Tamil Nadu Co-operative Societies… Bare Act

The source publishes this enactment as a single document rather than provision by provision, so the whole text is below and there are no per-section pages for it. Nothing has been shortened.

Type	Rules
Year	1983
Jurisdiction	State of Tamil Nadu
Status	In force as published by the source
Text	Published as one document, as the source published it
Subjects	agriculture

THE TAMIL NADU CO-OPERATIVE SOCIETIES RULES, 1988

CHAPTER I. PRELIMINARY.

1. Short title and commencement

2. Definitions

CHAPTER II. REGISTRATION OF CO-OPERATIVE SOCIETIES AND THEIR BY-LAWS.

3. Form of application for registration of a society

4. Duties and responsibilities of chief promoter

5. Procedure for deciding questions under section 7

6. Subject matter of by-laws

7. Procedure on receipt of application for registration of a society

8. Period within which a society shall commence working

9. Procedure regarding amendment of by-laws.

10. Procedure regarding the change of liability.

11. Purposes for which the Registrar may direct amendment of by-laws and the manner of consulting the financing bank under section 12

12. Maintenance of records of names ,addresses, by-laws and other particulars relating to societies

13. Norms for notification of a society as a central society

14. Classification and categorization of societies

15. Annual subscription to co-operative unions

16. Procedure for convening a joint meeting in the case of amalgamation of two or more societies

17. Direction by Registrar for amalgamation of societies

18. Manner of certifying the copy of resolution

19. Condition and procedure for conversion of a society into a different class or category

CHAPTER III. MAINTENANCE OF ACCOUNTS AND BOOKS.

20. Accounts ,books and records to be maintained by a society

21. Period of retention of accounts ,books and records maintained by a society

22. Power of Registrar to direct accounts, books and records to be written up

23. Power of Registrar to freeze credit or any other assistance ii

24. Manner of certifying copies of entries in books, documents, etc.

25. Statement and returns to be furnished by a society to Registrar 25-A. Manner of placing the audit report of apex society before the Legislative Assembly of the State

CHAPTER IV. MEMBERS OF CO-OPERATIVE SOCIETIES AND THEIR RIGHTS AND LIABILITIES.

26. Classes of societies in which persons who are minors or of unsound mind may be admitted as members and the privileges, rights and liabilities of such members

27. Form of application for, and the manner of, admission as a member

28. Procedure for removal of an individual deemed to have been admitted as a member

29. Procedure for refund of value of share or interest in the capital by financing bank or apex society to individual members on the cessation of membership

30. Membership in more than one society of certain classes of societies

31. Restriction on admission of certain individuals

32. Admission of associate members

33. Class of persons for purpose of clause (a) of sub-section(3) of section 23

34. Procedure for deciding question under sub-section (4) of section 23

35. Removal of a member of a society

36. Time limit to communicate the decision of the board and to apply for redress

37. Manner of giving opportunity to a member before expulsion under section 25

38. Restrictions on defaulting member to vote at eletion or to represent a society in any other society

39. Restrictions on the right of a member to attend and participate in meeting

40. Fees for inspection of accounts by members

41. Classes of cases in respect of which refund of share or interest in the capital may be made before the expiry of two years

42. Nomination under section 30

43. Transfer or refund of share or interest in the capital on death of a member

44. Valuation of share or interest in the capital for the purpose of repayment

45. Shares not to be hypothecated to society

CHAPTER V. GENERAL MEETING AND MANAGEMENT OF SOCIETIES.

46. General meeting of societies

47. Representative general body and its constitution

48. Near relations of members of a board for purpose of clause (d) of sub-section(2) of section32 iii

49. Societies which may requisition special general meeting and special board meeting of other societies

50. Omitted

51. Election of members of the Board of a primary society other than a scheduled co-operative society 51-A. Eligibility to vote at, or stand for, election

52. Election of members of the board 52-A Powers and functions of the Election Commission

53. Election of office - bearers 53-A Manner of election of delegate

54. Omitted

55. Representative of a society to the board of another society

56. Term of office of delegate

57. Exercising powers and performing functions of the president in certain circumstances

58. Meeting of the board and failure to attend meeting, etc.

59. Constitution of the board of scheduled co-operative societies

60. Resignation from membership of the board

61. Removal of an elected member of the board

62. Removal of an elected office-bearer

63. Near relations of a paid employee for purposes of disqualification for membership of the board

64. Class of contracts, sales, purchases or transactions not to apply for disqualification for membership of the board

65. Constitution of sub-committee

66. Constitution and functions of Advisory Body

67. Payment of travelling allowance, daily allowance and sitting fees to the members of the board and delegates

CHAPTER VI. PROPERTIES AND FUNDS OF THE SOCIETIES.

68. Declaration under section 41

69. Deduction from the salary or wages

70. Transaction with non-members

71. Purchase of products or commodities for sale

72. Procedure for making purchase by sample, description or specification and verification of the goods so purchased

73. Prohibition against and restrictions on making purchases or transacting business by societies iv

74. Prohibition against a society entrusting whole of its business and restriction on entrusting part of its business to others

75. Restrictions on grant of loans

76. Conditions for making loan and providing overdrafts, etc., to depositors by financing bank

77. Restrictions on borrowings by societies

78. Investment of funds in immovable properties

79. Investment of funds in a banking company

80. Maintenance of fluid resources

81. Payment to a member for work done by him as a clerk

82. Payment of honorarium from general funds by a society with accumulated loss but working on current profit

83. Rebate on patronage out of funds of society

84. Society not to incur expenditure towards election dispute

85. Incurring expenditure from the funds of a society on special occasions

86. Expenditure on advertisements

87. Use of premises and immovable properties

88. Purchase and use of vehicles

89. Use of telephones

90. Co-operative research and development fund

91. Co-operative Education Fund

92. Audit of accounts of the Co-operative Research and Development Fund and the Co-operative Education Fund

93. Agricultural Credit Stabilisation Fund, Failed Wells Fund and Project Service Account

94. Payment of honorarium out of net profits

95. Manner of crediting dividend in excess of fourteen per cent

96. Bonus to members in certain classes of societies

97. Bonus to employee in certain societies

98. Common good fund

99. Reserve fund

100. Disposal of the reserve fund on the winding up of the society

CHAPTER VII. AUDIT, INQUIRY, INSPECTION OR INVESTIGATION, SURCHARGE AND SUPERSESSION.

