MANAGEMENT OF SOCIETIES
57.
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Prohibition against being
interested in contracts etc:-
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(1)
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No officer of a society shall have any interest, directly or indirectly otherwise than
as such Officer;—
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(a)
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in any
contract made with or by the society; or
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(b)
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in any
property sold or purchased by the society; or
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(c)
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in any other
transaction of the society, except as investment made or as loan taken from
the society or the provision of residential accommodation by the society to any
paid employee of the society.
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(2)
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No officer
of the society shall purchase, directly or indirectly, any property of a
member of the society sold for the recovery of his dues to the society.
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57A
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Motion of
no-confidence against the officers of the society:-
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(1)
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The requisition to call the special
meeting of the committee of a society to consider a motion of no-confidence
against the President, Vice-President, Chairman, Vice-Chairman, Secretary,
Treasurer or other officer of the society, by whatever designation called,
who holds office by virtue of his elections to that office, shall be made in
Form M-18. The requisition shall be accompanied by;-
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(a)
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the grounds
of no-confidence;
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(b)
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the text of
the motion of no-confidence to be moved;
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(c)
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the name of
the committee members who shall move the motion of non-confidence;
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(d)
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a list of
members of the committee specifying their full names, and address who are,
for the time being, entitled to sit and vote at any meeting of the committee;
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(e)
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signatures
of the members of the committee who are signing the requisition duly attested
by the Chief Executive Officer of the society or Special Executive Magistrate
or Executive Magistrate or any Gazetted Officer of the Government.
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(2)
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The
requisition referred to in sub-rule (1) shall be delivered in person to the
Registrar. Such requisition or requisitions shall be delivered in duplicate
in each case. The Registrar on ascertaining that the requisition or
requisitions as the case may be, have been signed by not less than 1/3rd
members of the committee who for the time being are entitled to sit and vote
in any meeting of the committee of society;-
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(a)
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Receive and
acknowledge the requisition under his signature with date and time.
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(b)
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Issue
notice, within 7 days from the date of receipt of the. requisition,
convening, the special meeting for that purpose specifying therein place,
date, time, name and designation of the officer who shall be presiding over
such meeting, to all the members of the committee, the presiding officer and
the Managing Director, General Manager, Manager, Paid Secretary, Group
Secretary or such employee of the society, to whom the Registrar has directed
to produce minute book of committee meetings of the society. This notice of
no-confidence shall also be issued, to the Officer or officers against whom
the motion of no-confidence is being moved, and shall be accompanied by the
copy of the requisition along with enclosures and agenda.
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(c)
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The
Registrar shall direct the Managing Director, General Manager, Manager, Paid
Secretary, Group Secretary or any other employee to deliver in person the
minute book Of the committee meetings on the date, time and place of the
meeting, to the Presiding Officer.
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(d)
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The
Registrar shall send a notice under certificate of posting, to all the
persons concerned. However, he shall serve or cause to be served the notice
on the officer or officers against whom the motion of no-confidence is
proposed to be moved through the special messenger or the officer or
officers, as the case may be, or in his or their absence on any adult member
of his or their families at the place of residence. If for some reason it is
not possible to serve the notice, the authorised person in this behalf, shall
in presence of two witnesses, affix such notice on any conspicuous place of
the residence.
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(e)
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copies of
this notice shall
be displayed on
the Notice Board
of the Registrar, the Presiding Officer and the society. Such display of the
notice on the notice board of the Registrar and the Presiding Officer shall
be the conclusive proof that such notice has been served on all concerned.
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(3)
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Notwithstanding
anything contained in the bye-laws of the society regarding the procedure for
convening and holding meeting and recording of minutes, the procedure adopted
by the Registrar, the Presiding Officer and the Authorised Officer under
sub-rule (2) shall be deemed to be the proper procedure under the provisions
of bye-laws of the society.
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(4)
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If the
Registrar deems it necessary, he shall require any Officer of the society to
furnish any information to him and it shall be obligatory on the part of such
officer to furnish such information. On failure of the officer to furnish the
information, the Registrar may get it through any person authorising in that
behalf. This failure on part of the officer of the society shall be construed
as non-compliance of provisions as contemplated under sub-section (1) of
Section 79. However, in case of the officer of the society who holds that
office by virtue of his election, including the member of the committee of
management, it shall be construed as breach of provisions under sub-section
(1) of Section 79 and negligence of performance of duties imposed by the
Registrar as contemplated under subsection (1) of Section 78.
