(1) The State Government may, for the whole or any part of the
State and for any class of co-operative societies, after previous
publication, make rules to carry out the purposes of this Act:
Provided that any rule may be made under this section without
previous publication if the State Government considers that it should be
brought into force at once.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:-
(i) the manner in which the application for registration of a society may be made;
(ii) class of societies; minimum share capital for societies, for the purpose of registration; criteria on the basis of which a society may be registered;
(iii) the applicants to whom the order refusing the registration of co-operative society may be sent by the Registrar;
(iv) the procedure and conditions for change in the form and extent of the liability of a co-operative society;
(v) the qualifications or dis-qualifications relating to membership of a co-operative society;
(vi) the manner in which the proposal for an amendment of the bye-laws or for transfer of assets and liabilities, division and amalgamation of a co-operative society shall be forwarded to the Registrar; (vii) the provision for a second or casting vote by the chairperson of a meeting of a co-operative society; (viii) the appointment by a co-operative society of one of its members to represent and vote on its behalf at a meeting of another co-operative society of which it is a member; (ix) the withdrawal, removal or expulsion of members, the payments to be made to them, the liabilities of past members and the estates of deceased members; 1 (ix-a) formation of common cadre for a class of society, including rules for its applicability and governance; (x) the procedure for the nomination of a person to whom the share or interest of a member on his death may be transferred or the value thereof may be paid; (xi) the class of persons and local authorities, which may be admitted as a nominal member in a society; the class of societies, in which the spouse of a member may be admitted as an associate member; (xii) the procedure for the admission of members of a Hindu Joint Family, and minors and persons of unsound mind inheriting the share or interest of deceased members and provision for their rights and liabilities; (xiii) the mode in which the value of a deceased member's share shall be ascertained; (xiv) the payments to be made and the conditions to be complied with by members applying for loans, the period for which loans may be made and the amount which may be lent to an individual member; (xv) the inspection of documents in the Registrar's office and the levy of fee for granting certified copies of the same; (xvi) the confirmation and maintenance of a register of members, and where the liability of members is limited by shares, of a register of shares and a list of members; (xvii) providing that the share capital of any society shall be available in such way as may be necessary to secure that the share shall not appreciate in value and that necessary capital shall be available for the society as required; (xviii) regulating the manner in which funds may be raised by a society or class of societies by means of shares or debentures or otherwise and the quantum of funds so raised; (xix) the limits for loans to be granted by a society or class of societies against different classes of securities or without security and the procedure for granting loans; (xx) manner or recalling a loan; (xxi) the limits for granting credit by a non-credit society or a class of non credit societies; (xxii) the manner in which the Delegate General Body of a society may be elected; (xxiii) the requisitioning of a general meeting of co-operative society; and the time within which a general meeting shall be called; (xxiv) general meetings of the members, the procedure at such meetings and the powers to be exercised by such meetings; (xxv) the election of members of committee by the general body of a co-operative society; (xxvi) the qualifications or disqualifications for membership of a committee; (xxvii) the conditions in which a member of a co-operative society may be disqualified from voting; (xxviii) the appointment, suspension, removal, term of office and filling of casual vacancies of the members of the committee and other officers and for the appointment of Administrator under section 30 and the procedure at meeting of the committee and the powers to be exercised and the duties to be performed by the committee, Administrator and other officers; (xxix) the manner in which election of a co-operative society shall be conducted; (xxx) the procedure to be adopted by the Registrar in cases where the taking of possession of books, documents, securities, cash and other properties of a society or of a society the affairs of which have been ordered to be wound up by the Registrar or by a person entitled to the same is resisted or obstructed; (xxxi) the procedure to be adopted by taking possession of books, documents, securities, cash and other property of a society by a person acting under sections 54, 55 and 56 in cases where misappropriation of funds, breach of trust, or fraud has been committed or where it is suspected or apprehended that the books, documents, securities, cash and other properties are likely to be tempered with or destroyed or removed; (xxxii) the qualifications of a Manager, Secretary, Accountant or any other officer or an employee of the society and the conditions of their service including discipline and control; (xxxiii) the prohibition against