1

THE HIMACHAL PRADESH CO-OPERATIVE SOCIETIES RULES, 19711 ARRANGEMENTS OF RULES Rules: CHAPTER-I 1. 2. Short title. Definitions. CHAPTER-II REGISTRATION OF CO-OPERATIVE SOCIETIES AND THEIR BYELAWS 3. 4. 5. 6. 7. 8. 9. 10. Appointment of officers to assist the Registrar. Documents accompanying the form of application for registration. Registration of a society and refusal to register. Person to whom an order refusing the registration of a cooperative society may be sent by the Registrar. Appeal against refusal of registration. Procedure to be followed for amendment of the bye-laws of a society. Subject matter of bye-laws. Change of liability. CHAPTER-III MEMBERS OF CO-OPERATIVE SOCIETIES, THEIR RIGHTS AND LIABILITIES 11. 12. 13. 14. 15. 16. 17. 18. Conditions of membership of individuals. Restriction on re-admission of expelled members. Membership into credit societies prohibited. Admission of members before General Meeting of a cooperative society. Disposal of application for admission of members. Procedure for admission of joint members. Withdrawal of membership. Procedure for calculating the value of the share or interest of a

1 The Corrections made in these rules vide Corrigenda No. 5-3/69. Co-op (S), dated 207-1971 and 24/27-1-1972 have been carried out.

member. 19. 20. 21. 22. 23. 24. 25. Calculations of the sums due other than share and interest. Nomination. Vote of representative of societies. Expulsion of members. Procedure of expulsion of members. Members to furnish information as to their financial position. Powers of General Meeting. CHAPTER-IV MANAGEMENT OF CO-OPERATIVE SOCIETIES 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. Annual General Meeting. Power to call Annual General Meeting. Notice of General Meeting. Special General Meeting. Quorum of General Meeting. Chairman of the General Meeting. General Meeting by delegates. Division of area of a society for election of the delegates. Regulations to be framed by Managing Committee. Minutes of the General Meeting. Voting in the General Meeting on resolutions tabled. Election of committee. Constitution of Managing Committee. Appointment of Managing Committee member by the Registrar.

39(A). Qualifications, experience and manner of nomination of Government nominees on the committees of the society. 40. 41. 42. 43. Proportion of individuals and societies for constituting committee. Disqualification for membership of Committee. Term of office of member of Committee who is a delegate of another society. Removal, expulsion etc. of the Chairman, Committee-members and other elected office-bearers.

41-A. Opportunity for Surety before declaration as defaulter.

44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59.

Notice of committee meeting. Voting in the meeting of the managing committee. Chairman of the meeting. Quorum of the meeting. Requisition for special committee meeting. Powers of the managing committee. Duties of managing committee. Deputation of a Government servant to manage the affairs of a co-operative society. Duties of the Executive Officer. Procedure in case of difference of opinion. Withdrawal, indemnification and cost of Executive Officer. Appointment of a person to manage the affairs of a society. Officers and employees of co-operative societies. Prohibition against being interested in contracts etc. Grounds on which a person may be debarred to hold an office in a society. Powers of the Government nominees to vote in the general meeting. CHAPTER-V

DUTIES AND OBLIGATIONS OF CO-OPERATIVE SOCIETIES 60. 61. 62. 63. 64. Books and registers to be maintained by the society. Custody of account books and record. Preparation of statements at the expense of the society. Publication of the balance-sheet. Annual statements. CHAPTER-VI PRIVILEGES AND POWERS OF CO-OPERATIVE SOCIETIES 65. 66. 67. Proof of entries in societys books. Form of declaration. Financial assistance by the Government. CHAPTER-VII PROPERTIES AND FUNDS OF CO-OPERATIVE SOCIETIES

68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82.

Investment of funds. Co-operative Education Fund. Objects and investment of Reserve Fund. Distribution of profits. Payment of the dividend, bonus etc. Contribution to charitable purposes. Provident Fund. Honorarium. Maximum credit limit of members. Nature and extent of securities for loans. Restriction on borrowing of a co-operative society. Restriction on grant of loan. Restriction on transactions with non-members. Manner of recalling of loan. Writing off bad debts and assets. CHAPTER-VIII AUDIT AND ACCOUNTS

81-A. Advancement and recovery of crop loans.

83. 84. 85. 86. 87.

Date of audit. Audit fee. Statements of accounts. Procedure and principles for conduct of inquiry and inspection. Cost of rectification of defects pointed out as a result of inspection, enquiry or audit. CHAPTER-IX SETTLEMENT OF DISPUTES

88. 89. 90. 91. 92. 93.

Reference of disputes. Persons qualified to be appointed as Arbitrators under clause (c) of sub-section (1) of section 73. Cost of arbitration. Procedure of disposal of disputes. Nature of award or decision. Disposal of records.

94. 95. 96. 97. 98. 99. 100. 101. 102. 103.

Certified copies. Attachment before award under section 69. Procedure for attachment of property under section 74 and rule 95. Application for compromise between co-operative societies and its creditors. Notice of meeting to creditors. Appointment of proxy by a creditor unable to attend the meeting. Procedure to be followed at meeting. Minutes of the meeting. Dissolution of meeting if required number of creditors are not present. Publication of compromise or arrangement. CHAPTER-X

WINDING UP AND DISSOLUTION OF CO-OPERATIVE SOCIETIES 104. 105. 106. 107. 108. 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. Order of winding up. Communication of order of winding up. Appointment and removal of Liquidator. Powers of Liquidator under sub-section (1) of section 80. Procedure to be adopted by the Liquidator. Issue of summons, notice etc., by a Liquidator. Liquidator to keep record of deposition whose evidence he takes. Distribution of assets. Removal of the Liquidator. Liability due to claimants whose where-abouts are not known. Meeting of members at the conclusion of liquidation proceedings. Final report of the Liquidator and termination of proceedings. Maintenance of accounts by the Liquidator. Term of liquidation proceedings. Disposal of record.

CHAPTER-XI EXECUTION OF DECREES 119. 120. 121. 122. 123. 124. 125. 126. 127. 128. 129. 130. 131. Application for execution of Recovery Officer. Procedure in execution. Attachment and sale of specific movable property including crops on land. Attachment of other movable property. Attachment and the sale of immovable property. Effect of attachment on private alienation. Bhatta, costs and receipts for payments made. Investigation of claims to property attached. Loss caused by resale due to default by purchaser at first sale. Dismissal of application for execution for default of decree holder. Distribution of assets when there are claims under several decrees. Death of judgement-debtor- Execution against legal representatives. Fees for processes issued under these rules. CHAPTER-XII APPEAL, REVIEW AND REVISION 132. Constitution of Co-operative Appellate Tribunal. 132-A. Powers of the Co-operative Appellate Tribunal. 132-B. Tribunal to have powers of civil court. 132-C. Pay and allowances of the President and other members of the tribunal. 133. 134. 135. 136. 137. 138. 139. Procedure of appeal. Procedure after presentation of appeal. Procedure at the hearing. Fresh evidence and witnesses. Procedure in case of death etc. Procedure in case of assigament, insolvency etc. Pronouncement of judgement and cost of appeal.

140.

Supply of certified copies. CHAPTER-XII MISCELLANEOUS

141. 142. 143. 144. 145. 146. 147. 148. 149. 150. 151. 152. 153. 154. 1. 2. 3. 4. 5. 6. 7.

Mode of service of summons. Registrar and other officers to be public servants. Certain proceedings under the Act and the rules to be judicial proceedings. Recovery or receipt of societies dues by an officer or a member of the society. Code of Civil Procedure to operate in certain matters. Bye-laws of a Society not to contravene the Act and rules. Breach of mandatory provisions to be a culpable negligence punishable under section 109. Restrictions on legal practitioners. Fees for inspection of public documents filed in the office of the Registrar. Fees of certified copies of societys documents. Fees for certified copies of public documents. Power of Registrar to issue directives/instructions. Languages for proceedings under the Act. Repeal and savings. Definitions. Qualifications of candidates. Preparation of Voters list. Election. Admission to General Meeting. Voting. Maintenance of law and order. SCHEDULE __________

APPENDIX A Rules of election to the committee.

THE HIMACHAL PRADESH CO-OPERATIVE SOCIETIES RULES,

19711 CO-OPERATION DEPARTMENT NOTIFICATION Shimla 2, the 15th May, 1971. No. 5-3/69-Co-op.(S).-In exercise of the powers conferred by sub section (1) of section 109 of the Himachal Pradesh Co-operative Societies Act, 1968 (Act No. 3 of 1969), the Governor, Himachal Pradesh, is pleased to make the following rules for carrying out the purposes of the said Act after previous publication in Rajpatra, Himachal Pradesh, dated the 16th February, 1971 and these shall come into force immediately. CHAPTER 1 1. Short title.-These rules may be called the Himachal Pradesh Cooperative Societies Rules, 1971. 2. Definition.-In these rules, unless there is anything repugnant in the subject or context,(i) (ii) (iii) (iv) (v) "the Act" means the Himachal Pradesh Co-operative Societies Act, 1968 (Act No. 3 of 1969); `section" means section of the Act; "borrowed capital" means the total of loans, deposits and other borrowings of a co-operative society; "member" includes delegates of members referred to in the proviso to section 31; "owned capital" means the `total of paid up share capital and accumulated Reserve Funds and other funds and undistributed profits minus accumulated losses of a co-operative society; "schedule" means the schedule of forms appended to these rules; "Secretary" means a person, who, subject to the control of the Managing Committee, has the management of affairs of a cooperative society, and includes a member of a Managing Committee or any other person discharging the duties of Secretary by whatever name called and whether under a contract of service or not. The term "Secretary" shall also include `Manager'; "working capital" means the total owned capital plus the borrowed capital (minus the amount of the owned capital or borrowed capital invested in the fixed assets);

(vi) (vii)

(viii)

(ix) "share capital" means the subscribed share capital including

1 The Corrections made in these rules vide Corrigenda No. 5-3/69. Co-op (S), dated 207-1971 and 24/27-1-1972 have been carried out.

Government share capital; (x) "relative" includes any one related to the person concerned or his wife, his son/daughter or his son's wife or daughter's husband through a common ancestor not more remote than a grand father or any one married to a person so related; the term "Chairman" shall also include "President", and the term Vice-Chairman, the "Vice President"; "decree" means any order decision or award referred to in section 87; "decree holder" means any person holding a decree as defined in clause (xii) above; "maximum credit limit" means the extent to which a co-operative society may receive deposits and loans from members and non members; "paid up share capital" means such portion of the share capital as actually paid up;

(xi) (xii) (xiii) (xiv)

(xv)

(xvi) "recovery officer" means a person empowered to exercise the powers of the Registrar under section 87 of the Act; (xvii) "sale officer" means a person empowered by the Registrar, by general or special order, to attach and sell the property of a judgement debtor or to execute any decree by attachment, and sale of property; (xviii) "agenda" means a statement of business to be transacted in the general meeting, the Managing Committee (by whatever name called) meeting and Executive Committee meeting;
1

[(xix) "defaulter" means a member of a society who fails to repay any loan, advance, cash credit limits, sum or interest thereon accrued due to the society, financing bank within the time fixed for repayment or the time limit, if any, fixed in bye laws;]

(xx) "secondary society" is a society of which at least one member is a co-operative society; (xxi) "primary society" means a society which does not enroll societies as its members; (xxii) "apex society" means a secondary society the area of operation of which extends to the whole of the territory of Himachal Pradesh, or even beyond; (xxiii) "person" shall also include a co-operative society registered under
1 Sub. vide Not. No. Co-op. (ii) 21/74 dated 20-11-79, published in R.H.P. dated 12-1-80, P. 35.

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the Act; (xxiv) "Managing Director", "Executive Officer"/"Chief Exective Officer, "Accounts Officer" and "Assistant Manager" where elected or appointed in any society shall be officers within the meaning of `officer' under sub-section (11) of section 2 of the Act; (xxv) "judgment debtor" means a person against whom a decree has been obtained; (xxvi) "near relation" means any one related to the member of a society or his or her spouse being(a) brother or sister of either of them; or (b) step brother or step sister of either of them; or (c) father or mother of either of them; or (d) son or daughter of either of them; (xxvii) "legal practitioner" means a legal practitioner as defined in section 3 of the Legal Practitioners Act, 1879.
1

[(xxviii) Representative means a member of the managing committee of a society authorised by it to represent his/her Society in the deliberation of managing committee or general house of other society.] CHAPTER-II

REGISTRATION OF CO-OPERATIVE SOCIETIES AND THEIR BYE LAWS [3. Appointment of officers to assist the Registrar.-(1) Subject to the provisions of sub section (1) of section 3 of the Act, the State Government may appoint officers of the following categories to assist the Registrar, namely:(a) (b) (c) (d) (e) (f) Additional Registrar of Co-operative Societies; Joint Registrar of Co-operative Societies; Deputy Registrar of Co-operative Societies; Assistant Registrar of Co-operative Societies; such other categories of officers as may be notified by the Government from time to time; and The officers appointed to assist the Registrar shall, within such areas as the State Government may specify, exercise such powers
2

1 Clause (xxviii) ins. vide Not. No. Co-op. A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 2 Rule 3 Subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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and perform such duties conferred and imposed on the Registrar by or under the Act and these rules as the State Government may, by special or general order, direct.] 4. Documents accompanying the form of application for registration.The application for registration shall be in the form prescribed in the schedule and accompanied by three copies of bye-laws and such other documents as may be prescribed by the Registrar from time to time. Such copies of bye-laws shall bear the signatures of not less than two of the applicants duly authorised by the members of the proposed co-operative society. 5. Registration of a society and refusal to register.-(i) After the Registrar is satisfied, he may register the society, and its bye-laws containing its full postal address. A certificate of registration containing registration number, the date of registration, and the registered name, and address of the society shall be issued to the society along with a copy of the registered bye-laws. (2) It shall also be within the competence of the Registrar, before registering a society, to make such additions or alterations in the draft bye-laws submitted with the application, for registration as he may deem fit provided that the written consent of two thirds of the applicants is obtained to such additions or alterations. 6. Person to whom an order refusing the registration of a co-operative society may be sent by the Registrar.-The applicants of the proposed Cooperative Society shall intimate while sending the application for registration, the name and address of one of the applicants to whom the order passed by the Registrar under sub-section (4) of section 8 shall be communicated through registered post, together with the reasons of refusal. 7. Appeal against refusal of registration.-Where an application for registration of a co-operative society is rejected by the Registrar, the appeal, if made, shall be signed by all the persons joining the application for registration: Provided that where the application for registration has been signed by more than ten persons the appeal shall be signed by at least two-thirds of the persons joining the application for registration. 8. Procedure to be followed for amendment of the bye-laws of a society.-(1) Bye-laws may be made, altered or abrogated by a resolution passed at a general meeting of the society: Provided that(a)
1

due notice of any proposal to make, alter or abrogate the bye-laws is given to all the members in accordance with the bye-laws;

[(b) the resolution is passed by not less than two-thirds of the members present at the general meeting at which a quorum shall be present

1 Clause (b) Subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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as per Rule 30;] (c) a copy of existing bye-laws indicating the alterations proposed to be made, and three copies of the proposed amendments signed by two officers of the society, duly authorised, in this behalf are submitted to the Registrar with the copy of the resolution accompanied by(i) a statement of the Secretary of the society that the provisions of clauses (a) and (b) above have been fully complied with; (ii) an application from the Secretary that the change in the bye laws be registered. (2) Notwithstanding anything contained in sub-rule (1) above, the State Government by a general or special order in writing, may alter or modify the conditions laid down above in respect of secondary societies and financing banks. 9. Subject matter of bye-laws.-(1) A society shall make bye-laws in respect of the following matters:(a) name and the registered address; (b) area of operation; (c) the objects for which the society is established; (d) the qualifications for membership and the terms of admission of members; (e) nature and the extent of the liability of members; (f) withdrawal and expulsion of members and the payments, if any, to be made to such members; (g) transfer of shares or the interest of such members; (h) manner of raising funds; (i) general meeting and the procedure and the powers of such meeting; (j) appointment, suspension and removal of the officers of the society and the members of the managing committee or the board of directors; (k) constitution of the committee, or board of directors, or sub-committee and the procedure of holding its meetings, and as regards its powers and duties; (l) powers and duties of the officers of the society; (m) disposal of profits; (n) imposition of fines and penalties on members on consequences of the failure of any member to pay the sum due. (2) The bye-laws of the co-operative society may further provide for such matters as are incidental to the organisation of the society and the management of its business.

13

10. Change of liability.-(1) The prior approval of the Registrar for change of liability of a society under sub-section (1) of section 13, shall, be obtained by the committee by a resolution. (2) When a co-operative society resolves to change its form of liability under sub-section (2) of section 13, it shall adopt a proposal for such amendment of its bye-laws, as may be consequential and necessary for the safe conduct of its business, and submit an application in the manner provided in rule 8 for registration of such amendments. (3) The notice required under sub-section (2) of section 13 shall be issued under a certificate of posting in the form to be determined by the committee. CHAPTER III MEMBERS OF CO-OPERATIVE SOCIETIES, THEIR RIGHTS AND LIABILITIES 11. Conditions of membership of individuals.-(1) No person shall be eligible for admission as a member of the society if he(a) is an applicant to be adjudicated as a bankrupt or an insolvent or is an uncertified bankrupt; or is an undischarged insolvent; or (b) has been sentenced for any offence involving moral turpitude and such sentence has not been reversed, or has not been pardoned; or (c) is a minor, except when he happens to be minor heir, or nominee of a deceased member; or (d) is of unsound mind; or (e) is not a resident of the area of operation of the society, for the last six months; or (f) carries on business similar to that conducted by the society of which he wishes to become a member; or (g) does not fulfil such other conditions as specified in the bye-laws of the society; (2) A member of a society shall cease to be its member if he(a) applies to be adjudicated, or is an adjudicated bankrupt, or an insolvent; or (b) is sentenced for any such offence as is prescribed in clause (b) of subrule (1) above; or (c) becomes of unsound mind; or
1

[(d) leaves his residence in the area of operation of the society and the management of the society has informed him about the termination of

1 Clause (d) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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his membership]; (e) begins to carry on the business similar to that conducted by the society of which he is a member; or (f) ceases to fulfil such other conditions as specified in the bye-laws for being a member of the society. (3) A member of a society may be expelled from membership for such other reasons also as may be specified in the bye-laws. 12. Restriction on re-admission of expelled members.-No member of a society who has been expelled under the provisions of its bye-laws shall be eligible for re-admission as a member of that society, or for admission as a member of any other society, for a period of two years from the date of such expulsion: Provided that the Registrar may, in special circumstances, sanction the readmission or admission, within the said period of any such member, as a member of the same society or of any other society, as the case may be. 13. Membership in two credit societies prohibited.-(1) No person being a member of a credit society 1[xx] or of a society 2[,] which advances loans, except a co-operative land development bank, or financing bank, shall be a member of any other credit society, or of such society as advances loans to its members without the general or special sanction of the Registrar. (2) Where a person has become a member of two societies, as referred to in sub-rule (1), without the prior sanction of the Registrar, either or both of the societies shall be bound, to remove him from membership upon a written requisition from the Registrar to that effect. 14. Admission of members before General Meeting of a co-operative society.-No co-operative society shall admit members fifteen days prior to the date of its annual general meeting, or special general meeting called to hold elections to the Managing Committee. 15. Disposal of application for admission of members.-(1) A cooperative society shall dispose of an application received for admission as a member as early as possible and in no case later than the expiration of a period of 30 days from the date of receipt of the application by the society. In case of refusal to admit, such society shall communicate its decision together with reasons therefore to the applicant. (2) If no decision has been taken and communicated to the applicant within the period specified in sub-rule (1), the applicant shall be deemed to have been refused the admission to membership.
1 Sign "," Omitted vide Not. No. Co-op. E (11) 21/74-II, dated 4-1-82, published in R. H. P., dated 19-6-82, P. 370-371. 2 Sign "," inserted vide not. No. Co-op. E (11) 21/74-II, dated 4-1-82, published in R. H. P., dated 19-6-82, P. 370-371.

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(3) The applicant who has been refused admission under sub-rule (1) or (2) he shall have the right of appeal to the Registrar whose decision in the matter shall be final. 16. Procedure for admission of joint members.-A society may admit joint members, provided they make a declaration in writing that the person whose name stands first in the share-certificate, or the member-register, and in case of his death person mentioned next in the said certificate or the register, as the case may be, shall have the right to vote, and all the liabilities will be borne jointly and severally by them as provided in the Act, rules and bye-laws. 17. Withdrawal of membership.-(1) Subject to the provisions of the Act, and the rules and the bye-laws of the society, a member, may withdraw from the society after giving three months' notice to the Secretary of the society as regards his intention to resign from membership of the society. (2) No resignation of membership shall be accepted by the society unless the member has paid in full dues, if any, to the society, and has also cleared his liability, if any, as surety to any other member or otherwise. (3) The withdrawal from membership shall also be subject to such restrictions regarding the maximum amount of share capital that can be refunded in a year, or as may have been provided for in the Act, the rules or bye-laws of the society. (4) Any member, whose resignation has been accepted by the society, or a member who has been expelled from membership, or any heir or legal representative of a deceased member, may demand refund, of the share capital held by such member or deceased member and the society shall subject to the provisions of sections 23 and 24 and subject to the provisions of the bye-laws, refund the amount within six months from the date of acceptance of the resignation, or expulsion, or as the case may be, the date of demand made by the heir or legal representative of the deceased member : Provided further that such withdrawal of shares at any time shall not exceed five per cent of the aggregate paid-up share capital of the society, excluding Government contributions, as it stood on the 1[31st March], of the preceding co-operative year. (5) Irrespective of what is contained in the foregoing sub-rules of this rule, the share capital subscribed by the State Government in a co-operative society or by a Central or Apex Co-operative Financing Institution will be refunded in such a manner, and during such period as may be determined by the Registrar from time to time. 18. Procedure for calculating the value of the share or interest of a member.- (1) Where a cooperative society has to make a refund of the value of a share, under the Act and the rules, the value of the share shall be deemed to be
1 Subs. for the word and figure 30th June vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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equal to the amount paid-up on the share : Provided that where a portion of the assets is estimated to be bad or doubtful in the latest audited balance-sheet, and is not covered by funds created out of profits, the managing committee may, for the purpose of such payment, reduce the value of the share in the same proportion as the aggregate amount of assets which are not bad and doubtful less the amount of outside liabilities, bears to the paid-up share capital. [(Provided further that the member affected shall be given an opportunity of being heard before the reduction of the value of the share as contemplated in the first proviso is made.] Explanation to the provisoValue of each share to be refunded. (Total assets-Bad and doubtful assets) x Outisde liabilities -------------------------------------------Face value of a share. Total amount of share capital paid-up.] (2) Where a transfer of share or interest is made, the value of the share or interest shall be deemed to be the sum actually paid by the member for the acquisition of such share or interest. 19. Calculation of the sums due other than share and interest.-All sums other than share or interest due to a member under section 25 shall not exceed the actual amount received by the society. 20. Nomination.-(1) Every member of a society shall nominate a person or persons, to whom share, or interest, referred so in section 23 of the Act, or such sums out of such interest as may be specified by the member, shall, on the death of the member be, transferred or paid as laid down in the bye-law. (2) Such nomination may, from time to time, be revoked or modified by the member. (3) The number of persons who may be nominated by a member shall not exceed the number of shares held by the member. (4) When a member of a society nominates more than one 2[person] he shall, as far as practicable, specify the amount to be paid or transferred to, each nominee in terms of whole shares and the interest accruing thereon. (5) The record of nominations shall be kept by a society in such manner as may be laid down in the bye-laws.
1

1 Proviso added vide notification N. Co-op. E(11)21/74, dated 4-1-82 published in R. H. P., dated 19-6-1982, P. 370-371 2 Subs. for "persons" vide ibid.

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[(6) the Secretary of the society shall inform the fact of nomination along with factual position of assets and liabilities of the deceased member.] 21. Vote of representative of societies.-A society which is a member of another society may appoint one or more of its members as may be prescribed in the bye-laws, not disqualified for such appointment under any rule or bye-law to vote in the affairs of such other society. 22. Expulsion of members.-Any member who has been persistently defaulting payment of his dues, or has been failing to comply with the provisions of the bye-laws, or other matters in connection with his dealings with the society, or has done other acts detrimental to the interest or proper working of the society, may be expelled from the society. The expulsion from membership may involve forfeiture of shares held by the member. 23. Procedure for expulsion of members.-(1) Where any member of a society proposes to bring a resolution for the expulsion of any other member, he shall give a written notice thereof, to the Chairman of the society, On receipt of such a notice, or when the committee itself decides to bring in such resolution, the consideration of such resolution shall be included in the agenda for the next general meeting and a notice thereof shall be given to the member against whom such a resolution is proposed to be brought, calling upon him to represent at the general meeting, to be held not earlier than a period of one month from the date of such notice and to show cause against explusion to the general body of members. (2) After hearing the member, if he is present, or aftertaking into consideration any written representation which he might have made, the general body of members shall proceed to consider the resolution. (3) When a resolution passed in accordance with sub-rule (1) is sent to the Registrar, or otherwise brought to his notice, the Registrar may consider the resolution, and after making such enquiries as he may deem fit, give his approval and communicate the same to the society and the member concerned. The resolution shall be effective from the date of such approval by the Registrar. 24. Members to furnish information as to their financial position.- For purposes of section 30 of the Act, a member of a society or an applicant for membership of a society as the case may be, shall furnish information as to his financial position, and alienation of his immovable property in such form as may be determined by the Registrar. CHAPTER IV MANAGEMENT OF CO-OPERATIVE SOCIETIES 25. Powers of General Meeting.-(1) Without prejudice to the provisions of section 32 the general meeting shall have the powers to transact the following business :1 Sub-rule (6) added vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

18

(a) fixing of maximum credit limit of the society, subject to the approval of the Registrar; (b) fixing of the M. C. L. of each member; (c) consideration of Audit and Inspection notes; (d) confirmation of the newly admitted, fined, suspended, resigned members on the roll of the society by the committee; (e) review of the working of the managing committee; (f) review of the loans and advances made to and the defaults thereof, if any, made by the members of the committee and their relatives, and the action taken against such defaults by the committee. (2) Every resolution at a general meeting shall be decided by a majority of votes of the members present, and as laid down in the Act, and if the vote be equal the Chairman shall have a second or casting vote. (3) It shall be incumbent on the Secretary of the society to bring to the notice of the Registrar the names of the defaulter members of the Managing Committee together with the amount outstanding against each, and also the action suggested against them under clause (f) of sub-rule (1) by the general house within 30 days after the holding of the general body meeting. 26. Annual General Meeting.-A general meeting of every co-operative society, to be called annual general meeting, shall be held within 15 months from the date of its registration, and thereafter as provided in section 32 of the Act. The original general meeting held for the purpose of forming and applying for registration of a proposed society shall be deemed to be a regular general meeting under section 32 of the Act. 27. Power to call Annual General Meeting.-If the annual general meeting of a society is not called in accordance with the provisions of section 32 of the Act, the Registrar may authorise any person subordinate to him to call the annual general meeting, and the person so authorised shall have all the powers and functions of the officer of the society authorised to convene such annual general meeting under its bye-laws. 28. Notice of General Meeting.-(1) A general meeting shall be convened by the Managing Committee or President or under its, or his direction by the Secretary/Manager. (2) Unless otherwise provided in the bye-laws a notice of the meeting stating the place, date and hour of the meeting together with the agenda shall be given to every member at least ten clear days before the date of the meeting, in the manner prescribed by the Registrar. 29. Special General Meeting.-At a special general meeting, no business other than that specified in the agenda issued with the notice under sub-rule (2) of rule 28 shall be discussed.

