LIQUIDATION
102.
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(1)
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If the Registrar;
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(a)
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After an inquiry has been held under section 83 or an
inspection has been made under section 84 “or 89A” [* Was
inserted By MAH. XXIV of 1961] or on
the report of the auditor auditing the accounts of the society, or
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(b)
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on receipt of an application made upon a resolution
carried by three-fourths of the members of a society present at a special
general meeting called for the purpose, or
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(c)
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of his own motion, in the case of a society which-
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(i)
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Has not commenced working, or
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(ii)
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Has ceased working, or
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(iii)
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Possesses shares or members deposits not exceeding five
hundred rupees, or
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(iv)
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Has ceased to comply with any conditions as to
registration and management in this Act or the rules or the bye-laws, is of
the opinion that a society ought to be wound up, he may issue an interim
order directing it to be wound up.
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(2)
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A copy of such order made under sub-section (1) shall
be communicated, in the prescribed manner, to the society calling upon it to
submit its explanation to the Registrar within a month from the date of the
issue of such order, and the Registrar, on giving an opportunity to the
society and to the creditors of the society, city and of being heard, may
issue a final order, vacating or conforming the interim order.
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103.
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(1)
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When an interim order is passed under the last
preceding section or a final order is passed under that section, for the
winding up of a society, the Registrar may, in accordance with the rules
appoint a person to be Liquidator of the society, and fix his remuneration.
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(2)
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On issue of the interim order, the officers of the
society shall hand over to the Liquidator the custody and control of all the
property, effects and actionable claims to which the society is or appears to
be entitled, of all books records and other documents pertaining to the
business of the society and, shall have no access to any of them.
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(3)
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When a final order is passed confirming the interim
order, the officers of the society shall vacate their offices, and while the
winding up order remains in force the general body of the society shall not
exercise any powers.
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(4)
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The person appointed under this section as Liquidator
shall, subject to the general control of the Registrar, exercise all or any
of the powers mentioned in section 105. The Registrar may remove such person
and appoint another in his place, without assigning any reason.
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(5)
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The whole of the assets of the society shall on the
appointment of Liquidator under this Section vest in such Liquidator, and
notwithstanding anything contained in any law for the time being in force, if
any immovable property is held by a Liquidator on behalf of the society, the
title over the land shall be complete as soon as, the mutation of the name of
his office is effected, and no Court shall question the title on the ground
of dispossession, want of possession or physical delivery of possession.
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(6)
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In the event of the interim order being vacated, the
person appointed as Liquidator shall hand over the property, effects and
actionable claims and books, records and other documents of the society to
the officers who had delivered the same to him. The acts done, and the
proceedings taken by liquidator, shall be binding on the society, and such
proceedings shall, after the interim order has been cancelled under the
preceding section, be continued by the officers of the society.
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104.
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(1)
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The committee, or any member, of the society, ordered
to be wound up may prefer an appeal against the final order of winding up
within two months from the date of the issue of the order made under section
102, -
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(a)
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If made by the Registrar, or the Special or Additional
or Joint Registrar on whom the powers of the Registrar are conferred, to the
State Government;
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(b)
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If made by any person other than the Registrar, or the
Special or Additional or Joint Registrar on whom the powers of the Registrar
are conferred, to the Registrar;
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Provided that no appeal shall lie against an order,
issued under sub-clause (i), (ii) or (iii) of clause (c) of sub-section (I)
of section 102.
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(2)
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No appeal from a member under this section shall be
entertained unless it is accompanied by such sum as security for the costs of
hearing the appeal, as may be prescribed.
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105.
