(1) If a Co-operative Society is unable to pay its debt to a bank from which it has borrowed, by reasons of its members defaulting in the payment of the moneys due by them, the bank may direct the Committee of such Society to proceed against such members by taking action under the Meghalaya Co-operative Societies Act (Act I of 1950 as adapted by Meghalaya).
(2) If the Committee of a Co-operative Society fails to proceed against its defaulting members within a period of sixty days from the date of receipt of such direction from the bank, the bank itself may proceed against such defaulting members, in which event, the provisions of the Meghalaya Co-operative Societies Act (Assam Act I of 1950 as adapted by Meghalaya) the rules and the bye-laws made thereunder shall apply as if all references to the Society or its Committee in the said provision, rules and bye laws were references to the bank.
(3) Where a bank has obtained a decree or award against a Co-operative Society indebted to it, the bank 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.