19

30. Quorum of General Meeting.- [(1) The quorum for the general meeting shall be one-third of the total number of members subsisting as such on the date of notice of the meeting.] (2) No business shall be transacted at any meeting unless there is a quorum at the time when the business of the meeting is due to commence. (3) If within one hour from the time appointed for the meeting, a quorum is not present, the meeting shall stand adjourned to such suitable date, and time, as the Chairman or in his absence, the Vice-Chairman and in the absence of both, the Secretary may declare in the meeting so adjourned provided that:2

[(a) a quorum of one fifth of the total number of members shall be necessary at adjourned meeting and such adjourned meeting shall not be convened before lapse of ten days from previous meeting and fresh notice for the same shall be issued to all the members.]

(b) that a meeting which has been called on requisition under clause (a) of sub-section (1) of section 33 shall not he adjourned but dissolved; and (c) the meeting where the quorum declines after its proceedings have started shall be deemed to be a meeting with appropriate quorum. (4) In the general meeting of a society where the Government is not a share holder, the nominee of the Registrar shall be called to observe the proceedings of such a meeting. 31. Chairman of the General Meeting.-(1) The Chairman or in his absence the Vice-Chairman of a society, or in the absence of both, a member elected by the members present at the meeting, shall preside over the meeting till the general meeting elects a new Chairman. (2) The Chairman of the general meeting shall maintain order in the meeting and shall control and conduct the proceedings, in such a manner as may be conducive to expeditious and satisfactory disposal of business. He shall decide all points of order and his decision on such points shall be final. 32. General Meeting by delegates.-(1) A co-operative society with a membership of 1,000 (one thousand) or more shall and if the bye-laws so provide, a co-operative society with a membership of 500 or more, but less than 1,000 may hold its general meeting by calling representatives (hereinafter referred to as delegates) of areas or sections instead of summoning all the members in person. (2) One delegate shall be elected for every 10 members or major fraction thereof. (3) No person shall be qualified to be elected as a delegate who is not a
1 Sub-rule (1) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 2 Clause (a) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

20

member and who is not over 21 years of age. [(4) The delegates shall hold office and attend all general meetings for five years or till fresh delegates are elected in their places whichever is earlier.] (5) Each delegate shall have one vote. (6) A member shall cease to be a delegate if, he(a) ceases to be a member of the society; or (b) resigns his office as a delegate. (7) A casual vacancy in the office of a delegate in any area, or section, shall be filled by members in the area or section concerned.. [(8) The delegates shall transact business as provided in section 31 of the Act read with rule 25 other than election of managing committee.] 33. Division of area of a society for election of the delegates.-(1) The managing committee, subject to the approval of the Registrar, shall divide the area of operation of the society into convenient areas or sections for the purpose of election of delegates. (2) The division of the area of operation of a society, under sub-rule (1) shall be duly notified to all members, and a member in a particular area or section, shall be entitled to vote in the election of the delegates only for that particular area or section. 34. Regulations to be framed by Managing Committee.-The managing committee shall, subject to the approval of the Registrar, make regulations to provide for all matters relating to the election of delegates and in particular for3 2 1

[(a) the manner of nomination, election and removal of delegates];

(b) the total number of delegates to be elected and the number of delegates to be elected from each area or section in accordance with sub-rule (2) of rule 33. 35. Minutes of the General Meeting.-(1) Every co-operative society

1 Sub-rule (4) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 2 Sub-rule (8) added vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 3 Clause (a) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

21

shall keep the minutes of general meetings in a separate book kept for this purpose. (2) The minutes of the meeting shall be drawn up and signed by the Chairman at the close of the agenda of the meeting and the same shall be confirmed by the general house then and there. (3) Until the contrary is proved, every meeting of a society, in respect of the proceedings whereof minutes have been so recorded, shall be deemed to have been duly called and held. 36. Voting in the General Meeting on resolutions tabled.-(1) Except as provided in the Act or these rules or the by-laws the resolution which is put to the vote of the general meeting shall be decided by a majority of votes. (2) A member who is a defaulter for any debt, or dues, directly, or indirectly, of the society shall be debarred from exercising the right of vote in the annual or special general meeting including the general meeting called for conducting election to the committee. 37. Election to committee.-Notwithstanding anything contained in the foregoing rules, the members of the managing committee of co-operative society shall be elected in accordance with the rules given in Appendix `A' 38. Constitution of Managing Committee.-(1) The managing committee of a co-operative society shall be constituted by(a) election from amongst the members of the society at the annual/special general meeting; (b) appointment by the Registrar in the manner provided in rule 39; (c) nominees of the Government under section 35 of the Act; and (d) nominees of the other co-operative societies as provided in the byelaws. (2) The managing committee of a society shall have not less than five nor more than twenty-one members, including the Government nominees, as may be fixed in the bye-laws. [(3) The term of the Managing Committees constituted under sub-rule (1) shall be 5 years.] [Provided that if outgoing Managing Committee fails to initiate election process 90 days prior to its tenure, the Registrar shall appoint Administrator under
1 Sub rule (3) substituted vide Not. No. Co.op.E(5)1/2000 dated 2nd Nov. 2000 published in R.H.P. dated 1-12-2000 p. 4420. 2 Subs. vide Not. No. Co-op. A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-72006, p. 2788-2794.
2 1

22

section 37 of the Act and the Administrator so appointed shall conduct election of managing committee within six months of his appointment.]
1

[ X X X X]

[(4) The committee shall, as soon as may be possible, elect from among its elected members a President, Vice-President and such other officers as are specified in the bye-laws and only elected members of the committee shall participate in the election or removal process of President/Vice-President: Provided that only elected members of the committee shall represent the society in the committee or general meeting of other Society.] (5) A casual vacancy in the office of an elected member shall be filled up by co-option from amongst the members of the society by the managing committee. The managing committee member so co-opted shall qualify all the conditions laid down in the rules for membership of the committee of a society and shall retire within 90 days or at the next annual general meeting, which ever is earlier, and the vacancy thus caused shall be filled up at such meeting by election of a managing committee member in whose place the vacancy originally occurred. (6) Any dispute relating to the election to a committee of a member of an officer shall be referred to the Registrar under section 72 of the Act within 30 days from the date of delcaration of the result of such election. 39. Appointment of Managing Committee member by the Registrar.(1) Notwithstanding any limits prescribed in the bye-laws, in order to represent appropriate interest, the Registrar shall have powers to appoint an additional number of members for the managing committee, not exceeding one-third of the number of elected members: Provided that the total number of committee members so appointed or nominated and elected under clauses (a), (b), (c) and (d) of sub-rule (1) of rule 38 shall not exceed the maximum limit laid down under sub-rule (2) of rule 38. [(1-A) Out of the persons appointed under sub-rule (1), one shall be a person belonging to Scheduled Castes, one belonging to Scheduled Tribes and the remaining, if any, representing other appropriate interests including the interests of women, unless a member each belonging to the Scheduled Castes and Scheduled Tribes and representing other interests has already been elected on such
3

1 Provision in Sub-rule (3) of Rule 38 deleted vide Not. No. Co-op.E(5)-1/2000 dated 20-6-2002, published in R.H.P. Extra dated 11th July, 2002 p. 958. 2 Sub-rule (4) subs. vide Not. No. Co-op. A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 3 Sub-rule (1-A) added and (2) Subs. vide Not. No. Co-op. (ii) 21/70, dated 10-12-1976 published in R.H.P. Extra dated 18-12-1976, p. 2003-2007.

23

committee. (2) The members so appointed under sub-rules (1) and (1-A) shall hold office till the next election of the Managing Committee or till another person is appointed in his place, whichever is earlier, and shall have the right to vote. The Registrar shall either confirm their membership to the committee or shall appoint other persons in their place for the next term of the committee.] (3) Managing committee members appointed under this rule may or may not be the members of the society but should have all the qualifications prescribed for membership of a co-operative society and the managing committee. (4) If a vacancy occurs in the office of an appointed member on the managing committee, the vacancy shall be filled up by an appointment by the Registrar, and not by co-option. [39-A. Qualifications, experience and manner of nomination of Government nominees on the committees of the societies.-The State Government or any authority specified by the State Government by a notification under section 35 of the Act shall nominate members on committee of societies from amongst the following persons:(i) in case of an appex society sitting M.L.A.s' or ex-M.L.A.s' or eminent public men associated with the co-operative movement for at least 5 years in the State or officers of the State Government not below the rank of Class-I officers associated with the objectives of the co-operative society concerned for five years; (ii) in case of a co-operative society sitting M.L.A.'s. or ex-M.L.A.'s or eminent public men associated with the co-operative movement for at least 5 years in the State or officers of the State Government not below the rank of Class-II officers associated with the objectives of the co-operative society concerned; (iii) in case of a primary co-operative society, the persons to be nominated will be eminent public men belonging to the area of operation of the society and actively associated with the co-operative movement or Government officials associated with the objectives of the society concerned having at least two years' experience on the respective posts: Provided that the members so nominated by the Government through notification issued from time to time will be entitled to function on the managing committee of the society concerned with effect from the date of publication in the Official Gazette of their nomintion: Provided further that the persons other than Government officials so nominated shall cease to be members of the managing committee after expiry of
1 39-A added vide Not. No. Co-op. A(3)/86(s) dated 9-12-1987, published in R.H.P. Extra., dated 3-9-1988 p. 2125-2126.
1

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the tenure of the elected managing committee unless the Government otherwise directs.] 40. Proportion of individuals and societies for constituting committee.- In a co-operative society, the membership of which is not exclusively confined to individuals the representation of individuals and societies on the committee and the general body shall be such as may be laid down in the bye-laws of the co-operative society. 41. Disqualification for membership of committee.-(1) No person shall be eligible for appointment or election as a member of the committee of any society, if he(a) is an applicant to be adjudicated or is adjudicated a bankrupt or is an insolvent or an uncertificated bankrupt or an undischarged insolvent; or (b) has been sentenced for any offence other than an offence of a political character or any offence not involving moral delinquency, such sentence not having been reversed or the offence pardoned; or (c) is of unsound mind; or
1

[(d) a paid employee of the society or of any other Co-operative Society:

Provided that this condition shall not apply for election of a member for the managing committee of the Society of the employees of a Cooperative Society or its representative in other society or;] (e) is in the same line of business as conducted by the society; provided that if any question arises whether a person is or is not in the same line of business the question shall be referred to the Registrar and his decision shall be final; or (f) is concerned with the profits of any contract entered with the society except in transactions made with the society as a member in accordance with the objects of the society as stated in the bye-laws provided that if any question arises whether a person is or is not so concerned 2[with] the profits of any contract, the question shall be referred to the Registrar and his decision shall be final; or (g) is, except with the sanction of the Registrar, already the member of
1 Clause (d) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 2 Subs. for the words "which" vide Not. No. Co-op. E(II)21/74, dated 1-4-82, Published in R.H.P. dated 19-6-82 P. 370-371.

25

the committee of any other society of the same type; or (h) has been sued in arbitration in a society, and the award given against him stands unsatisfied wholly or partially; or (i) 1[has associated himself with the appointments of a near relation in the services of the society concerned], provided that if any question arises whether a person is or is not a near relation of a paid employee of the society, the question shall be referred to the Registrar and his decision shall be final; or 2 [(ii)) XXXXXXXXXXXXXX] (j) is a defaulter of any society; or
3

[jj) is a representative of defaulter society; or]

(k) has been debarred from becoming an officer of any society under Rule 58; or (l) is under 21 years of age. (2) A member of the committee of any society shall cease to hold office as such if he,(a) applies to be adjudicated, or is adjudicated a bankrupt or an insolvent; or (b) is sentenced for any such offence as is described in clause (b) of sub rule (1); or (c) becomes of unsound mind; or
4

[d) becomes a paid employee of the society or any other society: Provided that this condition shall not apply for election of a member for the managing committee of the society of the employees of a Co-operative Society or];

(e) enters on the same line of business as conducted by the society; or

1 Sub for the words "is a near relation of a paid employ of a society" vide Not. No. Coop A(3)1/86, dated 9-12-87, published in R.H.P. Extra, dated 3-9-88, P. 2125-2126. 2. Deleted vide Not. No. Co-op. A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-72006, p. 2788-2794. 3 Clause "jj" added vide not. No. Co-op-E (II) 21/74, dated 1-6-77 published R.H.P. Extra, dated 8-6-1977, P. 620-621. 4 Clause (d) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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(f) becomes concerned with profits of any contract entered into by the society except in transactions made with the society as a member, in accordance with the objects of the society as stated in the bye- laws; or (g) becomes a member of the committee of any other society of the same type, except with the sanction in writing of the Registrar; or (h) becomes a near relation of the paid employee of the society; or (i) becomes a defaulter of any debt or dues directly, or indirectly of his society or of any other society; or
1

(ii)

[X X X X]

[(i) is a representative of the society which becomes defaulter;]

(j) is debarred from becoming an officer of any society under rule 58; or (k) ceases to be a member of the society; or (l) is found to be under 21 years of age. [41-A. Opportunity for Surety before declaration as defaulter.-(1) When the Surety is called upon to clear the default of the person to whom he had stood surety and if he fails to discharge the liability he shall be treated as defaulter and denied loan for himself and also the voting right under section 20 of the Act.] (2) In case a dispute arises as to whether a member or a society is or is not a defaulter, the matter shall be referred to the Registrar whose decision shall be final and binding]. 42. Term of office of member of committee who is a delegate of another society.-A delegate of one society sitting on the committee of another society shall cease to be a member of such committee5 4 3

[(a) if the elected delegate of a society, functioning on the managing

1 Clause (ii) deleted vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 2 Clause (i) added vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 3 Clause (1) of rule 41-A added vide Not. No. Co-op-E(II)21/74, dated 6-3-78, published in R.H.P. dated 27-5-78, p. 490. 4 Clause (2) added vide Not. No. Co-op E(II) 21/74, dated 20-11-79, published in R.H.P. dated 12-1-1980, p. 35. 5 Clause(a) subs. vide Not. No. Co-op-A(3)1/86, dated 9-12-1987, published in R.H.P. Extra, dated 3-9-1988, p. 2125-2126.

27

committee of another society, completes one term on the society of which he is a delegate or otherwise ceases to be its member;] or (b) in case he was elected as a delegate by a society on the supersession of the committee of such society under section 37 of the Act; provided that the person or persons appointed by the Registrar under the said section shall have power to nominate himself or one among them of any member of the society, to the committee of another society; or (c) if the registration of the society of which he is a delegate, is cancelled; or (d) if he ceases to be a member of the society of which he is a delegate; or (e) if the society which he represents is ordered to be wound up from the date on which the order of winding up takes effect under sub-section (3) of section 78: Provided that no individual shall be a member of managing committee of more than two secondary societies at a time: Provided further that a delegate representing a viable or potentially-viable society shall only be eligible to seek election to the managing committee of a secondary society, the criteria for viable and potentially-viable societies being determined by the Registrar. 43. Removal, expulsion etc. of the Chairman, Committee-members and other elected officers.-(1) The elected Chairman of a society or any other officer elected under clause(a) of sub-rule (1) of rule 38 may be removed from the office by a resolution of a general meeting specially convened for the purpose. (2) The managing committee, with the prior approval of the Registrar, may remove any committee-member who fails to attend four consecutive meetings of the committee without previous permission of the Chairman obtained by him in writing. (3) Unless otherwise provided in the bye-laws, or in the terms of his appointment, and subject to the provisions of section 72 of the Act, any officer of the society appointed by the managing committee may be removed from his office by the managing committee, subject to the approval of the Registrar. 44. Notice of committee meeting.-Notice of a meeting of the managing committee shall be sent under certificate of posting by the President, or under his direction, by the Secretary in writing, or in such manner as the Registrar may

28

prescribe in respect of any society or class of societies, to every committee member specifying the place, date and hour of the meeting, together with the agenda to be discussed therein of not less than three clear days or such other period as may be provided in the bye-laws before the date of the meeting: Provided that any other business, though not included in the agenda, may be brought up and considered with the consent of the Chairman. 45. Voting in the meeting of the managing committee.-A resolution which is put to the vote of the committee meeting shall be decided by a majority of votes, and if the votes are equal, the Chairman shall have a second, or casting vote. 46. Chairman of the meeting.-The Chairman shall preside over all meetings of the managing committee at which he is present. In the absence of the Chairman, the Vice-Chairman, and in the absence of both, any member elected from amongst themselves by the committee-members present, shall take the chair. 47. Quorum of the meeting.-Unless a larger proportion is provided in the bye-laws, the quorum at a meeting of the managing committee shall be onethird of the total number of committee-members, or three, which ever is greater. 48. Requisition for special committee meeting.-(1) Any three committee-members, or such larger number as may be laid down in the bye-laws, may requisition a special meeting of the managing committee by giving seven clear days notice, provided that no such notice shall be necessary in the case of a special meeting requisitioned by the Registrar, or by an officer duly authorised by him in this behalf. (2) The requisition shall specify the object of the meeting, and shall be signed by the requisitionists, and should be delivered at the office of the society. (3) At such special meeting, no business other than that specified in the notice shall be transacted. 49. Powers of the managing committee.-(1) The managing committee of a co-operative society shall, subject to the provisions of the Act, the rules made thereunder, and such general or special orders as the Registrar may issue from time to time, exercise all or any of the following powers as may be provided in the bye-laws:(a) to admit new members and to fine, suspend, remove or expel exiting members on the roll of the society; (b) to raise funds; (c) to invest funds; (d) to appoint salaried or non-salaried officers for the conduct of the business of the society, in accordance with the provisions of these rules and the bye-laws, and to define their duties;

29

(e) to delay to enforce any debt or demand of the society or to institute, defined or compromise legal proceedings and subject to the approval of the Registrar to compromise or abandon any debt or demand of the society; (f) to dispose of applications for shares; (g) to dispose of applications for loans and to determine the security to be taken; and (h) to appoint sub-committees, as may be deemed necessary, from time to time, and delegate to them one or more of its powers for the smooth running of the business of the society. 50. Duties of managing committee.-The managing committees shall observe in all their transactions the provisions of the Act, rules and bye-laws, and in particular and shall, perform the following duties:(a) to receive and disburse money; (b) to maintain true accounts of money received and expended, and accounts of the assets and liabilities; (c) to prepare for submission to the annual general meeting(1) Receipt and Disbursement Statement; (2) Balance Sheet; (3) Trading and Profit and Loss Account; (4) Appropriation of Profits; (d) to prepare the statements of accounts required at audit and to place them before the Auditors; (e) to prepare, and submit all statements and returns, required by the Registrar in such form as he may direct; (f) to enter accounts of the society regularly and periodically in proper books; (g) to maintain a register of members up-to-date; (h) to facilitate the inspection of books and audit of account of the society by those entitled to inspect/audit them;

30

(i) to convene general meetings; (j) to convene the annual general meeting in due time; (k) to ensure that loans and advances are applied for the purposes for which they are made and that they are punctully repaid; (l) to examine and take prompt action in cases of all arrears and defaults in repayment of loans and advances; (m) to perform such other duties as may be entrusted by the general meeting; and (n) in general to carry on the busin ss of the society in accordance with its bye-laws.
1

[(o) to take steps to initiate election process 90 days before the expiry of term of the present committee.]

51. Deputation of a Government servant to manage the affairs of a Co-perative Society.- (1) A Government servant when deputed to the service of a co-operative society under section 36 shall be called the Executive officer of the society. (2) Subject to any conditions to the contrary that the State Government may in a particular case think fit to impose, the Executive Officer shall be under the general control of the managing committee of the society and shall on the conduct of the business of the society, exercise the following powers, namely :(i) to have control over the staff of the society with powers to fine, suspend or dismiss any member thereof, provided that the power of dismissal shall be exercised with the prior concurrence of the managing committee. (ii) to institute, defend and conduct legal proceedings in law courts, and other places, and enter into compromise or arbitration with creditors of the society. 52. Duties of Executive Officer.-Unless otherwise directed by the managing committee, the Executive Officer shall perform the following duties, namely:(i) to receive all money on behalf of the society, and to issue receipts other than receipts likely to create fresh obligations on the part of the society in effectual discharge of the money stated to have been received therein;
1 Clause (o) added vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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(ii) to pay all costs of management and working expenses out of the funds of the society such as salaries of the staff, travelling and other contingent expenses to be incurred in the working of the society; (iii) to deposit all money received on behalf of the society and securities and other effects as prescribed under section 53 of the Act; (iv) to maintain proper and accurate records and accounts of the society; (v) to call meetings of the managing committee as may be necessary for the proper conduct of business; (vi) to place, from time to time, before such of its members, or such other authority as the managing committee may direct, statements of receipts and disbursements for examination and approval. 53. Procedure in case of difference of opinion.-In the event of a difference of opinion between the Executive Officer and the managing committee of the society, with regard to any matter concerning the business of the society not expressed or covered by the Act, the rules and the bye-laws, the Executive Officer may refer the matter to the Registrar for his decision, and the decision of the Registrar in this regard shall be final. 54. Withdrawal, indemnification and cost of Executive Officer.-(1) The Executive Officer shall be indemnified out of the funds of the Co-operative society for all costs, charges, travelling and other expenses incurred by him in the conduct of the society's business, and in the discharge of his duties, and no suit or legal proceedings whatsoever shall lie against him in respect of anything done in good faith or intended to be done in accordance with the powers conferred on him. (2) At any time the State Government may, after giving ninety-days clear notice, withdraw from the service of a society, any Government servant deputed to it under section 36 of the Act. (3) The society may, at any time, by a resolution in the general meeting, apply to the State Government for withdrawing the Government servant so deputed. (4) The society shall make such contributions towards the cost of deputation of the officer as the State Government may direct. 55. Appointment of a person to manage the affairs of a society.-When the Registrar orders the removal of the managing committee of a society and makes an appointment of a person or persons to manage the affairs of the society under section 37, he may fix(1) the date by which a new managing committee is to be constituted; (2) the remuneration, if any, to be paid to the person or persons appointed to manage the affairs of the society; (3) the security to be furnished by the person or persons to be appointed.

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56. Officers and employees of co-operative societies.- (1) Notwithstanding anything contained in the bye-laws of a society, no co-operative society shall appoint any person its paid officer or employee in any category of service unless he possesses the qualifications and furnishes the security, if so specified by the Registrar, from time to time, for such category of service in the society, or for the class of societies to which it belongs. The conditions of service of the employees of the societies shall be specified by the Registrar. (2) No co-operative society shall retain in service any paid officer or employee, if he does not acquire the qualifications or furnish the security as is referred to in sub-rule (1) within such time as the Registrar may direct. (3) No co-operative society shall employ a salaried officer or servant with total monthly emoluments exceeding 1[rupees one thousand] without the previous permission of the Registrar. The promotion of an employee to a higher post shall be deemed to be an appointment under this sub-rule. (4) The Registrar may for special reasons to be recorded in writing relax in respect of any paid officer or employee, the provisions of this rule in regard to the qualifications he should possess or the security he should furnish. [(5) Where, in the course of an audit under section 61, or an inspection under section 65, or an inspection under section 66, or an inquiry under section 67, it is brought to the notice of the Registrar that the paid officer or servant of the society had committed, or has been otherwise responsible for mis-appropriation, breach of trust or other offence, in relation to the society or has wilfully neglected or failed to discharge his duties and functions as enjoined on him under the Act, rules or bye-laws or is otherwise responsible for any act or omission thereby adversely affecting the interest of the society, the Registrar, if in his opinion there is prima facie evidence against the paid officer or servant, and suspension of such paid officer or servant is necessary in the interest of the society, direct the committee of the society, pending the investigation and disposal of the matter, as the case may be, to place or cause to be placed such paid officer or servant under suspension from such date and for such period as may be specified by him:
3 2

[Provided that an officer/servant of the society shall be deemed to have been placed under suspension by an order of the competent Authority or the Registrar in the following circumstances:(a) If he is detained in custody, whether on a criminal charge or otherwise, for a period exceeding forty-eight hours;

1 Subs for "five hundred" vide Not. No. Co-op.-A(3)/86, dated 9-12-87 published in R.H.P. Extra, dated 3-9-88, p. 2125-2126. 2 Sub-rule(5) subs vide Not. No. Co-op(II)21/70 ,dated 10-12-1976, published in R.H.P. Extra, dated 10-12-1976, p. 2003 to 07. 3 Proviso to sub-rule (5) added vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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(b) If in the event of a conviction for an offence, he is sentenced to a term of imprisonment exceeding forty-eight hours. If a servant of the society who has been detained for a period exceeding forty-eight hours is later on released on bail, such release will not affect the deemed suspension which will continue to be in force until revoked by the competent authority or the Registrar.] (6) On receipt of a direction from the Registrar under sub-rule (5), the committee of society shall, notwithstanding any provision to the contrary in the bye-laws, place or cause to be placed the paid officer or servant under suspension forthwith. (7) If the committee fails to comply with the direction issued under subrule (5), the Registrar may make an order placing such paid officer or servant under suspension from such date and for such period as he may specify in the order and thereupon the paid officer or servant, as the case may be, shall be placed under suspension. (8) The officer or servant suspended under this rule shall be re-instated only after the previous approval of the Registrar. 57. Prohibition against being interested in contracts etc.-(1) Without prejudice to the provisions of the bye-laws, no officer of a co-operative society shall have an interest directly, or indirectly, otherwise than as such officer,(a) in any contract made with the society; or (b) in any property sold or purchased or leased by, or to the society; or (c) in any other transaction of the society except as an investment made or as a loan taken from the society or the provision of residential accommodation by the society to any paid employee of the society. (2) No officer of a society shall purchase, directly or indirectly, any property of a member of the society sold for the recovery of his dues to the society. (3) The prohibition contained in the rule shall continue to apply for a period of two years after a person ceases to be an officer of the society. 58. Grounds on which a person may be debarred to hold an office in a society.-(1) Without prejudice to any provision of the Act or these rules, the Registrar may, for the reasons to be recorded in writing, debar any person to hold an office in any society for not more than five years for the reasons to be recorded in writing, when he is satisfied that the person concerned(a) has, wilfully and without any reasonable cause, failed to comply with any of the provisions of the Act or these rules; or

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(b) has been found responsible for any misappropriation of the society's funds or for any avoidable loss to it or for its mismanagement as a result of an audit under section 61, or an inspection under section 65 or section 66, or an inquiry under section 67? (c) is responsible for any other misconduct, indiscipline or disorder causing any harm to the smooth functioning of the society or any other society. (2) The person debarred to hold office under sub-rule (1) above may appeal against the order of the Registrar or the State Government within 30 days after the receipt of the order and the decision of the State Government shall be final. 59. Powers of the Government nominees to vote in the general meeting.- Every Government nominee appointed under section 35 of the Act besides having a right to vote in the managing committee meeting, shall also have the right to attend all general meetings of the society and to exercise the voting power like other members. CHAPTER V DUTIES AND OBLIGATIONS OF CO-OPERATIVE SOCIETIES 60. Books and registers to be maintained by the society.-(1) The following registers and papers shall be maintained, and shall be open to inspection by any member interested in the funds except that no one except an authorised officer of the Himachal Pradesh Government Co-operative Department shall see the deposit account of any other person without the person's consent in writing(a) File board containing.(i) Registration Certificate issued under section 9 of the Act; (ii) a copy of Act, rules, bye-laws and consecutive amendments to the Act, the rules and the bye-laws; (iii) copies of such other circulars, as may be required by the Registrar from time to time, to be maintained; (b) a register of members showing the name age, parentage, address and occupation of every member, the number of shares held by him, the date of his admission to membership and the nominee appointed, where necessary, and in case of past members the date of termination of membership; (c) a cash book showing the receipts, disbursements and balance of each

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day on which business is done; (d) a ledger account of each member depositor and creditor and contingent income and expenditure; (e) a register showing periodical instalments for repayment of loans where necessary; (f) a minute book; (g) a register showing the maximum credit limit of each member; (h) a hand book showing all loans issued; (i) a pass book for each member and depositor; (j) a register containing the day to day position of articles in trade and fixed assets; (k) a visit book containing the particulars of visits made to the society by the Registrar, or a person working under his general or special orders. (2) The entries duly authenticated by an officer of the society in the pass book issued to each member or creditor under sub-rule (1) shall have equal evidential value to the entries in the books of accounts of the society. 61. Custody of account books and record.-The books and record of a society shall be kept in the custody of the Secretary or such other officer as the managing committee may authorise. 62. Preparation of statements at the expense of the society.-(1) If a society fails to send to the Registrar within the time allowed, any statement or return required by the Act, the rules and the Registrar, from time to time, the Registrar may cause such statement or returns to be prepared by employing such staff as he may deem to be necessary and may assess upon the society the cost of such staff. (2) The cost assessed under sub-rule (1) if not paid shall be recoverable from the society as laid down in section 90. 63. Publication of the balance sheet.-(1) Every society shall publish in such manner as the Registrar may direct its audited balance-sheet within 60 days from the date it is adopted by the general meeting by displaying it in any conspicuous place in the registered office of the society and in every branch of the society. (2) The managing committee of a society shall, in every co-operative year, lay before the general meeting of the society an audited balance-sheet.

