye-laws, be exercised or performed
by the Managing Committee or any officer of the registered
society:
Provided that the Registrar shall have the power to change
the Administrator during the period of dissolution.
(4) The Registrar shall, before the expiry of the period
of supersession under sub-section (2), require the Administrator
to take necessary action for the Constitution of the new Managing
Committee and the Administrator shall forth with hand over
the management to the mew managing Committee constituted in
accordance with the provisions of the Act and the Rules.
(5) The Registrar may dissolve the Managing Committee of a
registered society in case where –
(a) majority of the members and elected office- bearers of
the Managing Committee of a registered society resign from
their respective membership of office: or
(b) half the total member of seats of the Managing Committee
of a registered society, becomes vacant for any reason whatsoever,
and shall appoint Administrator for the better management
of the registered society.
Provided that if during the period of dissolution of the Managing
Committee, the Registrar is satisfied that the affairs of
a registered society have sufficiently improved and it is
desirable to restore the management to a newly elected Managing
Committee, he may by order direct that the Administrator shall
take steps for the constitution of a new Managing Committee
and on such Committee having been constituted in accordance
with the provision of this Act and the Rules the Administrator
shall hand over the management to such newly constituted Managing
Committee forthwith.
(6) An appeal shall lie from an order of the Registrar under
sub-section (1) & sub section (2) to the state Government
on application made by any member of the Managing committee
within One months from the date of communication of the order
to the registered society concerned. The order of the State
Government on appeal, and subject to the result of such appeal,
if any the order of the Registrar shall be final.
(7) The Registrar may issue such direction to the Administrator
as to his powers and duties and the affairs of registered
society as the Registrar deems desirable and the Administrator
may apply to the Registrar at any time for instruction as
to the manner in which the Administrator shall conduct the
management of the registered society.
(8) Nothing in this section shall be deemed to affect the
powers of the Registrar to order the winding up of a registered
society under section 42 or to cancel the registration of
the registered society under sub-section (8) of Section 44.
42. Winding up order. – The Registrar may, by notification,
order a registered society to be wound up if –
(a) after an inquiry has been held under section 35 or an
inspection made under section 34, section 36 or section 37,
or on receipt of an application made three-fourth of the members
of the society, or of his own motion, in the case of a
society that has not commenced working or has ceased working,
he is of opinion that the society ought to be dissolved, or
(b) It is a condition of the registration of the society that
it should consist of at least ten members who have attained
the age of eighteen years, and it is proved to the satisfaction
of the registrar that the number of members has been reduced
to less than ten.
43. Appeal against the order of winding up. – (1) Any
member of a society in respect of which an order under section
42 has been passed may, within two months from the date of
the publication of such order in the official Gazette appeal
to the State Government from such order.
(2) An order under section 42 shall not take effect until
the expiry of two months from the date of the publication
of such order in the official Gazette or, if an appeal be
preferred, unless and until it is confirmed by notification
or appeal.
(3) The order of the state Government on appeal and, subject
to the result of such appeal, if any, the order of the registrar
shall be final.
44. Liquidation and dissolution. – (1) Where the Registrar
has passed an order for the winding up of a registered society,
he shall appoint a person or persons to be liquidator of the
society.
(2) Notwithstanding anything contained in sub-section (2)
of section 43, liquidator on appointment shall have power
to take Immediate possession of all assets belonging to the
society and all books, records and other documents pertaining
to the business there of and to carry on the business of the
society so far as may be necessary. And all the rights, duties
assets and liabilities of the society shall devolve upon the
liquidator as such.
(3) Subject to the registrar’s power of control and
revision, such, liquidator shall also have power –
(a) to institute and defend suits and other legal proceedings
on behalf of the society by his mane of office;
(b) to determine and realize all sums due to the society from
any person:
(C) to determine from time to time, subject to the provisions
of section 32, the contribution to be made or remaining to
be made by the members or past members or by the estates or
nominees, heirs or legal representatives of deceased members
by any officers or former officers, to the asses of the society
and from time to time, to revise any order of contribution
until the winding up is completed, and to realize such contribution:
(d) to investigate all claims against the society and subject
to the provisions of this Act, to decide questions of property
arising between claimants after giving an opportunity of being
heard to all the creditors:
(e) to pay claims against the society (including interest)
up to the date of the publication in the official Gazette
of the notification ordering the winding up the society according
to their respective properties, if any, in full or rateably
as the assets of the society permit ; and to apply the surplus,
if any, remaining after payment of the claims of the claims
in full, in payment of interest from the said date of a rate
fixed by him but not exceeding in any case the rate agreed
to be paid by the society;
(f) to make any compromise or arrangement with persons between
whom and the society there exists any dispute or to refer
any such dispute to arbitration;
(g) to determine by what persons and in what proportions the
costs of the liquidation are to be borne; and
(h) to give such directions in regard to the collection and
distribution of the assets of the society as may appear to
him to be necessary for winding up the affairs of the society;
Provided that the liquidator shall not determine the contribution,
debt or assets to be recovered from any person unless an opportunity
of being heard has been given to such person.
(4) If an appeal from the order of winding up is allowed
by State Government under section 34, the liquidator shall
give up possession of the assets, books, records and other
documents of the society of the managing Committee; and shall
cease to carry on the business of the society, Provided that
all his acts done in his capacity as liquidator shall continue
to have legal validity as if they had been done by the Managing
Committee or the Society.
(5) With the special sanction of the Registrar, an appeal
shall lie to the Court of the District Judge within three
months from the date of communication by registered post of
an order of a liquidator under clauses (b), (c), (d) (e),
(g) or (h) of sub-section (3) to the person concerned.
(6) The orders of the liquidator, subject to any order of
the Registrar in revision or to any order of the District
Judge on appeal, if any, shall be final.
(7) When the affairs of the society have been wound up, the
liquidator shall deposit the records of the society in such
place as the Registrar may direct.
(8) After the records of society have been deposited under
sub-section (7) the Registrar shall cancel the registration
of the society and the society shall then cease to exist as
a corporate body.
CHAPTER VI-A: Land Development Banks
44A. Definitions.- In this Chapter, unless context otherwise
requires –
(a) ‘Board’ means the Managing Committee of the
State Cooperative Land Development Bank :
(b) ‘Land Development Bank’ Includes the State
Cooperative Land Development Bank and the primary Cooperative
Land Development Band;
(c) “Prescribed’ means prescribed by rules made
under this chapter,
(d) “Primary Cooperative Land Development Bank’
means registered society of that name, registered under section
11, and includes the Bihar State Cooperative and Mortgage
Bank Ltd registered as such under section 11; and
(f) ‘Trustee’ means the Trustee referred to in
section 44.C.
44 B. Application of Chapter to Land Development Bank,- The
Provisions of this chapter shall apply to Land Development
Banks advancing loan for all or any of the purposes herein
enumerated, that is to say-
(i) land improvement and productive purposes:
(ii) the redemption of mortgages on lands;
(iii) the redemption of mortgages on other valuable immovable
property subject to such conditions as may be prescribed;
(iv) the liquidation of debts of agriculturists subject to
such restriction as may be prescribed:
(v) the purchase of acquisition of title to agricultural lands
by tenants; or
(vi) the erection, re-building of repairing of houses for
agricultural purposes.
Explanation.- ‘Land improvement and productive purposes’
means any work, construction or activity which adds to the
productivity of the land, and in particular, includes the
following, that is to say-
(a) construction and repair of wells (including tube-wells,
tanks and other works) for the storage, supply or distribution
of water for the purpose of agriculture or for the use of
men and cattle employed in agriculture.
(b) Renewal or reconstruction of any of any of the foregoing
work;
(c) preparation of land for irrigation;
(d) drainage, reclamation from rivers of other waters or
protection from floods or from erosion or other damage by
water, of land used for agricultural purposes or waste land
which is cultivable;
(e) bunding and similar improvements;
(f) reclamation, clearance and enclosure of permanent improvement
of land for agricultural purposes;
(g) horticulture;
(h) Purchase of oil-engines, pumping sets and electrical motors
for any of the purposes mentioned herein;
(i) purchase of tractors or other agricultural machinery;
(j) increase of the productive capacity of land by addition
to it of special variety of soil;
(k) construction of permanent farm-house, cattle sheds and
sheds fox processing of agricultural produce at any stage.
(l) purchase of machinery for crushing sugarcane, manufacturing
gur of Khadsari sugar or sugar;
(m) purchase of land for consolidation of holdings;
(n) digging canals;
(nn) the establishment of poultry, fishery, dairy, piggery
and sheep rearing, etc. and
(o) such other purposes as the State Government may, from
time to time, by notification in the official Gazette declare
tote improvement for productive purpose for the purposes of
this Chapter.
44C. Appointment of Trustee and his powers and functions.-
(1) The Registrar, or- where the State Government appoint
any other person in this behalf, such person shall be the
Trustee for the purpose of securing the fulfilment of the
obligations of the State Cooperative Land Development Bank
to the holders of debentures issued by the Board.
(2) The powers and functions of the Trustee shall be governed
by the provisions of this chapter and by the instrument of
trust executed between the State Cooperative Land Development
Bank and the Trustee, as modified from time to time by mutual
agreement between the Board and the Trustee.
44D. Trustee to be a Corporation sole.- The Trustee shall
be a corporation sole by the name of the Trustee for the debentures
and as such shall
have perpetual succession and a common seal and in his corporate
name may sue and be sued.