officers of a co-operative society, being interested in contracts with the society; (xxxiv) the conditions on which any charge in favour of a society shall be satisfied and the extent to which and the order in which the property to the charge shall be used in its satisfaction; and the form of declaration to be made under section 39; (xxxv) reasonable notice of the charge under section 39; (xxxvi) the procedure by which a co-operative society shall calculate and write-off bad debts; (xxxvii) the form in which an agreement under section 41 may be executed; (xxxviii) the matters connected with the direct and indirect partnership of the Government in co-operative societies; (xxxix) the rate at which dividend may be paid co-operative societies; (xl) the period within which a co-operative society out of its net profit in a year, transfer the amount to the reserve fund; (xli) the constitution of a Co-operative Education and Training Fund and the payment to be made to that fund by a cooperative society out of its own profits and the mode of its investment and the procedure thereof; (xlii) the mode of investment of funds of a co-operative society; (xliii) maintenance and administration of the provident fund which may be established by a co-operative society for the benefit of officers and servants employed by it and for the administration of such provident fund; (xliv) the objects of the Reserve Fund of a co-operative society and the mode of its investment; (xlv) the mode of disposal of Reserve Fund of a co-operative society on its winding up; (xlvi) the extent and conditions subject to which a co-operative society may receive deposits and loans; (xlvii) the restrictions on transactions by a co-operative society with non-members; (xlviii) the restrictions on grant of loans by a co-operative society against its shares; (xlix) the forms and standards of fluid resources to be maintained by co-operative societies accepting deposits and granting cash credits; (l) the levy of audit fees on co-operative societies; (li) the procedure for conducting audit, the matters on which the auditor shall submit a report, the form in which the statement of account shall be prepared for his audit, the limits within which the auditor may examine the monetary transactions of a society, the form of audit memorandum and report; (lii) the procedure for appointment of auditors under section 54; (liii) the procedure and principles for the conduct of inquiry under section 55; (liv) the procedure for apportioning the cost of inquiry and inspection and for assessing damages against delinquent promoters under section 57 and for recovery of cost and damages; (lv) the procedure to be followed in proceedings before the Registrar, Arbitrator or other person deciding disputes; (lvi) the form in which a dispute shall be referred to the Registrar: (lvii) the issue and service of processes and the mode of proving of service thereof; (lviii) the procedure to be followed in execution of awards; (lix) the conditions subject to which assets of a co-operative society shall vest in a Liquidator and the procedure to be adopted in winding up of a co-operative society; (lx) the matters in which an appeal shall lie from the order of a Liquidator appointed under section 63; (lxi) the time within which, and the manner in which Land Development Bank may send a copy of the instrument of mortgage to the Registering Officer in order to avail the benefit under section 78; (lxii) the procedure for recovery of amounts due or payable to a co-operative society; (lxiii) the manner, in which the Registrar or Collector may take action on an application made under sub-section (1) of section 88; (lxiv) the mode of making attachment before judgement; (lxv) the investigation of claims and objections that may be preferred against any attachment effected by the Registrar; (lxvi) the procedure to be followed for the custody of property attached under section 101; (lxvii) the procedure for the distraint and sale of property mortgaged to a Land Development Bank; (lxviii) the procedure and conditions for the issue, redemption, reissue, transfer, replacement or conversion of debentures issued by a society to which Chapter XII is applicable; (lxix) the maximum amount of principal, the rate of interest and other conditions for the guarantee of debentures issued by a society to which Chapter XII is applicable; (lxx) the qualifications and methods of appointment of an officer to effect sale under section 89 and the powers and functions which such an officer may exercise; (lxxi) the appointment of a receiver of the proceeds and income of mortgaged property or sale under section 89, the conditions in which he may be appointed or removed, the powers and functions which he may exercise and the expenses of management and the remuneration which he may receive; (lxxii) the procedure according to which action may be taken by a Land Development Bank against the mortgager under section 89; (lxxiii) in case of sale of immovable property under Chapter XII - (a) the procedure for proclamation and conduct of sale and the conditions on which an attempt of sale may be abandoned; (b) the method of calculating the expenses incidental to the sale or attempted sale; (c) the procedure for the receipt of deposit and disposal of the proceeds of sale; (d) the procedure for resale if an attempted sale is abandoned or the purchase money is not deposited within the prescribed time and the penalty to be levied against the purchaser who fails so to deposit the purchase money; (e) the form and method of