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(3) The audited balance-sheet, so published and displayed every year, shall be kept open to inspection in addition to the documents mentioned under section 26 of the Act. 64. Annual statements.-The managing committee of every society, or any officer of the society appointed for the purpose by the managing committee, shall prepare yearly, in such forms as may be prescribed by the Registrar(a) an account showing the receipts and disbursements of the year; (b) a profit and loss account; (c) a balance-sheet; (d) any other statement prescribed by the Registrar from time to time. CHAPTER VI PRIVILEGES AND POWERS OF CO-OPERATIVE SOCIETIES 65. Proof of entries in society's books.-(1) For the purpose of section 44 of the Act, a copy of an entry in the books of a society shall bear a certificate written at the foot of such copy declaring that it is a true copy of such entry and the book containing the entry is still in the custdoy of the society, such certificate being dated and signed by the Secretary or President of the society. (2) Notwithstanding anything contained in sub-rule (1) copy of an entry, may also be signed and certified by the Administrator where appointed under section 37 or the Liquidator where appointed under section 79. 66. Form of declaration.-A declaration to be made under clause (i) or (ii) of section 47 of the Act shall be in the form set forth in the schedule. 67. Financial assistance by the Government.-(1) Subject to the provisions of the Act, the State Government may(i) make share capital contribution to a society; or (ii) give loans or financial assistance or any other type of assistance to a society; or (iii) guarantee the payment of the principal or debentures issued by a society or interest thereon both; or (iv) guarantee the payment of the principal and payment of interest on loans and advances given by the Reserve Bank of India or the State Bank of India or any other authority or institution constituted under any law for the time being in force; or (v) grant in aid any other form to a society under section 48 of the

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following terms and conditions, namely:(a) when the State Government purchases shares in a society it shall be entitled to dividend on the said shares as is declared by the society concerned, and is payable to other members of that society; (b) a society receiving State-aid shall not pay any dividend or distribute or take profit in excess of such percentage of rate upon the amount of the capital of the society as the State Government may from time to time, fix; (c) a society receiving State-aid shall, with the approval of the Registrar, appoint a paid Secretary or Manager of the society; (d) a society receiving State-aid shall be bound(i) to comply with any general or special order of the State Government relative to the inspection of the society; (ii) to permit the inspection of all accounts relative to the society; (iii) to maintain such accounts and to furnish such statements and returns as the State Government or the Registrar may, from time to time, require; and (iv) to comply with any order or conditions issued or imposed by the State Government, as may in its opinion be necessary, or expedient to safeguard its interest. (2) If the society to which State aid has been given in any form, fails to comply with any order made under the Act, or the rules framed there under, or commits any breach of any terms or conditions laid down for the grant of State aid, or if on inspection of accounts, returns, statements or audit report of such society, the State Government is of the opinion that the State aid should be withdrawn, the State Government may, after considering any representation which the society may make within such time as the State Government may allow in this behalf make an order directing(i) that the balance of any loan outstanding shall be recoverable forthwith; (ii) that the guarantee given shall cease from the date of such order; (iii) that the full value of any other State aid given and enjoyed till the date of the order shall be payable forthwith and the grant of such State aid beyond such date shall be discontinued. (3) An application of a society for a loan, or subsidy, or both from a Government department or a Government sponsored agency shall be made through the Registrar. While forwarding the application, the Registrar shall record his opinion regarding eligibility of the society for the said loan or subsidy or both its financial position and the desirability of sanctioning to the society the said

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loan, or subsidy, or both. (4) The State Government may set out other terms and conditions on which it shall provide State aid to a society. CHAPTER VII PROPERTIES AND FUNDS OF CO-OPERATIVE SOCIETIES 68. Investment of funds.-In addition to the manner specified in section 53, a co-operative society may invest or deposit its funds(a) with the State Bank of India; or (b) in the shares of the Reserve Bank of India; or (c) in any other manner permitted by the Registrar. [69. Co-operative Education Fund.-2(1) Every society shall contribute to the `Co-operative Education Fund' as provided in section 54 of the Act, to be administered by the Himachal Pradesh Co-operative Development Federation (hereinafter mentioned as State Co-operative Development Federation) and in its absence by any other agency duly authorised by the Government in this behalf, at the rate of rupees hundred or three percent of net profit of the year whichever is more but subject to a maximum of Rs. Fifteen lacs.] (2) The contribution payable by a society shall be a charge on the funds of the society and shall be recoverable in the manner provided in section 90 of the Act as arrears of land revenue, and the officer of the society wilfully failing to comply with the requirements of this rule shall be personally liable for making good the amount to the State Co-operative 3[Development Federation], or the authorised agency, as the case may be, the amount so assessed shall be remitted to the State Co-operative 4[Development Federation] or the authorised agency, within a period of one year after the close of the co-operative year for which it was assessed. For the utilisation and administration of the fund, the State Cooperative 5[Development Federation] or the authorised agency as the case may be, shall prepare regulations with the approval of the Registrar.] 70. Objects and Investment of Reserve Fund.-(1) A Reserve Fund
1 Subs vide Notification No. Co-op-E (11)21/74 dated 1-6-1977, published in R. H. P. Extra., dated 8-6-1977, p. 620-621. 2 Sub-rule (1) subs. vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 3 Subs. for words Union vide vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 4 Subs. for words Union vide Not. No. Co-op.A(3)1/99-Vol-I, dated 27.7.2006, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 5 Subs. for words Union vide Not. No. Co-op.A(3)1/99-Vol-I, dated 27.7.2006, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.
1

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maintained by a society shall belong to the society and intended to meet unforeseen losses. It shall be indivisible and no members shall have any claim to a share in it. (2) A society shall not invest or deposit its Reserve Fund except in one or more of the modes mentioned in section 57 of the Act, or modes as are laid down in section 53 read with rule 68: Provided that the Registrar may by general or special order permit any society or any class of societies to invest the Reserve Fund, or a portion thereof in its own business: Provided further that in exceptional circumstances and with the prior approval of the Registrar, the Reserve Fund may be utilised in meeting losses. (3) No society whose Reserve Fund has been separately invested or deposited shall draw upon, pledge or otherwise employ such fund except with the sanction of the Registrar obtained in writing. 71. Distribution of profits.-(1) Save as may be Registrar, no distribution of profits shall be made in the case of a society with unlimited liability, and save as provided in this rule, no part of the funds of a society shall be divided by way of dividend or loans or otherwise among it members. (2) No dividend or loans shall be paid(a) otherwise than out of profits certified by the auditor to have been actually realised in accordance with sub-section (1) of section 56, or (b) without the previous sanction of the Registrar, if the auditor reports that any asset is bad or doubtful and also recommends that such sanction is necessary: Provided that the auditor shall not so recommend if such an asset is adequately covered. (3) Subject to the provisions of sub-rule (2) after the proportion required by sub-section (2) of section 57 and sub-rule (1) of rule 69 has been carried to the Reserve Fund and the Co-operative Education Fund from the net profits of any year, the balance of such profits together with undistributed profit of past years, if any, may to such extent and under such conditions as are laid down in this Chapter, be distributed, as dividend among the members or paid as bonus or remuneration to a member or employee for any specific service rendered to the society. 72. Payment of the dividend, bonus etc.-1[(1) In every society with shares, the dividend may be declared upto a maximum of twelve per cent per annum on the amount of paid up shares.]

1 Sec. 72 (1) Subs vide Notification No. Co-op. (11)21/78, dated 10-12-1976 published in R.H.P., Extra dated 18-12-1976, p. 2003-2007.

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(2) No dividend shall be paid by a society with shares and unlimited liability without the previous sanction of the Registrar. (3) No dividend shall be paid in any society unless such dividend is recommended by the managing committee and approved by the general meeting: Provided that the general meeting may reduce the rate of dividend recommended by the managing committee but shall have no power to increase the same. (4) The Registrar may, by a general or special order, direct that a society shall not pay dividend or shall pay dividend at reduced rate so long as it receives loans and deposits from non-members. (5) Subject to the provisions of any law for the time being in force on the subject, society may set apart not more than ten per cent of its net profits for the payment of bonus to its salaried officers or employees, if such payment is recommended by the managing committee and approved by the general meeting and the Registrar: Provided that in case of a salaried officer or an employee, the amount of bonus shall not exceed two months' salary in any year. 73. Contribution to charitable purposes.-(1) After the proportion required by sub-section (2) of section 57 and sub-rule (1) of rule 69 has been carried to the Reserve Fund and the Co-operative Education Fund, the society may contribute not more than ten percentum of such balance for any charitable purpose as defined in section 2 of the Charitable Endowments Act, 1890. (2) The fund thus constituted under sub-rule (1) shall be utilised by society with the prior sanction of the Registrar. 74. Provident Fund.-(1) Subject to the provisions of any law for the time being in force on the subject, a society may establish a Provident Fund for its employees and after there has been carried to the Reserve Fund and Co-operative Education Fund, the necessary proportion of the net profit in any year may make such contribution not exceeding ten percent of the remaining net profits. (2) Such Provident Fund shall not be used in the business of the society but shall be invested or deposited in one or more of the ways specified in subsection (4) of section 1[57] read with rule 68. (3) The amount of contribution that can be made by an employee in any
1 Subs. vide for "53" Not. No. Co-op. E(11)21-74-III dt. 4-1-82 published R.H.P. dated 19-6-1982, P. 370-371.

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month shall not exceed such sum as may be fixed by the general meeting subject to a maximum of 10 per cent of his monthly salary. (4) The society may make such contribution every year to the Provident Fund to the employees as may be approved by the general meeting and the Registrar, but such contribution shall not exceed the annual contribution made by the employee concerned. (5) The interest accrued on the investment of the Provident Fund of the employees shall be credited to the account of individual employee concerned, in proportion to the balance standing to the credit of each account at the close of the preceding year. (6) The fund shall be administered under the rules duly approved by the Registrar. 75. Honorarium.-(1) No honorarium shall be paid by the society unless a resolution sanctioning the same has been passed by the managing committee and approved by the general house of the society and the Registrar. (2) The honorarium to be paid shall not exceed 5 per cent of net profits or Rs. 1,000 in a year, whichever is less. 76. Maximum credit limit of members.-The Registrar may, from time to time, lay down the limit beyond which a co-operative society or class of societies may not advance loans to members. 77. Nature and extent of securities for loans.-The Registrar may, from time to time, issue such directions, as he may consider necessary for regulating the nature and extent of security which a society or class of societies may demand in respect of loans advanced by it. 78. Restriction on borrowing of co-operative society.-(1) A cooperative society may receive deposit and loan from persons and institutions who are not members, provided that the amount so borrowed from such persons and institutions, together with the amount borrowed and deposits received from members, does not exceed the limit fixed from time to time by the Registrar for the society, or for the class of societies to which it belongs. (2) Notwithstanding anything contained in sub-rule (1) above, a cooperative society may receive deposits from its members exceeding the limit fixed in sub-rule (1), provided that amount in excess of the said limit is invested outside the business of the society. 79. Restriction on grant of loans.-No financing bank or credit society other than an agricultural credit society with unlimited liability, or a land development bank, or a society the object of which is to grant long term loans exclusively on the mortgage of immovable properties, shall grant loan for periods

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exceeding 1[fifteen] years. 80. Restriction in transactions with non-members.-On the application of member of any society or on his own motion, when it appears to the Registrar that it is necessary in the interest of the working of any particular society, to regulate or restrict transactions of such society with any non-member, the Registrar shall, after giving an opportunity to the society of being heard, issue such directions as he may consider necessary for regulating or restricting such transactions. 81. Manner of recalling of loans.-(1) Notwithstanding anything contained in the agreement entered into with the borrowing member, the committee of a society shall be entitled, after giving a week's notice to such member, to recall the entire loan amount immediately when it is satisfied that the loan given has not been applied for the purpose for which given or there has been breach of any of the conditions for the grant of such a loan. (2) Nothing in this rule shall be deemed to preclude the Registrar from directing the society to recall a loan of his own motion, when it is brought to his notice that the loan given by the society has been misapplied, or conditions thereof have been followed. The Registrar may make in the matter such enquiries as he may deem necessary and after giving a show cause notice to the society with intimation thereof to the financial bank, issue necessary directions to the society. The directions issued by the Registrar in this respect shall be complied with by the society. [81-A. Advancements and recovery of crop loans.-(1) In addition to the agricultural purposes defined in Explanation to section 90-A of the Act, the loans may also be advanced for the purposes of cutting, pruning and spraying the crops, purchase of insecticides, pesticides, spray oils, etc. and appliances used for such operations, defraying of expenses on labour charges and transportation charges for the marketing of agricultural produce. (2) The loans advance for the purposes mentioned in Explanation to section 90-A of the Act and in sub-rule (1) shall be repayable on or before such dates as may be specified by the State Government, in the orders issued from time to time, in this behalf.] 82. Writing off bad debts and assets.-No society shall write off in whole or in part all loans including interest thereon and recovery charges in respect thereof which are found irrecoverable and are certified as bad debts in audit and all other dues and accumulate losses or any other loss sustained by the society which cannot be recovered and have been certified as irrecoverable in audit or any
2

1 Subs. for the words five vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794. 2 Added vide Not. No. Co.op(11)21/70 dated 10-12-76 Published R.H.P. Extra dated 1812-76 P. 2003-7.

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of its assets certified as un workable in audit, without the previous sanction of the general body subject to the approval of the Registrar in writing.

CHAPTER VIII AUDIT AND ACCOUNTS 83. Date of audit.-Unless the Registrar directs otherwise for any society or class of societies, the audit of every society, except the societies which are audited concurrently, for the preceding co-operative year shall be completed and the audit report submitted within the current co-operative year but not later than 15 months from the previous date of audit of the society. 84. Audit fee.-(1) Audit fee in respect of audit of accounts shall be paid by all, or any types of societies at such rates as may be fixed by the Registrar, from time to time. : Provided that the Government may in special circumstances in its discretion exempt any society, or class of societies from the payment of audit fee assessed, in whole or in part, for such period as it may specify. (2) All fees payable under this rule shall be recoverable in the manner specified in section 90 of the Act. (3) The audit fee assessed under sub-rule (1) shall be deposited by the society in the Government treasury within a period of one year after the close of co-operative year for which it was assessed. 85. Statements of accounts.-For the purpose of audit under section 61, besides producing the books and the registers maintained by the society under rule 60, the managing committee of the society shall keep ready for audit the following statements in the form specified by the Registrar :(1) list of members, shares held and the arrear of share subscription, if any; (2) list of depositors and crediters; (3) list of debtors including outstanding loans and overdues, if any; (4) lists of stocks with value of dead stock and stock in trade; (5) statement of receipts and disbursements for the period under audit and such other statements as may be reguired by the auditor at the time of audit; (6) statement of trading, manufacturing and profit and loss accounts and balance-sheet. 86. Procedure and principles for the conduct of inquiry and

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inspection.-(1) An order authorising inspection under section 66 or inquiry under section 67 shall, among other things, contain the following:(a) the name of the person authorised to conduct the inspection or inquiry; (b) the name of the society whose affairs are to he inquired into or whose books are to be inspected; (c) the specific point or points on which the inspection or enquiry is to be made, the period within which the inspection or inquiry to be completed and report submitted to the Registrar; (d) cost of inquiry; and (e) any other matter relating to the inspection or inquiry. (2) A copy of every order authorising inspection under section 66 or inquiry under section 67 shall be sent to the society. (3) If the inquiry or inspection cannot be completed within the time specified in the order referred to in sub-rule (1), the person conducting the inquiry or inspection shall submit an interim report stating the reasons for failure to complete the inquiry or inspection and the Registrar, if he is satisfied, may grant such extension of time for the completion of the inquiry or inspection to the officer to whom it is entrusted, or hold the inquiry or inspection himself, or entrust it to such other person as he deems fit. (4) On receipt of the order referred to in sub-rule (1), the person authorised to conduct the inquiry or inspection shall proceed to examine the relevant books of accounts, and other documents in possession of the society, or any of its officers, members, agents or servants and obtain such information or explanation from any such officers, members, agents or servants of the society in regard to the transactions and working of the society as he deems necessary for the conduct of such inquiry or inspection. (5) The person authorised to conduct the inquiry or inspection shall submit his report to the Registrar, on all the points mentioned in the order referred to in sub rule (1). The report shall contain his findings and the reasons therefor supported by such documentary or other evidence as recorded by him during the course of his inspection or inquiry. He shall also specify in his report the costs of the enquiry or inspection and recommend to the Registrar the manner in which the entire cost, or a part thereof, may be apportioned amongst the parties specified in section 68. The Registrar shall pass such orders thereon as may be considered just after giving a reasonable opportunity of being heard to the person or persons concerned. (6) The costs of the inquiry, or inspection, apportioned by the Registrar under section 68 shall be recovered in the manner provided under section 90. 87. Cost of rectification of defects pointed out as a result of inquiry or

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audit.-(1) If the result of an inspection under section 65 or section 66 or inquiry under section 67 discloses any defects in the constitution, working financial condition or books of a society, the Registrar may bring such defects to the notice of the society. The Registrar may also make an order directing to society or its officers to take such action as may be specified in the order to remedy the defects, within the time specified therein. (2) The State Government may, in appeal, reverse, modify or confirm the order of the Registrar. (3) If a society fails to rectify the defects directed to be remedied under section 64, or fails to rectify the defects as directed by the Registrar under sub-rule (1) of this rule, and where no appeal has been made to the State Government within the time specified in the order, or where on an appeal so made, the State Government has not annulled, reversed or modified the order, the Registrar may himself take steps to have the defects rectified, and may recover the costs from the officer or officers of the society who, in his opinion, has or have failed to rectify the defects. CHAPTER IX SETTLEMENT OF DISPUTES 88. Reference of disputes.-(1) When a party to the dispute referred to in sub-section (1) of section 72 desires to have disputes determined in accordance with the said section, the party shall apply to the Registrar in writing, stating the substance of the dispute and the names and addresses of the other party in such form as the Registrar may lay down from time to time. (2) When the Registrar is satisfied that the reference made under section 72 of the Act is a dispute, he may make a note of the reference in the `Register or Disputes' maintained for the purpose. 89. Persons qualified to be appointed as Arbitrator under clause(c) of sub-section) (1) of section 73.-(1) Following offices shall be competent to decide the disputes with regard to the kind of societies mentioned against each:[(i) Additional/Joint/Deputy Registrar, Apex Societies.] Co-operative Societies (ii) Assistant Registrar, Co-operative Societies Federal and Secondary (District Co-operative and Supplies officers) Societies other than Apex Societies. (iii) District Inspector/District Audit Officers/ Primary Societies
1

1 Subs. vide vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 277-2006, p. 2788-2794.

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Inspectors/Auditors/ Sub-Inspectors. [(2) Notwithstanding anything contained in the foregoing rules, the Registrar may by an order in writing appoint an arbitrator consisting of retired officials of Revenue, Co-operative, Audit and Judicial Departments out of a panel of Arbitrators prepared by the Government for every district.] 90. Cost of arbitration.-(1) The Arbitrator or the person invested by the State Government to decide the dispute, or the Registrar, while deciding a dispute, as the case may be, shall have the power to order the expenses of determining a dispute or the cost of either party to be borne by such party or parties to the disputes, as he may think fit. [(2) The Registrar shall have powers to require the person referring a dispute under sub-section (1) of section 72 to deposit in advance the fee or cost or both, if any, to be specified by the Registrar for deciding the dispute. (3) The Registrar may, in such cases, as he thinks fit, order the payment of fee or costs or both to the arbitrator. (4) No fee shall be payable to an arbitrator till the dispute referred to him is finally decided. (5) The Registrar, may, in his discretion, remit the whole or any part of the fee collected under sub-rule (2).] 91. Procedure of disposal of disputes.-(1) In an arbitration proceeding the Registrar, or the Arbitrator, or the person invested by the State Government with powers to decide the disputes, as the case may be, shall communicate the date, time and place of hearing the dispute to all parties concerned in the manner laid down in rule 141. [(2) The Registrar or the arbitrator, as the case may be, shall after giving reasonable opportunity to the parties of being heard, give decision or award, as the case may be, in accordance with the principles of justice, equity and good conscience. The decision or award shall be reduced to writing, announced to the parties and filed in the office of the Registrar within a period of four months: Provided that the said period of four months may be extended by the Registrar Co-operative Societies from time to time whether before or after the expiry of the said period of four months.]
1 Sub-rule (2) Subs. vide No. Co op E (11) 21/74-IV, dated 4-1-82, published in R.H.P. dated 19-6-1982, 370-371. 2 Existing rule 90 renumbered as (1) and sub-rules (2), (3), (4) and (5) added vide ibid 3 Subs. Vide Not. No. Co-op (II) 21/71 dated 10-12-76. published R.H.P. Extra. 18-1276 P. 2003-07.
3 2 1

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(3) In the absence of any party duly summoned to attend, the dispute may be decided ex parte. 92. Nature of award or decision.-(1) The award or decision as the case may be, shall contain the number of reference, the names and description of the parties, and the particulars of the dispute and shall specify clearly the relief granted, the amount decreed, the future interest allowed, if any, and the costs awarded. (2) If no award or decision is made immediately on the conclusion of the hearing of the parties, the person deciding the dispute shall fix the date and place of the delivery of the award and shall, except for the reasons to be recorded in writing, deliver the award or decision on the date so fixed. 93. Disposal of records.-(1) The original record of dispute and of proceedings thereon, after the decision or award has been delivered shall be kept in such place and manner as the Registrar may direct. (2) Any document or record tendered by a party may, on application, be returned to the party after the disposal of the appeal, if any, or after the period of appeal. 94. Certified copies.-A copy of the decision or award shall on application be given to a party by the Registrar, duly certified, on payment of such fees as prescribed under rule 151. 95. Attachment before award under section 69.-If the Registrar is satisfied on affidavit, enquiry or otherwise that any person with intent to delay or obstruct the enforcement of any order that may be made against him under section 69(a) is about to dispose of the whole, or any part of his property; or (b) is about to remove the whole or any part of his property from the jurisdiction of the Registrar; he may, unless adequate security is furnished, direct the conditional attachment of the said property or such part thereof as he thinks necessary and such attachment shall have the same effect as if made by a competent civil court. 96. Procedure for attachment of property under section 74 and rule 95.-(1) Where the property to be attached is movable, other than agricultural produce, in the possession of the debtor the attachment shall be made by actual seizure, and the attaching officer shall keep the property in his own custody, or in the custody of one of his subordinates or a Receiver, if one is appointed under sub-rule (2), and shall be responsible for the due custody thereof; Provided that, when the property seized is subject to speedy and natural decay, or when the expense of keeping it in custody is likely to exceed its value, the attaching officer may sell it at once by open auction.