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(1)
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The Liquidator appointed under section 103 shall have
powers, subject to the rules and the general supervision, control and
direction of the Registrar;
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(a)
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to institute and defend any suit and other legal
proceedings, civil or criminal, on behalf of the society in the name of his
office;
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(b)
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to carry on the business of the society, so far as may
be necessary for the beneficial winding up of the same;
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(c)
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to sell the immovable and movable property and
actionable claims of the society by public auction or private contract, with
power to transfer the whole or part thereof, to any person or body corporate,
or sell the same in parcels;
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(c-i)
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to transfer by sale assets valued at market price to a
society registered with similar objects or to Government undertaking which
carries on the same business as of the society under liquidation;
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(c-ii)
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to lease to other societies or to Government
undertaking, with prior approval of the Registrar, the property of the
society to run the same business as that of the society under liquidation;
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(d)
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to raise, on the security of the assets of the society,
any money required;
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(e)
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to investigate all claims against the society and,
subject to the provisions of the Act, to decide questions of priority arising
out of such claims, and to pay any class or classes of creditors in full or
ratable according to the amount of such debts, the surplus being applied in
payment of interest from the date of liquidation at a rate to be approved by
the Registrar, but not exceeding the contract rates;
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(f)
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to make any compromise or arrangement with creditors or
persons claiming to be creditors or having or alleging themselves to have any
claims, present or future, whereby, the society may be rendered liable;
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(g)
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to compromise all calls or liabilities to calls and debts
and liabilities capable of resulting in debts, and all claims present or
future, certain or contingent, subsisting or supposed to subsist between the
society and a contributory or alleged contributory or other debtor or person
apprehending liability to the society, and all questions in any way relating
to or affecting the assets or the winding up of the society, on such terms as
may be agreed, and take any security for the discharge of any such call,
liability, debt, or claim, and give a complete discharge in respect thereof;
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(h)
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to determine, from time to time, after giving an
opportunity to answer the claim, the contribution to be made or remaining to
be made by the members or past members or by the estates, nominees, heirs or
legal representatives of deceased member, or by any officer, past officer or
the estate or nominees, heirs or legal representatives of deceased officer to
the assets of the society, such contribution being inclusive of debts due
from such members or officers;
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(i)
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to issue requisition under section 98;
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(j)
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to refer or to get referred any dispute to the
Co-operative Court for decision;
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(k)
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to determine by what persons and in what proportion the
costs of the liquidation shall be borne;
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(l)
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to fix the time or times within which the creditors
shall prove their debts and claims or be included for the benefit of any
distribution made before those debts or claims are proved;
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(m)
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to summon and enforce the attendance of witnesses and
to compel the production of any books, accounts, documents, securities, cash
or other properties belonging to or in the custody of the society by the same
means and in the same manner as is provided in the case of a Civil Court
under Code of Civil Procedure, 1908;
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(n)
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to do all acts, and to execute in the name and on
behalf of the society, all deeds, receipts and other documents as may be
necessary to such winding up;
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(o)
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to take such action as may be necessary under section
19 with the prior approval of the Registrar, if there is reason to believe
that the society can be reconstructed.
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(2)
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Notwithstanding anything contained in sub-section (1)
the liquidator shall not have the right to vote on behalf of the society in
liquidation, at the election of the member of the committee or of officers of
any other society.
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106.
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After expiry of the period for appeal against the order
made under sub-section (1) of section 102 or where the appeal has been
dismissed, the order for winding up shall be effective and shall operate in
favour of all the creditors and of all the contributories of the society, as
if it had been made on the joint petition of creditors and contributories.
When a winding up order becomes effective, the Liquidator shall proceed to
realize the assets of the society by sale or otherwise, and no dispute shall
be commenced or, if pending at the date of the winding up order, shall be
proceeded with, against the society except by leave of the Registrar and
subject to such terms as the Registrar may impose. The Registrar, may of his
own motion however, entertain or dispose of any dispute by or against the
society.
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107.
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Save as expressly provided in this Act, no Civil Court
shall take cognizance of any matter connected with the winding up or
dissolution of a society under this Act; and when a winding up order has been
made no suit or other legal proceedings shall lie or be proceeded with
against the society or the Liquidator, except by leave of the Registrar, and
subject to such terms as he may impose:
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Provided that, where the winding up order is cancelled
the provisions of this section shall cease to operate so far as the liability
of the society and of the members thereof to be sued is concerned, but they
shall continue to apply to the person who acted as Liquidator.
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108.
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(1)
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The Liquidator shall, during his tenure of office, at
such times as may be prescribed, but not less than twice each year, present
to the Registrar an account in the prescribed form of his receipts and
payments as Liquidator. The Registrar shall cause the accounts to be audited
in such manner as he thinks fit; and for the purpose of audit, the Liquidator
shall furnish the Registrar with such vouchers and information as he, or the
person appointed by him, may require.
