Financial Partnership Or Aid of the Government

(1) Notwithstanding anything contained in any law for the time being in force, the Government may, -

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(a) subscribe directly to the share capital of a co-operative society;

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(b) subject to the appropriate bye-laws, provide moneys to an apex society for purchase of shares in other co-operative societies, subjects to the condition that no such shares in any co-operative society shall be purchased except with the previous approval of the Government in each case;

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(c) give loan or make advances to co-operative societies;

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(d) guarantee the repayment of principal and payment of interest on debentures issued by a co-operative society;

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(e) guarantee the repayment of share capital of co-operative society and dividends thereon, at such rates as may be specified by the Government;

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(f) guarantee the repayment of principal and payment of interest on loans and advances to a co-operative society;

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(g) give financial assistance in any other form, including subsidies, to any co-operative society:

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Provided that liability in respect of any shares purchased with Government money either directly by the Government or through any other co-operative society shall, in the event of its being wound up, be limited to the amount paid in respect of such shares:

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⁵²[ Provided further that the Government shall not hold more than twenty-five percent of the total share capital of a short term co-operative credit structure society and such society or the Government shall have option to further reduce the Government's share capital.]

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(2) Notwithstanding any agreement to the contrary, the Government shall not be entitled to a dividend or interest on shares of any such co-operative society at a rate higher than that at which such dividend or interest is payable to any other shareholder of the society.