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(2) Where it appears to the officer ordering conditional attachment under section 74 or rule 95 to be just and convenient, he may appoint a Receiver for the custody of movable property attached under sub-rule (1) and his duties and liabilities shall be identical with those of a Receiver appointed under Order XL of Schedule `I' to the Code of Civil Procedure, 1908. (3) (a) Where the property to be attached is immovable, the attachment shall be made by an order prohibiting the debtor from transferring or charging the property in any way, and all persons from taking any benefit from such transfer or charge. (b) The order shall be proclaimed at some place on or adjacent to such property by beat of drum or other customary mode and a copy of the order shall be fixed at a conspicuous part of the village crossing. Where the property is land, paying revenue to the Government, a copy of the order shall be affixed in the nearest office of the Assistant Collector/District Collector having local jurisdiction. 97. Application for compromise between co-operative societies and its creditors.-(1) An application to the Registrar under section 77 shall contain the proposed terms and conditions of the compromise, or arrangements, and where the applicant is a society, shall be accompanied by a resolution of the general meeting proposing the compromise or arrangement. (2) On receipt of such an application, the Registrar may, if he is of opinion that the proposed terms and conditions of the compromise, or arrangement, shall be beneficial to the parties, give directions as to the following matters viz:(i) (ii) the date or dates when the scheme of compromise or arrangement shall be placed before the creditors; the time and the place where the meeting (or meetings) of the creditors shall be held;

(iii) the preparation by a person duly authorised by him of a statement containing the names of the creditors likely to be affected and the amount due by the society to each of them; and (iv) the time within which the Chairman of the meeting shall forward his report to the Registrar. (3) Together with the direction to be given under sub-rule (2), the Registrar may refer any question touching the compromise or arrangement for consideration and decision of the meeting and the Chairman of the meeting shall put such question to the meeting. 98. Notice of meeting to creditors.-(1) On receipt of the order of the Registrar, the society or the Liquidator, as the case may be, shall before 30 clear days of the date fixed for the meeting issue a notice-

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(a) of the date, time and place of the meeting; (b) of the proposals for compromise; and (c) to every creditor who is likely to be affected thereby. (2) The notice shall be sent by registered post or through a messenger in which case the signatures of the Receiver shall be taken as proof of service. (3) Any creditor desirous of moving an amendment to the proposed compromise or arrangement shall send to the Secretary of the society or to the Liquidator, if any, a copy of this amendment at least fifteen days before the date fixed for the meeting, and the Secretary or the Liquidator, as the case may be, shall send copies of such amendment by ordinary post to each creditor to whom the notice under sub-rule (1) has been sent. (4) The proceedings of any meeting, held under this rule, shall not be invalid by reason only of the fact that the notice prescribed was not received by any person entitled to receive it where proof of despatch is satisfactory. (5) Any officer of the society, or a Liquidator, or a person authorised in writing in this behalf by the Registrar, may attend the meeting, and if so requested by the Chairman of the meeting may take part in the discussion, but shall not be entitled to vote. 99. Appointment of proxy by a creditor unable to attend the meeting.(1) A creditor who is unable to be present in the meeting may appoint another person as his proxy, in writing, in the form set forth in the Schedule. (2) The appointment of proxy shall not be valid unless the form duly filled is deposited at the office from which the notice of the meeting is issued, at least 24 hours before the time fixed for holding the meeting. 100. Procedure to be followed at meeting.-(1) On the date, time and place appointed for the meeting the creditors present shall choose a person to be Chairman of the meeting. (2) Immediately after the Chairman has been elected, he shall read out a statement duly authenticated by an officer authorised in this behalf by the Registrar, containing the names of those creditors to whom notices under sub-rule (1) of rule 98 have been issued, and the amount due by the society to each. (3) If as many creditors as are required by sub-section (2) of section 77 are present, the Chairman shall read to the meeting the terms of the proposed compromise, or arrangement, and shall put to the meeting, the question whether proposed compromise or arrangement be accepted. (4) Any creditor present may move an amendment to the compromise or arrangement proposed, if he has given notice of such amendment in accordance with sub-rule (3) of rule 98, provided thatThe Chairman may put to the meeting any amendment proposed by a creditor of which such notice has not been given if a majority of the creditors

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present agree that such amendment may be considered by the meeting. (5) Every amendment shall be put to the meeting in such order as the Chairman may consider convenient for the purpose of discussion. (6) The person present at the meeting may speak on the motion put by the Chairman or any amendment moved thereto in such order as the Chairman may direct. The Chairman may fix a time limit for speeches. 101. Minutes of the meeting.-(1) The Chairman shall cause minutes to be prepared of the proceedings of the meeting, and shall sign them before leaving the meeting. (2) The minutes shall contain the names of all creditors present at the meeting and if a poll is demanded the name of each creditor voting for or against the motion, or any amendment moved thereto. (3) The Chairman shall forthwith forward to the Registrar a copy of the minutes of the proceedings of the meeting, together with a copy of the terms of the compromise, or arrangement, if any, duly signed by him. 102. Dissolution of meeting if required number of creditors are not present.-The Chairman shall dissolve the meeting, if the number of creditors required under sub-section (2) of section 77, is not present and shall report the fact to the Registrar. 103. Publication of compromise or arrangement.-A compromise or arrangement sanctioned by the Registrar shall be published by the society.(i) displaying it for thirty days in a conspicuous place at the registered office of the society; (ii) displaying it at such other conspicuous place in the area over which the society operates and in such other manner as the Registrar may direct; and (iii) sending copies of the same to all creditors to whom notices have been issued under sub-rule (1) of rule 98. CHAPTER X WINDING UP AND DISSOLUTION OF CO-OPERATIVE SOCIETIES 104. Order of winding up.-(1) When the Registrar is satisfied that a cooperative society(a) has not commenced working within a period of twelve months from the date of registration; or (b) has not carried on business during the previous eighteen months he may, after giving the society a show-cause notice and an opportunity to hear in the manner he deems fit, by an order in writing direct that society be wound up. (2) The Registrar may also issue a memorandum of liquidation together with the order of winding up containing-

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(a) statement of reasons for placing the society under liquidation; (b) time to be taken by the Liquidator to complete the winding up process from the date on which the order of winding up takes effect; (c) guidelines to the Liquidator for the beneficial winding up, or revival, of the society; 105. Communication of order of winding up.-When the Registrar passes an order under section 78 of the Act directing the winding up of a cooperative society, he shall(a) publish the order, if the liability of the society exceeds rupees twentyfive thousand, either in the Official Gazette, or the local or regional newspaper, as the Registrar may deem fit. (b) communicate the order to the society by registered post; and (c) send a copy of the order to the society, and to the financing bank, if any, of which the society is a member. 106. Appointment and removal of Liquidator.-(1) The appointment and removal of a Liquidator shall be published in the manner as the Registrar may deem fit. (2) The appointment and removal as published under sub-rule(1) above shall also be communicated in writing to the society. 107. Powers of Liquidator under sub-section (1) of section 80.-The whole of the assets of the co-operative society in respect of which an order for winding up has been made shall vest in the Liquidator from the date of his appointment under rule 106. 108. Procedure to be adopted by the Liquidator.-(1) The Liquidator, on appointment, shall prepare an up-to-date list of(a) members; (b) past-members, with dates of their withdrawal, who are subject to liabilities under section 29; and (c) deceased members, with dates of their death, names of their legal heirs who represent their estate, and who are subject to liability under section 29. (2) The Liquidator shall, as soon as the order of winding up of the society takes effect, publish in such manner as the Registrar may direct a notice set forth in the schedule, requiring all claims against the society the winding up of which has been ordered, to be submitted to him within 45 days of publication of the notice. All liabilities recorded in the account books of the society shall be deemed ipso facto to have been duly submitted to him under this clause. (3) The Liquidator shall after ascertaining the assets and liabilities of the society as they stood on the date of his appointment under rule 106, proceed next to determine the contributions (including debts due) to be made by each of its members or by the estates of the nominees, heirs or legal representatives of

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deceased members or by any officers or former officers, to the assets of the society under section 80. If necessity arises, he may also frame a subsidiary order, or orders, regarding such contributions and such orders and the original orders shall be enforceable under section 88. Every order issued by the Liquidator under this rule shall be called the contribution order and shall be enforceable under section 88 of the Act. (4) The Liquidator shall submit to the Registrar such periodical reports and statements, showing the progress made in the liquidation proceedings as the Registrar may require. (5) Subject to the approval of the Registrar, the Liquidator may appoint staff to assist him in the discharge of his duties. (6) The Liquidator may empower any person from among the members of the liquidation committee, if any, or from among the staff appointed under subrule (5) of this rule, or in its absence, any other person, by general or special order in writing, to make collections and grant valid receipts on his behalf. (7) The remuneration of the Liquidator fixed under sub-section (1) of section 79 and also that which is to be given to the staff appointed under sub-rule (6) of this rule shall be included in the cost of winding up which shall be payable out of the assets of the society in priority to all other claims. (8) All funds in the charge of the Liquidator shall be deposited with such institution or person and in such manner as the Registrar may approve. (9) The Liquidator may, at any time, call such meeting of the members or of the creditors, or joint meeting of the members and creditors; and such meeting shall be called, held and conducted at such time and place and in such manner as the Liquidator thinks fit. (10) The Liquidator shall call the annual general meeting of the society, during each co-operative year to consider the Annual Audit Report or any other point which may be specified by the Registrar or he may desire to bring into the notice of the House. (11) All the meetings called under sub-rules (9) and (10) shall be presided by a Chairman of the meeting, especially elected for the purpose, from among the members present. 109. Issue of summons, notice etc. by a Liquidator.-(1) The Liquidator may issue summons to persons where attendance is required either to give evidence or to produce documents. (2) The Liquidator shall himself arrange for the service of summons, and shall send warrants, if any, for execution to the competent magistrate having local jurisdiction. The said magistrate shall execute the warrants, as if issued by himself.

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[110. Liquidator to keep records of depositions whose evidence he takes.-The Liquidator shall keep record of the deposition of person whose evidence he takes.] 111. Distribution of assets.-(1) The audit fees due and all costs, charges and expenses incurred in the winding up of the society, including the remuneration of the Liquidator, shall be payable in priority to all other claims. (2) After the liabilities, other than the owned capital, as they stood on the date of order of winding up are paid up, the assets, if any left with the Liquidator may be employed subject to the approval of the Registrar for the following purposes in order of priority(i) proportional refund to members of any contributions realised from them in addition to their own personal debts; (ii) prorata refund of share capital; and (iii) prorata payment of dividend on the share, if any, at the rate not exceeding six per cent per annum for the whole period for which it has not been paid including the period of liquidation. 112. Removal of the liquidator.-When the Liquidator has been removed under section 79, he shall on such removal hand over all the property and documents relating to the society ordered to be wound up to such person as the Registrar may direct. 113. Liability due to claimants whose whereabouts are not known.-If any liability cannot be discharged by the Liquidator owing to the where abouts of the claimants not being known or for any other cause, the amount covered by such undischarged liability may be deposited in financing bank having jurisdiction over the area in which the society was functioning and shall remain at the disposal of the claimants for a period of three years, after which the undrawn amount, if any, may be transferred to the State Co-operative Union for credit to the Co-operative Education Fund. 114. Meeting of members at the conclusion of liquidation proceedings.- (I)At the conclusion of the liquidation procedings the Liquidator shall call a general meeting of the members and place before such meeting(i) a summary of his proceedings; (ii) a report on the cause of the failure of the society. (2) The members at such meeting after due consideration of the report placed by the Liquidator may by a resolution request the Registrar to cancel the registration or the order for the winding up of the society, as they think fit. 115. Final report of the Liquidator and termination of proceedings.1 Subs. vide Not. No. Co op. E (11) 21/74, dated 4-1-82, published in R. H. P., dated 19-682, P. 370-371.

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(1) After the liquidation proceedings of a society have been closed the Liquidator shall submit a final report to the Registrar together with a copy of his report and the resolution referred to in rule 114. (2) On receipt of the final report from the Liquidator the Registrar shall terminate the liquidation proceedings by cancelling either the registration or the order for the winding up of the society. 116. Maintenance of accounts by the Liquidator.-The Liquidator shall keep such books and accounts as may be laid down by the Registrar from time to ime. The accounts of the society so maintained shall be audited at least once in each co-operative year at such time and in such manner as the Registrar may determine. 117. Term of liquidation proceedings.-Subject to the period fixed in memorandum of liquidation under rule 104, the liquidation proceedings of a society shall be closed within a period of five years from the date on which the order of winding up takes effect, unless the period is extended by the Registrar. 118. Disposal of record.-(1) All the documents, books and records of society whose registration has been cancelled shall be deposited with the Registrar, or such person, or institution, as the Registrar may direct. (2) After the expiry of three years from the date of the order of cancellation passed under sub-rule (2) of rule 115, the documents, books and records deposited under sub-rule (1) of this rule may be destroyed under the order of the Registrar: [Provided that a precise description of each of the documents, books and records destroyed is maintained on record]
1

EXECUTION OF DECREES 119. Application for execution to recovery officer.-(1) Any decree holder requiring the provision of 2[XXXXXXX] section 87 to be applied, shall apply to the recovery officer in whose jurisdiction the cause of action arose, and shall deposit the necessary cost on a scale fixed by the Registrar. If the judgmentdebtor resides, or the property to be proceeded against is situated outside the jurisdiction of such recovery officer, the recovery officer shall transfer the application to the recovery officer in whose jurisdiction the judgement-debtor resides or the property is situated. (2) Every such application shall be made in the form specified by the Registrar and shall be signed by the decree-holder. The decree-holder may indicate whether he wishes to proceed in the first instance, against the immovable
1 Proviso added by Not. No. Coop. (11)21/74-III dated 4-1-82 published in R. H. P. dated 19-6-82 P. 370-371. 2 The words clause (c) of sub-section (1) of deleted vide Not. No. Co-op.A(3)1/99Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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property mortgaged to the decree-holder or other immovable property or to secure the attachment of movable property. (3) On receipt of the application, the recovery officer shall verify the correctness and genuineness of the particulars set forth in the application with the records, if any, in the office of the Registrar and prepare a demand notice in writing in duplicate in the form specified by the Registrar setting forth the name of the judgment-debtor, and the amount due, and forward it to the sale officer. 120. Procedure in execution.-Unless the decree-holder has expressed a desire that proceedings would be taken in a particular order as laid down in subrule (2) of rule 119 execution shall ordinarily be taken in the following manner:(i) movable property of the judgment-debtor shall be first proceeded against, but shall not preclude the immovable property being proceeded against simultaneously in case of necessity; (ii) if there is no movable property, or if the sale proceeds of the movable property or properties attached and sold are insufficient to fulfil the demand of decree-holder, the immovable property belonging to the judgment-debtor may be proceeded against. 121. Attachment and sale of specific immovable property including crops on land.-In the attachment and sale of immovable property, the following rules shall be observed:(a) The sale officer shall, after giving previous notice to the decreeholder, proceed to the village where the judgment-debtor resides, or the property to be attached is situated and serve a demand notice upon the judgment-debtor if he is present. If the amount due together with the expenses be not at once paid, the sale officer shall make the attachment by seizure or otherwise, and shall immediately deliver to the judgment-debtor a list or inventory of the property attached and an intimation of the place and the day, and hour at which the attached property will be brought to sale, if the amounts due are not previously discharged. If the judgment-debtor is absent, the sale officer shall serve the demand notice on some adult male member of his family, or on his authorised agent, or where such service cannot be effected shall affix a copy of the demand notice on some conspicuous part of his residence. He shall then proceed to make the attachment and shall fix the list of property attached on the usual place of residence of the judgment-debtor, endorsing thereon the place where the property may be lodged or kept and an intimation of the place, day and hour of sale. (c) After the attachment is made, the sale officer may arrange for the custody of the property attached, with the decree-holder

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or otherwise. If the sale officer requires the decree-holder to undertake the custody of the property, he shall be bound to do so and any loss incurred owing to his negligence shall be made good by the decree holder. If the attached property is livestock, the decree-holder shall be responsible for providing the necessary fodder therefor. The sale officer may, at the instance of the judgment-debtor, or of any other person claiming an interest in such property leave it in the village or place where it was attached in the charge of such judgment-debtor or person, if he enters into a bond in the form specified by the Registrar with one or more sureties for the production of the property when called for. (c) No attachment shall be made after sunset and before sunrise. (d) The attachment shall not be excessive, that is to say, the property attached shall be in value as nearly as possible proportionate to the sum due by the judgment-debtor together with interest and all expenses incidental to the attachment and sale. (e) If crops or ungathered products of the land belonging to a judgment debtor are attached, the sale officer may cause them to be sold when fit for reaping or gathering, or at his option may cause them to be reaped or gathered in due season and stored in a proper place until sold. In the later case, the expenses of reaping or gathering and storing such crops or products shall be defrayed by the owner upon his redeeming the property or from the proceeds of the sale in the event of its being sold. (f) The sale officer shall not work the bullocks or cattle, or make use of the goods or movable property attached, and he shall provide the necessary fodder for the cattle or livestock, the expenses attending which shall be defrayed by the owner upon his redeeming the property, or from the proceeds of the sale in the event of its being sold. (g) It shall be lawful for the sale officer to force upon any stable, cow house, granary, godown, out-house or other building, and he may also enter any dwelling-house the outer door of which may be open, and may break open the door of any room in such dwelling house for the purpose of attaching property belonging to a judgment-debtor and lodged therein, provided always that it shall not be lawful for him to break open or enter apartment in such dwelling-house appropriate for the ZANANA or residence of women, except as hereinafter provided. (h) Where the sale officer may have reason to suppose that the property

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of a judgment-debtor is lodged within a dwelling-house, the outer door of which may be shut or within any apartment appropriated to women, which by custom or usage are considered private, the sale officer shall report the fact to the officer-in-charge of the nearest police station. On such report the officer-in-charge of the said station shall send a police officer to the spot in the presence of whom the sale officer may force open the outer door of such dwelling-house, or break open the door of any room within the house except the room appropriated by women. The sale officer may also in the presence of the police officer after due notice is given for the removal of women within a ZANANA, and after furnishing means for their removal in a suitable manner, if they be women of rank who, according to the custom or usage cannot appear in public, enter the ZANANA apartments for the purpose of attaching the judgement-debtor's property, if any, deposited therein but such property, if found, shall be immediately removed from such apartments after which they shall be left free to the former occupant. (j) The sale officer shall cause proclamation of the time and place of the intended sale to be made by beat of drum in the village in which the judgment-debtor resides, and in such other place or places as the sale officer may consider necessary, to give due publicity to this sale. No sale shall take place until after the expiration of the period of fifteen days from the date on which the sale notice has been served or affixed in the manner prescribed in clause (a) : Provided that where the property attached is subject to speedy and natural decay, or where the expenses of keeping it in custody are likely to exceed its value, the sale officer may sell it at any time before the expiry of the said period of fifteen days, unless the amount due is paid earlier. (k) At the appointed time, the property shall be put up for sale in one or more lots, as the sale officer may consider advisable, and shall be disposed of to the highest bidder: Provided that it shall be open to the sale officer to decline to accept the highest bid where the price offered appears to be unduly low, or for other reasons. Where the property is sold for more than the amount due, the excess amount, after deducting the interest and the expenses of process and the other charges shall be paid to the judgment-debtor: Provided further that the recovery officer or the sale officer may, in his discretion, adjourn the sale to a specified day and hour recording his reasons for such adjournment. Where the sale is so adjourned for a longer period than seven days, a fresh proclamation under clause (i) shall be made unless the judgment-debtor consents to waive it.

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(l) The property sold shall be paid for in cash at the time of sale, or as soon thereafter as the officer holding the sale shall apoint, and the purchaser shall not be permitted to carry away any part of the property until he has paid for it in full. If the purchaser fails in the payment of purchase money, the property shall be resold. (m) Where it is proved to the satisfaction of any civil court of competent jurisdiction that any property which has been attached under these rules has been forcibly or clandestinely removed by any person, the court may order forthwith such property to be restored to the sale officer. (n) Where prior to the day fixed for sale, the judgment-debtor or any person acting on his behalf, or any person claiming an interest in the property attached, pays the full amount due, including interest, bhatta and other costs incurred in attaching the property, the sale officer shall cancel the order of attachment, and release the property forthwith. (o) The movable properties exempted from attachment by the proviso to section 60 of the Code of Civil Procedure, 1908 shall not be liable to attachment or sale under these rules. 122. Attachment of other movable property.-(1) Where the movable property to be attached is the salary or allowance or wages of a public officer or a railway servant, or a servant of a local authority or a firm or a company or any other person or institution, the recovery officer may, on receiving a report from the sale officer, order that the amount shall, subject to the provisions of section 60 of the Code of Civil Procedure, 1908 (5 of 1908), be withheld from such salary or allowance or wages, direct and upon receipt of an order, the officer or other person whose duty is to disburse such salary or allowances or wages shall withhold and remit to the sale officer, the amount due under the order, or the monthly instalment, as the case may be. (2) Where the property to be attached consists of the share or interest of the judgment-debtor in movable property belonging to him and another co-owner, the attachment shall be made by a notice to the judgment debtor prohibiting him from transferring the share on interest or charging it in any way. (3) Where the property to be attached is a negotiable instrument not deposited in a court, not in the custody of a public officer, the attachment shall be made by actual seizure and the instrument shall be brought to the office of the recovery officer ordering the attachment and be held subject to his further orders. (4) Where the property to be attached is in the custody of any court or

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public officer, the attachment shall be made by a notice to such court or officer, requesting that such property and any interest or dividend becoming payable, thereon may be held subject to the further orders of the recovery officer issuing the notice : Provided that where such property is in the custody of a court or any other recovery officer, any question of title or priority arising between the decreeholder and any other person, not being the judgement-debtor, claiming to be interested in such property by virtue of any assignment, attachment or otherwise shall be determined by such court or recovery officer, as the case may be. Explanation.-In this rule, a public officer includes a Liquidator appointed under section 79. (5) (i) Where the property to be attached is a decree, either for the payment of money, or for sale in enforcement of a mortgage or charge, the attachment shall be made, if the decree sought to be attached was passed by the Registrar or the person to whom a dispute has been transferred for disposal under section 73, by the order of the Registrar. (ii) Where the Registrar makes an order under clause (i), he shall, on the application of the decree holder, who has attached the decree, proceed to execute the attached decree and apply the net proceeds in satisfaction of the decree sought to be executed. (iii) The holder of a decree sought to be executed by the attachment of another decree of the nature specified in clause (i) shall be deemed to be the representative of the holder of the attached decree, and to be entitled to execute such attached decree in any manner for the holder thereof. (iv) Where the property to be attached in execution of decree is a decree other than decree of the nature referred to in clause (i), the attachment shall be made by issue of a notice by the recovery officer to the holder of such a decree prohibiting him from transferring or charging the same in any way. (v) The holder of the decree attached under this sub-rule, shall give the recovery officer executing the decree such information and aid as may reasonably be required. (vi) On the application of the holder of decree sought to be executed by the attachment of another decree, the recovery officer making an order of attachment under this sub-rule, shall give notice of such order to the judgment debtor bound by the decree attached; and no payment, or adjustment, of the attached decree made by the judgment-debtor in contravention of such order after receipt of notice thereof, either

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through the said recovery officer or otherwise, shall be recognised so long as the attachment remains in force. (6) Where the movable property to be attached is(a) a debt due to the judgment-debtor in question; (b) a share in the capital of a corporation or a deposit invested therein; or (c) other movable property not in the possession of the judgment debtor except property deposited in or in the coustody of any Civil Court, the attachment shall be made by a written order signed by the recovery officer prohibiting(i) in the case of a debt, the creditor from recovering the debt and the debtor from making payment thereof, (ii) in the case of a share or deposit, the person in whose name the share or the deposit may be standing from transferring the share or deposit or receiving any dividend or interest thereon, and (iii) in the case of any other movable property except as aforesaid, the person in possession of it from giving over to the judgment debtor. A copy of such order shall be sent in the case of the debt to the debtor, in the case of the share or deposit, to the proper officer of the corporation and in the case of the other movable property except property deposited in or in the custody of a Civil Court, to the person in possession of such property. As soon as the debt referred to in clause (a) or the deposit referred to in clause (b) matures, the recovery officer may direct the person concerned to pay the amount to him. Where the share is not withdrawable the said recovery officer shall arrange for its sale through a broker. Where the share is withdrawable, its value shall be paid to the recovery officer or to the party referred to in clause (c), the person concerned shall place it in the hands of the recovery officer as it becomes deliverable to the judgmentdebtor. 123. Attachment and sale of immovable property.-(1) Immovable property shall not be sold in execution of a decree unless such property has been previously attached:

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Provided that where the decree has been obtained on the basis of a mortgage of such property, it shall not be necessary to attach it. (2) In the attachment and sale, or sale without attachment of immovable property, the following procedure shall be observed:(a) The application presented under sub-rule (2) of rule 119 containing a description of the immovable property to be proceeded against, sufficient for its identification and in case such property can be identified by boundaries or numbers in a record of settlement or survey, the specification of such boundaries or numbers and the specification of the judgment-debtors' share or interest in such property to the best of the belief of the decree-holder and so far as he has been able to ascertain it. (b) The demand notice issued by the recovery officer under sub-rule (3) of rule 119 shall contain the name of the judgment-debtor, the amount due, including the expense, if any, and the BHATTA to be paid to the person who shall serve the demand notice, the time allowed for payment and in case of non-payment, the particulars of the properties to be attached and sold or to be sold without attachment, as the case may be. After receiving the demand notice, the sale officer shall serve or cause to be served a copy of the demand notice upon the judgmentdebtor or upon some adult male member of his family at his usual place of residence, or upon his authorised agent, or, if such personal service is not possible, shall affix a copy thereof on some conspicuous part of the immovable property about to be attached and sold or sold without attachment, as the case may be: Provided that where the recovery officer is satisfied that a judgmentdebtor with intent to defeat or delay the execution proceedings against him is about to dispose of the whole, or any part, of his property, the demand notice issued by the recovery officer under subrule (3) of rule 119 shall not allow any time to the judgment-debtor for payment of the amount due by him and the property of the judgment debtor shall be attached forthwith. (c) If the judgment-debtor fails to pay the amount specified in the demand notice within the time allowed, the sale officer shall proceed to attach and sell, or sell without attachment, as the case may be, the immovable property specified in the demand notice for execution. (d) Where the attachment is required before sale, the sale officer, shall if possible, cause a notice of attachment to be served on the judgmentdebtor personally. Where personal service is not possible the notice shall be affixed in some conspicuous part of the judgment- debtor's last known residence, if any. The fact of attachment shall also be

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proclaimed by a beat of drum, or other customary mode of announcement, at some place on or adjacent to such property, and at such other place, or places, as the recovery officer may consider necessary to give due publicity to the sale. The attachment notice shall set forth that unless the amount due with interest and expenses be paid within the date therein mentioned the property will be brought to sale. A copy of the notice shall be sent to the decree holder. Where the sale officer so directs, the attachment shall also be notified by public proclamation in a local newspaper, if any. (e) Proclamation of sale shall be published by affixing a notice in the office of the recovery officer, nearest office of the financing bank, and in the tehsil office, at least thirty days before the date fixed for the sale. It shall also be published by beat of drum in the village. Such proclamation shall, where attachment is required before sale, be made after the attachment has been effected. Notice shall also be given to the decree-holder and the judgment-debtor. The proclamation shall state the time and place of sale and specify as fairly and accurately as possible the following particulars:(i) the property for sale; (ii) any encumbrance to which the property is liable; (iii) the amount for recovery of which the sale is ordered; and (iv) every other matter which the sale officer considers material for a purchaser to know in order to judge the nature and value of the property. (f) (i) Where any immovable property is sold under these rules, the sale shall be subject to the prior encumbrances on the property, if any. The decree-holder shall, where the amount for the realisation of which the sale is held, exceeds Rs. 100, furnish to the sale officer within such time as may be fixed by him or by the recovery officer, an encumbrance certificate from the registration department for the period of not less than twelve years prior to the date of attachment of the property sought to be sold, or in cases falling under the proviso to sub-rule (1) prior to the date of the application for execution. The time for production of the encumbrance certificate may be extended at the discretion of the sale officer or the recovery officer, as the case may be. The sale shall be by public auction to the highest bidder: Provided that it shall be open to the sale officer to decline to accept the highest bid where the price offered appears to be unduly low or for other reasons :

