(1) A society may, with the previous approval of the Registrar, by resolution passed by two-thirds majority of the members present and voting at a special general meeting held for the purpose, decide a) To amalgamate with another society ;
b) To transfer its assets and liabilities, in whole or in part to any other society ;
c) to divide itself in to two or more societies ; or d) to convert itself into another class of society ;
Provided that when such amalgamation, transfer division or conversion, aforesaid, involves, a transfer of the liabilities of a society to any other society, no order on the resolution shall be passed by the Registrar, unless he is satisfied that
(i) the society, after passing such resolution has given notice thereof in such manner as may be prescribed to all its members creditors and other persons whose interest are likely to be affected (hereinafter, in this section referred to as "other interested persons") giving them the option, to be exercised within one month from the date of such notice of becoming members of any of the new societies, or containing their membership in the amalgamated or converted society, or demanding payment of their share or interest or dues, Power to direct amendment of bye-laws.
Change of name.
Change of liability.
Amalgamatio n, transfer, division or conversion of societies.
as the case may be.
(ii) all the members and creditors and other interested persons, have assented thereto, by virtue of any member or creditor, or any other interested person failing to exercise his option within the specified period in clause (i) aforesaid, and
(iii) all claims of members and creditors and other interested persons, who exercise the option within the period specified have been met in full or otherwise satisfied.
(2) Notwithstanding anything contained in the Transfer of property Act, 1882, or the Indian Registration Act, 1908, in the event of division or conversion, the registration of the new societies or, as the case may be, of the converted society, and in the event of amalgamation on the amalgamation, the resolution of the societies concerned with amalgamation, shall in each case be sufficient conveyance to vest the assets and liabilities of the original society or amalgamating societies in the new societies or converted or amalgamated society, as the case may be,
(3) The amalgamation of societies or division or conversion of a society shall not affect any rights or obligations of the societies so amalgamated, or society so divided or converted, or render defective any legal proceedings which might have been continued or commenced by or against the societies which have been amalgamated, or divided or divided or converted ; and accordingly such legal proceedings may be continued or commenced by or against the amalgamated society, or, as the case may be, the converted society, or the new societies.
(4) Where two or more societies have been amalgamated or a society has been divided or converted the registration of such societies or society shall be cancelled on the date of registration of the amalgamated society, or the converted society or the new societies between which the society may have been divided.
18.(1) Where the Registrar is satisfied that it is essential in the public interest or in the interest or the cooperative movement, or for the purpose of securing the proper management of any society, that two or more societies should amalgamate or any society should be divided to form to or more societies or should be reorganized, then notwithstanding anything contained in the last preceding section, but subject to the provisions of this section, the Registrar may, after consulting such federal society as may be notified by the Government, by the order published in the Official Gazette, provide for the amalgamation, division or reorganization of those societies, into a single society, or into societies, with such constitution, property, rights interests and authorities and with such liabilities, duties and obligations, as may be specified in the order.
(2) No order shall be made under this section, unless - a) a copy of the proposed order has been sent in draft to the society or each of the societies concerned; and b) the Registrar has considered and made such modifications in the draft order as may seem to him desirable in the light of any suggestions and objections which may be received by him within such period (not being less than two months from the date on which the copy of the order as aforesaid was received by the society) as the Registrar may fix in that behalf, either from the society, or from any member or class of members thereof, or from any creditor or class of creditors.
(3) The order referred to in sub-section (1) may contain such incidental consequential and supplemental provisions as may, in the opinion of the Registrar, be necessary to give effect to the amalgamation, the division or the reorganization.
(4) Every member or creditor of each of the societies to be amalgamated divided or reorganized, who has objected to the scheme of amalgamation, division or reorganization within the period specified, shall be entitled to receive, on the issue of the order of amalgamation, division or reorganization, his share or interest if he be a member, and the amount in satisfaction of his dues if he be a creditor.
Power to direct amalgamation , division and reorganization in public interest etc.