disposal of money by a Land Development Bank under section 91; (f) the form of a sale certificate under section 92; (g) the procedure for delivery by the court of the property purchased, to the purchaser under section 92; (h) the form of the notice referred to in section 97; and (i) the fee payable for the service of such notice and the manner of serving such notice; (lxxiv) the time within which and the procedure according to which property purchased by Land Development Bank at a sale of immovable property under Chapter XII shall be disposed of by the bank; (lxxv) constitution, maintenance and utilisation of Guarantee Funds; the Rate at which the State Land Development Bank and Land Development Banks shall contribute to the Guarantee Funds; (lxxvi) the manner in which the property or any portion thereof, ordered to be transferred to a society under section 103, shall be transferred to a society; (lxxvii) the condition of service and procedure for selection of chairman and members of the Tribunal; (lxxviii) the procedure to be followed in presenting and disposing of appeals; (lxxix) the method of communicating or publishing any order, decision or award required to be communicated or published under this Act or the rules; (lxxx) offences for contravening any of the rules; (lxxxi) the account books and registers to be kept by a cooperative society and power of Registrar to direct the accounts and books to be written up; (lxxxii) the manner of certification of entries in the books of a cooperative society and of copies of documents kept by it in the course of its business; (lxxxiii) the statements and returns to be furnished by a cooperative society to the Registrar; (lxxxiv) the restrictions on persons appearing as legal practitioners; (lxxxv) the inspection of documents and the fees to be paid to a co-operative society for granting certified copies thereof; (lxxxvi) the remuneration payable to an Administrator appointed in place of a committee removed by the Registrar; (lxxxvii) the matters expressly required or allowed by this Act to be prescribed or for which rules may be made. (3) All rules and regulations made under this Act after its commencement, shall be laid, as soon as may be after they are made, before the House of the State Legislature while it is in session for a total period of fourteen days which may be comprised in one session or two or more successive sessions, and if, before the expiry of the session in which they are so laid or the successive sessions as aforesaid, the House agrees in making any modification in the rules or regulations, as the case may be, or resolves that the rules or regulations, as the case may be, should not be made, the rules or regulations, as the case may be, shall thereafter have effect only in such modified form or be of no effect, as the case may be, so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under these rules or regulations, as the case may be.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:-
(i) the manner in which the application for registration of a society may be made;
(ii) class of societies; minimum share capital for societies, for the purpose of registration; criteria on the basis of which a society may be registered;
(iii) the applicants to whom the order refusing the registration of co-operative society may be sent by the Registrar;
(iv) the procedure and conditions for change in the form and extent of the liability of a co-operative society;
(v) the qualifications or dis-qualifications relating to membership of a co-operative society;
(vi) the manner in which the proposal for an amendment of the bye-laws or for transfer of assets and liabilities, division and amalgamation of a co-operative society shall be forwarded to the Registrar; (vii) the provision for a second or casting vote by the chairperson of a meeting of a co-operative society; (viii) the appointment by a co-operative society of one of its members to represent and vote on its behalf at a meeting of another co-operative society of which it is a member; (ix) the withdrawal, removal or expulsion of members, the payments to be made to them, the liabilities of past members and the estates of deceased members; 1 (ix-a) formation of common cadre for a class of society, including rules for its applicability and governance; (x) the procedure for the nomination of a person to whom the share or interest of a member on his death may be transferred or the value thereof may be paid; (xi) the class of persons and local authorities, which may be admitted as a nominal member in a society; the class of societies, in which the spouse of a member may be admitted as an associate member; (xii) the procedure for the admission of members of a Hindu Joint Family, and minors and persons of unsound mind inheriting the share or interest of deceased members and provision for their rights and liabilities; (xiii) the mode in which the value of a deceased member's share shall be ascertained; (xiv) the payments to be made and the conditions to be complied with by members applying for loans, the period for which loans may be made and the amount which may be lent to an individual member; (xv) the inspection of documents in the Registrar's office and the levy of fee for granting certified copies of the same; (xvi) the confirmation and maintenance of a register of members, and where the liability of members is limited by shares, of a register of shares and a list of members; (xvii) providing that the share capital of any society shall be available in such way as may be necessary to secure that the