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Provided further that the recovery officer, or the sale officer may in his discretion, adjourn the sale to a specified day and hour, recording his reasons for such adjournment where sale is so adjourned for a longer period than seven days, a fresh proclamation under clause (e) shall be made, unless the judgment-debtor consents to waive it. (ii) The sale shall be held after the expiry of not less than thirty days calculated from the date on which notice of the proclamation was affixed in the office of the recovery officer. The time and place of sale shall be fixed by the recovery officer and the place of sale shall be the village where the property to be sold is situated, or such adjoining prominent place of public resort as may be fixed by the said recovery officer : Provided that in cases where an encumbrance certificate is not obtainable, owing to the destruction of the connected records, an affidavit from the village Patwari with regard to the encumbrances known to him, supported by a certificate from the registration department that the encumbrance certificate cannot be granted owing to the destruction of the connected records, shall be accepted in the place of an encumbrance certificate. (g) A sum of money equal to 25 per cent to the price of which the immovable property is purchased in auction shall be paid by the purchaser to the sale officer at the time of the purchase, and in default of such deposits, the property shall forthwith be resold : Provided that where the decree-holder is the purchaser, and is entitled to set-off the purchase money under clause (k), the sale officer shall dispense with the requirements of this clause. (h) The remainder of the purchase money and the amount required for the general stamp for the sale certificate shall be paid within fifteen days from the date of sale: Provided that the time for payment of the cost of the stamp may, for good and sufficient reasons, be extended at the discretion of the recovery officer upto thirty days from the date of sale: Provided further that in calculating the amounts to be paid under this clause, the purchaser shall have the advantage of any set-off to which he may be entitled under clause (k). (i) In default of payment of the purchase money within the period mentioned in clause (h), the deposit may, if the recovery officer thinks fit, after defraying the expenses of the sale, be forfeited to

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the State Government, and the defaulting purchaser shall forfeit all claims to the property or to any part of the sum for which it may subsequently be sold. (j) Every resale of immovable property in default of payment of the amount mentioned in clause (h) within the period allowed for such payment, shall be made after the issue of a fresh proclamation, in the manner and for the period hereinbefore prescribed for the sale. (k) Where a decree-holder purchases the property, the purchase money, and the amount due on the decree, shall be set off against one another, and the sale officer shall enter upto satisfaction of the decree in whole or in part accordingly. (3) Where prior to the date fixed for sale, the judgment-debtor or any person acting on his behalf or any person claiming an interest in the property sought to be sold, tenders payment of the full amount due, together with interest BHATTA and other expenses incurred in bringing the property to sale, including expenses of attachment, if any, the sale officer shall forthwith release the property after cancelling, where the property has been attached, the order of attachment. (4) (i) Where immovable property has been sold by the sale officer, any person either owning such property or holding an interest therein, by virtue of a title acquired before such sale, may apply to have the sale set aside on his depositing with the recovery officer(a) for payment to the purchaser a sum equal to five per cent of the purchase money, and (b) for payment to the decree holder, the amount of arrears specified in the proclamation of sale as that for the recovery of which the sale was ordered, together with interest thereon and the expenses of attachment, if any, and sale and other costs due in respect of such amount, less the amount which may, since the date of such proclamation, have been received by the decree holder. (ii) If such deposit and application are made within thirty days from the date of sale, the recovery officer shall pass an order setting-aside the sale and shall repay to the purchaser, the purchase money so far as it has been deposited, together with the five per cent deposited by the applicant : Provided that, if more persons than one have made deposits and application, under this sub-rule, the application of the first depositor to the recovery officer shall be accepted. (iii) If a person applies under sub-rule (5) to set aside the sale of immovable property, he shall not be entitled to make an application under this sub-rule.

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(5) (i) At any time within thirty days from the date of the sale of immovable property, the decree-holder or any person entitled to share in a rateable distribution of the assets or whose interests are affected by the sale, may apply to the recovery officer to set-aside the sale on the ground of a material irregularity, or mistake, or fraud, in publishing the proclamation or conducting the sale: Provided that no sale shall be set-aside on the ground of irregularity, or fraud, unless the recovery officer is satisfied that the applicant has sustained substantial injury by reason of such an irregularity, mistake or fraud. (ii) If the application be allowed, the recovery officer shall set-aside the sale and may direct a fresh one. (6) (i) On the expiration of thirty days from the date of sale, if no application to have the sale set-aside is made, or if such application has been made and rejected, the recovery officer shall make an order confirming the sale : Provided that, if he shall have reasons to think that the sale ought to be set-aside, notwithstanding that no such application has been made, or on grounds other than those alleged in any application which has been made and rejected, he may after recording his reasons, in writing, set-aside the sale. (ii) Whenever the sale of any immovable property is not so confirmed or is set-aside, the deposit or the purchase money, as the case may be, shall be returned to the purchaser. (iii) After the confirmation of any such sale, the recovery officer shall grant a certificate of sale bearing his seal and signature to the purchase, and such certificate shall state the property sold, and the name of the purchaser and it shall be conclusive evidence of the fact of the purchase in all courts and tribunals, where it may be necessary to prove it, and no proof of the sale or signature of the recovery officer shall be necessary unless the authority before whom it is produced shall have reason to doubt its genuineness. (iv) An order made under this sub-rule shall be final, and shall not be liable to be questioned in any suit, or other legal proceeding. (7) Where any lawful purchaser of immovable property is resisted and prevented by any person other than a person (not being the judgment-debtor) claiming in good faith to be in possession of the property on his own account, from containing possession of the immovable property purchased, any court of competent jurisdiction, on application, and production of the certificate of sale provided for by sub-rule (6), shall cause the proper process to be issued for the purpose of putting such purchaser in possession, in the same manner as if the immovable property purchased had been decreed to the purchaser by a decision of the court.

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(8) It shall be lawful for the sale officer to sell the whole or any portion of the immovable property of a judgment-debtor in discharge of money due : Provided always that so far as may be practicable, no larger section or portion of immovable property shall be sold than may be sufficient to discharge the amount due with interest and expenses of attachment, if any, and sale. 124. Effect of attachment on private alienation.-Where an attachment has been made under these rules, any private transfer or delivery of the property attached or of any interest therein and any payment to the judgment debtor of any debt, dividend or other moneys, contrary to such attachment shall be void as against all claims enforceable under the attachment. Explanation.-For the purpose of this rule, claims enforceable under an attachment include claims for the rateable distribution of assets under rule 111. 125. Bhatta costs and receipts for payments made.-(1) Persons employed in serving notices or other processes under these rules shall be entitled to BHATTA (Travelling Allowance), at such rates, as may, from time to time, be fixed by the Registrar. (2) Where the cost and charges incurred in connection with the attachment, and sale of movable property, or the attachment and sale, or sale without attachment, of immovable property under these rules exceed the amount of the cost deposited by the decree-holder, such excess shall be deducted from sale proceeds of the property sold, or the moneys paid by the judgment-debtor, as the case may be, and the balance shall be made available to the decree-holder. (3) Every person making a payment towards any money due, for the recovery of which an application has been made under these rules, shall be entitled to a receipt for the amount, signed by the sale officer, or other officer empowered by the recovery officer in that behalf, such receipt shall state the name of the person making the payment and the subject-matter in respect of which the payment is made. 126. Investigation of claims to property attached.-Where any claim is preferred to, or any objection is made to the attachment of any property attached under these rules on the ground that such property is not liable to such attachment, the sale officer shall investigate the claim or objections, and make an order either rejecting the claim or objection 1[as the case may be,] and dispose it on merits: Provided that the sale officer, for reasons to be recorded in writing, may refuse to investigate the claim or objection, if he considers that the claim or
1 Ins. vide Not. No. Co-op. E (11) 21/74-III, dated 4-1-1982 published in R.H.P. dated 19-6-1982, P. 370-371.

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objection is frivolous. 127. Loss caused by the resale due to default by purchaser at first sale.-(1) Any deficiency of price which may arise on a resale held under clause (l) of rule 121 or under clause (g) or (j) of sub-rule (2) of rule 123 by reason of the purchaser's default, and all expenses attending such resale, shall be certified by the sale officer to the recovery officer, and shall at the instance of either the decreeholder or the judgment debtor, be recoverable from the defaulting purchaser. The cost if, any, incidental to such recovery shall also be borne by the defaulting purchaser. (2) Where the property may, on the second sale sell for higher price than at first sale, the defaulting purchaser at the first sale, shall have no claim to the difference or increase. 128. Dismissal of application for execution for default of decreeholder.-Where any property has been attached in execution of a decree, but by reason of the decree-holder's default, the recovery officer is unable to proceed further with the application for execution, he shall either dismiss the application or for any sufficient reason adjourn the proceedings to a future date. Upon the dismissal of such an application, the attachment shall cease. 129. Distribution of assets when there are claims under several decrees.- (1) Where the sale officer attaches, or has attached under these rules, any property not in the custody of any court, which is already under attachment made in execution of a decree of any court, such court shall receive and realise such property; and shall determine claims thereto and any objection to the attachment thereof: Provided that where property is under attachment in the execution of decrees of more courts than one, the court which shall receive or realise such property and shall determine any claim, thereto, and any objection to the attachment thereof, shall be the court of highest grade, or where there is no difference in grade between such courts, the court under whose decree the property was first attached. (2) Where the assets are held by the sale officer and before the receipt of such assets, demand notices in pursuance of applications for execution of decree against the same judgment-debtor have been received from more than one decreeholder and the decree-holders have not obtained satisfaction, the assets after deducting the costs of realisation shall be rateably distributed by the recovery officer among such decree-holders in the manner provided in section 73 of the Code of Civil Procedure, 1908. 130. Death of judgment-debtor-Execution against legal representative.-(1) Where a judgment-debtor dies before the decree has been

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fully satisfied, an application under sub-rule (1) of rule 119 may be made or continued against the legal representative of the deceased, and thereupon all the provisions of this chapter shall, save as otherwise provided in this rule, apply as if such legal representative were the judgment-debtor: Provided that a show-cause notice shall be issued to such legal representative, and his objection heard, before execution is proceeded against him. (2) Where the decree is executed against such legal representative, he shall be liable only to the extent of the property of the deceased which has come to his hands, the recovery officer executing the decree may, of his own motion or on the application of the decree-holder, compel such legal representative to produce such accounts as he thinks fit. 131. Fees for processes issued under these rules.-Where, in connection with the proceeding under clause (c) of section 87, any person requires the issue of any process or objects to any process issued, or objects to any order passed, he shall pay such fee as may be specified by the Registrar in behalf. [132. Constitution of Co-operative Appellate Tribunal.-(1) The Cooperative Appellate Tribunal under section 108 of the Act, shall be called the Himachal Pradesh Co-operative Appellate Tribunal. (2) The Tribunal shall consist of the President and not more than three members to be appointed by the Government, who shall possess the following qualifications:(a) The President of the Tribunal, shall be a person who is qualified to be a Judge of any High Court in India or is a retired District Judge, or who has held the office of the Registrar 2[or Additional Registrar] or Joint-Registrar of Co-operative Societies for not less than three years under any State Government or a member of Indian Administrative Service who has been born on the State Cadre for a period of not less than five years. (b) The other members of the Tribunal shall be persons who have held the office of the Registrar 3[or Additional Registrar] or Joint-Registrar of Co-operative Societies for not less than three years under any State
1 Subs. for the original rule by Not. No. Co-op. E. (ii) 21/74, dated 30-1-1975, published in R.H.P. Extra., dated 3-2-1976, p. 77-78 and again 132 subs. and 132-A, 132-B, 132-Cadded vide Not. No. Co-op (11) 21/71 dated 10-12-1976, published in R.H.P. dated 18-12-1976, p. 3003 3007. 2 Inserted vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-72006, p. 2788-2794. 3 Inserted vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-72006, p. 2788-2794.
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Government or a member of Indian Administrative Service who has been borne on the State Cadre for a period of not less than five years or as non-officials closely associated with the co-operative movement who possess legal qualification (a recognised degree in law) and experience. (3) Notwithstanding anything contained in sub-rule (2), a person shall be disqualified for being appointed as or for continuing as, President or a member of the Tribunal if he is, or becomes, a member of the committee of any society other than an educational society a propagandist society of a federal society which is not a business institution. (4) (a) The President and each of the other members of the Tribunal shall hold office for such period not less than two years, as the State Government may by notification in the Official Gazette specify in his case, and shall be eligible for re-appointment. (b) Notwithstanding anything contained in clause (a), no person shall be eligible to continue to hold office of the President or a member of the Tribunal after he attains the age of sixty-five years. (c) The President or a member of the Tribunal may at any time resign his office. (d) The President or a member of the Tribunal may, with the previous permission of the State Government hold any other office, appointment or employment not inconsistent with his position on the Tribunal. (5) Notwithstanding anything contained in sub-rule (4), the State Government may terminate, at any time, the appointment of the President or a member, if, in its opinion, such President or member is unable or unfit to continue to perform the duties of his office: Provided that no appointment shall be terminated under this sub-rule unless the person whose appointment is proposed to be terminated is given a reasonable opportunity of showing cause against such termination. (6) (a) If any vacancy in the membership of the Tribunal occurs by leave or absence, deputation, death, resignation, expiry of the period of appointment, termination of the appointment or for any other cause whatsoever, such vacancy shall be filled by the State Government by a person qualified for appointment under sub-rule (2) of this rule. (b) Till the vacancy in the office of President is filled on regular basis the Registrar shall have the power to appoint the Chairman out of the existing members of the Tribunal.

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(7) The headquarters of the Tribunal shall be at Shimla or at such other place as may be notified by the State Government in the Official Gazette. (8) The powers and functions of the Tribunal may be exercised and discharged by Benches constituted by the President from amongst the members of the Tribunal including himself: Provided that any inter-locutory application may be heard by one or more members who may be present. (9) The Benches of the Tribunal shall consist of two or more members. (10) Where a matter is heard by three members the opinion of the majority shall prevail, and the decision shall be in accordance with the opinion of the majority. Where a matter is heard by an even number of members, and the members are equally divided, if the President be one of the members the opinion of the President shall prevail and in other cases the matter shall be referred to the President, and shall be decided in accordance with his decision. (11) Subject to the previous approval of the State Government, the Tribunal shall frame regulations consistent with the provisions of the Act and rules made thereunder, for regulating its procedure and the disposal of its business. (12) The regulations made under sub-rule (11) shall be published in the Official Gazette. 132-A. Powers of the Co-operative Appellate Tribunal.-The Tribunal shall exercise all the appellate or revisional powers which the State Government exercises under sections 93, 94 and 95 of the Act, except for the matters referred to in clauses (a) to (d) and (i) and (j) of section 93 (1) of the Act: [(Provided that the State Government shall continue to exercise the powers under section 93, 94 and 95 of the Act till the constitution of the Tribunal: Provided further that the appeals which lie to the State Government under the Act, may be heard by the Secretary, (Co-operation) to the State Government if the impugned order has been passed by an officer not below the rank of the Registrar, Co-operative Societies: [Provided further that in case the impugned order or decision has been passed by some other officer subordinate or junior to the Registrar, Co-operative
1 Proviso 1 and 2 added. vide Not. No. Co-op-E (11) 21/74 dated 13-12-1979 published in R.H.P. dated 17-12-1977 p. 1874. 2 Third proviso subs vide Not. No. Co-op (E) 11/21/74-II dated 16-11-81 published in R.H. dated 4-12-1982, p. 1272.
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Societies, but exercising the powers of the Registrar, Co-operative Societies, such appeals may be heard by the Under/Deputy/Joint/Special Secretary (Co-operation) to the State Government, subject to the over all supervision and control of the Secretary (Co-operation) to the State Government]. 132-B. Tribunal to have powers of civil court-(1) In exercising the functions oonferred on it by or under the Act and the rules framed thereunder, the Tribunal shall have the same powers as are vested in a civil court in respect of(a) proof of facts by affidavit : (b) summoning and enforcing the attendance of any person and examining him on oath; (c) compelling discovery of the production of documents; and (d) issuing commissions for the examination of witnesses. (2) In the case of any such affidavit, any officer appointed by the Tribunal in this behalf may administer the oath to the deponent. 132-C. Pay and allowances of the President and other members of the Tribunal.-The President and other members of the Tribunal shall be entitled to receive such pay and allowances as may be specified by the State Government in the orders issued from time to time in this behalf. 133. Procedure of appeal.- (1) Every appeal under section 93 shall be in the form of memorandum, which shall (a) be either type written or written legibly in ink in Hindi or English. (b) specify the name and address of the appellant and also the name and address of the respondent or the opponent, as the case may be; (c) state whether the order complained of was made by the Registrar or by any person other than the Registrar on whom the powers of the Registrar are conferred; (d) clearly state the grounds on which the appeal is made; (e) state precisely the relief which the appellant claims; (f) state the date of the order or decision appealed against. (2) Every appeals shall be accompanied by a copy of the order appealed against, and shall be presented in person by the appellant, or by his duly appointed

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agent, to the appellate authority during office hours, or sent by registered post. 134. Procedure after presentation of appeal.- (1) On receipt of an appeal, the appellate authority shall examine it, and if it is found that it is in order as provided in sub-rule (1) of rule 133, it shall be registered in the appropriate register maintained for this purpose. (2) If the appeal is found to be defective in certain respects, the appellate authority may call upon, within such time not exceeding 15 days in any case, to remedy the formal defects pointed out in the appeal. (3) If the party concerned or his agent fails to remedy the defects within the prescribed time, the appellate authority shall fix a date for preliminary hearing of the appeal of which due notice shall be given to the party concerned (4) On the date fixed under sub-rule (3), the appellate authority shall hear the party or his agent, if present, and pass orders either directing that the appeal be admitted or rejecting the appeal. Where the appeal is rejected, the appellate authority shall record its reasons for doing so. (5) After an appeal is admitted, a notice shall be delivered or sent by registered post to the respondent, or opponent, calling upon him to appear before the appellate authority on the date specified in the notice. The notice shall also declare that if he does not appear before the appellate authority, either in person or through an agent on the date specified in the notice, or on any subsequent date to which the hearing may be adjourned, the appellate authority shall hear and decide the appeal exparte. 135. Procedure at the hearing.- (1) On the date fixed for hearing or on any other date to which the hearing may be adjourned the appellant or his agent, or if permitted by the appellate authority, his pleader, shall ordinarily be heard first in support of his appeal. The respondent or the opponent or his agent or if permitted by the authority, his pleader, shall if necessary be heard next; and in such case the appellant or his agent or his pleader shall be entitled to reply. (2) If, on the date fixed for hearing or on any other day to which the hearing may be adjourned, the appellant does not appear either in person or by his agent or pleader when the appeal is called for hearing, their appellate authority may dismiss the appeal or may decide it on merits, after hearing the respondent or opponent or his agent or pleader, if present. (3) If, on the day fixed for hearing or any other day to which the hearing may be adjourned, the respondent or opponent does not appear either in person or through his agent or pleader if permitted, when the appeal is called for hearing, the appellate authority may decide the same on merits after hearing the appellant or his agent or pleader if he be present.

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(4) If any of the parties was absent at the date of hearing and the appeal was heard and decided ex parte, the party concerned may apply for restoration of appeal and if the party satisfies the appellate authority that it had no notice of the date of hearing or if it was prevented for any sufficient cause from appearing when the appeal was called for hearing, the appellate authority may restore the appeal to its files: Provided that where the other party has appeared in the appeal, such party shall be given notice and an opportunity of being heard before the order for restoration of appeal is made. (5) The appellate authority may on such terms as it thinks fit and at any stage, adjourn the hearing of an appeal. 136. Fresh evidence and witnesses.- (1) No party to an appeal shall be entitled to adduce fresh evidence, whether oral or documentary, before the appellate authority. The appellate authority may accept documents tendered by a party or call for the same if it is of opinion that are necessary for deciding the appeal, provided that the other party shall in that case be entitled to produce rebutting evidence. (2) If the appellate authority is of opinion that any witness should be examined, it may do so, if it is necessary for deciding the appeal. (3) Where fresh evidence has been adduced under sub-rule (1) or a witness has been examined as provided in sub-rule (2) the parties may, if they so desire, address the appellate authority on points arising out of the fresh evidence or the deposition of the witness. 137. Procedure in case of death etc.-(1) If an appellant dies while the appeal is pending and it cannot be proceeded with unless his legal representative is made a party to the appeal, the appellate authority shall adjourn further proceedings to enable his legal representative to appear and apply for being made a party. If the legal representative fails to do so within 90 days from the date on which the appellant dies, the appeal shall abate as regards the deceased and if he be the sole appellant, the appeal shall be dismissed. It shall be proceeded with as regards the remaining appellants. (2) If the respondent or opponent dies while the appeal is pending, and it cannot be proceeded with unless his legal representative is made a party to the appeal, the appellant shall apply to the appellate authority for making the legal representative of such a respondent or opponent a party to the appeal with in 90 days from the date on which the respondent or opponent died. If the appellant fails to do so, the appeal shall abate as regards the

74

deceased. If the deceased be the sole respondent or opponent, the appeal shall be dismissed. In any other case it shall be proceeded with as regards the remaining respondents or opponents. (3) Notwithstanding anything contained in sub-rules (1) and (2) there shall be no abatement by reasons of the death of any party, between the conclusion of the hearing and the pronouncement of the judgment, but the judgment may in such case be pronounced notwithstanding the death, and shall have the same force and effect as if it had been pronounced before the death took place. No legal representative need be made a party in such a case. (4) If a question arises in any appeal as to whether a person, is, or is not, a legal representative of a deceased party, such question may be determined by the appellate authority, in a summary way, after taking evidence, if necessary. 138. Procedure in case of assignment, insolvency etc.- (1) In any case where the business of a party to an appeal before the appellate authority is, during the pendency of it, assigned or devolves wholly or in part to or upon some other person or society, the appeal may, by leave of the appellate authority, be continued by or against such person or society 1[as the case may be]. (2) A person claiming to be a legal representative of a deceased appellant or assignee or receiver of an insolvent may apply within 60 days from the date of abatement or dismissal of the appeal to have the abatement or dismissal set aside, and if it is proved to the satisfaction of the appellate authority that he was prevented by sufficient cause from appearing within time, the abatement or dismissal shall be set aside by the appellate authority and the appeal proceeded with. (3) If a party to an appeal becomes insolvent and its estate becomes vested in the assignee or receiver, the latter may, by leave of the appellate authority, be made a party to the appeal. 139. Pronouncement of judgment and cost of appeal.- (1) When the hearing of the appeal is complete, the appellate authority shall pronounce its judgment forthwith, or shall fix a date for the same. Such date shall be notified on the notice board of the appellate authority. (2) Every judgment of the appellate authority shall be written in either Hindi or English. (3) The appellate authority shall, in its judgment, state at the end, whether the appeal is dismissed, or allowed, wholly, or in part, and mention the relief if any, granted to the appellant.

1 Ins. vide Not. No. Co-op. E. (11) 21/74-III, dated 4-1-1982, published in R.H.P. dated 19-6-82, P. 370-371.

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(4) The costs of the appeal shall be at the discretion of the appellate authority in its final order. The appellate authority shall state who shall be at the cost, and in what proportion, if any. 140. Supply of certified copies.-Certified copies of the judgment shall be supplied on application to the parties concerned on payment of requisite fees as prescribed under rule 151. CHAPTER XIII MISCELLANEOUS 141. Mode of service of summons.- (1) Every summons issued under the Act or these rules shall be in writing, and shall be authenticated by seal, if any, of the officer by whom it is issued and shall be signed by such officer or by any person authorised by him in writing in that behalf. The summons shall require the person summoned to appear before the said officer at a stated time and place, and shall specify whether his attendance is required for the purpose of giving evidence or to produce a document or for both purposes; and any particular document, the production, of which is required, shall be described in the summons with reasonable accuracy. (2) Any person may be summoned to produce a document without being summoned to give evidence; and any person summoned merely to produce a document shall be deemed to have complied with the summons if he causes such document to be produced, instead of attending personally to produce the same. (3) The service of summons under the Act or these rules on any person, may be effected in any of the following ways:(a) by giving or tendering it in person; or (b) if such person is not found, by leaving it at least at his last known place of abode or business or by giving or tendering it to some adult member of his family; or (c) if the address of such person is known to the Registrar or other authorised person, by sending it to him by registered post with acknowledgement due; or (d) if none of the means aforesaid is available by affixing it in some conspicuous part of his last known place of abode or business. (4) Where the serving officer delivers or tenders a copy of the summons to the defendant personally, or to an agent, or other person, on his (defendant's)behalf, he shall require the signature of the person to whom the copy is so delivered or tendered as an acknowledgement of service endorsed on the original summons.