(5) On the issue of an order under sub-section (1 ), the provisions of sub- Section (2),
(3) and (4) of section 17 shall apply to the societies so amalgamated, divided or reorganized as if they were amalgamated divided or reorganization under that section, and to the society amalgamated, divided or reorganized.
19. Where a proposal for a compromise or arrangement - a. between a society and its creditors, or b. between a society and its members, is approved at a special general meeting called for the purpose, the Registrar may, on the application of the society, or of any member or of any creditor of the society of in the case of society which is being wound up, of the Liquidator, order reconstruction in the prescribed manner, of the society.
20.(1) Any two or more societies may, with the prior approval of the Registrar, by resolution passed by three-fourth majority of the members present and voting at a general meeting of each such society, enter into partnership for carrying out any specific business or businesses provided that its members has had clear thirty days written notice of the resolution, and the date of the meeting.
(2) Nothing in the Indian partnership Act, 1932 shall apply to such partnership.
21.The Registrar shall make an order cancelling the registration or a society if it transfers the whole of its assets and liabilities to another society or amalgamates with another society, or divides itself into two or more societies or if its affairs are would up, or it has not commenced business within a reasonable time of its registration, or has ceased to function of if he is satisfied, after making such inquiry as he thinks fit, that the society no longer has genuinely as its objects one or more of the objects specified in section 4, and its registration ought, in the interests of the general public, be cancelled. The society shall, from the date of such order of cancellation, be deemed to be dissolved, and shall cease to exist as a corporate body.
CHAPTER - Ill Members and their Right and Liabilities
22.(1) Subject to the provisions of section 24, no person shall be admitted as a member of a society except the following, that it is to say, a. an individual, who is competent to contract under the Indian Contract Act, 1872 ;
b. a firm, company or any other body, corporate constituted under any law for the time being in force, or a society registered under the societies registration Act 1860;
c. a society registered, or deemed to be registered under this Act;
d. the Government ;
e. a local Authority ;
f. a public trust registered under any law for the time being in force for registration of such trusts ;
Provided that, the provisions of clause (a) shall not apply to an individual seeking admission to society exclusively formed for the benefit of students of a school or college;
Provided further that, subject to such terms and conditions as may be laid down by the Government by general or special order, a firm or company may be admitted as member only of a society which is a federal or urban society or which conducts or intends to conduct as industrial undertaking ;
Provided also that, any firm or company which is immediately before the commencement of this Act a member of a society deemed to be registered under this Act, shall have, subject to the other provisions of this Act, the right to continue to be such member on and after such commencement.
Reconstruction of societies.
Partnership of societies.
X of 1932.
Cancellation of registration.
Person who may become member.
IX of 1872.
XXI of 1860.
Explanation - For the purpose of this section an "urban society" means a society the business of which mainly falls within the limits of a municipal corporation, municipality, cantonment or notified area committee.
(2) Where a person is refused admission as a member of a society, the decision, together with the reasons therefore, shall be communicated to that person within fifteen days of the date of the decision or within three months from the date of the application for admission, whichever is earlier.
23.(1) No society shall, without sufficient cause, refuse admission, to membership to any person duly qualified therefore, under the provisions of this Act and its bye-laws.
(2) Any person aggrieved by the decision of a society, refusing him admission to its membership, may appeal to the Registrar.
(3)The decision of the Registrar in appeal shall be final and the Registrar shall communicate his decision to the parties within fifteen days from the date thereof.
24.(1) Notwithstanding anything contained in section 22 a society may admit any person as a nominal, associate or sympathizer members.
(2) A nominal member or sympathizer member shall not be entitled to any share in any form whatsoever in the profits or assets of the society as such member. A nominal or sympathizer shall ordinarily not have any of the privilege and rights of a member, but such a member or an associate member, may subject to the provisions of sub- section (8) of section 27, have such privileges and rights and be subject to such liabilities, of a member, as may be specified in the bye-laws of the society.