44E. Issue of debenture by the Board.- (1) with the pervious
sanction of the Trustee, and subject to such terms and conditions
as the may impose, the Board may, from time to time, issue
debentures of such denomination for such periods as it may
deem expedient on the security of the mortgages held of mortgages
partly held and partly to be held and either transferred of
deemed to have been transferred, under the provisions of section
44-J, to the State Cooperative Land Development Bank and other
properties of such Bank
Provided that notwithstanding anything contained in this sub-section
regarding issue of debentures on security of mortgages, it
shall be competent for the Board with the pervious sanction
of the trustee, and subject to such terms and conditions as
it may impose to insue debentures in the security of the Governm4ent
guarantee regarding re-payment of principal and payment of
interest thereon in respect of loans issued to the corporate
bodies implementing special schemes of agricultural development
irrigation etc. on the basis of Government guarantee.
(2) Such debentures may contain a term fixing a period not
exceeding thirty years, from the date of issue, during which
they shall be redeemable, or reserving to the Board the right,
to call in at any time any of the debentures in advance of
the date fixed for redemption, after giving to the debenture-holders
concerned not less than three month’s notice in writing.
(3) The total amount due on the debentures issued by the Board
including those issued before the commencement of the Bihar
Cooperative Societies (Amendment) Ordinance, 1975 and outstanding
at any time shall not exceed the aggregate of –
(a) the amount due on the mortgages.
(b) the value of the properties and other assets transferred
of deemed to have been transferred under section 44-j to the
State Co-operative Land Development Bank and subsisting at
such time:
(c) the amounts paid under the mortgages aforesaid and remaining
in the hands of the Board or of the Trustee at that time;
(d) the amount due on the Government guarantee on the basis
of which loans have been issued to corporate bodies.
(4) Debentures in excess of the limit specified in sub-section
(3) may be issued with permission of the Trustee.
44F. Vesting of mortgaged property in the Trustee and floating
charge of debenture holders.- Upon the issue of debentures
under the provisions of section 44E, the mortgages, properties
and other assets, referred to in sub-section (3) of that section,
held by the State Cooperative Land Development Bank shall
vest in the Trustee and the holders of debentures shall have
floating charge on all such mortgages, properties and assets
and on the amount paid under such mortgages and remaining
in the hands of the State Cooperative Land Development Bank
or of the Trustee.
44G. Guarantee by the State Government of principal and interest
on debentures.- (1) The State Government may, if in their
opinion it is necessary in the public interest so to do, and
subject to such terms and conditions as the State Government
may think fit to impose, guarantee the principal of and interest
on the debentures issued by the Board, including debentures,
if any, issued prior to the commencement of Bihar Cooperative
Societies (Amendment) Ordinance, 1975 subject to such maximum
amount as may be fixed by the State Government.
(2) The State Government may, subject to the provisions of
any Act in that regard, increase the maximum amount of any
guarantee given under sub-section (1).
44H. Priority of mortgage, over claims.- (1) Mortgage executed
in favour of a Land Development Bank shall have priority over
any claim of the Stat Government arising from a loan, under
the Land improvement Loans Act, 1883 (19 of 1883),of the Agriculturists’
Loans Act, 1884(12 of 1884) or any other law for the time
time being in force, granted subsequent of the execution of
the mortgage.
(2) A mortgage executed in favour of a Land Development Bank
shall have priority also over the claim of may other person
arising out of a mortgage of any description executed or any
other charge created, after the issue of a public notice under
section 44. C in respect of the property of the loanee specified
in the said publice notice.
44 I. Right of Land Development Bank to purchase mortgaged
property.- Notwithstanding the provisions contained in the
Bihar Land Reforms (Fixation of Ceiling Are3a and Acquisition
of Surplus Land) Act, 1961 (Bihar Act XII of 1962) but subject
to any tenancy law for the time being in force, it shall be
lawful for Land Development Bank to purchase any mortgaged
property sold under this Chapter, and the property so purchased
shall be disposed to by such bank by sale in such manner and
within such period as may be fixed by the trustee:
Provided that a purchaser of such mortgaged property form
a Land Development Bank shall purchase it subject to the provisions
of the Bihar Land Reforms(Fixation of Ceiling Area and Acquisition
of Surplus Land) Act, 1961 (Bihar Act Xii of 1962)
44 J. Mortgages executed in favour of Land Development Bank
to Stand Vested in Trustee.- The mortgages executed in favour
of and all other assets transferred to the State Cooperative
Land Development Bank by its members, either before or after
the commencement Bihar Cooperative Societies (Amendment) Ordinance,
1975 shall vest in the Truste with effect from the date of
such execution or transfer and likewise mortgages or transfer
of assets in favour of Primary Cooperative Land Development
Bank by its members shall be deemed to have been transferred
to the State Cooperative Land Development Bank and shall vest
in the Trustee.
44 K. Power of Primary Land Development Bank to receive money
and grant discharge. – Notwithstanding that a mortgage
executed in favour of a Primary Land Development Bank has
been transferred or is deemed, under provisions of section
44-J, to have been transferred to the State Cooperative Land
Development Bank.
(a) all moneys due under the mortgage shall, in the absence
of any specific direction to the contrary issued by the Board
of trustee and communicated to the mortgagor, be payable to
the Primary Land Development Bank and such payment shall be
as valid as if the mortgage had not been so transferred: and
(b) the Primary Land Development Bank shall, in the absence
of any specific direction to the contrary, issued by the Board
of Trustee and communicated to the Primary Land Development
Bank, by entitled to sue on the mortgage or take any other
proceeding, including a proceeding under this Act. for the
recovery of the moneys due under the mortgage.
44 L. Registration of mortgage in favour of Land Development
Bank. – Notwithstanding anything contained in the Indian
Registration Act, 1908 (16 of 1908), it shall not be necessary
to register mortgages executed in favour of Land Development
Bank Provided that the Land Development Bank concerned sends
within such time and in such manner as may be prescribed a
copy of the instrument; where by movable or immovable property
is mortgaged for the purpose of securing repayment of the
loan to the Registering Officer within the local limits of
whose jurisdiction the whole or any part of the property mortgaged
is situate, and such Registering officer shall file a copy
or copies, as the case may be, in this Book no. 1 prescribed
under section 51 of the Indian Regist4ration Act, 1908 (16
of 1908).
44 M. Power of Land Development Bank to pay prior debts of
mortgagors and secure consequential reliefs. – (1) Where
a mortgage is executed in favour of a Land Development Bank
for payment of prior debts of the mortgagor, such Bank any,
notwithstanding anything contained in the Transfer of Property
Act, 1882 (4 of 1882) by such notice in writing may be prescribed,
require any person to whom any such debts is due to receive
payment of such debt of part thereof form the Bank at its
registered office or its branch offices within such period
as may be specified in the notice.
(2) Where any such person fails to receive such notice or
such payment, such debt or part there of as the case may be,
shall cease to carry interest from the expiration of the period
specified in the notice;
Provided that were there is a dispute as regards the amount
of any such debt, the person to whom such debt is due may
refer the dispute to Registrar for decision in accordance
with provisions of section 48;
Provided further that the person to whom such debt is due
shall, pending the decision in the dispute, be bound to receive
payment, of the amount offered by the Land Development Bank
towards the debt but such receipts shall not prejudice the
right, if any, of person to recover the balance claimed by
him.
(3) Where a notice has been served under sub-section (1) on
any person for receiving payment of his dues, such person
shall be bound to deliver possession, to the mortgagor, or
any property held in usufructuary mortgage for the debts due
on or before the date specified in the aforesaid notice;
Provided that the may deliver possession of any agricultural
land afther harvesting of the standing crop, if any, and in
such an event the shall be entitled to receive the amount
due to him from the Land Development Bank on the date of delivery
of possession given to the mortgagor.
(4) Where a person holding an; property in usufructuary mortgage
refuses delivery of possession in the manner indicated in
sub-section(3), the Collector shall, on an application of
the Land Development Bank made in this behalf, after making
a summary enquiry reject the mortgagee and restore the mortgaged
land to the mortgagor and the mortgage shall thereupon be
deemed to have terminated.
(5) The provisions of this section shall be subject to any
tenancy laws for the time being in force:
44 N. Power of Land Development Bank to advance loans and
hold lands. – Subject to the provisions of this Act
and in accordance with the rules made thereunder, it shall
be competent for a Land Development Bank to advance loans
for the purposes referred to in section 44- B and to hold
lands the possession of which is transferred to it under the
provisions of this Chapter.
44 O. Public notice for entertaining objection. – (1)
When an application for a loan is made for any of the purposes
mentioned in section 44- B, a public notice shall be given
of the application in such manner and form as may be prescribed,
calling upon all persons interested to make their objections
to the loan, if any, before the date specified therein. The
person by whom such public notice shall be given and the manner
in which the objection shall be disposed of by him shall be
such as may be prescribed. Copies of such public notice shall
also be sent separately to such persons and within such time
as may be prescribed,
(2) The person empowered to give notice under sub-section
(1) shall consider every objection made under that sub-section
and pass an order in writing either upholding or overruling
it. When the objections is overruled, he shall recommend the
application to the Land Development Bank for its consideration:
Provided that when the question raised by an objection is,
in the opinion of such person, one of such a nature that it
cannot be satisfactorily decided except by a Civil Court,
he shall postpone the consideration of the application until
the question has been so decided.