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(5) The serving officer shall, in all cases in which the summons have been served under sub-rule (4), endorse or annex, or cause to be endorsed or annexed on or to the original summons a return stating the time when and the manner in which the summons was served and the name and address of the person, if any, identifying the person served and witnessing the delivery or tender of the summons. (6) Where the person to be summoned is a public officer, or is the servant of a company or a firm or a local authority or an institution or any other person the officer issuing the summons may, if it appears that the summons may be conveniently so served, send it by registered post acknowledgement due for service on the party to be summoned to the head of the office in which he is employed together with a copy of the summons to be retained by person concerned. (7) The summons under sub-rule (3) (a) of the rule may be served through the Tehsildar or an employee of the Co-operative Department, or the Chairman or the Secretary of the society of which the person summoned is a member. [141-A. Manner of service of notice.- The notice under the provisions of section 86 shall indicate the substance of the demand or debt due to the cooperative society and shall be served in the manner laid down for service of summons in sub-rule (3) of rule 141. No. order under section 86 shall be made until a period of thirty days has expired from the date of service of notice.] 142. Registrar and other officers to be public servants.-The Registrar a person exercising the powers of the Registrar, a person entrusted with the supervisory functions of a society by the Registrar, a person authorised to audit the accounts of the society under section 61 or to make inspection under section 65 or section 66, a person to hold inquiry under section 67 or section 69, a person appointed an administrator under section 37, a person to whom the dispute has been referred or transferred for disposal under section 73, a liquidator appointed under section 79, recovery officer and sales officer appointed under Chapter- XI of these rules, process-server appointed under rule 141; returning officer, chairman, manager and registration officer appointed under rule 37 and all the members of the appellate tribunal, if any, shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code, 1860. 143. Certain proceedings under the Act and the rules to be judicial proceedings.- Proceedings of inspection under section 66 and inquiry under sections 67 and 69, proceedings under sections 73,74 79, 94, 95 and execution proceedings under section 87 shall be deemed to be judicial proceedings within
1 Added by Not. No. Co-op-E(ii)21/74, dated 12-11-1975, published in R.H.P. dated 15-11-1975 p. 1510.
1

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the meaning of section 228 of the Indian Penal Code, 1860 144. Recovery or receipt of society's dues by an officer or a member of the society.- (1) Unless otherwise provided in the bye-laws, an officer or a member of the society shall deposit with the society, any cash recovered or received on behalf of the society within a period not exceeding 20 days from the date of such recovery or receipt by him : Provided that for specific reasons the managing committee of the society may relax the above time-limit by a resolution passed in this behalf and approved by the Registrar. (2) Any contravention of sub-rule (1) shall constitute an offence of criminal misappropriation under the Indian Penal Code, 1860. 145. Code of Civil Procedure to operate in certain matters.- Where the Act, or these rules have not laid down any procedure for any matter arising during the course of proceedings under sections 1[xxx] 74, 87, 93, 94 and 95 the procedure laid down under the Code of Civil Procedure, 1908 for such matter shall be applied in the same manner as if the person conducting the proceedings is a civil court. 146. Bye-laws of a society not to contravene the Act and rules.- (1) Where it is found that any provision in the bye-laws of a society is contrary to the Act and the rules, the fact shall be brought to the notice of the society by the Registrar requiring such society to amend the same in accordance with the provisions of section 11, within the time specified. (2) The provisions of the bye-laws referred to in sub-rule (1) shall cease to operate from the date of receipt of the said notice by the society and any action under the said provisions thereafter shall be void. 147. Breach of mandatory provisions to be a culpable negligence punishable under section 109.- Save as provided in the Act and the rules, the wilful breach of any mandatory provisions of the Act and the rules by any society or an officer of the society shall be deemed to be a culpable negligence on the part of such society or the officer as the case may be, and shall be punishable in accordance with sub-section (3) of section 109. 148. Restrictions on legal practitioners.-Except with the permission of the Registrar or the person deciding a dispute under clauses (b) and (c) of subsection (1) of section 73, or the appellate authority, as the case may be, no legal practitioner in his capacity as a legal practitioner, or a person holding a power of

1 Figure "73" deleted in vide Not. No. Co-op-E (II) 21/74, dated 4-1-1982 published in R.H.P. dated 19-6-1982, p. 370-71.

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attorney (except where the legal practitioner or attorney is a near relative to the party or is himself a party to the dispute), shall be permitted to appear on behalf of any party at the hearing. 149. Fees for inspection of public documents filed in the office of the Registrar.- Any member of the public shall be permitted on payment of a fee of 1 [two rupees] for two hours, or fraction thereof, of inspecting, to inspect for any lawful purpose any public document (exclusive of public documents privileged under sections 123, 124 and 131 of the Indian Evidence Act, 1872) filed in the office of the Registrar, and in particular the following documents, namely:1. the registration register, 2. the registration certificate of a society, 3. the registered bye-laws of a society and amendments effected in such bye-laws, 4. an order cancelling the registration of a society, 5. an order directing the liquidation of a registered society, 6. the annual statements of the society, 7. any decision of the Registrar or award of an arbitrator under rule 150. Fees of certified copies of society's documents.- Subject to the provisions of rule 60, a member may get certified copies of the society's documents on payment of the fee to the society as mentioned below:(1) Books of accounts (2) other documents ..2[Re. 0.50] per entry. ..2[Re. 1.00] per hundred words or fraction thereof to a mini mum of Re. 1.

151. Fees for certified copies of public documents.- The fees prescribed for certified copies of any public documents, which any person has under the preceding rule, a right of inspection are as follows:3

For registration certificate [For other documents for

..

Rs. 5.

1 Subs. for "one rupee"vide Not. No. Co-op-E(11)21/74-III,dated 4-1-82,published in R.H.P. dated 19-6-82 p. 370-377. 2. Subs for the figurs "Re. 0.25 and Re. 0.50" vide Not. No. Co-op-E (11)21/74-II, dated 4-1-82 published in R. H. P. dated 19-6-82, p. 370-377. 3 Subs vide ibid.

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first two hundred words for every additional hundred words or fraction thereof Re.1/-]

..

Rs. 2.00

152. Power of the Registrar to issue directives/instructions.-(1) It shall be in the competence of the Registrar to give any directive or issue any instructions for the smooth and beneficial running of any society or class of societies and the directives or instructions so issued shall be binding on the society or class of societies as the case may be. (2) Where any society considers that any directive or instruction issued undersub-rule (1) above is not conducive to its smooth and beneficial running, it may go in appeal to the State Government, against such directive or instruction within 45 days of the receipt of such directive or instruction and the decision of the State Government shall be final in the matter. 153. Language for proceedings under the Act.- Every report made under section 63, 65, 66, 67 and 69 and every award or decision made under section 78 and every judgment made in appeal under section 93, and every order passed under sections 94 and 95 shall be in Hindi, in Devnagari script or in the English language. 154. Repeal and saving.- (1) These rules shall replace the previous rules made under the Himachal Pradesh Co-operative Societies Act, 1956 and the Punjab Co-operative Societies Act, 1961 (as applicable to Himachal Pradesh in accordance with the Punjab Re-organisation Act, 1966). (2) All appointments and orders made, all notifications and notices issued, all transactions entered into, and all suits and proceeding instituted under the previous rules shall be deemed, so far as may be, to have been made, issued, entered or instituted under these rules. APPENDIX `A' (See rule 37) RULES OF ELECTIONS TO THE COMMITTEE 1. Definitions. - In this Appendix, unless the context otherwise requires; (a) "Election" means the election of the committee; (b) "Chairman" means a person appointed by the Registrar to preside over a general meeting held for the purpose of election, and if no such person is appointed, then the President/Chairman and in his absence the Vice-President/Vice-Chairman and in the absence of both, the person elected by the members present to preside over that meeting;

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(c) "Manager" means any person appointed as such by the Registrar for the purpose of the rules contained in this Appendix and if no such person is appointed then the head of office of a co-operative society by whatever name called to whom the management of the office of the society is entrusted; (d) "Returning Officer" means the Registrar, Joint Registrar, Deputy Registrar or Assistant Registrar (by whatever name called), Cooperative Societies and shall include the person authorised by the Registrar in this behalf by a general or special order; and (e) "Registration Officer" means a person appointed by the Registrar under rule 3 of this Appendix. 2. Qualifications of candidates.- No person shall be eligible for election as a member of the committee if he is subject to any disqualification mentioned in rule 41. 3. Preparation of voters' list.- 1[(1) In the case of every Primary Society, the Registration Officer shall intimate every member of the society through authorized person or through registered notice of his being eligible or ineligible to vote as per Rules/bye-laws. The member shall be at liberty to inspect the tentative voter list maintained for the purpose of registration of voters. In addition, notice shall be pasted at conspicuous places such as Head office and Branch office(s) of the society, office of the Registrar, Inspector Co-operative Societies concerned, Panchayat Ghar, Mahila Mandal Ghar or village temple etc. Such notice may be published in two dailies (one Hindi & one English) and such notice/intimation shall be given one month prior to the date fixed for finalization of voter list. (2) In the case of every Secondary/Federal society, the Registration Officer shall intimate all members the last date by which name of persons authorized to vote on behalf of the member societies are to be intimated to the Registration Officer concerned such intimation shall be given one month prior to the date fixed for finalization of voters list. In addition, such notice may be published in two dailies (one Hindi and one English). In case a society does not send the name of its nominee before the said date as indicated above, the said society shall have no right to vote in the election. (3) Following procedure shall be carried out in all kinds of Societies after registration of voters:(a) A list of voters indicating the name of the member society, authorized nominee and other voters shall be published at the office of the
1 Inserted vide vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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society by the Registration Officer and objection thereon shall be heard by him. (b) Three clear days shall be given for hearing objections. The decision of the Registration Officer thereto shall be final. (c) The official list shall thereafter be published at the office of the society not later than one month prior to the date of poll by the Registration Officer.] 4. Election.- (1) The Manager shall draw up a detailed programme of election in accordance with the instructions issued by the Registrar from time to time. (2) The Manager shall, when so required by the Registrar for the purpose of such election, divide the area of operation of the co-operative society into such number of zones, as there are members to be elected, or into such lesser number as may be specified by the Registrar and communicate the zones so constituted to the Registrar for his prior approval. The members residing in the zone concerned shall form the general body for purpose of election of the committee member/members for that zone and one-third of the membership of the zone or 30, whichever is less, shall from the quorum for such general meeting: [Provided that the zones shall be constituted in such a way that members from contiguous areas are included in a particular zone and where such contiguity is not discernible, the zones shall be constituted as per Sr. No. of the members in the membership register.] (3) Notwithstanding anything contained in rule 28, the notice of the general meeting for the election together with the zones constituted, if any, shall be exhibited not less than 10 days before the date fixed for such general meeting at the registered office of the society and at some common place in the area of operation of the co-operative society for intimation of all the members of the cooperative society indicating(a) the number of members to be elected zone-wise, if any; (b) the date, hour and place of holding the general meeting and polling; (c) the last date of making nominations, which shall not be later than seven days before the date fixed for holding the said meeting; (d) the date on which, the place at which, and hours between which the scrutiny of nomination papers shall be made; and
1

1 Proviso to sub-rule (2) inserted vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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(e) the last date for the withdrawal of candidatures. This could be in addition to any other mode of notice which may be laid down in these rules, or the bye-laws of the society, or laid down in a resolution of the committee, or as may be specified by the Registrar by a general or special order. (4) The nomination papers duly completed on the forms prescribed by the Registrar and supplied by the co-operative society to its members on demand shall reach the head office of the society by such date and time as may be specified by the Manager in the programme drawn up in sub-rule (1) of this rule. (5) A candidate shall not be entitled to file this nomination paper for more than one office of the committee. If nomination papers, for more than one office are filed, the nomination paper filed for the first office shall only be considered, and the nomination papers for the other office/offices shall be deemed to be rejected. (6) The person who is to receive the nomination paper under sub-rule (4), shall on receiving the nomination paper, enter thereon the serial number of its receipt and shall endorse thereon the date on which, and the hour at which, the nomination was delivered to him. Nomination papers received after the date and time fixed under clause (b) of sub-rule (3) shall not be valid. The person submitting nomination paper shall be entitled to a receipt in 1[writing] from the person who is to receive nomination papers as an acknowledgement of having it received by the later. (7) After the nomination papers are scrutinised by the Returning Officer, the list of the validly nominated candidates for elction shall be announced, where necessary zone-wise, four days before the general meeting is held.
2

[(8) x x x x].

5. Admission to general meeting.-(1) Admission to the general meeting shall, if so desired by the Returning Officer, be on production of an admission card to be issued by the co-operative society, under postal certificate. The representative of member societies, shall, in addition, produce resolutions of their respective co-operative societies authorising them to represent the co-operative society in the general meeting. (2) If any difficulty arises with regard to the identification of individual members or representatives of the member societies, the manager may call upon
1 Subs. vide Not. No. Co-op-E (II)21/74, dated 4-1-82, published in R. H. P. dated 196-82, p. 370-371. 2 Sub rule (8) deleted vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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one or more officials of the Co-operative Department to assist him. (3) The Manager shall make such arrangements with regard to the admission and seating of members and others invited by the society as he may consider necessary. (4) The general meeting shall be presided over by the Chairman. 6. Voting.-(1) Voting shall be exercised by secret ballot. The Registrar may by general or special order grant exemption from this rule to any co-operative society or any class of co-operative societies. (2) The candidates who secure a majority of votes shall be declared elected by the Returning Officer. If the number of votes in favour of two or more candidates are equal, the Returning Officer shall decide the matter by lot. (3) The Returning Officer shall, immediately after the declaration of the result of the election, communicate the names of persons elected, to the offices of the concerned Assistant Registrar and the Deputy Registrar, Co-operative Societies and the Registrar, Co-operative Societies, Himachal Pradesh, and also to the Chairman of the house. He shall also direct the Manager, to exhibit a list of names of the persons elected at some conspicuous place at the registered office of society for a minimum period of seven days after the date of the close of the general meeting for election. 7. Maintenance of law and order.-If the Returning Officer is of the opinion that there may be some trouble from any quarter to hamper the smooth conduct of elections he may requisition such help as he considers necessary. [8. Exemption. - The Registrar may by general or special order grant exemption from the provisions of the rule 3 and 4 to any co-operative society or any class of co-operative societies.] _________ SCHEDULE FORM A (See rule 4) APPLICATION FOR REGISTRATION OF A SOCIETY (TO BE SUBMITTED IN DUPLICATE) 1. Name of the proposed society with headquarters 2. Address (village, post office, block, tehsil and district 3. Form of liability 4. Area of operation 5. Objects .. .. .. .. ..
1

1 Rule 8 inserted vide Not. No. Co-op.A(3)1/99-Vol-I, published in R.H.P. Extra dated 27-7-2006, p. 2788-2794.

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6. Share Capital(a) Authorised (b) Value of different category of shares .. 7. Number of persons who have agreed to join as members 8. Full name and address of the person authorised to correspond with the Registrar regarding registration of the society and to whom the order of refusal to register, if any shall be communicated by the Registrar under rule 6. 9. The applicants have elected the following persons to the Provisional Committee which is to conduct the affairs of the society for a period of three months from the date of registration of the society or for such further period as the Registrar may permit in writing. (1) (4) (7) (2) (5) (3) (6)

.. ..

..

Under section 7 of the Himachal Pradesh Co-operative Societies Act, 1968, we, the undersigned being persons possessing the qualification propose for election to membership according to the bye-laws, three copies of which are enclosed, request that the society may be registered. We declare that we belong/do not belong to different families as defined in clause (b) of sub-section (2) of section 7.

-----------------------------------------------------------------------------------------------Serial Name Fathers Age Profession Place of No. of shares No. Name residence purchased (1) (2) (3) (4) (5) (6) (7) -------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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Value of shares Value of shares Signature or Attestation of thumb subscribed paid up thumb-impression -impressions, if any (8) (9) (10) (11) -----------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------FORM B (See rule 66) FORM OF DECLARATION I,.......................son of....................age...............residing at...................................having been admitted to the membership of....................... Society, Limited/with Unlimited liability being desirous of borrowing loan from the society/and having borrowed loan from the society before..........................the date of the coming into force of the Himachal Pradesh Co-operative Societies Act, 1968 (Act No. 3 of 1969) make this declaration as required by section.......of the said Act that I own land specified in the Form given below and I hereby create a charge on the said land in favour of the society of the payment of the amount of the loan which the society may make/has made and for all future advances, if any, which the society may make to me subject to the maximum amount of Rs...............together with interest on such amount of the loan and advances. FORM --------------------------------------------------------------------------------------------------Survey No. Name of village Name of tehsil Name of district ------------------Plot No./Khata No. ---------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------Area Assessment Encumbrances, if any, emarks ------------------------------------------if any Big. Bis. Approximate value Nature Amount ---------------------------------------------------------------------------------------------------

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--------------------------------------------------------------------------------------------------In witness whereof, I, Shri...................hereunder set my hand this................day of.........................in the year one thousand nine hundred and.........................signed and delivered by the above named in the presence of : Witness : (1) (2) Applicant's/Borrower's signature, Attested by: Forwarded with compliments to the Halka Patwari with a request to include the particulars of the charge created under delaration in the Record of Rights and to return to the Secretary for its record. Chairman Secretary Society Returned with compliments to the Chairman.................Society Limited/Unlimited. The charge created under the declaration is duly included in the Record of Rights on the...............day of........1, ,and the land charged is free from any previous encumbrance. Patwari. FORM C FORM OF PROXY (Rule 99) The................Co-operative Society (Limited). I,...............of......................in the district of............being a member of the.....................Co-operative Society (Limited) hereby appoint..........................as my proxy to vote for me and on my behalf at the (ordinary or extraordinary) general meeting of the....................Co-operative Society to be held on the.................day of.............................................and at any adjournment thereof. Signed this..............day of............................... Signature.......................(20 paise revenue stamp). WITNESS: Name............................................................ Address.........................................................

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FORM D FORM OF LIQUIDATOR'S NOTICE [Rule 108(2)] In the matter of.............................Co-operative Society...... in the District of...........................under orders of winding up. Notice is hereby given that the above mentioned society has been placed under liquidation in order No................................dated...... 19 , and the undersigned has been appointed as Liquidator of the above society under section.........................of the Himachal Pradesh Co-operative Societies Act, 1968 (Act No. 3 of 1969), all creditors of the above society are hereby required within one month from the date of this notification, to send their names and addresses and the particulars of their claims to the undersigned as the Liquidator of the said society. Dated................................. Signature of Liquidator.

__________________________________________ (R.H.P. Extra., dated the 25th May, 1971, P. 367-420) ______ APPOINTMENTS AND DELEGATIONS Shimla-2, the 22nd September, 1986 No. Co-op. E (11)21/74-III.-In pursuance of the third proviso, incorporated below rule 132-A of the Himachal Pradesh Co-operative Societies Rules, 1971, notified vide this department notification of even number dated 16th November, 1982, all appeals against the orders passed by officers subordinate or junior to the Registrar Co-operative Societies/Additional Registrar Co-operative Societies, Himachal Pradesh, but exercising the powers of the Registrar Cooperative Societies under the said Act, which lie to the State Government under section 93 of the Himachal Pradesh Co-operative Societies Act, 1968 and Review/Revision petitions filed under section 94, shall hence forth be heard and finally disposed off by the Deputy Secretary (Co-operation) to the Government of Himachal Pradesh. This issues in supersession of office order dated 31-7-1984. -------------------------------------------(R.H.P., dated 23-7-1988, P. 623) ________ THE PRIMARY AGRICULTURAL CREDIT SOCIETIES

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SECRETARIES (TERMS OF EMPLOYMENT AND WORKING CONDITIONS) RULES DIRECTORATE OF CO-OPERATION ORDER Shimla-2, the 8th July, 1986 No. 5-65/80-Co-op (CSM)-II.-In exercise of the powers vested in me under rule 56(1) of the Himachal Pradesh Co-operative Societies Rules, 1971, and in supersession of order of even number, dated 29-6-1985, I, Yogesh Khanna, Registrar, Co-operative Societies, Himachal Pradesh, hereby frame Rules relating to the Terms of Employment and Working Conditions of the Secretaries of Primary Agricultural Credit Societies functioning in Himachal Pradesh, as annexed, with immediate effect. 1. These rules may be called the Primary Agricultural Credit Societies Secretaries (Terms of Employment and Working Conditions) Rules. 2. These rules shall come into force from such date as the Registrar, Cooperative Societies, Himachal Pradesh, may specify in this behalf. 3. These rules shall apply to all the Secretaries of the Primary Agricultural Credit Societies in service on the date the rules come into force and who may be taken or appointed by the societies after the said date. 4. Definitions.-In these rules, unless the context otherwise requires,(a) `Registrar' means Registrar, Co-operative Societies, Himachal Pradesh, or any other officer to whom powers of Registrar has been delegated; (b) `Society' means Primary Agricultural Credit Society which term includes multi purpose, service and thrift and credit societies functioning in rural areas; (c) `Year' means co-operative year commencing from 1st July and ending on 30th June every year. (d) `President' means the President of the Society and includes the VicePresident/Acting President; and (e) `Committee' means the Managing Committee of the Society. 5. Pay scales.-(a) The scales of pay of Secretaries shall be as under: -------------------------------------------------------------------------------------------------Class of Society Pay scales ---------------------------------------------------------------------------------------------------`A' Rs. 800-25-1500 `B' Rs. 600-20-1000 `C' Rs. 400-15-700

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`D' Rs 300-10-450 -----------------------------------------------------------------------------------------------These scales will be inclusive of all allowances i.e. the pay drawn in this scale will be the consolidated pay. (b) The classification of Societies as stated above into `A', `B', `C', and `D' shall be on the basis of (i) loaning business which will include Short and Medium Term loans issued during the year, (ii) deposit mobilisation at the end of the year, (iii) distribution of consumer articles and fertilizer activities undertaken during the year, and (iv) recovery performance during the year as given below: CLASSIFICATION OF SOCIETIES ACCORDING TO THE INTEGRATED NORMS Class `A' Societies having (i) Advancement of ST/MT loans to their members to the extent of Rs. 3.00 lakhs and above during the year. (ii) Societies which have mobilised deposits to the tune of above Rs. 1.80 lakhs at the end of the year. (iii) Societies which have undertaken activities of distribution of consumer articles and fertilizer of Rs. 3.00 lakhs and above during the year. (iv) Societies having effected recoveries to the extent of 80% and above of the demand during the year. CLASS `B' (i) Advancement of ST/MT loans to their members between Rs. 2.00 lakhs and Rs. 3.00 lakhs during the year (ii) Societies which have mobilised deposits to the tune of Rs. 1.20 lakh and below Rs. 1.80 lakhs at the end of the year, (iii) Societies which have undertaken activities of distribution of consumer articles and fertilizer above Rs. 2.00 lakhs and below Rs. 3.00 lakhs during the year. (iv) Societies having effected recoveries to the extent of 60% and below 80% of the demand during the year, CLASS `C' (i) Advancement of ST/MT loans to their members between Rs. 1.00 and below Rs. 2.00 lakhs during the year, (ii) Societies which have mobilised deposits between Rs. 0.60 lakh and below Rs. 1.20 lakhs at the end of the year, (iii) Societies which have undertaken activities of distribution of consumer articles and fertiliser above Rs. 1.00 lakh and below Rs. 2.00 lakhs during the year, (iv) Societies having effected recoveries of above 40% and below 60% of the demand during the year. CLASS `D'

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(i) Advancement of ST/MT loans to their members below Rs. 1.00 lakh during the year, (ii) Societies which have mobilised deposits to the extent of Rs. 0.60 lakh and below at the end of the year, (iii) Societies which have undertaken activities of distribution of consumer articles and fertilizer below Rs. 1.00 lakh during the year, (iv) Societies having effected recoveries to the extent of 40% of the demand during the year. A Society for being classified in a particular category will have to satisfy all the four criterias fixed for that class. Classification will be done every year in the month of July on the basis of working of the Society during the last year. (ii) If the implementation of scales of pay prescribed in these Rules effects adversely any Secretary of a Society, exemption can be sought from the Registrar, Co-operative Societies, who will consider the working results of the Society while considering such exemption. (iii) In case the management feels that keeping in view the resource position of the Society, it would not be able to pay the scales mentioned above it may obtain the permission of the Registrar to pay such scales as may be appropriate. (iv) The following classes of Societies shall not give the above scales of pay to the Secretaries employed by them.(a) Societies which are dorment and not undertaking any business; (b) Societies undertaking solely the work of sugar distribution. A Society for being classified in a particular category will have to satisfy all the four criterias fixed for that class. Classification will be done every year in the month of July on the basis of the working of the Society. (c) A Society falling in one of the class indicated in clause (b), if it improves its performance during the time and attains the higher class, the Secretary of the said Society shall be eligible for the scale of pay fixed for that higher class. In case, the Society does not sustain its classification on the basis of its annual performance and falls below the said classification, the Secretary of the said Society shall be eligible for the pay scales of the lower class and his pay shall be fixed at the maximum in that scale. (d) The pay of the Secretary shall be fixed in the scales mentioned above on the basis of its classification with effect from the date to be specified by the Registrar. In case the existing pay of the Secretary is higher than the scale fixed for that class of a Society in which the Society falls, the difference of pay shall be treated as personal pay

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which shall be adjusted in the future increments earned by the Secretary. (e) The Secretary of the society shall furnish security according to the form and standard prescribed by the Registrar from time to time. (f) The untrained Secretary already in the service of a Society will have to undergo the training within two years of the enforcement of these rules. The society will obtain a bond before sponsoring him for training for serving the Society for five years after training. It will be obligatory on the part of the Society to take him back after he has been imparted training. Exemption from bond may be given in exceptional cases by the Registrar, Co-operative Societies. (g) If the Secretary resigns before expiry of the period of his bond, he shall be required to pay to the Society an amount equivalent to his pay for the unexpired period of his bond. 6. The vacancies shall be filled by direct recruitment through calling applications from all the eligible candidates residing in the area of operation of such Society. Notice for calling the applications indicating basic qualifications, age and another qualifications required shall be pasted on the notice board in the office of the Society. 7. The qualifications laid down for the post of Secretary shall be as under:(a) (i) Candidates belonging to the general categories.-At least second divison in Matric/Higher Secondary or equivalent from a recognised University/Board. (ii) Candidates belonging to reserve categories such as Scheduled Castes/Scheduled Tribes/Backward Classes.-At least Matriculate/Higher Secondary with minimum 45% marks, or equivalent from a recognised University/Board. (iii) Training in Co-operation for four or six months at a Co-operative Training Centre will be a desirable qualification. (b) No person shall be eligible for appointment unless, he is above 18 years and below 32 years of age on the date of application provided that there shall be relaxation in age by five years to the candidates belonging to the Scheduled Castes/Scheduled Tribes/Ex-Servicemen/handicapped persons (c) Preference shall be given to the candidates who have undergone Cooperative Training, for four or six months at a Co-operative Training Centre. 8. No person shall be appointed in the service unless he produces from a Government Medical Officer a certificate about his physical and mental fitness.