25.· A person shall cease to be a member of a society on his resignation from the membership thereof being accepted, or on the transfer of the whole of his share or interest in the society to another member or on his death, removal or expulsion from the society.
26. No person shall exercise the rights of a member of a society, until he has made such payment to the society, in respect of membership, or acquired such interest in the society, as may be prescribed by the rules or the bye-laws of such society.
27.(1) No member of any society shall have more than one vote in its affairs provided that, in the case of an equality of votes, the chairman shall have a casting vote.
(2) Where a share of a society is held jointly by more than one person, only the person whose name stands first in the Share Certificate, shall have the right to vote.
(3) A society, which has invested any part of its funds in the shares of another society, may appoint one of its members to vote on its behalf in the affairs of that other society, and accordingly such member shall have the right to vote on behalf of the first society.
(4) A company or any other body corporate constituted under any law for the time being in force which has invested any part of its funds in the shares of society may appoint any one of its directors to vote on its behalf in the affairs of such society; and accordingly such director or officer shall have the right to vote on behalf of the company or body corporate.
(5) Where a firm has invested any part of its funds in the shares of a society, any one of its partners shall be entitled to vote in the affairs of the society on behalf of the firm.
(6) The Government, a local authority or public trust which has invested any part of its funds in the shares of a society, may appoint any of its officers, members or trustees to such persons shall have the right to vote on behalf of the Government, local authority or Open membership.
Nominal, associate and sympathizer member.
Cessation of membership.
No rights of membership to be exercised till due payments are made.
Voting powers of members.
the public trust as the case may be.
(7) In the case of a federal society, the voting rights of individual members thereof shall be such as may be regulated by the rules made under this Act and by the bye-laws of the society.
(8) No nominal, associate, or sympathizer member shall have the right to vote.
28. In any society, no member other than the Government or any other society, shall :
a. Hold more than such portion of the total share capital of the society (in no case exceeding one-fifth thereof) as may be prescribed, or b. Have or claim any interest in the shares of the society exceeding five thousand rupees:
Provided that the Government may, by notification in the Official Gazette specify in respect of any class of societies a higher or lower maximum than one fifth of the share capital or, as the case may be, a higher or lower amount than five thousand rupees.
29.(1) Subject to the provisions of the last preceding section as to the maximum holding of shares and to any rules made in this behalf, a transfer of, or charge on the share or interest of the member in the share capital of a society shall be subject to such conditions as may be prescribed.
(2) A member shall not transfer any share held by him or his interest in the capital or property of any society, or any part thereof, unless - a. he has held such share or interest for not less than one year;
b. the transfer is made to a member of the society or to a person whose application for membership has been accepted by the society.
(3) Notwithstanding anything contained in sub-section (1) and (2), where a member is allowed to resign or is expelled, or cease to be a member on account of his being disqualified by this Act or by the rules made there- under or by the bye-laws of the society, the society may acquire the share or interest of such member in the share capital by paying for it at the value determined in the manner prescribed, provided that the total payment of share capital of a society in any financial year for such purpose does not exceed ten percent of the paid-up share capital of the society on the last day of the financial year immediately preceding.
Explanation - The right to forfeit the share or interest, of any expelled member in the share capital by virtue of any bye-laws of the society, shall not be affected by the aforesaid provisions.
(4) Where the Government is a member of a society the restriction contained in this section shall not apply to any transfer made by its share or interest in the capital of the society; and the Government may, notwithstanding anything in this Act, withdraw from the society its share capital at any time, after giving to the society notice thereof not less than three months.
30.(1) On the death of a member of a society the society shall transfer the share or interest of the deceased member to a person or persons nominated in accordance with the rules, or, if no person has been so nominated, to such persons as may appear to the Committee to be the heir or legal representative of the deceased member :
Provided that such nominee, heir or legal representative, as the case may be, is duly admitted as a member of the society ;
Provided further that, nothing in this sub-section or in section 22 shall prevent a minor or a person of unsound mind from acquiring by inheritance or otherwise, any share or interest of deceased member in a society.