101. Preparation of financial statement and other details required for audit 101-A. Qualifications of auditors and auditing firms

102. Procedure for conducting audit v

103. Levy of audit fees

104. Procedure regarding inquiry, inspection or investigation

105. Manner of consulting the financing bank under section 88

106. Duties of the Special Officer appointed under section 88 or section 89 CHAPTERVIII. SETTLEMENT OF DISPUTES AND ISSUE OF CERTIFICATE AND DECISION.

107. References of disputes

108. Issue of certificate under sub- section (1) of section 150

109. Procedure for taking decision on petitions and applications for which no separate procedure is provided for

110. Fees for application or petition under the Act etc.,

CHAPTER IX. ISSUE OF SUMMONS AND SERVICE OF NOTICE OR COMMUNICATION.

111. Mode of service of summons

112. Procedure for service of notice, etc.

CHAPTER X. WINDING UP AND CANCELLATION OF REGISTRATION OF SOCIETIES.

113. Procedure to be followed before ordering the winding up of a society under section 137

114. Procedure to be adopted by liquidator

CHAPTER XI. EXECUTION.

115. Procedure for delivery of immovable property resumed for breach of the conditions of assignment or allotment

116. Application for execution of decree

117. Fees chargeable for the processes of execution

118. Procedure to be followed where the judgment debtor dies before full satisfaction of decree vi

119. Procedure on receipt of application for execution of decree

120. Mode of proceeding against the properties of judgment-debtor

121. Rules for seizure and sale of movable property

122. Attachment of salary or allowances of public officer or servant of a Railway administration or local authority or co-operative society or firm

123. Attachment of share or interest in movables, negotiable instruments and property in custody of Court or public officer

124. Attachment of decree

125. Attachment of debt, share or other property not in possession of Judgment-debtor

126. Procedure in attachment and sale of immovable property

127. Application to set aside sale on deposit

128. Application to set aside sale on ground of irregularity or fraud

129. Confirmation of sale and issue of sale certificate

130. Delivery of possession

131. Reconveyance of immovable property by a society

132. Private alienation of property after attachment to be void

133. Cost and charges recoverable from sale proceeds

134. Receipts for payment of amount due

135. Investigation of claims and objections to attachment of property

136. Dismissal or adjournment due to decree-holder’s default

137. Attachment in execution of decrees of several courts and rateable distribution of assets

138. Authentication of notice of process

139. Procedure for recovery of sum due to Government

140. Mode of making attachment before judgment

141. Application under section 144

142. Procedure in respect of property deposited or entrusted

143. Conditions governing publication of informations respecting members or past or deceased members from whom any debt or outstanding demand is due to the society by financing bank

144. Recovery of debts under section 149

CHAPTER XII. OFFICERS AND EMPLOYEES OF SOCIETIES.

145. Qualifications of Managing Directors or Chief Executive Officers

146. Powers and functions of Managing Director or the Chief Executive Officer

147. Omitted

148. Security to be furnished by paid employees of societies vii

149. Conditions of service of paid officers and servants of societies

150. Constitution of Recruitment Bureau

151. Procedure to be followed by Recruitment Bureau

152. Common Cadre of service

CHAPTER XIII. JOINT FARMING SOCIETIES.

153. Declaration to be made by members of joint farming society

154. Matters to be specified in the agreement with joint farming society

155. Purpose for which lands may be acquired for a joint farming society

156. Procedure of arbitrator in land acquisition cases and deposit of charges before acquisition

CHAPTER XIV. LIFT IRRIGATION SOCIETIES.

157. Extent of land for purposes of sub-section (2) of section 104

158. Declaration by members of lift irrigation society

159. Term of agreement in favour of lift irrigation society

160. Condition for withdrawal of membership of a lift irrigation society

CHAPTER XV. AGRICULTURE AND RURAL DEVELOPMENT BANKS.

161. Procedure for distraint and sale under section 118 of produce of the mortgaged land including the standing crops thereon

162. Procedure for sale of mortgaged property under section 119

163. Application for recovery of moneys under section 120

164. Authorisation of the officers of State Agriculture and Rural Development Bank or primary agriculture and rural development bank to exercise the powers under the Tamil Nadu Revenue Recovery Act, 1864

165. Procedure regarding action under section 123 by the board of the State Agriculture and Rural Development Bank or the Trustee

166. Manner of certifying copies under sub-section (3) of section 129

CHAPTER XVI. APPEAL, REVISION AND REVIEW.

167. Qualifications of members of Co-operative Tribunal viii

168. Procedure regarding the disposal of appeal by the Co-operative Tribunal

169. Procedure regarding appeals other than those to Co-operative Tribunal and application for revision

170. Application for review

171. Fees chargeable for the processes of Appeal, Revision and Review

172. Authority to execute orders passed in appeal, revision or review

CHAPTER XVII. MISCELLANEOUS.

173. Fees for granting certified copies of document in the Registrar’s Office

174. Payment of expenses by societies

CHAPTER XVIII. CO-OPERATIVE SUGAR MILLS.

175. Application of this chapter

176. Definitions

177. Statement and returns to be furnished by Sugar Mill to Registrar

178. Additional qualifications for membership of a Sugar Mill

179. Membership in more than one Sugar Mill

180. Expulsion from membership of Sugar Mill

181. Restriction on the continuance of certain members

182. Admission of Associate Member

183. Power to grant loans

184. Entrustment of the business of a Sugar Mill

185. Constitution of Committees

186. Purchase and use of vehicles and telephones

187. Conditions of service

188. Co-operative Research and Development Fund

189. Powers and functions of the Managing Director

190. Restriction on defaulting member to vote at election or to represent Sugar Mill in any other society

SCHEDULE I

SCHEDULE II

SCHEDULE III

SCHEDULE IV

SCHEDULE V CO-OPERATION DEPARTMENT THE TAMIL NADU CO–OPERATIVE SOCIETIES RULES, 1988. (G.O.Ms.No.92, Co–operation, 14 th March 1988) In exercise of the powers conferred by sub – sections (1), (2) and (3) of section 180 of the Tamil Nadu Co-operative Societies Act, 1983 (Tamil Nadu Act 30 of 1983), and in supersession of all the rules made under the Tamil Nadu Co-operative societies Act, 1961 (Tamil Nadu Act 53 of 1961) and under the Tamil Nadu Co-operative Land Development Banks Act, 1934 (Tamil Nadu Act X of 1934), the Governor of Tamil Nadu hereby makes the following rules:- THE TAMILNADU CO–OPERATIVE SOCIETIES RULES, 1988.

CHAPTER I. PRELIMINARY.