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(5)
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The time of
the meeting shall be between Office hours of the authorised officer. The
meeting shall be held either in the office of the society or at any other place
which may, as far as possible, be public place or any other place specified
by the District Deputy Registrar.
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(6)
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No other
subject, except the motion or motions of no-confidence shall be kept on the
agenda.
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(7)
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The
Registrar or the officer authorised to preside over the meeting shall,
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(a)
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announce or
cause to be announced the commencement of the meeting,
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(b)
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take possession
of the minute
book of the
committee meetings from the officer
of the society. However, for some reasons, if it is not possible for him to
take possession of the minute book of the committee meetings of the society,
at the commencement of the meeting, he shall record proceedings in the register
kept for that purpose in his office. The text of the minutes of the meeting
recorded in the minute book kept in the office of the Registrar shall be
incorporated in the minute book of the society.
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(c)
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record the
date, time, place, names of members of the committee present at the
commencement of the meeting, in the minute book of the society or kept by
him, as the case may be, in his own hand and cause all the members of the
committee who are present, to sign it and it shall be obligatory on their part
to do so. The signature of the members on the minute book shall be the
concrete proof of their attendance.
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(d)
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not allow
any other person to enter the place of meeting except the person or persons
appointed to assist him, the officer of the society who has produced the
minute book, the officer or officers against whom the motion of no-confidence
is moved, the members of the committee who are for the time being entitled to
sit and vote in any meeting of the committee, who are present at the
commencement of the meeting and police officer or officers if called by him
to maintain the law and order.
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(e)
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record or
cause to be recorded, the proceedings of the meeting and thereafter allow
those members who desire to sign the proceedings. Signature of the members on
the minute book shall be the conclusive proof of their attendance.
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(f)
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not allow the discussions on any other subject than the subject on
agenda.
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(g)
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declare the motion or motions as rejected and take a note to that
effect with reasons, in the minute book under the following circumstances;—
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(i)
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if no member of the committee present;
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(ii)
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none of the members of the committee, who are present refuse to sign
the requisition;
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(iii)
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2/3rd members are not present at the commencement of the meeting (i)
2/3rd is fraction; it shall be rounded to next higher number.
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(h-i)
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read or
cause to be read the text and grounds of no-confidence motion and allow any
of the member, who have signed the requisition to move the motion and to
speak in support of the motion.
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(h-ii)
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allow the
member against whom no-confidence motion is moved or any other member on his
behalf to defend.
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(i)
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put the
motion to vote
and declare the
results as laid
down in sub-section (6) of Section 73ID.
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(j)
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the
Presiding Officer shall not speak or give any decision on the merit or
otherwise of no-confidence motion.
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(k)
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Issue
certificate in Form M-19 in favour of the society.
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58.
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Disqualification
for membership of committee:-
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(1)
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No person
shall be eligible for
appointment, or election or nomination or co-option or being continued as
member of the committee or District Loan Committee of State Land Development
Bank, if he is in default to any society, in respect of any dues from him
either as borrower or is a defaulter within the meaning of Section 73FF or
has incurred disqualification under Clauses (ii), (iii), (iv), (v), and (iv)
of sub-section (1) of Section 73FF.
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(2)
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When any
member incurs disqualification as mentioned in sub-rule (1) the Chief
Executive Officer or whatsoever name called, shall communicate, the members
that he has ceased to be a member of the committee, under certificate of
posting. The Chief Executive Officer shall also report along with a copy of
communication to the Registrar and also affix a copy thereof on the notice
board of the society. The publication of such copy of the notice of the
receipt of such copy of the notice in the office of the Registrar shall be
the conclusive proof of the fact that the person has duly received the
communication. When any member ceased to be a member of the committee, the
seat of such member shall be deemed to have fallen vacant from the date of
such communication. The society shall not allow such persons to exercise any
powers enjoy any rights and privileges and perform functions as member of the
committee, under the Act and the rules and bye-laws made there under. If the
Chief Executive Officer fails to take action as contemplated above, the
Registrar shall after giving an opportunity to the person disqualified, issue
communication of cessation of membership of such person from the committee of
the society under certificate of posting and also by publishing a copy on the
notice board of his office.
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58-A.
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Bond to be executed by elected
Members of Managing Committee: -
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Every elected member of the Managing
Committee shall execute a bond in Form M-20 within fifteen days of his
assuming the office. Such bond shall be executed on the stamp paper as
provided under the Bombay Stamp Act, 1958. The expenditure on stamp paper
shall be borne by the society. The Chief Executive Officer/Secretary of the
society shall receive such bonds and keep them on record of the society and
accordingly inform the Registrar within fifteen days from formation of the
Committee.