(3) A notice under sub-section (1) published in the manner
prescribed, shall for the purpose of this Act, be deemed to
be proper notice to all persons having or offered as security
for the loan,
(4) Where an application is recommended under sub-section
(2) the Land Development Bank shall, in accordance with the
rule made by it in this behalf, consider such applicati0n
for the purpose of making the loan,
5. Where no objection under sub-section (1) has been made
the question at issue shall be decided by the person empowered
to consider objections in such manner as he may deem proper
and no person shall have any claim what-soever including any
claim arising out of a mortgage of any description against
the property of the loanee for which the loan applied for
is sanctioned under the provisions of this Chapter, until
such time as the loan together with interest thereon or any
other dues arising out of the loan are paid in full.
44 P. Mortgage executed by managers of Hindu joint families
or natural or legal guardians of minors or disabled persons.
– (1) Mortgages, in respect of loans by a Land Development
Bank either before or after the commencement of the Bihar
Cooperative Societies (Amendment) Ordinance, 1975 by the manager
of a Hindu Joint family or the natural or legal guardian of
a minor or disabled person for any of the purposes specified
in section 44 B. shall be binding on every member of such
Hindu joint family, or such minor or disabled person, notwithstanding
any law to the contrary.
(2) Subject to the provisions of sub-section (1), where a
mortgage execute in favour of a Land Development Bank, either
before or after the commencement of the Bihar Cooperative
Societies (Amendment) Ordinance, 1975, is called in question
on the ground that it was executed by the Manager of a Hindu
Joint family or natural or legal guardian of a minor or disabled
person for a purpose not binding on the members of such Hindu
joint family or such minor or disabled person, the burden
of proving the same shall, notwithstanding any law to the
contrary, lie on the party alleging it.
44 Q. Order granting loan conclusive of certain matters. –
Written order by the Land Development Bank, or person o managing
committees authorised by this Chapter or under the bye-laws
of the Bank loans for all or any of the purposes specified
in section 44-B granting either before or after the commencement
of the Bihar Cooperative Societies (Amendment) Ordinance,
1975, a loan to or with the consent of a person mentioned
therein for the benefit of
the land or for the productive purpose specified therein,
shall be conclusive of the following matters namely :-
(a) that the work described or the purpose for which the loan
is granted, is an improvement or productive purpose, as the
case may be, within the meaning of section 44-B;
(b) that the person had on date of the order a right to make
such productive purpose, as the case may be; and
(c) that the improvement is one benefiting the land specified
and the productive purpose concerns the land offered as security
or any part thereof as may be relevant.
44 R. Recovery of loan by Land Development Bank. – Any
loan granted by a Land Development Bank, including any interest
chargeable and, such cost, if any as may be prescribed incurred
in connection therewith shall, when they become due, be recoverable
by the Bank concerned:
Provided that such loan, interest or cost may be recoverable
also by the State Cooperative Land Development Bank even if
the loan has been granted by a Primary Cooperative Land Development
Bank affiliated to it.
44 S. Collector to make recoveries during certain period.
– (1) During such period as the Stat Government may,
by general or special order, notifying in the official Gazette,
it shall be competent for Collector, on application being
made to him in this behalf by a Land Development Bank, to
recover all sums due to the Bank, including the cost of such
recovery.
(2) The Collector or any person specially authorized by him
in this behalf, shall recover all sums due to a Land Development
Bank in the following order and manner, namely :-
(a) for the borrower as if they were in arrears of land revenue
due by him.
(b) Out of the land for the benefit of which the loan has
been ranted as if they were arrears of land revenue in respect
of that land.
(c) for a surety, if any, as if they were arrears of land
revenue due by him;
(d) out of the property comprised in the collateral security,
if any according to the procedure for realization of land
revenue by the sale of immovable property other than the land
on which the revenue is due.
(3) the provisions of this section shall be subject to any
tenancy law for the time being in force.
44 T. Distraint and sale. – (1) if any installment payable
under mortgage executed in favour of a Land Development Bank
of any part of such installment has remained unpaid for more
than one month from the date on which it fell due, the managing
committee of such a bank or the Board may, in addition to
any other remedy available to the bank, apply to the Registrar
for the recovery of such installment of part there of by distraint
and sale the produce of the mortgaged land, including the
standing crops thereon, and any other movable property of
the default in the manner prescribed. On receipt of such application
the registrar may, after giving registered notice to the mortgagor
notwithstanding anything contained in the Transfer of Property
Act. 1882 (4 of 1882), direct distraint and sale of such produce
and, if necessary, also of such other movable property of
the defaulter:
Provided that such implements of husbandry other than the
implements mortgaged to the Land Development Bank, and such
cattle of the defaulter as may, in the opinion of the Registrar,
be necessary to enable the defaulter to earn his livelihood
as an agriculturist shall not be liable for such distraint
and sale:
Provided further that no such distraint shall be made after
the expiry of twelve months from the date on which the installment
fell due.
(2) The value of the property distrained shall be, as far
as may be, equal to the amount due, and the expenses of the
distraint and the cost of the sale.
44 U. Powers of sale when to be exercised. – (1) Notwithstanding
anything contained in the Transfer of Property Act, 1882 (4
of 1882). Where a power of sale without the intervention of
the court is expressly conferred on a Land Development Bank
by the mortgage deed, the managing committee of such bank
or the Board or any person authorized by such managing committee
or the Board in this behalf shall, in case of default of payment
of mortgage money or any part thereof, have power, in addition
to any other remedy available to the bank, to bring the mortgaged
property to sale without the intervention of court.
(2) No such power shall be exercise unless and until -
(a) the Board has previously authorized the exercise of the
power conferred by sub-section (1) after considering the representation,
if any, of the mortgagor:
(b) the registered notice requiring payment of such mortgage
money or part thereof has been served upon-
(i) the mortgagor;
(ii) any person who has any interest in, or charge upon the
property mortgaged or in or upon the right to redeem the same;
(i) any surety for the payment of the mortgage debt or any
part there of; and
(c) default has been made in payment of such mortgage money
or part thereof, for there months after service of notice
in this behalf,
44 V. Powers of Land Development Bank where mortgaged property
is destroyed or security becomes insufficient. – Where
any property mortgaged to a Land Development Bank is wholly
or partially destroyed or for any reason the security is rendered
insufficient and the mortgagor, having been given a reasonable
opportunity, by the managing committee of the said bank or
the Board of providing further security enough to make the
whole security sufficient or of re-paving such portion of
the loan as may be determined by the managing committee or
the Board has failed to provide such security or to repay
such portion of the loan the whole of the loan shall, notwithstanding
its terms and conditions, be deemed to fall due at once and
the managing committee or the Board shall be entitled to take
action against the mortgagor, under section 44-S or section
44-T or section 44-U, for the recovery thereof.
Explanation.- For the purpose of this section, security shall
be deemed to be insufficient unless the value of the mortgaged
property, including improvement thereon, exceeds the amount
for the time being, due on the mortgage by such proportion
as may b specified in the rules or the bye-laws of the Land
development Bank.
44 W. Power of the Board or Trustee to take action against
defaulters. – (1) The Board or the Trustee may direct
the managing committee of a primary Cooperative Land Development
Bank to take action against a defaulter under sections 44-S,44-T,44-U
or 44-V and if the managing committee neglects or fails to
do so, the Board or the Trustee may take such action. The
Trustee may direct the Board to take similar action against
a defaulter and on the Board]s neglect or failure to do so,
may take such action himself.
(2) Where an action is taken under the provisions of sub-section
(1) by the Board, the provisions of this Chapter or any rules
made in pursuance there of shall apply as if all references
therein to a primary Co-operative Land Development
Bank and its managing committee were references to the State
Cooperative Land Development Bank and the Board.
(3) When an action is taken under the provisions of sub-section
(1) by the Trustee, the provisions of this Chapter or any
rules made in pursuance thereof shall apply as if all references
therein to primary Cooperative Land Development Bank and its
managing committee or the state Cooperative Land Development
Bank or the Board were references to the Trustee.
44 X. Confirmation of sale. – Where any mortgaged property
is sold under the provisions of section 44- U by a Primary
Land Development Bank, the Bank shall, in the manner prescribed,
submit to the State Cooperative Land Development Bank and
the Registrar a report setting forth the manner in which the
sale has been effected and the result of the sale. Where the
sale is made by the State Cooperative and Development Bank
or the Trustee is a person other than the Registrar. Similar
Report shall be submitted by the Board or the Trustee as the
case may be, to the Registrar.
(2) After the report aforesaid has been submitted to the Registrar
the managing committee of a Primary Cooperative Land Development
Bank or the Board of the Trustee, as the case may be, may
with the approval of Registrar, confirm or cancel the sale
within one hundred and twenty days of the date of sale.
(3) Where the Registrar is the Trustee and has taken action
pursuant to subsection (1) of section 44-W,he may confirm
of cancel the sale of the mortgaged property of his own motion
or on the appl9ocation of a Land Development Bank within one
hundred and twenty days form the date.
(4) Upon the mortgagor or any person having a right, title
or interest in the mortgaged property applying to the managing
committee or a Land Development Bank or the Board or the Trustee
or the Registrar as the case may be, for setting aside the
sale after having deposited at the Office of the Land Development
Bank concerned such sums of money as may be sufficient for
payment of the amount specified in the notice served under
clause (b) of sub-section (2) of section 44-U together with
subsequent interest and costs, if any, incurred during the
process of sale and a commission, for payment to the purchaser,
or a sum equal to five percent of the purchase money deposited
by him, the sale of the mortgaged property shall be cancelled
under the provisions of sub-section (9) or (3) of this section.