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9. No person shall be appointed in the service unless his antecedents has been certified to the satisfaction of the Society. 10. An employee on his appointment shall have to furnish a statement of his wealth and that of his dependants and a statement of debt owned by him. 11. The appointment shall initially be on probation for a period of two years. During the probation period he shall be eligible for the basic pay only and he will become eligible for increment only on satisfactory completion of his probation and subject to the provision of Rule 10. His regular appointment shall be considered on completion of the probation period. 12. Selection Committee.The following shall constitute the Selection Committee for the selection of a Secretary:(a) Chairman of the Society. (b) Inspector Co-operative Societies of the circle. (c) One member of the managing committee of the Society. 13. The marks allotted for the interview shall be as under:Qualification : (i) (a) Graduate (b) Post-graduate 2 3 ---5 ---15 15 15 --50 ---

Experience :

(ii) One mark for every one year (iii) Training Co-operation (iv) Interview

14. Increments : Annual increment under the grade shall be deemed to be due w.e.f. first of the month when the Secretary has completed one year provided the Society is in profit which profit shall be on the basis of the annual audit of the society. If any Secretary reaches the maximum of the scales of pay allowed for the class to which he belongs such a Secretary shall be permitted to draw the last drawn increment on a biennial basis provided that the Society is in profit and that the maximum number of increments so drawn shall not exceed three. 15. In case of efficiency bar, the Managing Committee of the Society shall

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allow the employees to cross the efficiency bar in case his/her work and conduct is found good provided the society is in profit. 16. Leave : (a) The authority competent to grant leave to the Secretary of the Society shall be the President of the Society. (b) The leave shall not be claimed as a matter of right. Leave granted may be cancelled and the Secretary may be called to duty if the exigency of service so requires. (c) The Secretary shall be eligible for the following kinds of leave: (i) Casual leave upto 12 days during the year. (ii) Earned leave upto 30 days during the year. Earned leave may be accumulated upto a maximum period of 90 days. Any accumulation in excess of 90 days shall lapse. Earned leave can be availed of at a time upto a period of 30 days. 17. Retirement : The Secretary shall stand retired on attaining the age of 58 years. The date of retirement shall be the last date of the month in which the Secretary completes 58 years of age. 18. Maintenance of Service Registers : Every society shall maintain a service register in the form prescribed by the Registrar for every employee to indicate his date of birth, qualifications, date of appointment, etc. The Secretary shall authenticate the entries in the register and such register of the Secretary shall be authenticated by the President and kept in his custody. Note.-The date of birth of the employees shall be that entered in the school leaving certificate. No other certification, horoscope, etc. will be acceptable. 19. Employees Welfare Fund : The Secretary shall be eligible for retirement assistance at the rates mentioned below:(1) The retirement assistance shall be payable to the Secretary after he has rendered continuous service for not less than five years :

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(a) on his superannuation; or (b) on his retirement; or (c) resignation; or (d) on his death or disablement due to accident : Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment is due to death or disablement : Provided further that in the case of the death of the Secretary retirement assistance payable to him shall be paid to his nominee or, if no nomination has been made, to his legal heirs. Explanation : For the purpose of this rule "disablement" means such disability as incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement. (2) For every completed year of service or part thereof excess of six months, he shall be eligible for the retirement assistance at the rate of one month's pay subject to a maximum of Rs. 10,000. (3) The Society shall maintain an Employees Welfare Fund and each year it shall allocate 10% of its net profit towards this fund. The retirement assistance shall be paid out of this fund subject to the approval of the managing committee and the Registrar. (4) In case the contribution made by the Society in para 3 falls short of the maximum amount due, the contribution shall be restricted to the actual amount in this fund. The society will, however, be at liberty to pay upto the maximum of Rs. 10,000 provided its resources so warrant and the Society is in profit. (5) This fund shall be deposited in the Co-operative Bank to which the society is affiliated and withdrawal from this fund would be in the manner stated in the preceding paragraph. 20. Provident Fund: (1) Subject to the provision of any law for the time being in force on the subject, a Society may establish the Provident Fund for its employees and after this has been carried to the Reserve Fund and Co-operative Education Fund and other funds, if any prescribed in the bye-laws of the Society, the necessary proportion of the net profits in any year Society may make such contribution not exceeding ten per cent of the remaining net profits.

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(2) Such Provident Fund shall not be used in the business of the Society but shall be invested or deposited in the Co-operative Bank to which the Society is affiliated. (3) The amount of contribution that can be made by an employee in any month shall not exceed such sum as may be fixed by the general meeting subject to a maximum of 10 per cent of his monthly salary. (4) The Society may make such contribution every year to the Provident Fund of the employees as may be approved by the general meeting and the Registrar but such contribution shall not exceed the annual contributions made by the employees concerned. (5) The interest accrued on the investment of the Provident Fund of the employees shall be credited in proportion to the balance standing to the credit of each account at the close of the preceding year. 21. Payment of bonus: Subject to the provisions of any law for the time being in force on the subject, a Society may set apart not more than ten per cent of its net profits for the payment of bonus to its salaried employees, if such payment is recommended by the managing committee and approved by the general meeting and the Registrar : Provided that the amount of bonus should not exceed two month's salary in an year. 22. Prohibition of pecuniary transactions: (a) No Secretary shall have pecuniary transactions with individuals or institutions coming in contact with him in the course of his official duties or accept directly or indirectly, either on his own behalf or on behalf of any other person, any gift, gratuity or reward from any person with whom he may have to deal in his official capacity, provided that this clause shall not apply for the borrowings by an employee on the security of his deposits, savings, insurance policies or documents from other institutions and individuals. (b) No Secretary of a co-operative society shall purchase directly or indirectly any property of a member of the society against his dues to the Society sought to be recovered. 23. Suspension: (a) If the Secretary is arrested on any criminal charge the President of the Society may order his suspension from the date of his arrest and for the payment of subsistence allowance to him during the period of suspension. If the Secretary is convicted and sentenced for any offence, his services shall be deemed to have been terminated from the date of conviction and in such cases it will not be necessary to give him any charge sheet. In case he is honourably acquitted he may

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be reinstated in the service of the Society. (b) Subsistence allowances shall be paid equivalent to half of the pay during the period of his suspension upto a maximum of one year after which period the disciplinary authority will review the case and take a decision regarding continuance or otherwise of the subsistence allowance and the rate at which it will be paid. 24. Disciplinary action: (a) The Secretary shall be awarded any one of the following punishments if found guilty on misconduct apart from recovery of actual dues or damages caused by him to the Society :(i) Warning. (ii) Stoppage of increments for a period not exceeding one year without affecting future increments. (iii) Withholding of annual increment with or without cumulative effect. (iv) Termination. (v) Dismissal. (b) The Committee of the Society shall be the disciplinary authority to award punishment indicated above. (c) The term misconduct shall include any of the following acts on the part of Secretary(i) Wilful damage or attempt to cause damage to the property of the Society. (ii) Conviction by any court of law for any criminal offence involving moral turpitude. (iii) Unauthorised disclosure or any attempt to disclose information regarding affairs of the Society or any of members or any person connected with the Society. (iv) Wilful disobedience of any lawful or reasonable order of the management or of the Co-operation Department. (v) Failure to account for or concleament or misappropriation of cash or other property of the Society. (vi) Absence from duty without leave.

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(vii) Knowingly or wrongfully interferring or tempering the records of the Society. (viii) Closing of office/shop of the Society other than permitted holidays without permission of management. (ix) Claiming or preferring any false claim. (x) Taking part or canvassing or otherwise interferring or using his influence in any election to the Central or State Legislature or municipal committees or panchayats or other local bodies or the Society or any institution constituted under Himachal Pradesh State laws. (xi) Engaging in any other trade or occupation. (xii) Negligence in the performance of his duty. N.B.-The above list is only illustrative and not exhaustive. 25. No punishment for misconduct shall be imposed on the Secretary unless he is proved guilty of misconduct in an enquiry conducted in the following manner:(i) The President shall serve to the Secretary a charge sheet in Form "A" clearly stating the misconduct and the circumstances appearing against him and call for his explanation within a period of at least 15 days. (ii) If the Secretary accepts the charge, the Committee shall award suitable punishment to him. In case of denial, the Inspector, Cooperative Societies, shall conduct the enquiry into the charges levelled against the Secretary. (iii) The Secretary shall be allowed to defend by himself and an outsider shall not be allowed to conduct the defence on his behalf. (iv) The Secretary shall be permitted to produce witness in his defence and cross examine any witness on whose evidence the charge rests. (v) The substance of the evidence shall be recorded and read over to the Secretary. (vi) The Inspector shall complete the enquiry and submit his report within two months to the Committee of the Society. The enquiry report shall include the statement of witnesses for and against the

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Secretary and the findings of the enquiry officer based on such evidence on each charge. (vii) On receipt of the enquiry report, the Committee of the Society shall examine the finding and pass necessary orders. (viii) The order of punishment shall be in writing and shall be issued under the signatures of the President of the Society or any other member of the Committee duly authorised and handed over to the Secretary. 26. Appeal: Except in the case of awarding punishment of warnring, an appeal shall be against every order awarding punishment to the Secretary to the Assistant Registrar, Co-operative Societies incharge whose decision shall be final. Every appeal shall be presented to the appellate authority within thirty days of the date on which the order appealed against was communicated to him. 27. The Secretary shall not cantest or convass for any election to Central or State Legislatures or Municipal Corporation/Municipal Board, Panchayat, Cooperative Society or other elected bodies constituted under the Himachal Pradesh State laws. 28. Prohibition of personal contracts etc.- No Secretary of a Cooperative Society shall have any interest directly or indirectly, other than as an employee in(a) any contract made with the society; or (b) any property sold or purchased or leased by, or to the Society; or (c) any other transaction of the Society except as an investment made or as a loan taken from the Society or the provision of residential accommodation by the Society to any paid employee of the Society. 29. Interpretation of these rules as given by the Registrar, Co-operative Societies shall be final. 30. The Registrar may by an order in writing(a) exempt any society or class of societies from the application of any of the provisions of these rules; and (b) direct that any such provisions shall apply to such society to such extent as may be specified in the order.

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----FORM A [See rule 25 (i)] To ....................................... ....................................... It has come to my notice that you have committed the acts as mentioned in the Annexure which amount to misconduct and they are punishable under rule 24 of the rules relating to the terms of employment and working conditions of the Secretaries of Primary Agriculture Credit Societies. If the charges are not acceptable to you, please submit your explanation in writing so as to reach within a week from the receipt of this notice. Please also note that in the event of your disputing the charges an enquiry will be held by the Inspector Co-operative Societies....................... Block..........................................into the charges. You are advised to remain at the said enquiry and also furnish the names of your witnesses and produce the documents upon which you rely upon in your defence. If you desire to inspect any papers connected with the basis of the charges, you can do so during working hours on any working day making a request in writing. Please note that if you do not remain present at the enquiry on the date and time intimated to you the enquiry will be proceeded ex parte. Date......................... President of the society. -----------------------------------------------------(R.H.P. Extra, date 8-9-1986. p, 1447-1456.) _________ THE PRIMARY AGRICULTURAL CO-OPERATIVE CREDIT SOCIETIES EMPLOYEES (TERMS OF EMPLOYMENT AND WORKING CONDITIONS) RULES DIRECTORATE OF CO-OPERATION, HIMACHAL PRADESH ORDER

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Shimla-171009, the 24th August, 1996 No. 5-65/80-Co-op.(C&M.).- In supersession to all the previous orders on, the subject the annexed rules relating to the terms of employment and working conditions of the employees of the Primary Agricultural Credit Co-operative Societies functioning in Himachal Pradesh are hereby approved under Rule 56 (i) of the Himachal Pradesh Co-operative Societies Rules, 1971. The application of these Rules shall attract no financial or other liability to the State Government in any shape. (The Hindi version of these Rules is also enclosed). RULES RELATING TO THE TERMS OF EMPLOYMENT AND WORKING CONDITIONS OF THE EMPLOYEES OF PRIMARY AGRICULTURAL CO-OPERATIVE CREDIT SOCIETIES 1. These rules may be called the Primary Agricultural Co-operative Credit Societies Employees (terms of employment and working conditions) Rules. 2. These rules shall come into force from such date as the Registrar, Cooperative Societies, Himachal Pradesh may specify in this behalf. 3. These rules shall apply to all the employees of the Primary Agricultural Co-operative Credit Societies in service on the date the rules came into force and who may be taken or appointed by the societies after the said date. 4. Definitions: (a) In these rules unless the context otherwise requires Registrar means Registrar Co-operative Societies, Himachal Pradesh or any other officer to whom powers of Registrar have been delegated. (b) Society means Primary Agricultural Co-operative Credit Society which term includes Multipurpose service, and thrift credit societies functioning in rural areas. (c) Year means co-operative year commencing from 1st April and ending on 31st March, every year. (d) President means the President of the society and includes the Vice-President/Acting President. (e) Committee means the Managing Committee of the Society. 5. Pay Scale:

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(a) The scales of pay inclusive of all allowance and incentives i.e. pay drawn in these scales shall be consolidated as under:Class of Pay scales of Asstt. Secretary/ Peon/Chowkidar society Manager/Secretary Acctt./Clerks/ Salesmen/Cashier A. 1800-75-2100-100- 1350-50-1500-60- 600-25-900 2800-125-33001800-75-2100150-3500 100-2800 B. 1350-50-1500-60- 1150-40-1350-50- 500-20-800 1800-75-2100-100- 1500-60-1800-752800 2100 C. 1150-40-1350-50- 1000-30-1150-401500-60-400-151350-50-1500-60700-1800-75-2100 1800. D. 1000-30-1150-40- 900-20-1000-30- 300-10-450 1350-50-1560-70- 1150-40-1350-501800. 1500 (b) The classification of societies as stated above into ABCD shall be based on working capital of the societies as on 31st March of each year excluding (1) Building, (2) Machinery, (3) Provident fund of employees, (4) Losses. Subject to (i) Loaning business which will include short and medium term loans issued during the year (ii) deposit mobilization at the end of the year. (iii) distribution of consumer articles and fertilizer activities undertaken during the year and (iv) recovery performance during the year as given below:CLASS: CLASSIFICATION ACCORDING TO NORMS OF SOCIETIES THE INTEGRATED

During the year the society having: (Rs. In lacs) Working capital as per column (b) Advancement of ST/MT above Loans to the members Rs. 50.00 and above 5.00 & above Rs. 25.00 to Rs. 50.00 Rs. 10.00 to Rs. 25.00 3.00 to 5.00 2.00 to 3.00

Class of Society A. B. C.

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D.

Below Rs. 10.00

Below Rs. 2.00

Class of Society A. B. C. D.

Mobilisation of deposits 3.00 & above 2.00 to 3.00 1.00 to 2.00 Below Rs. 1.00

Distribution of consumer articles and fertilizer 5.00 & above 3.00 to 5.00 2.00 to 3.00 Below Rs. 2.00

Recoveries to demand 80% 60% to 80% 40% to 60% Upto 40%

(c) The Secretaries of A & B class shall be called Manager GradeA/Grade-B. (d) No. of posts in different categories shall be determined by the management of the society keeping in view the profitability and resource position of the society fails to sustain its classification on the basis of annual performance and falls below the said classification resulting in continuous losses to it, then the Managing Committee of the society can take decision for the retrenchment of its employee(s) keeping in view the prevalent position of the society. (e) The Management of the society shall be eligible to release the pay scales as under:(i) These pay scales shall be applicable to all employees of societies with the prior approval of the Registrar Cooperative Societies in case Government participation in the shape of share capital contribution is above 50% of the total paid up share capital of the society. (ii) The society in which Government share participation of their total paid up share capital is up to 50% such societies can introduce these pay scales to its employees without seeking any prior approval from the Registrar. (iii) The societies having no Government participation in the shape of share capital contribution in their paid up share capital are free to opt these for the pay scales or frame their own pay scales keeping in view their financial position.

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(f)

(i) A society for being classified in a particular category will have to satisfy all the above criterion fixed for that class. Classification will be done every year in the month of April on the basis of working of the society during the last year. (ii) If the implementation of scales of pay prescribed in these Rules effects adversely any employee of a society exemption can be sought from Registrar Co-operative Societies, who will consider the working results of the society while considering such exemption. (iii) The following classes of societies shall not give the above scales of pay to the employees employed by them: (a) Societies which are dormant and not undertaking any business. (b) Societies undertaking solely the work of sugar distribution. A society for being classified in a particular category will have to satisfy all the above criterion fixed for that class. (c) A society falling in one of the class indicated in clause 5 (b) if it improves its performance during the time and attains the higher class, the employee of the said society shall be eligible for the scale of pay fixed for that higher class.

In case the society does not sustain its classification on the basis of its annual performance and falls below the said classification, the employee of the said society shall be eligible for the pay scales of the lower class and his pay shall be fixed at the maximum in that scale. (d) The pay of the employees shall be fixed in the scale mentioned above on the basis of classification. In case the existing pay of the employee is higher than the scale fixed for that class of a society in which the society falls, the difference of pays shall be treated as personal pay which shall be adjusted in the future increment earned by the employee. (e) The employees of society shall be required to furnish the security as given below: of Cash Indemnity bond or to Classification of Category society employees Security pledge land of the same value A. Manager 25000/- Indemnity bond of 1.00 lac or to pledge land of the same value in favour

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B. C. D. A.

B. C. D.

-doSecretary -doAsstt. Secy/ Acctt./Clerk/ Cashier/Salesman -do-do-do-

15000/10000/5000/*15000/-

of the society. -do-do-do-do-

*10000/5000/*5000/-

-do-do-do-

In case any candidate is unable to deposit cash security as detailed above he can provide Bank guarantee/guarantee of some Government Servant (who may be capable of standing such guarantee) of the same amount in lieu of the each security. 6. The vacancies in the categories of Manager/Secretary and Asstt. Secretary/Acctt./Clerk/Salesmen/Cashier shall be filled up by promotion of employees from the immediately next lower categories. In case a suitable candidate as per required standard of educational qualification is not available for promotion, the management may decide to fill up the vacancies of these posts from open market. 7.(a) The qualification laid down for the posts shall be as under:Class of employees Educational qualification For reserve categories for General Categories i.e. SC/ST/OBC/HC/ExServicemen 2 3 1 (i) Manager/Secretary (a) At least 2nd division (a) At least in Matriculation Matriculation/high with minimum er secondary or 40% equivalent form a marks/higher recognized secondary or University/Board. equivalent from (b) A training in coa recognized operation for at University/Boa least 4 months at a rd. co-operative (b) A training in training centre. co-operation for at least 4 months at a cooperative training centre. (ii) Asstt. Secretary/ (a) At least (a) At least

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Acctt./Clerks/Salesmen/ Cashier.

(iii) Peon/Chowkidar

matriculation with minimum 40% marks or equivalent from a recognized University/Boar d. (b) Preference shall be given to the candidates who have undergone Co-operative Training for 4 to 6 months at a Co-operative Training Centre. (a) At least Middle Pass.

matriculation or equivalent from a recognized University/Boar d. (b) Preference shall be given to the candidate who have undergone Co-operative Training for 4 to 6 months at a Co-operative Training Centre.

At least Middle pass.

(b)

No person shall be eligible for appointment unless he is above 18 years and below 35 years of age on the date of application. Provided further that there shall be relaxation in age by 5 years to the candidates belonging to the SC/ST/OBC/HC/Ex-Servicemen.

8. No person shall be appointed in the service unless he produces from a Government Medical Officer a certificate about his physical and mental fitness. 9. No person shall be appointed in the service unless his antecedents have been certified to the satisfaction of the society. 10. An employee on his appointment shall have to furnish a statement of his wealth and that of his dependents and a statement of debt owned by him. 11. The appointment shall initially be on probation for a period of two years. During probation period he shall be eligible for the basic pay only and he will become eligible for increments only on satisfactory completion of the probation and subject to the provisions of rule 10. His regular appointment shall be considered on completion of the probation period. 12. Selection committee: The following shall constitute the selection committee for the selection of employees:(a) Chairman of the Society.

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(b) (c)

Inspector Co-operative Societies of the Circle. One member of the Managing Committee of the Society.

13. The marks allotted for interview shall be as under:Manager/ Secretary Asstt./Secretary/ Peon/Chowkidar Acctt./Clerks/ Salesmen/Cashie r 5 5 in case matriculate or above 10 10

Qualification(i) (a) Graduate 2 (b) Post Graduate or above 3 Experience.(ii) One mark for every one year of service. (iii) Training in Cooperation (iv) Interview

15

-15 35

10 10 35

-20 3

14.

Increments:

Annual increments under the grades shall be deemed to be due w.e.f. first of the month when the employee has completed one year of continuous service provided the society is in profit shall be on the basis of the annual audit of the society. 15. If any employee reaches the maximum of the scale if any allowed for the class to which he belongs to such an employee shall be permitted to draw the last increment on a biennial basis provided that the society is in profit and that the maximum number of increments so drawn shall not exceed three. 16. Leave: (a) The authority competent to grant leave to the employees of the society shall be the president of the society. (b) The leave shall not be claimed as a matter of right, leave granted may be cancelled and the employees may be called to duty if the exigency of services so required. (c) The employees shall be eligible for the following kinds of leave:(i) (ii) Casual leave upto 12 days during the year. Earned leave upto 30 days during the year. Earned leave may be accumulated upto maximum period of 90 days. Any

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accumulation in excess of 90 days shall lapse. Earned leave can be availed of a at a time upto a period of 30 days. (d) Leave Encashment.- The employees shall be entitled to encash the period due earned leave upto 15 days only once in a year beyond 75 days at credit on discretion in writing within two months after the close of each calendar year which shall be payable @ half month pay only drawn in the last month of the year.

17. Retirement. The employees shall stand retired on attaining the age of 58 years. The date of retirement shall be the last date of the month in which the employees complete 58 years of age. 18. Maintenance of service Register: Every society shall maintain a service register in the form prescribed by the Registrar for the employees to indicate his date of birth, qualifications, experience and date of appointment etc. The Secretary shall make entries in the Register and such entries of the employee shall be authenticated by the president and be kept in his custody. Note.- The date of birth of the employees shall be that entered in the school leaving certificate. No other certification or Horoscope etc., will be acceptable. 19. Employees Welfare Fund: The employees shall be eligible for retirement assistance at the rates mentioned below:(a) On his superannuation, or (b) On his retirement, or (c) Resignation, or (d) On his death or disablement due to accident or retrenchment: Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment is due to death or disablement. Provided further that in the case of death of the employee retirement assistance payable to him shall be paid to his nominee or if the nomination has been made to his legal heirs. Explanation.- For the purpose of this rule disablement means such disability as in-capacitates an employee for the work which he was capable of performing

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before the accident or disease resulting in such disablement. 2. For every completed year of service or part thereof excess of six month he shall be eligible for the retirement assistance at the rate of 15 days pay for every completed year of service based on average of pay drawn in the last 10 months provided the society has made provision for the purpose by creating a specific fund out of its annual profits. 3. The society shall maintain an employees welfare fund and each year it shall allocate 10% of its net profit towards this fund. The retirement assistance shall be paid out of this fund subject to the approval of the managing committee and the Registrar. 4. In case the contribution made by the society in para 3 falls short of the maximum amount due, the contribution shall be restricted to the actual amount in this fund. The society will however, be at liberty to pay upto maximum of Rs. 30,000/- provided its resources so warrant and the society is in profits. 5. This fund shall be deposited in the co-operative bank to which the society is affiliated and withdrawal from this fund would be in the manner stated in the preceding paragraph. 20. Provident Fund: 1. Subject to the provisions of any law for the time being in force on the subject, a society may establish provident fund for its employees and after there has been carried to the reserve and co-operative education fund and other funds, if any prescribed in the bye-laws of the society, the necessary preposition of profits in any year may make such contribution not exceeding ten per cent of the remaining net profits. 2. Such provident fund shall not be used in the business of the society but shall be invested or deposited in the co-operative bank to which the society is affiliated. 3. The amount of contribution that can be made by an employee in any month shall not exceed such sum as may be fixed by the general meeting subject to a maximum of 10% of his monthly salary. 4. The society may make such contribution every year to the provident fund of the employees as may be approved by the general meeting and the Registrar but such contribution shall not exceed the annual contribution made by the employee concerned. 5. The interest accrued on the investment of the provident fund of the employee shall be credited to the account of an individual employee concerned in proportion to the balance standing to the credit of each account at the close of the preceding year.

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21. Payment of bonus: Subject to the provisions of any law for the time being in force on the subject, a society may set apart not more than 10% of its net profits for the payment of bonus to its salaried employees, if such payment is recommended by the Managing Committee and approved by the General Meeting and the Registrar: Provided that the amount of bonus should not exceed two months salary in a year. 22. (a) Prohibition of pecuniary transaction: No employee shall have pecuniary transactions with individuals or institutions coming in contract with him in the course of his official duties or accept directly or indirectly, either on his own behalf or on behalf of any other person, any gift, gratuity or reward from a person with whom he may have to deal in his official capacity, provided that this clause shall not apply for the borrowings by an employee on the security of his deposits, savings, insurance policies or documents from other institutions and individuals. No employee of a co-operative society shall purchase directly or indirectly any property of a member of a society against his dues to the society which are sought to be recovered. Suspension: If the employee is arrested on any criminal charges, the President of the society may order his suspension from the date of his arrest and for the payment of subsistence allowance to him during the period of suspension. If the employee is convicted and sentenced for any of the offence his services shall be deemed to have been terminated from the date of conviction and in such cases it will not be necessary to give him any charge sheet. In case he is honourably acquitted he may be reinstated in the service of the society.

(b)

23. (a)

Subsistence allowance shall be paid equivalent to half of the pay during the period of his suspension upto a maximum of one year after which period the disciplinary authority will review the case and take a decision regarding continuance or otherwise of the subsistence allowance and the rate at which it will be paid. 24. Disciplinary Action: (a) The employee shall be awarded any one of the following punishments if found guilty of misconduct, apart from recovery of actual dues or damages caused by him to the society.

(b)

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(i) Warning. (ii) Stoppage of increment for a period not exceeding one year without affecting future increment. (iii) Withholding annual increment with/without cumulative effect. (iv) Termination. (v) Dismissal. (b) The committee of the society shall be the disciplinary authority to award punishment indicated above. The term misconduct shall include any of the following acts on the part of the employee. (i) (ii) Wilful damage or attempt to cause damage to the property of the society. Conviction by any court of law for any criminal offence involving moral turpitude.

(c)

(iii) Un-authorised or any attempt of disclosure of information regarding affairs of the society or any of its member or any person connected with the society. (iv) (v) (vi) Wilful disobedience of any lawful or reasonable order of the management or of the co-operative department. Failure to account for a concealment or misappropriation of cash or other property of the society. Absence from duty without leave.

(vii) Knowingly or wrongfully interfering or tempering with the record of the society. (viii) Closing of office/shop of the society on other than permitted holidays without permission of management. (ix) (x) Claiming or preferring any false claim. Taking part or canvassing or otherwise interfering or using his influence in any election to the Central or State legislature or Municipal Committees or Panchayats or other local bodies or the society or any Institution constituted under Himachal Pradesh State Laws. Engaging in any other trade or occupation.

(xi)

(xii) Negligence in the performance of his duty. 25. No punishment for misconduct shall be imposed on the employee unless he is found guilty of misconduct in an enquiry conducted in the following manner:-

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(i)

President shall serve to the employees a charge sheet in Form A clearly stating the misconduct and the circumstances appearing against him and call for his explanation within a period of atleast 15 days. If the employee accepts the charges the committee shall award suitable punishment to him. In case of denial the Inspector, Cooperative Societies shall conduct the enquiry into the charges leveled against the employee.

(ii)

(iii) The employee shall be allowed to defend by himself and an outsider shall not be allowed to conduct the defence on his behalf. (iv) The employee shall be permitted to produce witness in his defence and cross examine any witness on whose evidence the charge rests. The substance of the evidence shall be recorded and read over to the employee. The Inspector shall complete the enquiry and submit his report within two months to the committee of the society. The enquiry report shall include the statement (s) of witness(es) for and against the employee and the findings of the enquiry officer based on such evidence on each charge.