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(2)
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The Liquidator shall cause a summary of audited
accounts to be prepared, and shall send a copy of such summary to every
contributory.
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(3)
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The Liquidator shall pay such fees as the Registrar may
direct, for the audit of the accounts and books kept by him in the manner
prescribed.
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(4)
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The Liquidator shall be held liable for any irregularities
which might be discovered in the course or as a result, of audit in respect
of transactions subsequent to his taking over the affairs of the society, and
may be proceeded against as if it were an act against which action could be
taken under section 88 :
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Provided that, no such action shall be taken unless the
irregularities have caused or are likely to cause loss to the society, and
have occurred due to gross negligence or want or omission, in carrying out
the duties and functions.
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109.
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(1)
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The winding up proceedings of a society shall be ceased
as soon as practicable within six years from the date the Liquidator takes
over the custody or control of all the property, effects and actionable
claims to which the society is or appears to be entitled, and of all books,
records and other documents pertaining to the business of the society, under
sub-section (2) of section 103, unless the period is extended by the
Registrar:
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Provided that, the Registrar shall not grant any
extension for a period exceeding one year at a time and four years in the
aggregate, and shall, immediately after the expiry of ten years from the date
aforesaid, deem that the liquidation proceedings have been terminated, and
pass an order terminating the liquidation proceedings.
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“Provided
further that, if, due to termination of liquidation proceedings at the end of
ten years, the Registrar comes to a conclusion that, the work of liquidation
under section 105 could not be completed by the liquidator due to the reasons
beyond his control, he shall call upon the liquidator to submit the report.
After getting the report, if the Registrar is satisfied that the realization
of assets, properties, sale of properties still remained to be realized, he
shall direct the liquidator to complete the entire work and carry out the
activities only for the purposes of winding up and submit his report within
such period not exceeding one year reckoned from the date of receipt of
report from the liquidator.” [* Was
inserted By MAH. XXIV of 1961]
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Explanation.—In the case of a society which is under
liquidation at the commencement of the Maharashtra Co-operative Societies
(Second Amendment) Act, 1985 the period of six years shall be deemed to have
commenced from the date on which the Liquidator took over the custody or
control as aforesaid.
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(2)
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Notwithstanding anything contained in the foregoing
subsection, the Registrar shall terminate the liquidation proceedings on
receipt of the final report from the Liquidator. The final report of the
Liquidator shall state that the liquidation proceedings of the society have
been closed, and how the winding up has been conducted and the property of,
and the claims of the society have been disposed of, and shall include a statement
showing summary of the account of the winding up including the cost of
liquidation, the amount (if any), standing to the credit of the society in
liquidation, after paying of its liabilities including the share or interest
of members and suggest how the surplus should be utilised.
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(3)
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The Registrar, on receipt of the final report from the
Liquidator, shall direct the Liquidator to convene a general meeting of the
members of the society for recording his final report.
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110.
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The surplus assets, as shown in the Final Report of the
Liquidator of a society which has been wound up, may either be divided by the
Registrar, with the previous sanction of the State Government, amongst its
members in such manner as may be prescribed or be devoted to any object or
objects provided in the bye-laws of the society, if they specify that such a
surplus shall be utilised for the particular purpose or may be utilised for
both the purposes. Where the surplus is not so divided amongst the members
and the society has no such bye-laws, the surplus shall vest in the
Registrar, who shall hold it in trust and shall transfer it to reserve fund
of a new society registered with a similar object, and serving more or less
an area which the society, to which the surplus belonged was serving:
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Provided that, where no such society exists or is
registered within three years of the cancellation of the society whose
surplus is vested in the Registrar, the Registrar may distribute the surplus,
in the manner he thinks best, amongst any or all of the following :-
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(a)
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an object of public utility and of local interest may
be recommended by the members in general meeting held under the preceding
section;
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(b)
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a Federal Society with similar objects to which the
cancelled society was eligible for affiliation or, where no Federal Society
exists, the State federal society which may be notified in this behalf by the
State Government; and
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(c)
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Any charitable purpose as defined in section 2 of the
Charitable Endowments Act, 1890.
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