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59.
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First general meeting:-
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(1)
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Within three
months from the date of registration of
a society, the Chief Promoter thereof, shall convene the first general
meeting of all persons who had joined in the application for registration of
the society. Where the Chief Promoter fails to convene the meeting as
aforesaid, it shall be convened by any person authorised in that behalf by
the Registrar.
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(2)
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At the first
general meeting, the following business shall be transacted;—
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(i)
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Election of
a president for the meeting;
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(ii)
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Admission of
new members;
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(iii)
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receiving a statement of accounts and reporting all transactions
entered into by the promoter up to 14 days before the meeting.
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(iv)
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Constitutions of a provisional committee until regular elections are
held under the by-laws. The provisional committee shall have the same powers
and functions as the committee elected in accordance with the by-laws;
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(v)
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Fixing the limit up to which the funds may be borrowed;
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(vi)
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Any other matter which has been specifically mentioned in the by-laws.
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59-A2
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Deleted
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59-B2
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Deleted
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60.
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General
meetings: -
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(1)
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All general meetings of a society excepting the first general meeting
shall be convened by the Secretary or any other officer authorised by and
under the by-laws to convene such meetings under
intimation to the Registrar, who may attend such meetings or authorise some
person to attend such meetings on his behalf. The President of the Society or
in his absence the Vice-President or, in the absence of both, a member
elected by the members present at the meeting shall preside over the meeting
unless the by-laws specify that the President of the meeting elected by the
meeting.
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(2)
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No general
meeting shall be held or proceeded with unless the number of members required
to form a quorum as specified in the by-laws are present.
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(3)
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The
Secretary or any other officer convening the meeting shall read out the
notice convening the meeting and the agenda for the meeting and then the
subjects shall be taken up for consideration in the order in which they are
mentioned, in the agenda unless the members present, with the permission of
the President, agree to change the order. Unless otherwise specified in the
Act, these rules and the by-laws, the
resolutions will be passed by a majority of the members present. The President will have a casting vote.
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(4)
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When the
members are divided on any resolution, any member may demand a poll. When a
poll is demanded, the President shall put the resolution for vote.
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(5)
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Voting may
be by show of hands or by ballot as may be decided by the members present at
the meeting, unless otherwise specified in the by- laws. Notwithstanding
anything contained in the by-laws, election of office bearers of a Society
having members share capital in excess of Rs. 10,000, including Government
share capital, if any, shall be by ballot.
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(6)
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When voting
is to be by ballot, the President shall take necessary steps for the issue of
ballot papers and counting of votes.
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(7)
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The result
of voting shall be announced by the President.
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(8)
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If all the
business in the agenda cannot be transacted on the date on which the general
meeting is held, the meeting may be postponed to any other suitable date not
later than thirty days from the date of the meeting as may be decided by the
members present at the meeting.
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(9)
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The
remaining subject or subjects on the agenda shall be taken up for
consideration at the postponed meeting.
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(10)
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If the
general meeting cannot be held for want of quorum, if shall be adjourned to a
later hour on the same day as may have been specified in the notice calling
the meeting or to a subsequent date not earlier than seven days and at such
adjourned meeting the business on the agenda of the original meeting shall be
transacted whether there is a quorum or not.
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(11)
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No
resolution regarding expulsion of a member of the society, removal of a
member of the committee or amendment of by-laws shall be brought forward in
any general meeting, unless due notice thereof is given in accordance with
the provisions of the Act, these rules and the by-laws of the society.
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61.
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Annual
statements of accounts including balance sheet, etc:-
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Within forty-five days of the close of
every co-operative year, or within such extended period as may be specified
by the Registrar, in the case of any society or class of societies, the
committee of every society shall prepare annual statements of accounts
showing;—
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(i)
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receipts and
disbursements during the previous co-operative year;
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(ii)
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the profit
and loss account for the year; and
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(iii)
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the balance
sheet as at the close of the year.
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These
statements of accounts shall be open to inspection by any member during
office hours at the office of the society and a copy thereof shall be
submitted, within fifteen days from the date of preparation, to the auditor
appointed by the Registrar for the audit of that society.
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62.
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Form for the
balance sheet and the profit and loss account:-
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(1)
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The balance sheet and the profit and
loss account to be laid before the annual 'general meeting of a society by
the committee shall ordinarily be in Form N :
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Provided
that it shall be competent for the Registrar to permit a society or class of
societies to adopt such other form as he may deem fit.