(v)

(vi)

(vii) On receipt of the enquiry report the committee of the society shall examine the findings and pass necessary orders. (viii) The order of punishment shall be in writing and shall be issued under the signatures of the president of the society or any other member of the committee duly authorized and handed over to the employee. 26. Appeal: Except in the case of awarding punishment of warning an appeal shall lie against every order awarding punishment to the employee to the Assistant Registrar Co-operative Societies incharge whose decision shall be final. Every appeal shall be presented to the appellate authority within thirty days of the date on which order appealed against was communicated to him. 27. The employees shall not contest or canvass for any election to Central or State Legislatives or Municipal Corporation, Municipal Board, Panchayat/Co-operative Society or other elected bodies constituted under the Himachal Pradesh State Laws.

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28. No employee of a Co-operative Society shall have any interest directly or indirectly, other than as an employee in:(a) Any contract made with the society; or (b) Any property sold or purchased or leased by or to the society; or (c) Any other transaction of the society except as an investment made or as a loan taken from the society the provision of residential accommodation by the society to any paid employees of the society. 29. Interpretation of these rules as given by the Registrar Cooperative societies shall be final. 30. The Registrar may by an order in writing (a) Exempt any society or class of societies form the application of any of the provisions of these rules; and (b) Direct that any such provisions shall apply to such society to such an extent as may be specified in the order. ---------------FORM-A [Rules 25 (i)] . . .. It has come to my notice that you have committed the acts as mentioned in the Annexure which amount to misconducts and they are punishable under Rule 24 of the Rules relating to the terms of employment and working conditions of the employees of Primary Agriculture Co-operative Credit Societies. If the charges are not acceptable to you, please submit your explanation in writing so as to reach within a week from the receipt of this notice, please also note that in the event of your disputing the charges the enquiry will be held by the Inspector, Co-operative Societies Block into the charges. You are advised to remain present at the said enquiry and also furnish the names of your witnesses and produce the documents upon which you rely upon in your defence. If you desire to inspect any papers connected with the basis of the charges, you can do so during working hours on any working day by making a request in writing.

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Please note that if you do not remain present at the enquiry on the date and time intimated to you the enquiry will be proceeded ex-parte. Date . President of the Society -------------------------------------(R.H.P. Dated 28-9-1996, p. 1432-1438). __________

THE RULES FOR THE GRANT OF SUBSIDIES/GRANT-IN-AID TO CO-OPERATIVE SOCIETIES CO-OPERATIVE DEPARTMENT NOTIFICATION Shimla-2, the 6th June, 1990 No. Co-op. B(12)3/88.- The Governor, Himachal Pradesh, is pleased to make the following rules for regulating payment of grant-in-aid to the Cooperative Department, Himachal Pradesh, namely:1. Short title.- (a) These rules may be called Rules for the Grant of Subsidies/Grant-in-aid to Co-operative Societies. (b) These rules shall come into force from the date of notification in the Official Gazette. 2. Purpose for which Subsides/Grant-in-aid may be granted.Subsidies/Grant-in-aid may be granted for all or any of the following purposes to Co-operative Societies in Himachal Pradesh by the Registrar, Co-operative Societies, with the approval of the State Government. The Registrar, Co-operative Societies, Himachal Pradesh may also grant subsidies/grant-in-aid to the Cooperative institutions functioning outside Himachal Pradesh:(i) For staff, technical or otherwise, employed or to be employed, (ii) For purpose of tools, appliances, equipment, furniture, fixture and machinery, (iii) For purchase of new material required for any undertaking, (iv) For construction or renovation/repairs of office building working sheds, sales shops, milk collection booths, godowns, Sehkari Bhawans,

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(v) For working capital requirements, (vii) For setting up processing units, (vi) for purpose of transport vehicles, (viii) For Co-operative Training and Education Programmes, Seminars and other propoganda and publicity programmes. (ix) For strengthening of Agricultural Credit Stabilisation fund, Agriculture Credit Relief Fund and Price Fluctuation Fund. (x) For any other purpose as approved in the plan document or by the State Government. 3. Conditions of subsidies/Grant-in-aid.- The subsidy/grant-in-aid shall be sanctioned to a society subject to the following conditions:(i) The subsidy/grant-in-aid shall be spent for the purpose for which it has been given. (ii) The subsidy/grant-in-aid shall be utilised within one year from the date of its drawal from the treasury. The subsidy/grant-in-aid given for the purpose as mentioned in Rule 2(iv), (vi), (vii) shall be utilised within a period of two years from the date of its drawal. The period of utilisation of subsidy/grant-in-aid may be extended by the Registrar, Co-operative Societies, on the request of a society through the Assistant Registrar, Co-operative Societies, from time to time so that the aggregate period does not exceed three years. (iii) The accounts of subsidy/grant-in-aid shall be open for inspection or audit by the Registrar, Co-operative Societies or the person authorised by him or the officers of Accountant General (Audit), Himachal Pradesh. (iv) The amount of subsidy/grant-in-aid likely to be drawn from Government Treasury shall be debitable to any of the Major Heads (a) "2216-Housing",(b) "2403-P oil", (c) "2404-Dairies", (d) "2405Fisheries", (e) "2408- Food Storage and Warehousing", (f) "2425-Cooperation", and (g) "2851-Village and Small Industries"as the case may be. 4. Procedure to be followed by the Drawing and Disbursing Officer.On the drawal of subsidy/grant-in-aid from the Treasury by the Drawing and Disbursing officer he shall deposit the subsidy/grant-in-aid in the Co-operative Banks in the Savings Bank Account of the society concerned duly pledged to him and release the same after his satisfaction of its utilisation or the same in instalments on the progress of work if the subsidy/grant-in-aid has been given for

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the construction of godown/work shed/building. But in no case the subsidy/grantin-aid should remain unrealised or refunded beyond the period fixed for its utilisation. Any un-spent balance of subsidy/grant-in-aid shall be refunded to the State Government after the utilisation period is over: Provided that managerial subsidy granted to the Co-operative societies shall be released after ensuring expenditure of equal amount from their own resources and in these cases no utilisation certificate needs to be furnished by the guarantee(s). 5. Application for the grant of subsidy/grant-in-aid.-Application for the grant of subsidy/grant-in-aid shall be submitted in the proforma at Annexure `A'or on the proforma as may be revised from time to time by the Registrar, Cooperative Societies. 6. Agreement.- The recipient society through its Chairman and Secretary shall execute on agreement in the form Annexure `B' on receipt of the subsidy/grant-in-aid, the terms of the agreement shall become binding on the society. 7. Submission of utilisation Certificate.-The Drawing and Disbursing Officer shall submit the utilization certificate within a period of three months after the period of utilisation is over on the proforma at Annexure `C' in duplicate to the Registrar, Co-operative Societies. 8. Accounts and Records.- (a) Every society to which subsidy/grant-inaid is sanctioned shall maintain the accounts and records of subsidy/grant-in-aid separately. They shall be open to inspection/audit at all times by the officers/officials of Co-operative Department as well as officers of Accountant General (Audit), Himachal Pradesh. (b) The Drawing and Disbursing Officer shall maintain register in his office for the assets acquired by the society out of the subsidy/grant-in aid on the proforma at Annexure `D'. 9. Inspection Audit.- (a) The Sub-Inspector Co-operative Societies during the course of his visit to a recipient society shall invariably check the utilisation of subsidy/grant-in-aid sanctioned to it. Similarly the Inspector, Cooperative Societies on his Inspection of the Society shall specifically examine the accounts of subsidy/grant-in-aid maintained by the society. Both these officials shall send special report to the Registrar, Co-operative Societies, through Assistant Registrar, Co-operative Societies, in case there is any misutilisation/nonutilisation of subsidy/grant in-aid within a period of one month from the date of visit/inspection. (b) The Inspector (Audit) Co-operative Societies shall audit the accounts

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of subsidy/grant-in-aid maintained by the Society during the course of Annual Audit of the Society and shall attach his report on the proforma prescribed within the audit report. 10. Disposal of assets acquired out of subsidy/grant-in-aid.- The society shall not dispose off any assets acquired wholly or partially out of subsidy/grant-in-aid given to it without prior approval of its general house and Registrar, Co-operative Societies, Himachal Pradesh. 11. Revocation of subsidy/grant-in-aid.- If the recipient society fails to comply with any of the conditions attached to the sanction of subsidy/grant-in-aid or commits any breach of any terms or conditions of the agreement of it on inspection of accounts of the society or audit report of such society, the Registrar, Co-operative Societies, is of the opinion that the subsidy/grant-in-aid should be withdrawn, the Registrar, Co-operative Societies, may after considering any representation which the society may make within such time as may be allowed in this behalf, make an order directing the society to refund the full value or unutilised part of subsidy/grant-in-aid given to it alongwith upto date interest accrued on this unspent amount. 12. It shall be open to the Registrar, Co-operative Societies, to issue such instructions as he may deem suitable and expedient to ensure proper maintenance of accounts, records, utilisation etc. of the subsidy/grand-in-aid. ANNEXURE `A' APPLICATION FORM FOR AVAILING SUBSIDY/GRANT-INAID BY THE CO-OPERATIVE SOCIETIES 1. (a) Name and address of the Societies with Village/Tehsil/Distt. (b) No. and date of registration of society; (c) Whether the society is viable/potentially viable. 2. (i) Membership and paid-up share capital as on 30-6 (a) Co-op. (Rs.in lacs) Society (b) Individuals: (i) Tribals (ii) Scheduled Caste Share No. Capital

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(iii) Othere (c) State Government (d) others Total (ii) Reserve and other funds as on 30.6 (Rs. in lacs) 3. Net profit or net loss of the society for the last three years: Years Profit Loss 19 19 19 4. Cumulative loss, if any as on 30.6 (Rs. in lacs). 5. Business operations (Rs. in lacs) (Sales turnover only): --------------------------------------------------------------------------------------------------Marketing Achievement Anticipated for Programme for next of last two current year year years ------------------ --------------------------------------19 19 19 ------------------------------------------------------------------------------------------------(i) Distribution of Agil. inputs (ii) Consumer articles (iii) Loan issued: (a) S.T. (b) M.T. (c) Long term (iv) Other, if any (specify)....................... -------------------------------------------

Total..

as subsidy to the society for enabling the society to carry on its activities

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in a smooth and efficient manner. The Chairman and Secretary/Manager of the Society is, hereby, authorised to sign all the documents in this behalf and also to release and receive the assistance when sanctioned in favour of the society. The Secretary/Manager is authorised to sign the application form in this behalf. Certified that the above copy is true copy of such entry and the proceedings book containing the entry is still in the custody of the society. Dated, the................................. Secretary or President. (Name of the Society). ANNEXURE B AGREEMENT This agreement entered into this...................................... day of ................between the........................................(Registered full name and address of the society) hereinafter alled the society, this expression unless repugnant to the context includes its successors and assignees, through its Chairman or President and Secretary or Manager by whatever name called on one part and the Registrar, Co-operative Societies, Himachal Pradesh through Assistant Registrar, Co-operative Societies in whose jurisdiction the society falls, on the other part. Whereas the society has requested the Registrar, Co-operative Societies, Himachal Pradesh (hereinafter called Registrar) for subsidy/grant-in-aid for the purpose of..............................................................amounting to Rs...................................................... And whereas the Registrar has sanctioned subsidy/grant-in-aid amounting to Rs.....................................for the said purpose on terms and conditions as appearing in the sanction letter and in the Rules for the grant of subsidy/grant-in-aid to co-operative societies. In consideration of the above, the society agrees to abide by the conditions stated below:1. The society shall utilise the subsidy/grant-in-aid for the purpose for which it has been sanctioned. 2. The society shall unless for special reasons beyond their control utilise the subsidy/grant-in-aid within a period of...................year (s) from the date of it has been drawn from the Treasury. 3. The society shall submit the certificate of utilisation of subsidy/grant-

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in-aid within a period of one month after the period of utilization is over to the Assistant Registrar, Co-operative Societies. 4. The society shall keep separate account for the amount of subsidy/grant-in-aid and the account shall be open for supervision/Inspection/Audit by the staff of Co-operative Department and the officer of A.G., Himachal Pradesh. 5. The Registrar, Co-operative Societies shall have the powers to recover the amount of subsidy/grant-in-aid from the society in case of breach of any or all of the conditions mentioned above. For and on behalf of the society. Chairman Secretary Witnessed by: 1. 2. ANNEXURE C FORM OF UTILISATION CERTIFICATE Letter Amount Certified that out of Rs...................of No. and grant in-aid sanctioned during the year in favour date of....under this Department's letter No. and date given in the margin a sum of Rs...................... has been utilised for the purpose of..............for which it was sanctioned and that the balance of Rs.........................remaining unutilised at the end of the year has been surrendered to Government vide No......................dated............................/will be adjusted towards the grant-in-aid payable during the next year.

Sl.No.

Certified that I have satisfied myself that the conditions on which the grant-in-aid was sanctioned has been duly fulfilled/are being fulfilled and that I have exercised the foilowing checks to see that the money was actually utilised for purpose for which it was sanctioned : Kinds of check exercised: 1. 2. 3.

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4. 5. Signature Designation Dated 6. No. of own godown with the Society (i) Number (ii) Capacity 7. No. of hired godowns with capacity 8. No. of transport vehicles with the society 9. Staff employed in the society: -----------------------------------------------------------------------------------------------Sl.No. Name of Post Pay scale or Total employee held consolidated emoluments pay per month per month -----------------------------------------------------------------------------------------------10. Amount of subsidy applied for (Resolution of the management to be attached). 11. Purpose for which subsidy is required. 12. Amount of subsidy availed of during the past three years with purpose. Date.................... Signature of the Secretary/ Manager. subsidy

Recommended a sum of Rs....................... as for.........................for the year.................................to the society.

Inspector, Co-operative Societies. Certified that the application has been scrutinised and is found to be complete in all respects. The society needs subsidy amounting to Rs........................(Rs.......................) and the case is hereby recommended. Assistant Registrar. Co-operative Societies. (Copies of audited balance-sheet, trading and profit and loss account for the year alongwith the latest tentative balance-sheet, trading, profit and loss account for the last co-operative year should be enclosed. Copy of the resolution.......................passed by its Managing Committee in its meeting held

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on...................................date..........................................and attended by ...............................members. Resolved that the society is in need of subsidy amounting to Rs......................for the purpose of.........................and therefore, requests the Registrar, Co-operative Societies, Himachal Pradesh, to grant an amount of Rs....................................... ANNEXURE D ASSETS ACQUIRED WHOLLY OR PARTIALLY OUT OF GOVERNMENT GRANTS 1. S. No. 2. Name of Grantee Institution 3. No. and date of sanction 5. Amount of the sanctioned grant 4. Brief purpose of the grant. 6. Whether any condition regarding the right of ownership of Government in the property or other assets acquired out of the grant was incorporated in the grant-in-aid sanction. 7. Particulars of assets actually created or acquired. 8. Value of the assets as on. 9. Purpose for which utilised at present 10. Encumbered or not 11. Reason if encumbered 12. Disposed of or not 13. Reason and authority, if any, for disposal 14. Amount realised on disposal 15. Remarks ------------------------------------------------(R.H.P.. dated 21-7-90, p. 768-771). ----Shimla-2, the 29th November, 1985 No. 10-9/71(Co-op.)(s)-III.-In partial modification of this department notification of even number, dated the 24th May and 15th November, 1984, the Governor, Himachal Pradesh, in exercise of the powers conferred upon him by

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section 98 of the Himachal Pradesh Co-operative Societies Act, 1968 (Act No. 3 of 1969), is pleased to constitute the Himachal Pradesh State Co-operative Council Consisting of the following members. The manner and quantum of travelling allowance and daily allowance in respect of the non-official members and the members of the Legislative Assembly appointed/nominated to the State Co-operative Council for attending the meetings of the Council has been determined in consultation with the Finance Department and notified separately vide this department notification of even number, dated the 7th January, 1984. The constitution/functions/terms of office of the State Co-operative Council would be as under:(i) Chairman : State Minister (Co-operation). (ii) Chairman of Apex Societies : (a) Chairman, Himachal Pradesh State Co-operative Marketing and Consumer's Federation Ltd., Shimla. (b) Chairman, Himachal Pradesh State Co-operative Bank Ltd., Shimla. (c) Chairman, Himachal Pradesh State Co-operative Land Development Bank Ltd., Shimla. (d) Chairman, Himachal Pradesh State Co-operative Union Ltd., Shimla. (iii) Five non-official members namely :1. Sh. Ganesh Dutt Bharwal, MLA (Chintpurni). 2. Sh. Prem Singh, MLA. 3. Chairman, The Lahaul Potato Growers Co-operative and Processing Society, Manali. 4. Sh. Ishwar Dass, MLA (Ani). 5. Shri Jaishi Ram Sharma (Ex-Principal Co-op. Training College Chandigarh), Village and P.O. Jubbal, District Shimla, Himachal Pradesh. (iv) Three members as elected by the members of the H.P. Legislative Assembly from amongst themselves: (a) Shri Nehar Singh, MLA, (Rohru). (b) Shri Ram Partap Chandel, MLA (Doon).

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(c) Shri Satya Parkash Thakur, MLA (Inner Seraj). (v) The Commissioner-cum-Secretary (Co-operation) to the Government of Himachal Pradesh. (vi) The Registrar, Co-operative Societies, Himachal Pradesh. (vii) The Director of Agriculture, Himachal Pradesh, Shimla. (viii) The Director, Industries, Himachal Pradesh, Shimla. (ix) The Financial Commissioner (Dev.) to the Government of Himachal Pradesh. (x) Financial Commissioner-cum-Secretary (Fin). to the Government of Himachal Pradesh. (xi) The Financial Commissioner-cum-Secretary (Ind.) to the Government of Himachal Pradesh. (xii) The Director of Horticulture, Himachal Pradesh Shimla. (xiii) The Director of Animal Husbandry, Himachal Pradesh, Shimla. 2. The Registrar, Co-operative Societies, Himachal Pradesh, shall act as Member-Secretary to the Council. 3. The Functions of the Council as constituted shall be as follows:(a) To advise the State Government on all general questions relating to co-operative movement. (b) To review the Co-operative movement and to suggest ways for coordinating the activities of the co-operative societies in the State. (c) To suggest ways and means to remove the difficulties experienced by the co-operative societies in the State in the administration. (d) To make suo-motu recommendation to the State Government in regard to any matter relating to the administration of co-operative societies. (e) To report to the State Government on such matters as may be referred to it by the State Government for its opinion. (f) The Council should meet at least once a year with the prior

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concurrence of the Chairman. (g) The term of office of the non-official nominated members of the Council as mentioned in clause (iii) above, shall be one year provided that the same is extended by the Government from time to time. -------------------------------------------(R.H.P. dated the 16-5-1992 p. 519) ----THE HIMACHAL PRADESH STATE AGRICULTURE CREDIT (RELIEF AND GUARANTEE) FUND RULES, 1989 CO-OPERATION DEPARTMENT NOTIFICATION Shimla-2, the 4th October, 1991. No.Co-op-F(15)1/78.-In exercise of the powers conferred upon him, the Governor, Himachal Pradesh, is pleased to frame the following rules:1. Short title.-(1) These rules may be called the Himachal Pradesh State Agriculture Credit (Relief and Guarantee) Fund Rules, 1989. (2) These rules shall come into force at once. 2. Definitions.-In these rules, unless there is anything repugnant in the subject or context,(a) "Government" means thee Government of Himachal Pradesh. (b) "Registrar" means the Registrar, Co-operative Societies, Himachal Pradesh, appointed under the Himachal Pradesh Co-operative Societies Act, 1968 and includes any person appointed to assist the Registrar, when exercising all or any of the powers of the Registrar. (c) "Fund" means the fund established under rule 3. (d) "Co-operative Credit Institution" means a Primary Agriculture Credit Society, the State Co-operative Bank, the Central Co-operative Banks and or the Himachal Pradesh State Co-operative Agricultural and Rural Development Banks as the case may be. (e) "Financial Year" means the year ending on the 31st day of March. (f) "Government Security" means a security created and issued by the Central Government or by a State Government for the purpose of

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raising a public loan and having any of the forms specified in or prescribed under clause (2) of section 2 of the Public Debt. Act, 1944. (g) The amount would be debited under Head "8235-General and Other Reserve Fund-120-Other funds (a) Himachal Pradesh State Agricultural Credit (Relief and Guarantee) Fund" be paid:3. There shall be established a fund known as the Himachal Pradesh State Agricultural Credit (Relief and Guarantee) Fund to the credit of which be paid,(i) such sums as Government may, in pursuance of an annual budgetary provision set apart and sanction for being credited to the fund. (ii) the interest accuring from the investment of the amount standing to the credit of the fund, (iii) the dividends received by the Government on its Share Capital in the Co-operative Credit Institutions to the extent that such dividend exceeds three per cent, (iv) such sums as may be received in accordance with these rules from the persons to whom assistance has been given from the fund. 4. The fund may be utilised for one or more of the following purposes.(a) For assisting a co-operative credit institution to write off arrears of any debts, the recovery of which has proved to be difficult, where the total of such debts owned to the Co-operative Credit Institutions is of such magnitude as to threaten its stability, provided the authority competent to operate on the fund is satisfied that such arrears have arisen from cases such as wide spread floods, famine, failure of crops or any other natural calamity or other similar causes beyond the control of the institution. (b) For making grant-in-aid directly to Primary Agriculture Credit Societies for enabling them to write off loans (principal and interest) due from members effected by successive natural calamities as well as these non willful indebted members of Primary Agri. Credit Societies, who did not receive the benefit of conversion even in the years of natural calamity brought under the programme of rehabilitation. (c) For writing off the instalment due in the year of natural calamity together with interest thereon should any natural calamity occur during the currency of any loan rescheduled into a six or seven years terms loan.

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(d) To meet losses sustained by co-operative credit institution on account of loans granted in an economically backward areas or to a special class or classes of the population such as the scheduled tribes. (e) For recouping of losses sustained due to wide spread floods, famine, failure of crops or any other natural calamity or other similar causes beyond the control of the institution on account of loans granted for agricultural purposes out of short term or medium term accommodation provided by the Reserve Bank of India or from any other source and guaranteed in either case by the Government. (f) To meet losses arising due to wide spread floods, famine, failure of crops or any other natural calamity or other similar cause beyond the control of the institution out of guarantee given by the Government in respect of the principal and interest of the debentures issued by the State Land Development Bank. 5. (i) No payment shall be made from the fund for any of the purpose mentioned in rule 4 except on application made to the Registrar, by the institution desiring assistance from the fund. (ii) Any application for the assistance from the fund shall be in the form at Annexure-I to these rules and shall be forwarded to the Registrar.(a) in case of a Primary Agriculture Credit Society through the State Cooperative Bank, Central Co-operative Banks to which it is affiliated. The banks concerned shall consolidate the demand of their constituents and forward the same to the Registrar after their verification; and (b) in all other cases to the Registrar direct. 6. The Registrar on receipt of the application for assistance out of the fund may call for the report of officers subordinate to him and, in the context of such report, seek further information from the societies which he may deem necessary. 7. If, after consideration of the information furnished by the society and the reports made by the officers subordinate to the Registrar, the Registrar is satisfied that the institution cocerned deserves assistance out of the fund, he may, subject to these rules, sanction the financial assistance and, in pursuance thereof, operation of the fund. 8. The Registrar shall be competent to sanction assistance to a cooperative credit institution out of the fund upto a miximum of Rs. 10,000/- in a single case and upto a maximum of Rs. 50,000 in a single financial year. For assistance beyond these limits the Registrar shall refer the case to Government for

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sanction. After the sanction of Government is received, the Registrar shall be competent to operate on the fund and disburse the amount to the institution concerned. 9. The Registrar may from time to time call for reports from the institution concerned regarding the utilisation of assistance sanctioned out of the fund in the form at Annexure-II. The grant sanctioned shall be utilised for the purpose it has been sanctioned within one year from the date of release of the grant. The guarantee institution shall furnish the utilisation certificate in the form at Annexure-II as well as to the Senior DAG (A&E) Himachal Pradesh, Shimla within a period of three months after the period of utilisation is over. 10. If, at any stage, the Registrar or Government is satisfied that the amount sanctioned has been misapplied, he may, after giving suitable opportunity to the institution concerned to furnish an explanation take action for the recovery of the amount involved. 11. The Government may from time to time or at any time issue such directions to the Registrar as may be necessary for the `purpose of these rules. 12. (a) The amount outstanding the credit of the fund shall be included within the public account of the State of Himachal Pradesh and may, except so far as it has been or is required to disburse under these rules, be invested in Government securities. (b) The investment of the fund shall not be utilised, except for the purposes mentioned in these rules. (c) After the end of each financial year, the Registrar, shall forward to Government inform at Annexure-III a statement of the accounts relating to the fund, as audited by the Accountant General(Audit) Himachal Pradesh and shall also submit at the same time a report on the assistance granted from the fund. ANNEXURE-I FORM OF APPLICATION FOR GRANT OF ASSISTANCE TO COOPERATIVE CREDIT INSTITUTIONS OUT OF THE STATE AGRICULTURAL CREDIT (RELIEF AND GUARANTEE) FUND PART-I 1. Name and address of the society. 2. Date of Registration 3. Membership

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(a) at the time of registration (b) on the date of application 4. Financial position of the society on the date of application: (a) paid-up share capital (b) owned capital (c) working capital PART-II 5. The amount of financial assistanee required. 6. The purose or purposes for which the financial assistance is required. 7. The reasons for which financial assistance is required. 8. Has the society's managing committee passed resolution asking for financial assistance on the conditions laid down in the rules governing the fund? If so, attach a copy of the resolution. Secretary of the Society, General Manager. PART-III 9. Report of the Inspector. 10. Report of the Assistant Registrar. ANNEXURE-III STATEMENT OF ACCOUNTS FOR THE FINANCIAL YEAR 1. Amount to the credit of the fund as on 31st March. 2. Amount credited during the year. Total:3. Amount utilised during the year: 4. Balance at the end of the financial year..................................... 5. Remarks, if any. Sd/Registrar, Co-operative Societies, Himachal Pradesh. ANNEXURE-II UTILISATION CERTIFICATE Certified that a grant of Rs. ................................... in words......................................................... sanctioned vide letter No........................................ by Registrar, Co-operative Societies/Government in favour of...............................(Name of the Institution)............... out of State Agriculture Credit (Relief and Guarantee) Fund has been utilised for the purpose

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for which it was sanctioned and no amount is lying unspent. --------------------------------------------------(R.H.P. dated 30-11-1991, p. 1471-1473). ________