1. Short title and commencement. __

(1) These rules may be called the Tamil Nadu Co–operative Societies Rules, 1988.

(2) They shall come into force on the date of the commencement of the Act, namely, the 13 th April 1988

2. Definitions. __ In these rules, unless the context otherwise requires,-

(a) “Act” means the Tamil Nadu Co–operative Societies Act, 1983 (Tamil Nadu Act 30 of 1983);

(b) “decree” means any decree, decision, award, order or certificate obtained or passed under the Act and includes a decree or order of a Civil Court;

(d) “default” means in respect of a loan, failure on the part of any member or person to repay to the society concerned the loan or any instalment thereof or any other amount due to the society within the time fixed for repayment or to keep any other obligation for the fulfilment of which a time limit has been specified in the by–laws and in respect of an advance or credit purchase, failure to repay the advance or sum due under 2 credit purchase within the time limit fixed for repayment and where no such time limit is fixed within thirty days from the date of advance or credit purchase;

(dd) “Election Commission” means the Tamil Nadu State Co-operative Societies Election Commission.

(e) “federal society” means an apex society to which central or primary societies of similar class or category are affiliated or a central society to which primary societies of similar class or category are affiliated;

(ea) “financial year” means the period commencing on the 1 st day of April of any year and ending with the 31 st day of March of the succeeding year.”;

(f) “Form” means a Form set out in Schedule – I;

(g) “general body” or “a meeting of the general body” means in relation to a society which has provided for the constitution of a representative general body under clause (b) of sub– section (1) of section 32, such representative general body in respect of the powers exercisable by the representative general body or a meeting thereof;

(h) “judgment-debtor” means the society against which or the person against whom a decree has been obtained;

(i) “Sale Officer” means the Registrar or a Government servant or an officer subordinate to the Registrar authorised or empowered by the Registrar to distrain and sell the produce of any land or to attach and sell the property of any judgement-debtor under the Act or these rules;

(j) “Schedule” means a Schedule appended to these rules;

(k) “section” means a section of the Act;

(l) “society” means a registered society;

(m) “Working Capital” means such portion of the reserve fund and other reserves created from out of net profits, paid up share capital, borrowings and deposits received by a society and debentures issued by a society as have not been invested in buildings and other fixed assets and as have not been eroded by way of accumulated loss. 3

CHAPTER II. REGISTRATION OF CO-OPERATIVE SOCIETIES AND THEIR BY-LAWS.

3. Form of application for registration of a society. – (1) Every application for the registration of a society shall be in Form No.1.

(2) The application shall be sent by registered post with acknowledgement due or delivered in person under acknowledgement.

4. Duties and responsibilities of chief promoter. __

(1) The chief promoter may collect money towards initial share capital and entrance fees for the proposed society from the applicants and other persons who are willing to join as members of the proposed society and he shall issue receipts for the amounts so received by him.

(2) The Chief promoter shall deposit all the money collected towards initial share capital and entrance fees in such financing bank or co–operative bank as may be approved by the Registrar in that behalf within seven days from the date of receipt of the moneys:

Provided that the chief promoter may retain such amount as may reasonably be necessary to meet the expenditure referred to in sub rule (4).

(3) The Chief promoter shall not withdraw any sum from the amount so deposited without the previous permission of the Registrar.

(4) The chief promoter may incur such expenditure as may reasonably be necessary for the formation of the proposed society and shall obtain vouchers for the expenses incurred by him. He shall, along with the application for registration of the proposed society, furnish the details of the moneys collected towards initial share capital and entrance fees and of the expenditure incurred by him upto the date of such application.

(5) The chief promoter shall maintain proper accounts along with the counterfoil of the receipts for the amounts collected and vouchers for the expenses incurred by him. The chief promoter shall place or cause to place the accounts together with the details of the expenditure incurred by him for the registration of the society for approval in the first general meeting of the society held after its registration. 4

(6) The chief promoter shall not carry on any business on behalf of the proposed society nor shall he incur any liability on behalf of the society.

(7) Where the Registrar has refused to register the proposed society, the Registrar shall, after the expiry of a period of three months from the date of communication of the order of refusal, but before the expiry of a period of six months from the said date, accord his permission to the chief promoter to withdraw the moneys deposited under this rule and to refund the same to the applicants and other person concerned rateably:

Provided that no such permission shall be accorded where any appeal has been filed against the refusal to register the society, until final orders (including orders on revision or review) are passed on the appeal.

5. Procedure for deciding questions under section 7. __ Before deciding any question under section 7, the Registrar shall issue a notice giving an opportunity to the parties concerned to make their representations. The Registrar shall decide the question within a period of ninety days from the date of issue of the notice.

6. Subject matter of by-laws. __

(1) the by–laws may deal with all or any of the following matters, namely : __

(a) the name and address of the society:

(b) the area of its operations;

(d) the purposes for which its funds may be applied;

(e) the qualifications for admission of membership and the payment, if any, to be made or interest to be acquired as a condition precedent for exercising the right of membership;

(f) the liability of the members of the society whether limited or unlimited, and if limited liability, the nature and extent of the liability of the members for the debts contracted by the society;

(g) whether persons who are minors or of unsound mind may be admitted as members, and if so, the privileges, rights and liabilities of such members as specified in the rules;

(h) whether persons may be admitted as associate members, and if so, the qualifications therefor as specified in the rules;

(i) the nature and amount of share capital, if any, of the society; 5

(j) the entrance and other fees, if any, to be collected from members;

(k) the circumstances under which withdrawal from membership shall be permitted and the procedure to be followed in cases of withdrawal, ineligibility and death of members;

(l) the maximum share capital that can be refunded, if any, in any co-operative year by the society;

(m) the procedure for expulsion of members and as to how the assets and liabilities of an expelled member in the society shall be dealt with;

(n) the constitution of representative general body and the powers of the general body that are exercisable by the representative general body and the restrictions and conditions subject to which the representative general body may exercise its powers;

(o) the number of members to be elected by different constituencies to the board

(p) the constitution of the board and the duties and powers of the board and officers;

(q) the constitution and functions of advisory body or purchase committee, if any;

(r) the manner in which the society may borrow funds, the maximum borrowing power, the maximum rate of interest payable on borrowings and the procedure to be followed in such borrowings;

(s) conditions regarding marketing of produce of members;

(t) the manner in which the society shall transact business with its members and others and the terms and conditions governing such business;

(ta) the conditions regarding the minimum level of services of the society that shall be utilised by a member;

(u) custody, maintenance and keeping of cash and other properties, the mode of custody and investment of funds and the mode of keeping the accounts, books and records;

