(1) A credit agency shall have the right to inspect the books of any cooperative society which has either applied to the credit agency for financial assistance or is indebted to it.
(2) The inspection may be made either by an officer of the credit agency or a member of its paid staff authorised by the credit agency as competent to undertake such inspection.
(3) The officer or member so inspecting shall, at all reasonable times, have free access to the books, account, documents, securities, cash and other properties belonging to or in the custody of the co-operative society and may also call for such information, statements and returns as may be necessary to ascertain the financial conditions of the co-operative society, and to ensure security of the sums lent to it by the credit agency ;'';
(5) in section 70, in clause (d) of sub-section (1), after the words ''cooperative society'', the words ''or a credit agency'' shall be inserted;
(6) after section 71A the following section shall be inserted, namely:- 1975: KAR. ACT 2] Agricultural Credit Operations and Miscellaneous Provisions 19 ''71B. Powers of credit agency to proceed against members of a co-operative society for the recovery of money due to it from such society.- (1) If a co-operative society is unable to pay its debts to a credit agency by reason of its members committing default in the payment of the moneys due by them, the credit agency may direct the committee of such co-operative society to take proceedings against such member under section 70 or initiate proceedings under section 101, as the case may be, and if the committee fails to do so within a period of ninety days from the date of receipt of such direction the credit agency may itself proceed against such defaulting members under section 70 or section 101, as the case may be, in which case, the provisions of the Act, the rules or the bye-laws shall apply as if all references to the co-operative society or its committee in the said provisions, were reference to the credit agency.
(2) Where a credit agency has obtained a decree or award against a cooperative society in respect of money due to it from the co-operative society the credit agency may proceed to recover such moneys firstly from the assets of the co-operative society and secondly from the members of the co-operative society to the extent of their debts due to the society.''
18. Money Lenders Act not to apply.- The provisions of Karnataka Money Lenders Act, 1961 (Karnataka Act 12 of 1962) shall not apply to financial assistance granted to an agriculturist by a credit agency.
19. Modified application of section 8 of the Act XXXII of 1956.- Section 8 of the Hindu Minority and Guardianship Act, 1956, shall apply to mortgages in favour of a credit agency subject to the modification that reference to the court therein shall be construed as reference to the Deputy Commissioner or his nominee and the appeal against the order of the Deputy Commissioner or his nominee shall lie to the 1[Regional Commissioner]1
1. Substituted by Act 17 of 2007 w.e.f. 5.1.2007.
Agricultural Credit Operations and [1975: KAR. ACT 2 Miscellaneous Provisions 20 1[19A. Application of Indian Limitation Act, 1963.- The provisions of sections 4, 5 and 15 of the Indian Limitation Act, 1963 (Central Act 36 of 1963) and articles 19, 21, 25, 36, 37, 38 and 62 of the Schedule to the said Act, shall apply mutatis-mutandis to all the proceedings under this Act and rules.
19B. Burden of proof.- Where validity of a mortgage or charge created under this Act is questioned in a court of law, notwithstanding anything contained in any law for the time being in force, the burden of proving that it was not created for agricultural or valid purposes shall be on the party alleging it.]1
1. Sections 19B and 19C inserted by Act 26 of 1984 w.e.f. 28.04.1984 and are renumbered as sections 19A and 19B in Act 22 of 2000.
* * * * NOTIFICATION Bangalore, dated 17th July 1975. [No. PD 87 PCM 71] S.O. 2050.- In exercise of the powers conferred by sub-section (3) of Section 1 of the Karnataka Agricultural Credit Operations and Miscellaneous Provisions Act, 1974 (Karnataka Act 2 of 1975), the Government of Karnataka hereby appoints the Seventeenth day of July 1975 as the date on which the said Act shall come into force in the whole of the State of Karnataka.
By Order and in the name of the Governor of Karnataka, DHIRENDRA SINGH, Deputy Secretary to Government, Planning Department.
(Published in the Karnataka Gazette Part IV-2C (ii) Extraordinary No.1946 dated 17-7-1975) * * * *