(1) Subject to the provisions of this Act, a society which has as its object the promotion of the economic interests of its members in accordance with co-operative principles, or a society established with the object of facilitating the operations of such a society, may be registered under this Act with limited or unlimited liability:
Provided that -
(i) the liability of a society of which a registered society is a member shall be limited; and
(ii) an agricultural credit society shall be registered only with limited liability:
Provided further that no society shall be registered if in the opinion of the Registrar it is likely to be economically unsound or the registration of which may have an adverse effect on the co-operative movement.
(2) Whether the liability of the members of a registered society is unlimited or limited by shares, the liability of the Government or of a financing bank, which has taken shares in such registered society, shall be limited to the share capital subscribed by the Government or such financing bank.