(v) the consequence of default in payment of any sum due by a member;

(w) convening of the meetings of the general body and the board, notice, business and quorum for such meetings, conditions for, and manner of, adjournment of such meetings;

(wa) the condition regarding the minimum requirement of attending the meetings of the general body by a member of the society; 6

(x) the nature of penalty and manner in which such penalty may be imposed on a member for non-compliance with the terms and conditions subject to which services are rendered by the society;

(y) the authorisation of an officer or officers to sign documents including contracts or to institute and defend suits and other legal proceedings on behalf of the society;

(z) the method of appropriating payments made by members from whom moneys are due;

(aa) the preparation and submission of annual or other statements as are specified in the Act or these rules and the publication of the same;

(bb) the other funds to which and the rates at which contribution from the net profits may be made under clause seventhly of sub-section(2) of section 72;

(cc) the constitution and maintenance of various funds as required to be maintained under the Act, these rules and the by-laws;

(dd) the utilization of the reserve and other funds constituted by the society out of profits;

(ee) the settlement of disputes referred to in section 90;

(ff) the affiliation of the society to a financing bank or any other institution;

(gg) the inspection of the accounts of the society by members and the fee payable;

(hh) the manner of making, amending or repealing by-laws;

(ii) in the event of winding up of the society, the purpose for which surplus assets, if any, shall be utilised;

(jj) in the case of credit societies __ (A) the maximum amount of loan or advance that may be made to a member; (B) the maximum rates of interest chargeable on loans or advances made to 7 members; (C) the conditions subject to which loans or advances may be made to members and penalties for misapplication of loans or advances so made; (D) the procedure for granting extension of time for the repayment of loans or advances; (E) the circumstances under which a loan or advance may be recalled;

(kk) in the case of non-credit societies, the mode of conducting business such as purchase, storing, processing, sale, stock-taking and other like matters;

(ll) in the case of society having both credit and non-credit functions, matters referred to in clauses (jj) and (kk);

(mm) subject to the provisions contained in sections 73 to 77 and the rules made and orders issued thereunder, special by-laws, specifying the authority competent to fix, revise or regulate the strength of the establishment, the scales of pay and allowances of the employees of the society; and the conditions of service of employees of the society providing for— (A) the age at entry in service and for retirement on superannuation; (B) the minimum educational and other qualifications for the several categories of employees; (C) the method of recruitment of candidates; (D) the service conditions including leave to which employees are eligible, the authority competent to sanction leave, the penalties that may be imposed by way of disciplinary action and the authority competent to impose such penalities and the appellate authority in respect of disciplinary action taken by such authority; (E) the establishment of employees provident fund; and 8 (F) payment of gratuity on retirement or death.

(2) The by-laws may also deal with such other matters incidental to the organisation and working of the society and the management of its business as may be deemed necessary.

7. Procedure on receipt of application for registration of a society. __

(1). The Registrar shall enter the particulars of the application for registration of a society on its receipt in a register to be maintained by him in Form No.2, give a serial number to the application and issue forthwith an acknowledgement thereof in Form No.3. If the application prima-facie appears not to be in order or it does not contain the particulars required under rule 3, the Registrar shall, within fifteen days from the date of receipt of the application in the office, pass an order refusing to register the proposed society specifying the reasons therefor in Form No.4 and send it to the chief promoter by registered post with acknowledgement due or by personal delivery under acknowledgement.

(2) Where no order of refusal has been passed under sub-rule (1), the Registrar shall examine the application and the proposed by-laws in order to satisfy himself that all the requirements specified in sub-section (1) of section 9 have been complied with.

(3) The Registrar may, before passing final order, call for such further information from the chief promoter or make such enquiry as he may deem necessary.

(4) The Registrar may, before registering a society, make such alteration in the proposed by-laws as he may deem necessary without changing the principal objects of the society.

(5) If the Registrar is satisfied that all the requirements of sub-section (1) of section 9 have been complied with he shall register the proposed society and its by-laws within one hundred and twenty days from the date of receipt by him of the application for registration.

(6) Where the Registrar is not so satisfied, he shall pass an order of refusal and communicate it to the chief promoter in Form No.5 together with the reasons therefor. The order of refusal to register the proposed society shall be communicated by the Registrar within one hundred and twenty days from the date of receipt by him of the application for registration. 9

(7) Where a society and its by-laws are registered under sub-rule (5) or are deemed to have been registered under sub-section (3) of section 9, the Registrar shall issue to the chief promoter a certificate of registration in Form No.6 signed by him and bearing his official seal together with two certified copies of the by-laws, one for safe custody and the other for reference as registered or deemed to have been registered by him.

(8) A copy of the certificate of registration together with a copy of such by-laws shall be furnished by the Registrar to—

(i) the financing bank concerned;

(ii) the federal society concerned;

(iii) the district co-operative union concerned or the Tamil Nadu Co-operative Union, as the case may be;

(iv) the Regional Officer, if any, who is the next higher authority to the registering authority;

(v) the Registrar for the State; and

(vi) the District Co-operative Audit Officer concerned.

(9) The Registrar shall maintain in Form No.7 a register of all societies registered or deemed to have been registered.

(10) Where a society is deemed to have been registered under sub-section (3) of section 9, the Registrar shall also enter the details of such society in a separate register in Form No.8. The Registrar shall review the case of every such society and satisfy himself whether such society complies with the provisions of sub-section (1) of section 9, within a period of ninety days from the date on which the society was deemed to have been registered. The result of such review shall be entered in the register maintained in Form No.8.

8. Period within which a society shall commence working. __ Every society registered or deemed to have been registered shall commence working within a period of three months from the date of its registration. The Registrar may, either suo-moto or on application from the President of the society, extend such period if, in the opinion of the Registrar, such extension is necessary: 10

Provided that the total period shall not exceed one year in the aggregate from the date of registration of the society.

Explanation.- For the purpose of this rule, the society shall be deemed to have commenced working if,—

(i) the society has held the first general meeting after its registration and admitted members or has allotted shares; and

(ii) its board has held its first meeting

9. Procedure regarding amendment of by-laws. – (1) Save as otherwise provided in the Act and these rules, every amendment of by-laws shall be made only by a resolution passed by a majority of the members present and voting at a meeting of the general body for which notice of amendment of by-laws has been given in accordance with this rule and the by-laws.