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(2)
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A copy of
the balance sheet and profit and loss account to be presented at the annual
general meeting under sub-section (2) of Section 75 and a copy of the report
of the committee under sub-section (3) of Section 75 shall be fixed on the
notice board of the society at least fourteen days before the date fixed for
the annual general meeting.
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63.
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Power to
call annual and special general meeting:-
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If the
annual general meeting of a
society is not called in accordance with the provisions of Section 75 or if
the Chairman or a majority of the committee of the society fail to call a
special general meeting in accordance with the provisions of Section 76, the
Registrar may authorise any person subordinate to him or any officer or
employee of a federal society to
call the annual general meeting or the special general meeting, as the case
may be, and such officer or person shall have all the powers and functions of
the officer of the society authorised to convene such annual or special
general meeting, under its bylaws.
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64.
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Procedure
for appointment, suspension, and removal of members of the committee and
other officers, etc:-
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(1)
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Notwithstanding
anything contained in the by-laws
of a society but subject to the provisions of Section 78, the Registrar may by an order stating the reasons therefore;—
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(a)
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remove the committee of a society and appoint a new committee in its
place consisting of three or more members of the society to manage the
affairs of the society; or
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(b)
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remove the committee and appoint one or more administrators, who need
not be members of the society, to manage the affairs of the society; or
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(c)
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remove any member of the committee of a society and appoint in his
place such other member as he may deem fit.
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(2)
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Before making any order under sub-rule (I), the Registrar shall
consult the federal society to which the society is affiliated and give an
opportunity to the committee or the member concerned to show cause, within
fifteen days from the date of issue of notice, why such an order shall not be
made.
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(3)
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The member
appointed under clause (c) of sub-rule (1) shall hold office so long as the
member in whose place he is appointed would have held office, if the vacancy
had not occurred.
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(4)
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Notwithstanding
anything contained in the by-laws regarding holding any meeting of the
society, the Registrar may, by special or general order specify the procedure
for holding meetings of the Committee appointed by him under clause (a) of
sub-rule (1).
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(5)
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Immediately
after the appointment of a new committee or an administrator or
administrators under sub-rule (1), the committee in whose place such
appointment is made and officers of the society shall give the new committee
or the administrator or administrators, as the case may be, the of the
property, documents and accounts of the society
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65.
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Accounts and
books to be kept:-
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(1)
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Every
society shall keep the following accounts and books;—
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(1)
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A register
of members including persons nominated under Section 38 in Form I.
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(2)
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A register
of shares.
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(3)
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A register
of debentures and bonds (where capital is raised by debentures and bonds).
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(4)
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Minute book
regarding proceedings of general meetings.
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(5)
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Minute book
recording proceedings of committee meetings.
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(6)
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Cash book.
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(7)
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General
ledger and personal ledger.
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(7)
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Stock
register.
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(8)
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Property
registers.
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(9)
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Register of
audit objections and their rectification.
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(10)
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Such other
accounts and books as from time to time are specified by the State Government
by special-or general order for any society or class of societies.
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(2)
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Where the
State Government directs by order as provided under sub-section (2A) of
Section 81 that the cost audit of any society or class of societies shall be
conducted, such society or class of societies shall, in addition to the
accounts and books required to be kept under sub-rule (1), also maintain such
books, records and accounts in such manner as the State Government may
specify by general or special order from time to time for the purposes of
cost audit.
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66.
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Copies of
monthly returns to be furnished to Registrar: -
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All
Registered Co-operative
Societies classified by the Registrar as Central Banks or as Urban Banks
shall furnish to the Registrar every month a copy of each of the returns
required to be furnished to the Reserve Bank of India under Sections 18, 24
and 27 of the Banking Regulation Act, 1949 (10 of 1949).
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67.
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Registrars
power to enforce performance of obligations: -
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(1)
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In addition to the periodical financial
statements referred to in Rule 66, the Registrar may, by special or general
order, require any society to furnish to him any other returns in such forms
as may be specified by him, on such date or dates or at such interval or
intervals as may be specified by him, in the order. The salaried officers of
the society shall be responsible for the submission of these returns on due
dates. If there are no salaried officers of the society or if the executive
functions are attended to by the Chairman or any other member of the
committee in an honorary capacity, the return shall be submitted by the
Chairman or such member of the committee.
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(2)
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On failure
of the society
to furnish any returns
on due dates,
the Registrar may, after giving due notice to the person or persons responsible for
the submission of the same, depute an employee of the Co-operative Department
or of the Federal Society to which the society is affiliated to prepare the
return or returns and submit it or them to him. The members of the committee
and other officers of the society shall furnish to the employee of the
Co-operative Department or of the federal society entrusted with the work,
all information necessary for preparing the return or returns. The expenses
incurred by the Registrar in getting such return or returns prepared shall be
borne by the society and shall be recovered from the society under Section 79
as if they were an arrear of land revenue.