(5) When sale is confirmed under the provisions of this section
it shall become absolute and shall be deemed to be absolute
to be absolute for the purpose of the Code of Civil Procedure,
1908 (5 of 1908).
44 Y. Disposal of sale proceeds. – (1) The proceeds
of the sale, effected under this Chapter shall be applied
of all costs, charges and expenses incurred in connection
with the sale or attempted sales, secondly to the payment
of any or all interest due on account of the mortgage in consequence
whereof the mortgaged property was sold and thirdly to the
payment of the principal due on account of the mortgage including
cast and charges incidental to the recovery.
(2) if there remains any residue from the proceeds of sale
referred to under subsection (1), the same shall be paid to
the person proving himself interested in the property sold,
or if there are more such persons than one, to such persons
upon their joint receipt or according to their respective
interest therein:
Provided that, before such payments are made, the unsecured
dues owing from the mortgagor to the Land Development Bank
may be adjusted.
44 Z. Certificates of purchase, delivery of property and title
to purchaser. – Where a sale of mortgaged property has
become absolute the Bank
shall grant a certificate to the purchaser, in the prescribed
form, specifying the property sold, the sale-proceeds, the
date of its sale, the name of the person who at the time of
the sale is declared to be the purchaser and the date on which
the sale become absolute and upon the production of such certificate,
the Sub-Registrar appointed under the Indian Registration
Act, 1908 (16 of 1908) within the limits of whose jurisdiction
the Whose or any part of the property specified in the certificate
is situated shall enter a copy of such certificate in the
relevant book maintained for such purpose.
(2) Where a mortgaged property is sold under the provisions
of this Chapter and a certificate is granted to the purchaser
under the provisions of sub-section (1), Collector shall,
on the application of the purchaser, his, their or successor-in-interest,
order delivery of possession to be made to such a person and
shall put in possession such a person or his nominee.
44 AA. Title of purchaser not to be questioned on ground of
irregularities, etc. – Where any property is sold in
exercise or power of sale under this Chapter, the title of
the purchaser shall not be questioned on the ground that-
(a) the circumstances required for authorising the sale had
not arisen,
(b) due notice of the sale was not given, or
(c) the power of sale was otherwise improperly or irregularly
exercised; but any person who has suffered any damage by an
unauthorized, improper or irregular exercise or such power
is entitled to have a remedy in damage against the Land Development
Bank.
44 AB. Mortgage not to be questioned on insolvency of mottgagor.
– Notwithstanding anything in any law relating to insolvency,
a mortgage executed in favour of a Land Development Bank shall
not be called in question on the ground that it was not executed
in good faith for valuable consideration or on the ground
that it was executed in order to give the Land development
Bank a preference over the other creditors of the mortgagor.
44 AC. Appointment of receiver and his powers. – (1)
The Board may, of its own motion or on the application of
a Primay Land Development Bank and under circumstances in
which the power of sale conferred by section 44-U may be exercised,
appoint in writing a person other than member of the managing
committee of the Land Development Bank concerned to be the
receiver of the produce of and income of the mortgaged property
or any part thereof and such receiver shall be entitled either
to take possession of the property or collect its produce
and income, or both, as the case may be, to retain out of
any money realized by him in expenses or management including
his remuneration, if any, as fixed by the Board and to apply
to balance in accordance with the provisions of sub-section
(8) of section 69 A of the Transfer of Property, Act, 1882
(4 of 1882).
(2) The Board may, for sufficient cause; removes such receiver
on an application made by the mortgagor and fill the vacancy
in the office of the receiver.
(3) Nothing in this section shall empower the Board to appoint
a receiver where the mortgaged property is already in the
possession of a receiver appointed by a competent court.
44 AD. Restriction on leases. – (1) Notwithstanding
anything contained in the transfer of property Act, 1882 (4
of 1882), or any law for the time being in force, no mortgagor
of property mortgaged to a Land Development Bank shall, except
with the prior consent in writing of the bank and subject
to such terms and conditions as the bank may impose lease
or create to any tenancy rights or any other right, title,
or interest in any such property;
Provided that the rights of the Land Development Bank shall
be enforceable against the lessee or the tenant, or any other
person, as the case may be, as if he himself were a mortgagor.
(P) Where the land, mortgaged with possession to a Land Development
Bank, is in actual possession of a tenant, the mortgagor of
the Land Development Bank shall give notice to the tenant
to pay rent to the Land Development Bank during the currency
of the lease and the on such notice being given, the tenant
shall be deemed to have attorned to the Land Development Bank.
44 AE. Registration of documents executed on behalf of a Land
Development Bank. – (1) Notwithstanding anything in
the Indian Registration Act, 1980 (16 of 1908), it shall not
be necessary for any officer of a Land Development Bank to
appear in person or by any agent at any registration office
in any proceedings connected with the registration of any
instrument executed by him in his official capacity or to
sign as provided in section 58 of that Act.
(2) Where any instrument is so executed, the Registering Officer
to whom such instrument is presented for registration may,
if he thinks fit, reer to the aforesaid officer of the Land
Development Bank for any information in respect thereof and
on being satisfied of the execution thereof, shall register
the instrument.
44 AF. Delegation of certain powers by Board. – The
Board if it thinks fit, may delegate all or any of its powers
under section 44 U, 44 W of 44 AC to an Executive Committee
consisting of three or more of its members constituted by
it.
44 AG. Provision of the Transfer of Property Act, 1882 to
apply to notice under this chapter. – The provisions
of Sections 102 and 103 of the Transfer of Property Act, 1882
(4 of 1882) and of any rule made by the High Court under section
104 of that Act for carrying out of the purposes of the said
sections shall apply so far as may be, in respect of all notices
to be served under this Chapter.
44 AH. Board’s power of supervision over Primary Cooperative
Land Developm3ent Banks. – Subject to the provisions
of the Act, the Board shall have such powers of supervision
over the primary Cooperative Land Development Bank, including
powers of inspection of account books and proceeding of such
bank, as may be prescribed by rules.
44 AI. Power to make rules. – The State Government
may, after previous publication, make rules for carrying into
effect the purposes of this chapter.
(2) Such rule may provide for all or any of the following
matters, namely:-
(a) the manner of effecting distraint under this Chapter,
the custody, preservation and sale of distrained property,
immediate sale of perishable articles where such articles
are distrained;
(b) conduct of the sale of the property mortgaged to Land
Development Bank, appointment of sales officers, recovery
of expenses of such sale, deposit of the purchase money in
connection therewith and resale of the mortgaged property
where purchase money is not deposited in sale proceedings;
(c) submission of returns and reports by primary cooperative
Land Development Bank to the State Cooperative Land Development
Bank in respect of their transactions periodical statement
of accounts between the primary Cooperative Land Development
Bank and the State Cooperative Land Development Bank, payment
of amount recovered by the primary Cooperative Land Development
Bank on mortgages transferred to the State Cooperative Land
Development
Bank the form in which application to Land Development Bank
for loans may be made, the properties offered as security
for such loans the investment of money realised by Land Development
Bank from the mortgagors and matters generally relating to
the conduct of business of Land Development Bank: and
(d) all matters expressly required of all9owed in this Chapter
to be prescribed by rules.
CHAPTER VI-B
44 AJ. Application of the Chapter to cooperative Bank. –
(1) The provisions of this chapter shall apply to a Cooperative
Bank as defined in the Deposit Insurance Corporation Act,
1961 (47 of 1961) in addition to the provisions contained
in other parts of this Act, where any question of apparent
or implied inconsistency arises, the provisions of this Chapter
shall prevail over the provisions of the other parts of this
Act.
(2) For the purposes of this chapter,” Deposit insurance
corporation means the Deposit insurance corporation established
under the Deposit Insurance Corporation Act, 1961) and “Reserve
Bank’ means the Reserve Bank of India established under
the Reserve Bank of India Act, 1934 (2 of 1934)
44 AK. Division, amalgamation, compromise, etc. – (1)
No order sanctioning a scheme of compromise or arrangement
or of amalgamation or reconstruction or of division or transfer
of assets and liabilities of a Cooperative Bank shall be made
without the pervious sanction in writhing of the Reserve Bank.
(2) Where an order of moratorium has been made by the Central
Government under sub-section (2) of section 45 of the Banking
Regulation Act, 1949(10 of 1949) in respect of a Cooperative
Bank, the Registrar, with the previous approval of the Reserve
Bank in writing nay during the period of moratorium, prepare
a scheme,-
(i) for the re-construction of the Cooperative Bank; or
(ii) for its amalgamation with any other Cooperative Bank
(herein referred to as the transferee Bank).
(3) Notwithstanding anything to the contrary to the contrary
contained in this Act where a Cooperative Bank being an insured
bank within the meaning of the Deposit Insurance Corporation
Act, 1961(47 of 1961) is amalgamated or in respect of which
a scheme of compromise or arrangement or of reconstruction
has been sanctioned and the Deposit Insurance Corporation
has become liable to pay to the depositors of the insured
bank, under sub-section (2) of section 16 of the Act, the
bank with which such insured bank is amalgamated or, the mew
Cooperative Bank formed after such amalgamation or, as the
case may be, the insured bank or the transferee bank shall
be under an obligation to repay the Deposit Insurance Corporation
in the circumstances, to the extent and in the manner referred
to in section 21 of that Act.