(2) Every such resolution shall be forwarded to the Registrar within a period of two months from the date of such meeting with an application in Form No.9 for the registration of amendment of by-laws, which shall be signed by the President or the Vice-President and two other members of the Board who were present at the meeting of the general body and sent to the Registrar by registered post with acknowledgement due or delivered personally under acknowledgement.

Explanation: – For the purpose of this rule, the term “President” includes Chairperson and the term “Vice-President” includes Vice-Chair person.

(3) On receipt of the application in Form No. 9 the Registrar shall enter the particulars in a register to be maintained by him in Form No.10, give a serial number to the application and issue forthwith an acknowledgement thereof in Form No.11.

(4)Where on examination of the proposed amendment of by-laws, the Registrar is satisfied that all the provisions of sub-section (3) of section 11 have been compiled with, he shall register the proposed amendment within a period of one hundred and twenty days from the date of receipt by him of the application in Form No.9. 11

(5) Where the Registrar is of the opinion that the amendment proposed does not comply with any of the provisions of sub-section (3) of section 11, he shall by notice in writing in Form No.12, call upon the society to show cause within a period of not less than fifteen days from the date of receipt of such notice as to why the registration of the proposed amendment shall not be refused.

(6) Where on examination of representations, if any, received from the society within the period specified in sub-rule (5), the Registrar is satisfied that all the provisions of sub-section (3) of section 11 have been complied with, he shall register the proposed amendment within a period of one hundred and twenty days from the date of receipt by him of the application in Form No. 9.

(7) Where no representation is received from the society within the period specified in sub-rule (5) or on examination of the representations received from the society within the period aforesaid, the Registrar is satisfied that the proposed amendment does not comply with any of the provisions of sub-section(3) of section 11, he shall pass an order in Form No.13 refusing to register the proposed amendment and communicate it together with the reasons therefor to the society within a period of one hundred and twenty days from the date of receipt by him of the application in Form No. 9:

Provided that notwithstanding the non-receipt of representations from the society within the period specified in sub-rule (5), the Registrar may, if he is satisfied that all the provisions of sub-section (3) of section 11 are complied with, register the proposed amendment.

(8) Where the amendment is registered under this rule or deemed to have been registered under sub-section (6) of section 11, the Registrar shall issue a certificate of registration in Form No.14 to –

(i) the society (two copies);

(ii) the financing bank;

(iii) the federal society in which the society is a member or eligible to become a member;

(iv) the District Co-operative Union or the Tamil Nadu Co-operative Union in which the society is deemed to be a member; 12

(v) the Regional Officer, if any, who is the next higher authority to the registering authority,

(vi) the Registrar for the State; and

(vii) the District Co-operative Audit Officer concerned.

(9) Where an amendment of by-laws of a society is deemed to have been registered under sub-section (6) of section 11, the Registrar shall enter the details of amendments deemed to have been registered in a separate register in Form No. 15. The Registrar shall review the case of each such amendment and satisfy himself whether such amendment complies with all the provisions of sub-section (3) of section 11, within a period of ninety days from the date on which the amendment was deemed to have been registered. The result of such review shall be entered in the register maintained in Form No. 15.

(10) Where any amendment of the by-laws proposed by a society involves, in the opinion of the Registrar, a material change in the objects or operations of the society, he may register the proposed amendment only if the society has followed the procedure specified in rule 19.

10. Procedure regarding the change of liability. – Where amendment of the by-laws of a society is proposed for changing its liability from unlimited to limited under section 5, the procedure specified in rule 9 shall apply with the modification that the amendment shall be approved by a resolution passed by a majority of not less than two thirds of the members present and voting at a meeting of the general body specifically called for the purpose under section 5.

11. Purposes for which the Registrar may direct amendment of by-laws and the manner of consulting the financing bank under section 12. – (1) The Registrar may direct amendment of by-laws under sub-section (1) of section 12, for the following other purposes, namely:-

(a) securing proper and efficient management of the business of any society or class or category of societies;

(b) securing proper implementation of co-operative production or other development programme approved or undertaken by the Government; 13

(c) preventing the affairs of any society from being conducted in a manner detrimental to the interests of the members or the depositors or the creditors thereof.

(2) Before calling upon any society to show cause why an amendment of by-laws shall not be made under sub-section (1) of section 12, the Registrar shall furnish to the board of the financing bank, if any, to which the society is affiliated, a copy of the proposed amendment of by-laws together with a statement of the reasons for the amendment and require the board of the financing bank to communicate its comments on the proposed amendment. Before proceeding further with the proposed amendment, the Registrar shall consider the comments, if any, of the board of such financing bank.

12. Maintenance of records of names, addresses, by-laws and other particulars relating to societies.—(1) Every society shall keep a copy of its registered by-laws with all subsequent amendments thereto arranged in the order in which the amendments are registered. One copy of the registered by-laws shall be kept in safe custody, and the other copy of the registered by-laws shall be kept as a reference copy.

(2) Every financing bank, every federal society and every co-operative union shall also keep a register of the names and addresses of societies affiliated to them and their registered bylaws with all subsequent amendments thereto arranged in the order in which the amendments are registered.

(3) Whenever there is any change in the address of a society, the society shall communicate a copy of the notice in that behalf to the Registrar under section 37, to the financing bank, the federal society to which it is affiliated and to the co-operative union concerned.

(4) The financing bank, federal society and co-operative union shall also maintain a register containing important information about the working of the societies affiliated to them as at the end of every co-operative year which shall contain, among others, the following:-

(i) Registration number and name of the society with full address

(ii) (a) Number of members 14

(b) Paid up share capital Rs.

(d) Reserve Fund (i) Invested Rs.

(ii) Yet to be invested Rs.

(e) Other reserves Rs.

(f) Borrowings Rs.

(g) Working Capital Rs.

(iii) (A) In the case of credit societies,-

(a) Loans Issued Rs.

(b) Loans collected Rs.

(d) Overdues Rs.

(e) Percentage of overdues to demand. (B) In the case of non-credit societies,

(a) Purchases Rs.

(b) Production, Processing, etc., of goods Rs.

(d) Closing stock Rs. (C) In the case of societies having both credit and non-credit functions Particulars as specified in columns (A) and (B) above.

(iv) Working results: Profit or Loss Rs.

(v) Such other particulars as may be specified by the Registrar.

(5) In respect of societies affiliated to a federal society, the federal society concerned and in respect of societies not affiliated to a federal society but affiliated to a financing bank, the financing bank concerned and in respect of societies not affiliated to a federal society or financing bank, the co-operative union concerned shall consolidate and furnish, -

(i) the information as mentioned in the register specified in sub rule(4) to the Registrar within three months of the close of the co-operative year to which it relates; and 15

(ii) periodical, statistical or other statements containing particulars regarding the working or functioning of the affiliated societies.