share shall not appreciate in value and that necessary capital shall be available for the society as required; (xviii) regulating the manner in which funds may be raised by a society or class of societies by means of shares or debentures or otherwise and the quantum of funds so raised; (xix) the limits for loans to be granted by a society or class of societies against different classes of securities or without security and the procedure for granting loans; (xx) manner or recalling a loan; (xxi) the limits for granting credit by a non-credit society or a class of non credit societies; (xxii) the manner in which the Delegate General Body of a society may be elected; (xxiii) the requisitioning of a general meeting of co-operative society; and the time within which a general meeting shall be called; (xxiv) general meetings of the members, the procedure at such meetings and the powers to be exercised by such meetings; (xxv) the election of members of committee by the general body of a co-operative society; (xxvi) the qualifications or disqualifications for membership of a committee; (xxvii) the conditions in which a member of a co-operative society may be disqualified from voting; (xxviii) the appointment, suspension, removal, term of office and filling of casual vacancies of the members of the committee and other officers and for the appointment of Administrator under section 30 and the procedure at meeting of the committee and the powers to be exercised and the duties to be performed by the committee, Administrator and other officers; (xxix) the manner in which election of a co-operative society shall be conducted; (xxx) the procedure to be adopted by the Registrar in cases where the taking of possession of books, documents, securities, cash and other properties of a society or of a society the affairs of which have been ordered to be wound up by the Registrar or by a person entitled to the same is resisted or obstructed; (xxxi) the procedure to be adopted by taking possession of books, documents, securities, cash and other property of a society by a person acting under sections 54, 55 and 56 in cases where misappropriation of funds, breach of trust, or fraud has been committed or where it is suspected or apprehended that the books, documents, securities, cash and other properties are likely to be tempered with or destroyed or removed; (xxxii) the qualifications of a Manager, Secretary, Accountant or any other officer or an employee of the society and the conditions of their service including discipline and control; (xxxiii) the prohibition against officers of a co-operative society, being interested in contracts with the society; (xxxiv) the conditions on which any charge in favour of a society shall be satisfied and the extent to which and the order in which the property to the charge shall be used in its satisfaction; and the form of declaration to be made under section 39; (xxxv) reasonable notice of the charge under section 39; (xxxvi) the procedure by which a co-operative society shall calculate and write-off bad debts; (xxxvii) the form in which an agreement under section 41 may be executed; (xxxviii) the matters connected with the direct and indirect partnership of the Government in co-operative societies; (xxxix) the rate at which dividend may be paid co-operative societies; (xl) the period within which a co-operative society out of its net profit in a year, transfer the amount to the reserve fund; (xli) the constitution of a Co-operative Education and Training Fund and the payment to be made to that fund by a cooperative society out of its own profits and the mode of its investment and the procedure thereof; (xlii) the mode of investment of funds of a co-operative society; (xliii) maintenance and administration of the provident fund which may be established by a co-operative society for the benefit of officers and servants employed by it and for the administration of such provident fund; (xliv) the objects of the Reserve Fund of a co-operative society and the mode of its investment; (xlv) the mode of disposal of Reserve Fund of a co-operative society on its winding up; (xlvi) the extent and conditions subject to which a co-operative society may receive deposits and loans; (xlvii) the restrictions on transactions by a co-operative society with non-members; (xlviii) the restrictions on grant of loans by a co-operative society against its shares; (xlix) the forms and standards of fluid resources to be maintained by co-operative societies accepting deposits and granting cash credits; (l) the levy of audit fees on co-operative societies; (li) the procedure for conducting audit, the matters on which the auditor shall submit a report, the form in which the statement of account shall be prepared for his audit, the limits within which the auditor may examine the monetary transactions of a society, the form of audit memorandum and report; (lii) the procedure for appointment of auditors under section 54; (liii) the procedure and principles for the conduct of inquiry under section 55; (liv) the procedure for apportioning the cost of inquiry and inspection and for assessing damages against delinquent promoters under section 57 and for recovery of cost and damages; (lv) the procedure to be followed in proceedings before the Registrar, Arbitrator or other person deciding disputes; (lvi) the form in which a dispute shall be referred to the Registrar: (lvii) the issue and service of processes and the mode of proving of service thereof; (lviii) the procedure to be followed in execution of awards; (lix) the