(1) A co-operative society shall, out of its net profits in any
year,-
(a) transfer, to the reserve funds, twenty five percent of its profits within such period as may by prescribed;
(b) credit one portion of the profits, as may be prescribed, to the Co-operative Education and Training Fund constituted under the rules;
(c) credit such portion of the profits, as may be specified in the bye-laws, in the fund created under bye-laws to meet out the losses, if any; and
(d) pay dividend to members on their paid up share capital at such rate, as may be prescribed.
(2) The balance of the net profits may be utilised for all or any of the following purpose, namely:-
(a) payment of incentive to members on the amount or volume of business done by them with the society, to the extent and in the manner specified in the bye-laws;
(b) constitution of, or contribution to, such special fund as may be specified in the bye-laws;
(c) donations of amount not exceeding ten percent of the net profits for any charitable purpose as defined in section 2 of the Charitable Endowments Act, 1890 (Central Act 6 of 1890); or for a cause dedicated to the co-operative movement;
(d) payment of bonus to employee of the society, to the extent and in the manner specified in the bye-laws:
54[ Provided that a short term co-operative credit structure society shall not be bound to continue to any funds other than funds as may be established or maintained for the improvement of its net worth:
Provided further that a primary agricultural credit society may decide disposal of its net profits and declare dividend as per the guidelines issued by the Registrar in consultation with the National Bank.]
(a) transfer, to the reserve funds, twenty five percent of its profits within such period as may by prescribed;
(b) credit one portion of the profits, as may be prescribed, to the Co-operative Education and Training Fund constituted under the rules;
(c) credit such portion of the profits, as may be specified in the bye-laws, in the fund created under bye-laws to meet out the losses, if any; and
(d) pay dividend to members on their paid up share capital at such rate, as may be prescribed.
(2) The balance of the net profits may be utilised for all or any of the following purpose, namely:-
(a) payment of incentive to members on the amount or volume of business done by them with the society, to the extent and in the manner specified in the bye-laws;
(b) constitution of, or contribution to, such special fund as may be specified in the bye-laws;
(c) donations of amount not exceeding ten percent of the net profits for any charitable purpose as defined in section 2 of the Charitable Endowments Act, 1890 (Central Act 6 of 1890); or for a cause dedicated to the co-operative movement;
(d) payment of bonus to employee of the society, to the extent and in the manner specified in the bye-laws:
54[ Provided that a short term co-operative credit structure society shall not be bound to continue to any funds other than funds as may be established or maintained for the improvement of its net worth:
Provided further that a primary agricultural credit society may decide disposal of its net profits and declare dividend as per the guidelines issued by the Registrar in consultation with the National Bank.]
54 Added by Act no. 7 of 2010 (w.e.f. 16.10.2009).