13. Norms for notification of a society as a central society. __ For the purpose of notifying a society as a central society under sub-clause (b) of clause (9) of section 2, -

(a) the turnover of the society including issue of loans during the preceding co-operative year or the working capital of the society at the end of the preceding co-operative year shall not be less than one crore of rupees; and

(b) the number of members of the society at the end of the preceding co-operative year shall not be less than five thousand.

14. Classification and categorisation of societies. __

(1) After registration of a society, the Registrar shall classify and categorise the society into one or other of the following classes and categories of societies, according to the principal object provided in its by-laws:- Serial number Class Category

1. Agricultural Producers Marketing Society ---

2. Agro-Engineering Society ---

3. Consumer Society (i) Urban Stores.

(ii) Rural Stores.

(iii) Staff and Students Stores.

(iv) Employees Stores.

(v) Canteen and Restaurant.

4. Co-operative Union ---

5. Credit Society (i) Agricultural Service Society.

(ii) Primary Agriculture and Rural Development Bank. 16

(iii) Financial Bank.

(iv) Urban Bank.

(v) Urban Credit Society.

(vi) Employees Credit Society.

6. Dairy Society (i) Milk Producers Society.

(ii) Milk Consumers Society.

(iii) Milk Supply Society.

(iv) Milk Supply Union.

(v) Dairy farm.

7. Farming Society (i) Joint Farming Society.

(ii) Collective Farming Society.

(iii) Tenant Farming Society.

(iv) Land Colonisation Society.

(v) Gramdhan Sarvodaya Society.

(vi) Bhoodan Service Society.

8. Fisheries society ----

9. Housing society (i) Building (Housing) Society.

(ii) House Building Society.

(iii) House Construction Society.

(iv) Township.

(v) Tenancy Housing Society.

(vi) Rural Housing Society.

(vii) House Sites society.

(viii) House Service Society.

10. Industrial Society (i) Artisans Industrial Society.

(ii) Technicians Industrial society.

(iii) Producers’ Industrial Society.

(iv) Industrial Service Society.

11. Labour Contract society ----

12. Lift Irrigation Society ---- 17

13. Miscellaneous Society (i) Barbers Society.

(ii) Cattle or Duck or Goat or Pig or Poultry or Sheep Breeding Society.

(iii) Indian Medical Practitioners Pharmacy.

(iv) Other Miscellaneous Society.

(v) Printing Press.

(vi) Rural Electric Society.

(vii) Salt Workers Society.

(viii) Washermen Society ; and

(ix) Writers Society.

14. Oil Seeds Growers Society -----

15. Processing Society (i) Sugar Mill.

(ii) Spinning Mill.

(iii) Textile Processing Mill.

(iv) Industrial Tea Factory

16. Omitted

17. Weavers Society ---

18. Sericulture Society ---

Explanation. – For the purpose of this rule, the expression, --

(a) “agro-engineering society” means a society which has as its prinicipal object the provision of agricultural services to its members and undertaking servicing, repairing, hiring, manufacturing and selling agricultural implements and machineries;

(b) “dairy society” means a society which has as its principal object the arranging for, and undertaking of, production of milk or purchase of milk produced by its members and storing, processing and marketing of such milk and its products or the supply of milk and its products to its members and includes any society which has as its principal object the provision of facilities for the operation of a dairy society; 18

(c) “farming society” means a society which has as its principal object the organising of cultivation jointly or otherwise of the lands held by the society or by its members with a view to increasing agricultural production and employment, by proper utilisation of land, labour and other resources;

(d) “fisheries society” means a society which has as its principal object the provision of facilities for inland or marine fishing operations or undertaking of marketing of fish, fish products and other marine products of its members and includes any society which has as its principal object the provision of facilities for the operation of a fisheries society;

(e) “housing society” means a society which has as its principal object the purchase or acquisition of land to lay out as house sites for the benefit of its members or the construction of houses for its members or the financing or facilitating the construction of houses by its members or the maintenance of, or the provision of amenities to house;

(f) “labour contract society” means a society which has as its principal object the securing and provision of employment of its members by executing works with the help of its members or through them;

(g) “miscellaneous society” means a society which does not fall under any other class;

(h) “processing society” means a society which has as its principal object the undertaking of the processing, such as ginning, spinning, crushing, decorticating, pressing, finishing, hulling or curing the produce or other raw materials of its members or for the benefit of its members and includes any society which has as its principal object the provision of facilities for the operation of a processing society;

(i) “industrial society” means a society which has as its principal object the production of articles or finished goods through or with the help of its members or the provision of service facilities to its members who are artisans, technicians or small producers who are its members and includes any society which has as its principal object the provision of facilities for the operation of an industrial society; 19

(j) Omitted

(k) “Sericulture society” means a society which undertakes mulberry cultivation or silkworm rearing or chawkie rearing or silk reeling or silk twisting and do other service activities to sericulturists by sale of inputs, laying, etc.,

(2) The Registrar may categorise any class of societies with reference to the composition of their membership or the nature of business transacted by them or the articles handled by them or any other similar consideration.

(3) Any society may also be further classified by the Registrar on structural basis into “apex society”, “central society’ and “primary society”.

(4) If any question arises as to the class or category to which a society belongs within the meaning of this rule, the question shall be referred to the Registrar for decision.

15. Annual subscription to co-operative unions. __ The rate of annual subscription payable to co-operative unions under sub-section (2) of section 20 shall be as follows:- (A) District Co-operative Union Annual subscription

(i) Primary societies having jurisdiction of not more than one revenue taluk. Ten rupees for every one lakh of rupees of working capital or part thereof subject to a maximum of two thousand rupees.

(ii) Primary societies having jurisdiction of more than one revenue taluk and central societies other than co-operative training institutes. One hundred rupees for every ten lakh of rupees of working capital or part thereof subject to a maximum of five thousand rupees. 20 (B) Tamil Nadu Co-operative Union Annual subscription

(i) District co-operative Unions Ten percent of the annual subscription collected by the district co-operative union from the member societies.

(ii) Omitted

(iii) Apex societies One thousand rupees for every one crore of rupees of working capital or part thereof subject to a maximum of twenty five thousand rupees.

Explanation:- For the purpose of this rule, the working capital as on the 31 st March immediately preceding the co-operative year in respect of which the subscription is payable shall be taken into account.