(2) Notwithstanding anything contained in sub-section (1 ), and such nominee, heir or legal representative, as the case may be, may require the society to pay him the value of share or interest of the deceased member, ascertained in accordance with the rules.
Restrictions on holding of shares.
Restrictions on transfer of charge on share of interest.
Transfer of interest on death of member.
(3) A society may pay all other moneys due to the deceased member from the society to such nominee, heir or legal representative, as the case may be.
(4) All transfer and payments, duly made by a society in accordance with the provisions of this section, shall be valid and effectual against any demand made upon the society by any other person.
31. The share or interest of a member in the capital of a society, or the loan stock issued by a housing society, or in the funds raised by a society from its member by way of savings deposit, shall not be liable to attachment or sale under any decree or order of a Court for or in respect of any debt or liability incurred by the member.
32.(1) Every member of a society shall be entitled to inspect, free of cost, at the society's office during office hours, or any time fixed for the purpose by the society, a copy of the Act, the rules, and the byelaws, the last audited annual balance sheet, the profit and loss account, a list of the members of the committee, a register of members the minutes of general meetings minutes of committee meetings and those portions of the books and records in which his transaction with the society have been recorded.
(2) A society shall furnish to a member, on request in writing and on payment of such fees as may be prescribed thereof, a copy of any of the documents mentioned in the foregoing sub-section within one month from the date of payment of such fees.
33.(1) Subject to the provisions of sub-section (2) the liability of a past member or the estate of a deceased member of a society for the debts of society as they stood - a) in the case of a past member, on the late on which he ceased to be a member, and b) in the case of a deceased member, on the date of his death, shall continue for a period of two years from such date.
(2) Where a society, is ordered to be wound up under any provision of this Act, the liability of a past member or of the estate of a deceased member, who ceased to be a member or died within two years immediately preceding the date of the order of winding up shall continue until the entire liquidation proceedings are completed but such they stood on the date of his ceasing to be a member of death, as the case may be :
Provided that provisions of sub-section (1) and (2) shall not apply in the case of a minor who succeeds the deceased.
34.Notwithstanding anything contained in any law for the time being in force, the dues of society from a member, in insolvency proceedings against him, shall rank in order or priority next to the dues payable by him to Government or to a local authority.
35.(1) A society may, by resolution passed by three-fourths majority of the members entitled to vote who are present at general meeting held for the purpose, expel a member for acts which are detrimental to the interest or proper working of the society :
Provided that, no resolution shall be valid, unless the member concerned is given an opportunity or representing his case to the general body and no resolution shall be effective unless it is approved by the Registrar.
(2) No member of a society who has been expelled under the foregoing sub-section shall be eligible for re-admission as a member of the society, or for admission as a member of any other society, for a period of one year from the date of such expulsion ; Provided that Registrar may, on an application by the society and in special circumstances, sanction the re-admission or admission, within the said period, of any such member as a member of the said society or of any other society, as the case may be.
36.(1) Every member of a society shall exercise his vote in person and no member shall be permitted to vote by proxy.
(2) Notwithstanding anything contained in sub-section (I) ; a society which is a member of another society may, subject to the Rules, appoint one of the members to vote on its behalf in the affairs of that other society.
Share interest not liable to attachment.
Rights of member to see books etc.
Liability of past member and estate of deceased member.
Insolvency of members.
Expulsion of members.
Manner of exercising vote.
CHAPTER- IV Incorporation, Duties and Privilege of Societies 37 .The registration of the society shall render it a body corporate by the name under which it is registered, with perpetual succession and a common seal and with power to acquire, hold and dispose of property, to enter into contracts, to institute and defend suits and other legal proceedings, and to do all such things as are necessary for the purpose for which it is constituted.
38.Every society shall have an address, registered in accordance with the rules to which all notices and communications may be sent and the society shall send notice in writing to the Registrar of any change in the said address within thirty days thereof.