44 AL. Supersession of Managing Committee of Cooperative
Bank. – Notwithstanding anything contrary contained
in this Act Registrar Shall if so required in writhing by
the Reserve Bank in 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 Cooperative Bank; pass an order
for the supersession of the managing committee or other managing
body (by whatever name called) of that Cooperative Bank and
appointment of an administrator therefore, upon such terms
and for such periods not exceeding five years in the aggregate,
as may from time to time be specified by the Reserve Bank.
44 AM. Reserve Bank’s sanction or requisition for winding
up order. – (1) Notwithstanding anything to the contrary
contained in this Act, no Cooperative Bank shall be wound
up except with the previous sanction in writing of the Reserve
Bank.
(2) Notwithstanding anything to the contrary contained in
this Act, the Registrar shall make an order for the winding
up of a Cooperative Bank if so required by the Reserve Bank
in the circumstances mentioned in section 13 D of the Deposit
insurance Corporation Act, 1961 (47 of 1961)
44 AN. Reimbursement to Deposit Insurance Corporation. –
Where a Cooperative Bank, being an insured bank within the
meaning of Deposit Insurance Corporation Act, 1961 (47 of
1961) is wound up or is taken into liquidation and the Deposit
Insurance Corporation has become liable to pay to the depositors
of the insured bank under sub-section (1) of section 16 of
that Act, the Deposit Insurance Corporation shall be reimbursed
in the circumstances to the extent and in the manner provided
in section 21 of that Act.
44 AO. Finality of the Reserve Bank’s sanction or requisition.
– Notwithstanding anything to the contrary contained
in this Act where with the previous sanction in writing or
on the requisition of the Reserve Bank-
(i) an order for the winding up of the cooperative bank is
made, or
(ii) in respect of which a scheme of compromise or arrangement
or of reconstruction or amalgamation is made, or
(iii) in respect of which an order for the supersession of
its managing committee or other managing body (by whatever
name called) and the appointment of an administrator therefore
has been made.
no appeal or revision on review there against shall lie or
be permissible and such sanction or requisition of the Reserve
Bank shall not be liable to be called in question in any manner.]
CHAPTER VI-B : Special provisions for primary agricultural
credit society, farmers Service society and multipurpose cooperative
society
44 AP. Provisions of this chapter to apply to Agricultural
Credit Society. – The provisions contained in this Chapter
shall apply only to Primary Agricultural Credit Society, the
Farmers Service Society and the Multipurpose Cooperative Society.
44 AQ. Power of Registrar to order Liquidation of Societies
and amalgamation of several Societies. – (1) Notwithstanding
anything to the contrary contained in this Act where with
the Registrar is satisfied that, in the interest of the Cooperative
Movement of for the purpose of securing proper management
of Cooperative Societies or for the reason that the society
has not been working as a viable unit or has incurred bad
debts or has remained inactive, it is necessary to liquidate
a society he may, by an order published in the official Gazette,
direct for the liquidation of the society and shall appoint
person or persons for carrying out the functions of the liquidator
as laid down in section 44.
(2) Where in the opinion of the Registrar, or an officer authorized
by the Registrar to act on his behalf (who shall not be below
the rank of the District Cooperative Officer), amalgamation
of two or more primary agricultural societies is necessary
in order to improve the working of such society or for increasing
their strength or usefulness, by may by an order, notwithstanding
anything to the
contrary contained in this Act, direct the amalgamation of
two or more such societies, within such time as may be specified
therein, into one single society and register the same as
a mew society.
1. Ins. by Act 2 of 1976 This should be Chapter VIC since
in the Amending Act of 1982 Chapters ‘’VIB”
have been added.
(3) The societies which are amalgamated under sub-section
(2) shall be deemed to have been dissolved and shall cease
to exist and the membership thereof shall stand transferred
to, and all the assets and liabilities thereof shall vest,
in the new society formed by amalgamation of two or more societies:
Provide that State Government may from time to time, declare
a moratorium on the liabilities of the societies so amalgamated.
(4) Upon the amalgamation of societies and establishment of
a new society, the Registrar shall, for purposes of managing
the affairs of the new society, depute an officer of the State
Government subordinate to him, till such time as a new managing
committee is constituted and the officer so deputed shall
exercise such Powers and perform such functions as may be
prescribed.
(5) The Registrar may by an order in writing and published
in the official Gazette determine the local limits of the
new society established after the amalgamation of several
societies.
(6) Every family residing within the local limits of the
new society determined under sub-section (5) shall be represented
by at least one adult member of the family who shall be a
normal or associate member of the society and shall be entitled
to a right of voting if he pays a membership fee of Rs. 1
and may become a full-fledged member of the society if he
purchases at least one share of the society and he shall be
entitled to receive loan there from and shall also be eligible
to hold and elective post of the society.
44 AR. Appeal from the order of the Registrar. – Any
person aggrieved by the liquidation under sub-section(1) of
section 44 AO or by amalgamation or establishment of new societies
and the registration there of under sub-section (2) of the
said section may file a representation before the state Government
against the order of the Registrar within thirty days of the
date of order and the State Government may, after hearing
the objections, pass such orders as may be deemed fit and
the order of the state Government thereon shall be final and
shall not be called in question in any Court of law.
44 AS. Election of new society formed after amalgamation.
– The election of the new society established under
sub-section (2) of section 44AQ shall be held within a period
of six months from the date of registration of the society
unless, for special reasons to be recorded in writing, the
State Government may extend the period by another six months.
CHAPTER VII : Penalties and Procedure.
45. Offences. – (1) It shall be an offence under this
Act it-
(a) an officer or member of a registered society
The election of the new society established under sub-section
(2) of section 41 intentionally neglects or refuses to do
any act required to be done, or to furnish any information
required to be furnished, by this Act or by any rule; or
(b) an officer or member of a registered society or any
person appointed under sub-section (2) of section 41 willfully
makes a false return or furnishes false information.
(2) Any officer or member of registered society 1[or any person
appointed under sub-section (2) of section 41] guilty of an
offence under sub-section (1) shall be punishable with fine
which may extend to fifty rupees.
45A. (1) On election of new secretary or on supersession
of cooperative society or on expiry of the term of the office
bearers of a cooperative society, the outgoing secretary or
the person holding charge of the office of the cooperative
society shall hand over charge of his office and all papers
and properties in his possession as secretary or in charge
of the said society to the new secretary or the officer directed
by the prescribed authority to take charge of the affairs
of the said society.
(2) If the outgoing secretary of a cooperative society or
the person holding charge of the office of secretary fails
or refuses to hand over charge of his office as required under
sub-section(1) above, the prescribed authority or any officer
empowered by it in this behalf, may by an order in writhing
direct the outgoing Secretary or the person holding charge
of the office of Secretary to hand over immediately the charge
of his office and all papers and properties in his possession
as such secretary to the new secretary in case of fresh election,
and in case of supersession or on expiry of the term of office
to the officer appointed to manage the affairs of the society.
(3) If the person to whom a direction has been issued under
sub-section (2) fails to comply with the said direction he
shall be punishable with the imprisonment which may extend
up to the period of six months or a fine or a fine of Rs.
500, or with both.
(4) The offence under sub-section (3) shall be cognizable.
(5) If it is so required, the prescribed authority may, by
order in writhing, authorise any officer to forcibly take
possession with the help of local police and Magistrate, of
all papers and properties from the secretary or the person
holding charge of the office of secretary and hand them over
to the new secretary in case of fresh election and to the
officer of the State Government appointed to run the affairs
of the society in case of its supersession or expiry of the
term of office bearers where fresh election in still to be
held.
45A. Production of records by the Secretary or person in charge
of the office of a Cooperative Society.- (1) The Secretary
of a Cooperative Society shall, on direction by Registrar
or by any other Gazetted officer of Cooperative department,
forthwith hand all records and documents of the Society as
the Registrar or the officer mentioned above may required
for inspection or enquiry relating to the affairs of the said
Cooperative Society,
(2) If the Secretary of the person in charge of the office
of the Cooperative Society fails, refuses of avoids to hand
over the documents as required under foregoing sub-section
(1) he shall be punishable with imprisonment for a period
which my extend up to six months or with a fine of Rs. 500/-
or with both, and such an offence shall be cognizable.
(3) When a person to whom a direction has been issued sub-section
(1) of this section fails, refuses of avoids of furnish all
records and documents of that Society with the help of police
and magistrate.
46. Prohibition of the use of the word ‘cooperative’
- (1) No person or society other than a registered society
shall trade or carry on business under any name of title of
which the word cooperative is part without the sanction of
the State Government.
Provided that nothing in this section shall apply to the use
by any person or his successor in interest of any name or
title under which he traded or carried on business at the
date on which the Cooperative Society Act. 1912, Came into
operation.
(2) Any officer or member of a society or any person who contravenes
the provisions of sub-section (1) shall be punishable with
fine which may extend to fifty rupees, and, in the case of
a continuing offence, with a further fine of five rupees for
each day on which the offence is continued after conviction
therefore.
47. Cognizance of offences. - (1) No Court inferior to that
of a Magistrate of the second class shall try any offence
under this Act.