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67A.
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Directions
of Registrar to the society to make regulations on certain matters:-
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(1)
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Where, in
the course of, or as a result of audit under Section 81, or enquiry under Section 83, or
inspections under Section 84 or Section 89A or supervision under Section 89A
or visit or administrative inspection of any officer of the Co-operative
Department or financial institution, or on the report of federal society or
financial institution, or in any other way, or suo moto or otherwise, the
Registrar is of the opinion that it is necessary, having regard to financial
condition of the society or before after
grant of Government financial assistance of any kind directly or indirectly,
including Government guarantee or any other financial interest of Government
accrue or likely to be accrued to regulate the manner of carrying on trade or
business, the Registrar, after making such further enquiry if he deems
necessary and after consulting the committee or any officer of the society
and after examining the record of the society, shall;—
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(i)
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direct the
society to make regulations on the items specified by him;
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(ii)
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direct the
society to make regulations in such manner as he specifies and forward the
same to him within three months from the date of such issue of directions to
him, for approval.
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(2)
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The society
shall frame the regulations on items specified by the Registrar and also in
the manner specified by him, if he has so directed while forwarding
regulations and forward the same personally along with copy of resolution
within a period of three months from the date of issue of such directives.
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(3)
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On receipt
of regulations, the Registrar or the District Deputy Registrar on examination
may issue an order approving them or modify, eliminate, delete or add as he
deems fit in the interest of the society. The regulations shall be effective
from the date of issue of order of approval by the Registrar and the society
shall carry on its business in accordance with such regulations from the date
of order of approval of such regulations.
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(4)
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If any
society fails to submit regulations to the Registrar on any or all the items
forwarded by the Registrar or in the manner directed by him, the Registrar
shall make the regulations on the items and in the manner if directed by him
under sub-section (1) of Section 79AA and issue an order directing the
society to carry on its business in accordance with such resolutions from the
date of issue of such order. It shall be obligatory on the society to carry
on its business and trade in accordance with the regulations so issued.
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(5)
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If;—
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(a)
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the Committee or any officer of the society fails to attend the consultation,
to produce record furnishing the information, attend for satisfying the
doubts of Registrar or to carry out any other act or to comply with any of
the provisions of sub-rules (1), (2) and (3);
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(b)
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after issue of order in sub-rules (3) and (4) of this rule, if the
society is negligent in observance or fails to comply with the regulations,
it shall be construed as non-compliance of direction issued by the Registrar
under sub-section (1 ) of Section 79, if it relates to clause (a) and
non-compliance of directions issued by the Registrar under Section 79AA, if
it relates to clause (b) and thereupon the provisions of Section 79 shall be
applicable mutatis mutandis. If the committee or elected officer of the
society is responsible for non-compliance of provisions of clauses (a) and
(b) of this sub-rule, it shall, in addition to non-compliance of directives
under sub-section (I) of Section 79 and Section 79AA, also be construed as
negligence in performance of duties imposed on it or upon him by the Act arid
the rules made there under and willful disobedience of instructions issued by
the Registrar as contemplated in sub-section (1) of Section 78.
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68.
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Procedure to be adopted for taking possession of books, documents,
securities, cash and other properties of society:-
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(1)
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Where taking
possession of books,
documents, securities, cash or other properties of a society is considered
necessary and where taking of such possession is resisted or obstructed, the
Register, the Liquidator or any other person entitled to the same may take or
cause to be taken order for seizing the books, documents, securities, cash or
other properties of the society, as the case may be, in the manner provided
in Section 80.
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(2)
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Any person
appointed by the Registrar as a Liquidator of a society or any person
authorised by the Registrar to audit the accounts of a society under Section
81 or any person authorised by the Registrar to hold an inquiry into the
constitution, working and financial conditions of a society under Section 83
or any person authorised by the Registrar to inspect the books of a society
under Section 84 shall, in cases where the misappropriation of funds, breach
of trust or fraud has been committed or where it is suspected or apprehended
that the books, documents, securities, cash or other properties of a society
are likely to be tampered with or destroyed or removed, and where taking of
possession of such books, documents, securities, cash or other properties is
considered necessary, shall follow the same procedure, with the previous
permission of the Registrar, as is laid down in Section 80 for the purposes
of obtaining such possession.
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