39.(1) Every society shall keep a register of its members and enter therein the following particulars, that is to say :
a. the name, address and occupation of each member;
b. in the case of a society having share capital, the share held by each member;
c. the date on which each person was admitted as a member ;
d. the date on which any person ceased to be a member; and e. such other particulars as may be prescribed :
Provided that where a society has, by or under this Act, permitted a member to transfer his share or interest on death to any person, the register shall also show against the member concerned the name of the person entitled to the share or interest of the member and the date on which the nomination was recorded.
(2) The register shall be prima facie evidence of the date on which any person was admitted to membership, and of the date on which he ceased to be a member.
40. Every society shall keep, at the registered address of the society, a copy of this Act and the rules and of its bye-laws and a list of members, open to inspection to the public free of charge, during office hours or any house fixed by the society thereof.
41.(1) A copy of any entry in any book, register of list, regularly kept in the course of business and in the possession of a society, shall, if duly certified in such manner as may be prescribed be admissible in evidence of the existence of the entry, and shall be admitted as evidence of the matters and transactions therein recorded in every case where, and to the same extent to which, the original entry would if produced, have been admissible to prove such matters.
(2) In the case of such societies, as the Government may by general or special order, direct, no officer of a society shall in any legal proceedings to which the society is not a party, be compelled to produce any of the society's books the contents of which can be proved under the foregoing sub-Section or to appear as witness to prove the matters transactions and accounts therein recorded, unless required to do so by order the Court or a judge made for any special reason.
42.Nothing in clauses (b) and (c) of sub-section (1) of section 17 of the Indian Registration Act, 1908, shall apply - a. To any instrument relating to shares in a society, notwithstanding that the assets of the society consist in whole or in part of immovable property ; or b. To any debentures issued by any society and not creating, declaring, assigning, limiting or extinguishing any right, title or interest to or in immovable property, except in so far as it entitles the holder to the security afforded by a registered instrument whereby the society has mortgaged, conveyed or otherwise transferred the whole or part of its immovable property or any interest therein to trustees upon trust for the benefit of the holders of such debenture ; or c. To any endorsement upon, or transfer of, any debentures issued by any society.
Societies bodies to be corporate.
Address of societies.
Register of members.
Copy of Act etc. to be open to inspection.
Admissibility of copy of entry as evidence.
XVI of 1908 Exemption from compulsory registration and instruments relating shares ar debentures
43.The Government, by notification in the Official Gazette, may in the case of any society or class of societies, remit, a. The stamp with which under any law relating to stamp duty for the time being in force, instruments executed by or on behalf of a society by on officer or member thereof and relating to the business of the society or any class of such instruments or awards of the Registrar or his nominee or board of nominees under this Act are respectively chargeable.
b. Any fee payable by or on behalf of a society under the relating to the registration of documents and to court fees for the time being in force, and c. Any other tax or fee or duty (for any portion thereof) payable or on behalf of a society under any law for the time being in force, which the Government is competent to levy.
44.A Society shall receive deposits and loans from members and other persons, only to such extent, and under such conditions as may be prescribed, or specified by the Bye laws of the society.
45.(1) No society shall make a loan to any person other than a member, or on the security of its own shares or on the security of any person who is not a member. Provided that with the special sanction of the Registrar, a society may make loans to another society:
(2) Notwithstanding anything contained in the foregoing sub-section a society may make a loan to a depositor on the security of his deposit.
(3) If, in the opinion of the Government, it is necessary in the interest of the society or societies concerned to do so, the Government may by general or special order, prohibit, restrict or regulate the lending of money by any society or class of societies on the security of any property.
46.Same as is provided in this Act, the transaction of a society with persons other than members, shall be subject to such restrictions, if any, as may be prescribed.