(2) Every offence under this Act shall, for the purpose of
the code of criminal Procedure, 1898 2[ 5 of 1898)] be deemed
to be non-cognizable.
(3) No Prosecution for an offence under this Act shall be
instituted without the previous sanction of the Registrar,
and the Registrar shall not sanction the prosecution of any
person unless he has given such person an opportunity of being
heard.
48 Disputes. - (1) If any dispute touching the business of
a registered society (other than a dispute regarding disciplinary
action taken by the society or its managing committee against
a paid servant or the society) arises.-
(a) amongst members, past members, persons claiming through
members, past members or deceased members, and sureties of
members, past members or deceased members, whether such sureties
are members or non-members; or
(b) between a member, past member, persons claiming through
a member, past member or deceased member, or sureties of members,
past members or deceased member, whether such sureties are
members or non-members and the society, its managing committee
or any officer, agent or servant or the society; or
(c) between the society or its managing committee and any
past or present officer, agent or servant of the society;
or
(d) between the society and any other registered society;
or
(e) between a financing bank authorized under the provisions
of subsection (1) of section 16 and a person who is not a
member of a registered society;
such dispute shall be referred to the Registrar;
Provided that no claim against a past member or the estate
of a deceased member shall be treated as a dispute if the
liability of the past member or of the estate of the deceased
member has been extinguished by virtue of section 32 or section
63.
Explanation.- (1) A claim by a registered society for any
debt or demand due to it from a member, non-member past member
or the nominee, heir or legal representative of a deceased
member or non-member or from sureties or
members, past members or deceased members, whether such sureties
are members or non-members, shall be a dispute touching the
business of the society within the meaning of this sub-section
even in case such debt or demand is admitted and the only
point at issue is the ability to pay or the manner of enforcement
of payment.
Explanation.- (1) The question whether a person is or was
a member of a registered society or not shall be a dispute
within the meaning of this sub-section.
(2) The Registrar may on receipt of such reference.-
(a) decide the dispute himself; or
(b) transfer it for disposal to any person exercising the
powers of a Registrar in this behalf; or
(c) subject to any rules refer it for disposal to an arbitrator
or arbitrators.
(3) Subject to any rules, the Registrar may withdraw any reference
transferred under clause (b) of sub-section (2) or referred
under clause (c) of the said subsection and deal with it in
the manner provided in the said sub-section.
(4) The appointment of an arbitrator or arbitrator and the
procedure to be followed in proceedings before the Registrar
or such arbitrators shall be regulated by rule.
1. Ins. by Act 16 of 1948.
(5) In the case of dispute involving property which is given
as collateral security, it shall be competent to the person
deciding such dispute to issue mortgage award which shall
have the same force as a mortgage decree of a competent Civil
Court.
(6) Any person aggrieved b any decision given in dispute transferred
or referred under clause (b) or (c) of sub-section (2) may,
within three months from the date of such decision, appeal
to the Registrar.
(7) The Registrar, in the case of dispute under this section,
shall have the power of review vested in a civil Court under
section 144 and under Order XL VII, rule 1 of the Code of
Civil Procedure, 1908, and shall also have the inherent jurisdiction
specified in section 151 of the said Code.
(8) The Registrar may where it appears to him advisable, either
of application or of his own motion, state a case and refer
it to the District Judge for decision, and the decision of
the District Judge shall be final.
(9) Save as expressly provided in this section, a decision
of the Registrar under this section, and subject to the orders
of the R3gistrar on appeal or review, a decision given in
a dispute transferred or referred under clause (b) or (c)
of subsection (2) shall be final.
49 Registrar, liquidators and arbitrators to have certain
powers of Civil Court. – Subject to any rules, the Registrar,
any person authorized to hold an inquiry under section 35
or an inspection under section 36, any liquidator, any person
exercising the powers of a Registrar, of any arbitrator or
arbitrators appointed under section 48, shall in so far as
such powers are necessary for carrying out any of the purposes
of this Act, have power to summon and enforce the attendance
of witnesses and parties concerned and to examine them upon
oath and to compel the production of any books, accounts,
documents or property by the same means and, so far as may
be, in the same manner as if provided in the case of a Civil
Court under the Code of Civil Procedure, 1908 (5 of 1908).
50. Attachment of property. – (1) Where the Registrar
is satisfied on the application of the liquidator or of a
society that any person with intent to defeat or
delay the execution of any order that may be passed against
him under section 44 or 48.
(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, unless adequate security is furnished to
his satisfaction, direct the attachment of the said property
or such part thereof , as he thinks, necessary, any such attachment
shall have the same effect as if it had been made by a competent
court.
(2) An order of attachment passed under sub-section (1) shall,
on the application of the Registrar, be executed by the Collector
in whose jurisdiction the property lies, in the same manner
as an order of a Revenue Court.
51. Enforcement of orders. – Orders passed under section
44, 48 and 50 shall in addition to any other method of enforcement
provided under this Act, on application be enforced as follows
:-
(a) when passed by the Registrar, a liquidator or by an arbitrator
or arbitrators, by any Civil Court having local jurisdiction
in the same manner as a decree of such Court:
(b) when passed by the District judge, in the same manner
as a decree of the district judge made in the suit pending
before him.
52. Recovery of sums due. – any sum payable by any person
or by any registered society -
(a) as fees for an audit held under section 33,
(b) in accordance with an order of the Registrar under section
39 apportioning the costs of an inquiry of inspections,
(c) in accordance with an order passed under Section 40.
(d) in accordance with an order of the Registrar or of a liquidator
passed under section 44, or
(e) in accordance with an order, decision or award passed
or made under section 48.
(f) As an amount due from member, past member or the nominee,
heirs, or legal representative of the deceased member or a
primary cooperative society shall be recoverable, as a public
demand in any area, in which the Bihar and Orissa Public Demands
Recovery Act, 1914 ( B.& O. Act 4 of 1914), is in force
or as an arrear of land revenue throughout the whole of the
State and the Registrar or other person authorized by him
in this behalf, shall be deemed to be the person to whom such
public demand is due or to whom such arrear of land revenue
is payable.
53. Recovery of sums due to the Government. – All sums
due from a registered society or from an officer or member,
past or present of from his sureties or from the estate of
a deceased member of a registered society or from his sureties
as such to the Government including any casts awarded to the
Government may be recovered in the same manner as arrears
of land-revenue.
54. Property from which sums due from a society can be recovered.
– All sums due from a registered society to the Government
and all sums recoverable from a registered society under section
33,39,44 or 48 may be recovered firstly, from the property
of the society, secondly, in the case of a
society, the liability of the members of which is limited,
from the members, past members of which is limited, from the
members, past members or estates of deceased members, or their
sureties subject to the limit of their liability; and thirdly,
in the case of other societies from the members, past members,
or estates of deceased members or their sureties to such extent
or in such proportion as may be determined by the Registrar.
55. Liability of past members. – Notwithstanding anything
contained in sections 53 and 54, the liability of past members
and of the estates of deceased members shall in all cases
be subject to the provisions of sections 32 and 63.
56. Power of revision by Registrar. – The Registrar
may, on application or of his own motion, Revise any order
passed by a person exercising the powers of a Registrar or
by a liquidator under section 44 provided such order has been
passed within a period not exceeding six months:
Provided that the Registrar shall have no power to revise
any order against which appeal has been provided under provisions
of this Act,”
57. Bar of jurisdiction of Court. – (1) Save in so far
as expressly provided in this Act., no Civil or Revenue Court
shall have any jurisdiction in respect of any matter concerned
with the winding up or dissolution of the registered society
or suspension of the Managing Committee of a registered society
under its cat, or of any dispute required by section 48 to
be referred to the Registrar or of any proceedings, under
Chapter VII A.
(2) While a society is in liquidation, no suit or other legal
proceeding shall be proceeded with or instituted against the
liquidator as such or against the society or any member thereof
on any matter touching the affairs of the society, except
by leave of the Registrar and subject to such terms as he
may impose.
(3) No order of the State Government, District judge, Registrar,
a person appointed to assist the Registrar, liquidator, or
an arbitrator or arbitrators purporting to be one, which under
any provision of this Act is declared to be final shall be
liable to be challenged, set aside, modified. revised, or
declared void in any Court upon merits or upon any ground
whatsoever except want of jurisdiction.
CHAPTER VII-A : Distraint
57A. Cases in which application for distraint may be made.
– Where any debt or outstanding demand is due to a registered
society from any member, past member or estate of deceased
member or is due to a registered society which is duly authorized
by the Registrar under any of the provisions of sub-section
(1) of section 16 of this Act to grant loans to non-members,
from any person who is not a member of a registered society
or from the estate of such person if he I dead the society
may, in addition to any other remedy to which it is entitled
by law, present an application to the Registrar requesting
him to recover the debt or outstanding demand by detraining,
while in the possession of the defaulter:-
(1) any crops or other products of the earth standing or
ungathered on the holding of the defaulter;
(2) any crops or other products of the earth which have been
grown on the holding of the defaulter and have been reaped
or gathered and are deposited on the holding or on a threshing
floor or place for treading out grain whether in the fields
or within a homestead.
57B. Form of application. – (1) Every application under
the last foregoing section shall specify-
(a) the holding of the defaulter and the boundaries thereof
or such other particulars as may suffice for its identification:
(b) the name of the defaulter;
(c) the detailed account of the dues:
(d) the nature and approximate value of the produce to be
distrained;
(e) the place where it is to be found, or such other particulars
as may suffice for its identification: and
(f) if it is standing or ungathered at the time at which it
is likely to be cut or gathered.