16. Procedure for convening a joint meeting in the case of amalgamation of two or more societies.—(1) (a) The person by whom a joint meeting referred to in clause (e) of subsection (2) of section 13 shall be convened shall be the person elected by a joint meeting of all the boards of the societies which have resolved to amalgamate into one society.

(b) If the boards of the societies referred to in clause (a) fail to meet and elect a person within three months from the date of despatch of the preliminary resolution by the societies or if a person is not elected for any reason, the Registrar may nominate the president of any of such societies as the person to convene the joint meeting.

(c) Notwithstanding anything contained in the by-laws of any such society, the person so elected or nominated shall determine the date, time and place of the meeting. He shall preside over the joint meeting and in his absence, the members attending the joint meeting may choose a person from among themselves to preside over the joint meeting.

(2) The person elected and nominated to convene the joint meeting and in his absence, the person presiding over the joint meeting shall, within seven days from the date of the joint 21 meeting, communicate a copy of the resolution of the joint meeting to all such societies, the financing bank, the federal society and the Registrar.

17. Direction by Registrar for amalgamation of societies. __

(1)The draft of the proposed order for amalgamation of societies under section 14 shall, among others, specify the manner in which the board of the society resulting from such amalgamation shall be constituted and the bylaws which such society shall follow.

(2) If any society fails, within a period of fifteen days from the date of receipt of the draft order, to communicate a copy of the draft order or gist thereof under clause (a) of sub-section (2) of section 14, the Registrar may authorise the financing bank or the federal society or any person subordinate to him or an employee of the society concerned to communicate, within a period of fifteen days from the date of such authorisation, a copy of the draft order or gist thereof to every member and creditor of such society calling upon such member or creditor to send his objections and suggestions, if any, direct to the Registrar.

(3) The draft order or gist thereof shall be communicated by the society concerned or by the person authorised by the Registrar, under sub-rule (2) by one or more of the following modes, namely: __

(a) by giving or tendering it to such person and if he is not found, to some adult member of his family under acknowledgement; or

(b) by sending it by post under certificate of posting to his last known address; or

(4) Where the by-laws of an amalgamated society do not provide for nomination of all the members of the board, the Registrar may nominate the board including the president and vice-president to conduct its affairs for a period not exceeding three months from the date of its registration and the board so nominated shall exercise all the powers conferred and discharge all the duties imposed on the board under the by-laws of such amalgamated society,

(5) Upon the issue of the order under sub-section (1) of section 14, the board of each of the societies ordered to be amalgamated shall deliver possession of the books, accounts, 22 documents, securities, cash and other properties in their possession to the board of the amalgamated society nominated under sub-rule (4) or under clause (b) of sub-section (1) of section 33.

(6)The Registrar shall, before the expiry of the term of office of the board nominated under sub-rule (4), arrange for the constitution of a board in accordance with the provisions of the Act, these rules and the by-laws of the amalgamated society and as soon as such a board is constituted, such nominated board shall irrespective of the period for which it was nominated, cease to function and it shall handover the management of the society to the board so constituted.

(7) Every member or creditor referred to in sub-section (4) of section 14 shall make an application separately which shall be distinct from his suggestions and objections.

(8) Where the copy to the draft order or gist thereof is communicated under sub-rule (2) by any person authorised by the Registrar, the Registrar may, by order, determine the costs to be paid to the Government or to the person authorised, as the case may be, and direct its recovery from the society concerned or the amalgamated society.

18. Manner of certifying the copy of resolution. __

(1) The copy of the resolution referred to in clause (c) of sub-section (1) of section 13 shall be signed by the president and not less than two members of the board ,who were present at the meeting of the general body, and shall bear the seal of the society.

(2) the copy of the resolution referred to in clause (c) of sub-section (2) of section 13 shall be signed by the person presiding over the joint meeting and not less than one member of the board of each society represented at such joint meeting and shall bear the seals of all the societies concerned.

(3) The copy of the resolution referred to in sub-section (3) of section 15 shall be signed by the president of each of the societies concerned and not less than two members of the board of each such society, who were present at the meeting of the general body, and shall bear the seal of the society concerned. 23

19. Conditions and procedure for conversion of a society into a different class or category. __

(1) No society shall convert itself into a society of a class or category different from the one to which it belongs unless,--

(a) the principal object for which the society is registered no longer exists or the society cannot render service to its members;

(b) the society after conversion will comply with the requirements of sound business and has reasonable chances of success; and

(c) the area of operations of the society after conversion will not overlap the area of operations of another society of the class or category into which the society is proposed to be converted, save as permitted by the Registrar.

(2) Subject to the provisions of sub-rule (1), any society may, at a meeting of its general body specially called for the purpose, of which atleast fifteen clear days’ notice shall be given to its members, resolve to convert itself by an amendment of its by-laws into a society of a class or category different from the one to which it belongs. The said resolution (hereinafter in this rule referred to as the preliminary resolution) shall include the proposed amendments to the by-laws.

(3) (a) A copy of the preliminary resolution shall be sent to all the members and creditors of the society.

(b) Any member of the society may, notwithstanding any by-law to the contrary, by notice given to the society within a period of one month from the date of receipt by him of the preliminary resolution, intimate his intention not to continue as a member of the society and to withdraw his share or interest in the capital and other moneys due to him.

(c) Any creditor of the society may, notwithstanding any agreement to the contrary, by notice given to the society within a period of one month from the date of receipt by him of the preliminary resolution, intimate his intention to demand a return of the amount due to him.

(4) After the expiry of two months from the date of despatch of the preliminary resolution to all the members and creditors of the society, a meeting of the members of the society, of which atleast fifteen clear days’ notice shall be given to its members, shall be 24 convened for considering the preliminary resolution. If, at such meeting, the preliminary resolution is confirmed by a resolution passed by a majority of not less than two-thirds of the members present and voting either without changes or with such changes as, in the opinion of the Registrar, are not material, he may, on receipt of a copy of such resolution signed by the president and not less than two members of the board who were present at the meeting of the general body and bearing the seal of the society register the amendment to the by-laws adopted by the society subject to the provisions of sub-rules (1) and (6) and of section 9. On such registration, the conversion shall be deemed to have taken effect.

(5) At the meeting referred to in sub-rule (4) provision shall be made by another resolution for--

(a) the repayment of the share or interest in the capital and other moneys due to all the members who have given notice under clause (b) of sub-rule(3); and

(b) the satisfaction of the claims of all the creditors who have given notice under clause (c) of sub rule(3):

Provided that no member or creditor shall be entitled to such repayment or satisfaction until the amendments to the by-laws are registered under sub-rule (4).