47.A society shall have a charge upon the share or interest in the capital, and on the deposits, of a member or past member or deceased member, and upon any dividend, bonus or profits payable to any such member, in respect of any debt due, from such member or his estate to the society ; and the society may set-off any sum credited or payable to such member in or towards payment of any such debt :
Provided that no Co-operative bank shall have a charge upon any sum invested with it by a society out of the provident fund established by it under section 72 or its reserve fund ;
and no co-operative bank shall be entitled to set-off any such sum towards any debts due from the society.
48.(1) Notwithstanding anything in any other law for the time being in force, but subject to any prior claim of Government in respect of any money recoverable as a public demand and to the provisions of sections 60 and 61 of the Code of Civil Procedure, 1908 or the analogous law in force in the State of Arunachal Pradesh.
(a) Any debt or outstanding demand, owed to a society by any member or past member or deceased member, shall be a first charge -
1. upon the crops, or other agricultural produce raised in whole or in part whether with or without a loan taken from the society by such member or past member or deceased member.
11. upon any cattle, fodder for cattle, agricultural or industrial implements or machinery or raw materials for manufacture, or workshop, godown or place of business society.
Power to exempt from taxation.
Restrictions on borrowings.
Regulation of loan making policy.
Restrictions on transaction with persons other than members.
Charge and set-off 1n respect of share or interest of member.
Prior claim of society.
V of 1908.
supplied to or purchased by such member or past member or deceased member, in whole or in part, from any loan whether in money or goods made to him by the society, and iii. upon any movable property which may have been hypothecated, pledged or otherwise mortgaged by a member with the society and remaining in his custody :
(b) any outstanding demands or dues payable to a society by any member or past member or deceased member in respect of rent, shares, loan or purchase money or any other rights or amounts payable to such society shall be a first charge upon his interest in the immovable property of the society.
Explanation - The prior claim of Government in respect of dues, other than land revenue, shall be restricted for the purpose of sub-section (1) to the assets created by a member out of the funds in respect of which the Government has claim.
(2) No property or interest in property, which is subject to a charge under the foregoing sub-section, shall be transferred in any manner without the previous permission of the society; and such transfer shall be subject to such conditions, if any, as the society may impose.
(3) Any transfer made in contravention of sub-section (2) shall be void.
(4) Notwithstanding anything contained in sub-sections (2) and (3), a society, which has as one of its objects the disposal of the produce of its members may provide in its bye-laws, or may other5wise contract with its members,
(a) That every such member shall dispose of his produce through the society; and
(b) That any member, who is found guilty of a breach of the byelaw or any such contract, shall reimburse the society for any loss, determined in such manner as may be specified in the bye-laws.
49. Notwithstanding anything contained in this Act or in any other law for the time being in force, a. Any person, who makes an application to a society of which he is a member, for a loan shall, if he owns any land or has interest in any land as a tenant, made a declaration in the form prescribed, such declaration shall state that the applicant thereby creates a charge on such land or interest specified in the declaration for the payment of the amount of the loan which the society may make to the member in pursuance of the application, and for all future advances if any, required by him which the society may make to him as such member, subject to such maximum as may be determined by the society, together with interest on such amount of the loan and advances :
b. Any person who has taken a loan from a society of which he is a member, before the date of the coming into force of this Act, and who owns any land or has interest in land as a tenant, and who has not already made such a declaration before the aforesaid date shall, as soon as possible thereafter, make a declaration in the form and to the effect referred to in clause (a); and no such person shall, unless and until he made such declaration, be entitled to exercise any rights as a member of the society ;
c. a declaration made under clause (a) or (b) may be varied at any time by a member, with the consent of the society in favour of which such charge is created d. No member shall alienate the whole or an part of the land or interest therein, specified in the declaration made under clause (a) or (b) until the whole amount borrowed by the member together with interest thereon, is repaid in full :
Provided that, for the purpose of paying in full to the society the whole amount borrowed by the member together with interest thereon, the member may, with the previous permission in writing of the society and subject to such conditions as the society may impose, alienate the whole or any part of such land or interest thereon :
Provided further that, if a part of the amount borrowed by a member is paid, Charge on the immovable property of members borrowing from certain societies.