(2) The application shall be signed and verified in the manner
prescribed by the code of Civil Procedure, 1908 (5 of 1908),
for the signing and verification of plaints.
57C. Procedure on receipt of application. – (1) The
applicant shall at the time of filing an application under
the foregoing sections, file before the Registrar such documentary
evidence (if any) as he may consider necessary for the purposes
of the application.
(2) The Registrar may, after taking such evidence as he thinks,
fit, admit the application or reject it.
(3) Where the Registrar cannot forthwith admit or reject an
application he may, if he thinks fit make an order prohibiting
the removal of the produce specified in the application, pending
the execution of an order for distaining the same or the rejection
of the application.
(4) when an order for distaining any produce is made under
the section at a considerable time before the produce is likely
to be cut or gathered, the Registrar may suspend the execution
of the order for such time as he thinks fit and may, if he
thinks, fit, make a further order prohibiting the removal
of the produce pending the execution of the order for distraint.
(5) An order under sub-section (3) or under sub-section (4)
shall be served and published in such manner as the state
Government may rules prescribe.
57D. Execution of order for distraint. – (1) If an application
is admitted under the last foregoing section and an order
for distaining any produce is made the Registrar shall send
a copy of the order containing the prescribed particulars
to the Collector for execution.
(2) The Collector shall, upon receipt of the order referred
to in sub-section (1), depute an officer to distrain the produce
specified therein or such portion of that produce as he thinks
fit, and the officer shall proceed to the place where the
produce is, and distrain the produce by taking charge of it
in this behalf and publishing a notification of the distraint
in accordance with rules to that effect made by the State
Government.
Provided that produce, which from its mature does not admit
of being stored, shall not be distrained under this section
at any time less than twenty days before the time when it
would be fit for reaping or gathering.
57E. Service of demand and account. – (1) The distraining
officer, shall at the time of making the distraint, serve
on the defaulter a written demand for the amount due and the
casts incurred in making the distraint, with an account exhibiting
the grounds on which the distraint is made.
(2) Where the distraining officer has reason to believe that
a person other than the defaulter is the owner of the property
distrained, he shall serve copies of the demand and account
on that person likewise.
(3) The demand and account shall, if practicable be served
personally but, if a person on whom they are to be served
absconds or conceals himself or cannot otherwise be found,
the officer shall affix copies of the demand and account on
a conspicuous part of the outside of the house in which he
usually resides.
57F. Rights to reap etc., produce. – (1) A distraint
under this Chapter shall not prevent any person from reaping,
gathering or storing any produce or doing any other act necessary
for its due preservation.
(2) If the person entitled to do so fails to do so at the
proper time, the distraining officer shall cause any standing
crops or ungathered products distrained to be reaped or gathered
when ripe, and stored in such granaries or other places as
are commonly used for the purpose or in some other convenient
place in the neighborhood or shall to whatever else may be
necessary for the due preservation of the same.
(3) in either case the distained property shall remain in
the charge of the distaining officer or of some other person
appointed by him in this behalf.
57G. Sale proclamation to be issued unless demand is satisfied.
– (1) Unless the demand with all costs of distraint,
be immediately satisfied that distraining officer shall issue
a proclamation specifying the particulars of the property
distrained and the demand for which distrained, and notifying
that he will, at a place and on a day specified not being
less than three of more than seven days after the time making
the distraint, sell the distraint property by public auction:
Provided that when the crops or products distrained from their
nature admit of being stored but have not yet been stored,
the day of the sale shall be so fixed as to admit of their
being made ready for storing before its arrival.
(2) The proclamation shall be struck up on a conspicuous place
in the village in which the land of the defaulter is situate.
57H. Place of sale. – The sale shall be held at the
place where the distrained property is, or at the nearest
place of public resort if the distraining officer is of opinion
that it is likely to sell there to better advantage.
57 I. When produce may be sold standing. – (1) Crops
or products which from their nature admit of being stored
shall not be sold before they are reaped or gathered and are
ready for storing.
(2) Crops or products which from their nature do not admit
of being stored may be sold before they are reaped or gathered,
and the purchaser shall be entitled to enter on the land by
himself, or by any person appointed by him in this behalf
and do all that is necessary for the purposes of tending and
reaping or gathering them.
57 J. Manner of sale. – The property shall be sold
by public auction, in one or more lots as the officer holding
the sale may think advisable and if the demand with the costs
of distraint and sale, is satisfied by the sale of a portion
of the property, the order of distraint shall not be executed
with respect to the remainder.
57 K. Postponement of sale. – If, on the property being
put for sale, a fair price (in the estimating of the officer
holding the sale) is not offered for it, and if the owner
of the property, or a person authorized to act in his behalf,
applies to have the sale postponed till the next day or (if
a market is held at the place of sale) the next market day,
the sale shall be postponed until that day and shall be then
completed, whatever price may b offered for the property.
57 L . Payment of purchase money . – The price of every
lot shall be paid at the time of sale, or as soon thereafter
as the officer holding the sale direct, and in default of
such payment the property shall be put up again and sold.
57 M. Certificate to be given to purchaser. – When
the purchase money has been paid in full, the officer holding
the sale shall give the purchaser a certificate describing
the property purchased by him and the price paid.
57 N. Proceeds of sale how to be applied. – (1) From
the proceeds of every sale of distrained property under this
chapter, the officer holding the shall pay the casts of the
distraint and sale, calculated on a scale of charges prescribed
by rules to be made, from time, by the state Government in
this behalf.
(2) The remainder shall be applied to the discharge of the
amount due for which the distress was made, with interest
thereon up to the day of sale; and the surplus (it any) shall
be paid to the person whose property has been sold.
57O. Certain persons may not purchase. – Officers holding
sales of property under this Chapter ad all persons employed
by, or subordinate to such officers and all officers and members
of the staff of registered societies are prohibited form purchasing
either directly or indirectly, any property sold by such officers.
57 P. Procedure where demand is paid before the sale. –
(1) if at any time after a distraint has been made under this
Chapter, and before the sale of the destrained property, the
defaulter, or any person making a bonafide claim as the owner
of the distrained property, where he is not the defaulter
deposits with the Collector executing the order of distraint
or in the hands of the distraining officer, the amount specified
in the demand served under section 57-E, with all casts which
may have been incurred after the service of the demand, the
Collector, or officer, as the case may be, shall grant a receipt
for the same, and the order of distraint shall not be executed.
(2) When the distraining officer receives the deposit, he
shall forthwith pay it to the collector.
(3) After the expiration of one month from the date of a deposit
being made under this section, the collector shall pay there
from to the applicant for distrain the amount due to him,
unless in the mean while the person making a bona fide claim
as the owner of the property distrained has instituted a suit
against the applicant contesting the legality of the distraint
and claiming compensation is respect of the same.
57 Q. Distraint of property which is under attachment. –
When any conflict arises between an order for distraint issued
under this Chapter and an order issued by a Civil Court for
the attachment or sale of the property, which is the subject
of the distrait, the order for distrait shall prevail; but
if the property is sold under that order, the surplus proceeds
of the sale shall not be paid under section 57-N, to the owner
of the property without the sanction of the Court to which
the order of attachment of sale was issued.
57 R. Suit for condensation for wrongful distrait and appeals.
– No appeal shall lie from any order passed by the Registrar
or a Collector under the Chapter, but any person whose property
is distained on an application is not permitted by that section,
may institute a suit against the application for the recovery
of compensation:
Provided that, if such an order is passed by an Assistant
Registrar or Deputy Registrar exercising the power of a Registrar,
an appeal shall lie to the Registrar and his decision on such
appeal shall be final.
57 S. Power to make rules. – The State Government may
from time to time, make rules for regulation the procedure
in all cases under the foregoing provisions of this Chapter.
57 T. Interpretation. – in the Chapter, unless there
is anything repugnant in the subject or context-
(a) “Collector” includes an officer appointed
by the State Government to discharge any of the functions
of a Collector under this Chapter;
(b) “defaulter” means a person (including his
legal representative if he is dead) from whom any such debt
or outstanding demand as is referred to in section 57-A, is
recoverable; and
(c) “holding” means any land used for agricultural
or horticultural purposes.
CHAPTER VIII : Miscellaneous
58. Registrar and other officers to be public servants :-
The Registrar, a person exercising the powers of a Registrar,
a person authorized to make an inspection under section 34
or 36 or to hold an inquiry under section 35,a liquidator
and an arbitrator or arbitrators to whom any dispute is referred
under section 48, shall be deemed to be public servants within
the meaning of section of the Indian Penal Code (45 of 1860).
59. Proof of entries in societies book. – (1) A copy
of an entry in a book, register of list of a registered society
regularly kept in the course of business, shall, if certified
in such manner as may be prescribed by the rules, be admissible
in evidence of the existence of such entry, and shall be admitted
as evidence of the matters, transactions and accounts therein
recorded in every case where, and to the same extent as. The
original entry would, if produced, have been admissible to
prove such matters, transactions and accounts.
(2) In the case such societies as the State Government may,
be general or special order, direct, no officer of a society
shall in any legal proceeding to which the society is not
a party, be compelled to produce any of the society’s
books, the contents of which can be proved under sub-section
(1), or to appear as a witness to prove the matters, transaction
and accounts therein recorded unless by order of the Courts
or a Judge mad for special cause.