conditions subject to which assets of a co-operative society shall vest in a Liquidator and the procedure to be adopted in winding up of a co-operative society; (lx) the matters in which an appeal shall lie from the order of a Liquidator appointed under section 63; (lxi) the time within which, and the manner in which Land Development Bank may send a copy of the instrument of mortgage to the Registering Officer in order to avail the benefit under section 78; (lxii) the procedure for recovery of amounts due or payable to a co-operative society; (lxiii) the manner, in which the Registrar or Collector may take action on an application made under sub-section (1) of section 88; (lxiv) the mode of making attachment before judgement; (lxv) the investigation of claims and objections that may be preferred against any attachment effected by the Registrar; (lxvi) the procedure to be followed for the custody of property attached under section 101; (lxvii) the procedure for the distraint and sale of property mortgaged to a Land Development Bank; (lxviii) the procedure and conditions for the issue, redemption, reissue, transfer, replacement or conversion of debentures issued by a society to which Chapter XII is applicable; (lxix) the maximum amount of principal, the rate of interest and other conditions for the guarantee of debentures issued by a society to which Chapter XII is applicable; (lxx) the qualifications and methods of appointment of an officer to effect sale under section 89 and the powers and functions which such an officer may exercise; (lxxi) the appointment of a receiver of the proceeds and income of mortgaged property or sale under section 89, the conditions in which he may be appointed or removed, the powers and functions which he may exercise and the expenses of management and the remuneration which he may receive; (lxxii) the procedure according to which action may be taken by a Land Development Bank against the mortgager under section 89; (lxxiii) in case of sale of immovable property under Chapter XII - (a) the procedure for proclamation and conduct of sale and the conditions on which an attempt of sale may be abandoned; (b) the method of calculating the expenses incidental to the sale or attempted sale; (c) the procedure for the receipt of deposit and disposal of the proceeds of sale; (d) the procedure for resale if an attempted sale is abandoned or the purchase money is not deposited within the prescribed time and the penalty to be levied against the purchaser who fails so to deposit the purchase money; (e) the form and method of disposal of money by a Land Development Bank under section 91; (f) the form of a sale certificate under section 92; (g) the procedure for delivery by the court of the property purchased, to the purchaser under section 92; (h) the form of the notice referred to in section 97; and (i) the fee payable for the service of such notice and the manner of serving such notice; (lxxiv) the time within which and the procedure according to which property purchased by Land Development Bank at a sale of immovable property under Chapter XII shall be disposed of by the bank; (lxxv) constitution, maintenance and utilisation of Guarantee Funds; the Rate at which the State Land Development Bank and Land Development Banks shall contribute to the Guarantee Funds; (lxxvi) the manner in which the property or any portion thereof, ordered to be transferred to a society under section 103, shall be transferred to a society; (lxxvii) the condition of service and procedure for selection of chairman and members of the Tribunal; (lxxviii) the procedure to be followed in presenting and disposing of appeals; (lxxix) the method of communicating or publishing any order, decision or award required to be communicated or published under this Act or the rules; (lxxx) offences for contravening any of the rules; (lxxxi) the account books and registers to be kept by a cooperative society and power of Registrar to direct the accounts and books to be written up; (lxxxii) the manner of certification of entries in the books of a cooperative society and of copies of documents kept by it in the course of its business; (lxxxiii) the statements and returns to be furnished by a cooperative society to the Registrar; (lxxxiv) the restrictions on persons appearing as legal practitioners; (lxxxv) the inspection of documents and the fees to be paid to a co-operative society for granting certified copies thereof; (lxxxvi) the remuneration payable to an Administrator appointed in place of a committee removed by the Registrar; (lxxxvii) the matters expressly required or allowed by this Act to be prescribed or for which rules may be made. (3) All rules and regulations made under this Act after its commencement, shall be laid, as soon as may be after they are made, before the House of the State Legislature while it is in session for a total period of fourteen days which may be comprised in one session or two or more successive sessions, and if, before the expiry of the session in which they are so laid or the successive sessions as aforesaid, the House agrees in making any modification in the rules or regulations, as the case may be, or resolves that the rules or regulations, as the case may be, should not be made, the rules or regulations, as the case may be, shall thereafter have effect only in such modified form or be of no effect, as the case may be, so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under these rules or regulations, as the case may be.
1 Inserted by Act No. 7 of 2016 (w.e.f. 4.4.2016).