the Central Financing Agency may, on an application from the member, release from the charge created under the declaration made under clause (a) or (b), such part of the movable or immovable property specified in the said declaration as it may deem proper with due regard to the security of the balance of the amount remaining outstanding from the member : Provided further that, standing crops on any such land may be alienated with the previous permission of the society.
e. Any alienation made in contravention of the provision of clause (d) shall be void ;
f. Subject to the prior claim of the Government in respect of land revenue or any money recoverable as land revenue, or any other law for the time being in force in any part of the State there shall be first charge in favour of the society on the land or interest specified in the declaration made under clause (a) or (b), for and to the extent of the dues owing by him on account of the loan ;
g. the record of rights shall also include the particulars of every charge on land or interest created under a declaration under clause (a) or (b) notwithstanding anything contained in any law relating to land revenue for the time being in force ;
h. any sum due to a society in consequence of charge created under a declaration under clause (a) or clause (b) shall on application for its recovery being made by such society accompanied by a certificate signed by the Registrar, be recoverable by the Deputy Commissioner/Additional Deputy Commissioner according to the laws and under the rules for the time being in force for recovery as a public demand under the Bengal Public Demand Recovery Act, 1913.
Explanation - For the purpose of this section, the expression "society" means -
1. any resource society, the majority of the members of which are agriculturist and the primary object of which is to obtain credit for its members, or ii. any society, or any society of the class of societies specified in this behalf by the Government, by a general or special order .
50.(1) It shall be compulsory for any office bearer or employee of a society to enter into an agreement in writing with the society, that in case of misappropriation, defalcation or in connection with an amount realizable from such person, shall be realized from his salaries, securities or any amounts that may be payable to him on the strength of the said agreement to be entered into before assuming office bearer or employees.
2) On the execution of such agreement, the employer shall if so required by the society by a requisition in writing, and so long as the society does not intimate that the whole of such debt on demand has been paid make the deduction in accordance with the agreement, and pay the amount so deducted to the society, as if it were a part of the wages payable by him as required under the Payment of Wages Act, 1936 on the day on which he makes payment. Such payment shall be valid discharge of the employee's liability to pay the amount deducted.
(3) If after the receipt of a requisition made under the foregoing subsection, the employer at any time fails to deduct the amount specified in the requisition from the salary or wages payable to the member concerned to makes default in remitting the amount deducted to the society, the employer shall be personally liable for the payment thereof ; and the amount shall be recoverable on behalf of the society from him as a public demand under the Bengal Public Demands Recovery Act, 1913 and the amount so due shall rank in priority in respect of such liability of the employer as wages in arrears.
(4) Nothing contained in this section shall apply to person employer in any railways and in mines and oil fields.
CHAPTER-V State aid to Societies
51. The Central Government may subscribe directly to the share capital of a society with limited liability upon such terms and conditions as may be agreed upon.
Deduction from salary to meet society's claim in certain cases.
IV of 1936.
Direct partnership of Central Government in societies.
52. The Central Government may, under appropriation made by law, provide moneys to a society for the purchase directly or indirectly of shares in other societies with limited liability. (A society to which moneys are so provided for the aforesaid purpose is hereinafter in this Chapter referred to as an 'Apex Society).
53.(1) An Apex Society which is provided with moneys as aforesaid shall, with such moneys establish a Fund to be called the "Principal State Partnership Fund".
(2) An Apex Society shall utilize the Principal State Partnership Fund for the purpose of - a. directly purchasing shares in other societies with limited liability;
b. providing moneys to a society to enable that society (hereinafter in this referred to as a Central Society to purchase share in other societies with limited liability (the later societies being hereinafter in this Chapter referred to as Primary Societies):
c. Making payments to the Central Government in accordance with the provisions of this Chapter and for no other purpose.