60. Delegation of power to hear appeals. – The State
Government may, by general or special order, delegate its
power of hearing appeals under the provisions of this Act,
to any authority specified in such order.
61. Compulsory affiliation of registered societies to a Cooperative
Federation. – (1) the registered cooperative society
in accordance with the provisions of Rules framed under the
Act shall be affiliated to Bihar Cooperative Federation in
such manner and on such condition as has been directed by
the Rules for the purpose.
(2) The organization and activities of Bihar Cooperative Federation
shall be regulated, under rules framed under the provisions
of this Act, and for which affiliation under sub-section (1)
is compulsory.
62. Exemptions from requirements as to registration. –
(1) Notwithstanding anything contained in this Act, the State
Government may, by special order in each case and subject
to such conditions, if any, as it may impose, exempt any society
from any of the requirements of this Act as to registration.
(2) The State Government may by general or special order exempt
any registered society from any of the provisions of this
Act, or may direct that such
provisions shall apply to such society with such modifications
as may be specified in the order.
63. Limitation. – Notwithstanding any of the provisions
of the Indian Limitation Act, 1908 (9 of 1908), the period
of limitation for debt including interest due to a registered
society by a member there of shall be computed from the date
on which such member dies of ceases to be a member of the
society.
64. Power to exempt from income tax, stamp duty and registration
fees. – (1) The Central Government, by notification
in the official Gazette, may in the Case of any registered
society or class of registered societies, remit the income-
tax payable in respect of the profits of the society, or of
the dividends or other payment received by the member of the
society on account of profits.
(2) The Collecting Government may be notification remit,
in the case of any registered society or class of registered
societies-
(a) the stamp duty with which under any law for the time being
in force, instruments executed by or on behalf of a registered
society or by an officer or member thereof and relation to
the business of such society or any class of such instruments
or decisions, awards or orders of the Registrar or of any
arbitrator under this Act, are respectively chargeable, and
(b) any fee payable under the law of registration for the
time being in force. In this sub-section” collection
Government” has the same meaning as in the Indian stamp
Act, 1899.
65. Exemption from compulsory registration of instrument relating
to shares and debentures of a registered society.– Nothing
in clauses (b) and (c) of sub-section (1) of Section 17 of
the Indian Registration Act, 1908 shall apply to –
(1) any instrument relating to shares in registered society
notwithstanding that the assets of such society consist in
whole or in pat of immovable property; or
(2) any debenture by any such society and not creating, declaring
assigning or extinguishing any, right, title or interest to
or in immovable property except in so far as it entitles the
holders to the security afforded by a registered instrument
where by its immovable property or any interest therein to
trustees upon trust for the benefit of the holders of such
debentures; or
(3) any endorsement upon or transfer of any debenture issued
by any such society
65 B. Removal of difficulty. - If any difficulty arises in
giving effect to the provisions of this Act the State Government
may, association may require, by order published in official
Gazette, to anything not inconsistent with the provisions
of this Act for purpose of removing the difficulty.
66. Power to make rules. – The State Government may
for the whole or any part of the State and for any registered
society or a class of registered societies, make rules to
carry out all or any of the purpose of this Act.
In particular and without prejudice to the generality of the
foregoing power, such rules may-
(i) Prescribes the forms to be used and the conditions to
complied with in the making of application for the registration
of a society and the procedure in the mater of such applications;
(ii) Prescribes the conditions to be complied with by persons
applying for admission or admitted as members and provided
for the election and the admission of member and the payment
to be made and the interests to be acquired before the exercise
of the right of membership.
(ii) Prescribes the extent to which a society may limit the
number of its members and, subject to the provision of section
29, prescribe the maximum number of shares or portion of the
capital of society, which may be held by a member;
(iii) Prescribes the condition of acceptance of registration
of members and prescribe for the expulsion of member and for
the payments, if any to made to members who withdraw or are
expelled;
(iv) prescribes the condition of acceptance of registration
of members and prescribe for the expulsion of member and for
the payments, if any to be made to members who withdraw or
are expelled;
(ii) provide for the general meeting of the members and for
the procedure at such meetings and the powers to be exercised
by such meeting ;
(iii) prescribe the matters in respect of which is a society
may or shall make bye-laws, and the procedure to be followed
in making, altering and abrogating bye-laws and the conditions
to be satisfied prior to such making, alteration or abrogation;
(iv) prescribe the manner in which managing committees and
sub –committees thereof shall be constituted, and provide
for the appointment, suspension and removal of the members
of managing committees and other officers, and for the procedure
at meetings of managing committees and for the powers to be
exercised and the duties to be performed by managing committees
and other officers.
(v) prescribe the conditions under which a society may be
prohibited form appointing a defaulting member of any society
to its managing committee of to the managing committee of
any other society and from allowing him to exercise his right
of membership in the society or to represent it in on other
society:
(vi) prescribe the procedure to be followed when societies
change the forum or extent of their liability, and provide
for the amalgamation and division of societies and prescribe
the conditions of such amalgamation and division;
(vii) prescribe the conditions and terms under which and regulate
the manner in which funds may be raised by means of shares
deposits of debentures or otherwise.
(viii) prescribe the conditions to be complied with by members
applying for loans, the period for which loans may be made,
the amount which may be lent and the manner of re payment;
(ix) provide for the deposit or investment of any funds under
control of a society;
(xiii) prescribe the conditions, prohibitions and restrictions
to which societies may –
(a) transact business with persons who are not members; or
(b) make advances against movable property;
(xiv) prescribe the method of calculating the working capital
and the net profits and the conditions under which such profits
may be distributed, and the maximum rate of dividend which
may be paid by any society or cooperative societies;
(xv) provide for the formation and maintenance of reserve
funds and the objects to which such funds may be applied and
for the writing off of bad debts.
(xvi) prescribe the condition for refund of share money
and transfer of shares;
(xvii) provide for the mode in which the value of a deceased
member’s interest shall be ascertained, and for the
manner of nomination of a person to whom such interest may
be paid or transferred;
(xviii) provide for the information and maintenance of a register
of members and where the liability of members is limited by
shares, of a resister of shares and share-holders;
(xix) prescribe the forms to be used and the accounts and
registers to be kept and the reports and returns to be submitted
by a society and provide for the persons by whom such reports
and returns shall be submitted, and in case of failure to
submit and such reports or returns, for the levy of the expenses
of preparing them;
(xx) prescribe rules for audit under section 33 and for the
periodical publication of balance-sheets showing the assets
and liabilities of a society;
(xxi) provide for the persons by whom and the form in which
copies of entries in records and registers of societies may
be certified and for the charge to be levied for the supply
of such copies;
(xxii) provide for the custody and destruction of records
and registers;
(xxiii) provide for the procedure to be followed in the appointment
or removal of and for the payment of remuneration to, a liquidator.
(xxiv) prescribe the procedure to be followed by the liquidator
and provide for the manner of disposal of the surplus, if
any, of the society;
(xxv) prescribe the procedure to be followed in presenting
and disposing of appeals under this Act;
(xxvi) prescribe the procedure to be followed in the appointment
of an arbitrator or arbitrators and in proceeding before the
Registrar any person exercising the powers of a Registrar
and an arbitrator of arbitrators including the transfer, reference
and withdrawal of cases;
(xxvii) prescribe the procedure and condition for exercise
of the powers conferred by section 49:
xxviii provides for all matters expressly requited or allowed
by this Act to be prescribed by rules.
[xxix] provides for all matters expressly required or allowed
by this Act be prescribed by rules.
(3) The power to make rules conferred by this section is subject
to the condition to the rules being made after previous publication.
(4) All rules made under this Section shall be published in
the official Gazette and on such publication shall have effect
as if enacted in this Act.
66 A. Fixation of proportion of Cooperative Loans for schedule
castes, scheduled tribes, small farmers, marginal farmers
and other weaker sections of the community.- Subject to such
directions as may be issued by the Reserve Bank of India,
the primary agricultural cooperative societies shall during
a cooperative yea disburse to scheduled castes/scheduled tribes,
small and marginal farmers and other weaker sections of the
community, such proportion of their total lending may be laid
down by Registrar, Cooperative Societies from time to time
having regard to the class of societies, the strength of membership
of persons belonging to above classes.
Said societies shall maintain separate account in respect
of their lending to the aforesaid classes in a manner to be
prescribed by the Registrar.
66 B. (1) Notwithstanding anything contained in this Act
of the rules and bye laws made there under, the State Government
may, from time to time, by special or general order, determine
the mature and number of posts to be created and the mode
of recruitment of personnel by Cooperative Societies and prescribe
among other things-
(1) the qualifications, age and experience,
(2) the pay scale and other emoluments.
(3) the method of recruitment,
(4) the conditions of service, and
(5) the disciplinary procedure to be followed.
(2) Any appointment made in contravention of the order of
the State Government under sub-section (1) shall be void as
if no such appointment ever existed and salary and other allowances
paid if any, shall be recoverable under Section 40.
67. Repeals .- The enactments specified in the schedule are
hereby repealed in so far as they apply to the State to the
extent specified in the fourth column of the said schedule.
SCHEDULE
Enactments Repealed
(See Section 67) Year No. Short title Extent of repeal
1. 2. 3. 4.
1912 II The Cooperative Societies Act 1912 The whole
1920 XXXVIII The Devolution Act, 1920 So much as relates to
Act II of 1912
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