(6) If, in the opinion of the Registrar, the provision made for the repayment of the share or interest in the capital and other moneys due to the members and the satisfaction of the claims of the creditors referred to in sub-rule (5) is not satisfactory, the Registrar may refuse to register the amendment to the by-laws adopted by the society.

CHAPTER III MAINTENANCE OF ACCOUNTS AND BOOKS

20. Accounts, books and records to be maintained by a society. __

(1) Every society shall keep and maintain correctly the following accounts, books and records upto date for the purpose of recording the business transacted by it, namely:-

(a) Minutes books for recording the proceedings of the board or of the meeting of the general body. 25

(b) Register of application for membership containing the name and address of the applicant, the date of receipt of application, the number of shares applied for, the date of payment in the society in respect of membership and the amount paid, the date of admission and in case of refusal of admission, the date of communication of the decision refusing admission.

(c) Admission book showing the name and address of each member, the date of admission, the shares taken by him and the amount paid by him towards such shares and entrance fee paid and the amount of share capital refunded to him, if any, together with the date of each such payment and refund.

(d) Nomination register containing the name and address of the person nominated by a member to succeed to his share or interest in the capital of the society or other money due and the relationship with him.

(e) A book showing the name and address of each associate member, the date of admission and the amount paid by him towards admission fees.

(f) Day book showing daily receipts and expenditure and the cash balance at the end of each day.

(g) Receipt book or challan for money received by the society.

(h) Voucher file containing all vouchers for expenditure incurred by the society, numbered serially and filed chronologically.

(i) Ledger of borrowings showing deposits and other borrowings of all kinds.

(j) In the case of a society with unlimited liability, property statement of members showing the assets and liabilities of each individual member on the date of his admission with full details of the property including the survey number of the lands, the statement being revised as often as may be necessary and in any case atleast once in three years and such statement being entered in a register in a stitched volume.

( k) In the case of societies issuing loans-

(i) Loan application register; 26

(ii) Loan ledger showing the number and date of disbursement of each loan issued to members, the amount of loan, the purpose for which it is granted and the date or dates of repayment distinguishing principal and interest;

(iii) Liability register showing the extent of indebtedness of each member to the society whether on account of loans taken directly by him or on account of loans for which he stands as surety;

(iv) Register of lands cultivated by members;

(v) Credit limit statement;

(vi) Register of declaration made under section 41;

(vii) Register of loan foreclosed;

(viii) Register showing progress of application for arbitration and execution;

(ix) Register of immovable property of judgment debtors brought in auction by the society.

(l) In the case of a consumer society, effecting sales of any commodity to members or non – members,-

(i) bill book containing the names and addresses of the purchasers; and

(ii) sales chitta.

(m) In the case of a society, the working capital of which exceeds twenty thousand rupees, general ledger showing receipts and disbursements and the outstanding under various heads from day to day.

(n) In the case of a society to which rule 80 applies, register of fluid resources showing the immediate liabilities of the society and the extend of fluid resources available to meet them.

(o) Monthly register of receipt and disbursements or Trial balance.

(p) Register of dividend containing the details of dividends declared on the paid up share capital of members and the payments therefrom. 27

(q) Rectification register containing the objections or defects pointed out during inspection, audit, etc., rectifications approved by the board, remarks of inspecting officers, etc., and further action taken thereon.

(r) Any others accounts, books and records that may be specified by the Registrar from time to time in respect of a society or class or category of societies.

(2) Every society shall also maintain a register showing the particulars of various accounts, books and records maintained by the society in respect of every co-operative year.

21. Period of retention of accounts, books and records maintained by a society. __

(1) The accounts, books and records maintained by a society specified in column (2) of the Table below shall be retained permanently or till the completion of the period specified in column (3) thereof, from the date of issue of the last audit certificate to which they relate or from the date of completion of action on all the items in the accounts-books and records, whichever is later:- THE TABLE Serial number Accounts, books and records Period

(1) (2) (3)

1. Minutes Book Permanent

2. Notice and agenda notes for meetings 5 years

3. Membership application register 10 years

4. Admission book Permanent

5. Nomination register Permanent

6. Associate membership book Permanent

7. Share certificate book Permanent

8. Share withdrawal or transfer register Permanent

9. Register showing the list of members Permanent

10. Rough cash book or chitta or cash scroll 5 years

11. Receipt book or bill book or challan 10 years

12. Voucher file and acquittance roll 10 years 28

13. Main Day Book and Subsidiary day books Permanent

14. Ledgers of deposits and other borrowings Permanent

15. Diary of due dates to watch repayments of deposits or Borrowings 1 year

16. Application for loans or making deposits, etc 10 years

17. Loan application register 10 years

18. Loan ledgers Permanent

19. Investment register or ledger Permanent

20. Diary of due dates of loans taken by member or investments made 1 year

21. Suspense recoverable (due to) and suspense payable (due by) ledgers or registers Permanent

22. General ledger and others subsidiary ledgers Permanent

23. Register of monthly statement of receipts and disbursements or monthly trial balances 10 years

24. Register of ledger balances reconciled with general ledger balances 5 years

25. Register of cheque books 5 years

26. Register of loan bonds Permanent

27. Register of declaration made under section 41 12 years

28. Loan verification register 10 years

29. Liability register of members (showing direct and indirect liability of members) Permanent

30. Property statement of members Permanent

31. Register of lands cultivated by members 10 years

32. Credit limit statement 10 years

33. Register of Reserve Fund and other funds Permanent

34. Register of fluid resources 5 years

35. Register of grants (subsidies) received from Government or other bodies Permanent 29

36. Register of overdue loans 3 years

37. Register of foreclosed loans 3 years

38. Register of application for arbitration and execution 10 years

39. Register of immovable properties of defaulting members purchased in auction by the society Permanent

40. Register of immovable properties owned by the society Permanent

41. Register of vehicles owned by the society Permanent

42. Furniture Register Permanent

43. Log book 10 years

44. Dividend register 10 years

45. Register of bonus to members 10 years

46. Price fixation (costing) register 5 years

47. Goods (Stock) ledgers or registers 10 years

48. Register of goods (stock) on which pledge loans issued 10 years

49. Purchase, issue and stock register 10 years

50. Sales bill books 7 years

51. Sales chitta 7 years

52. Salesman indent books or registers 5 years

53. Register of issue to salesman 10 years

54. Salesman liability register 10 years

55. Stock book of empties 10 years

56. Stock register of goods received for sale on agency basis or on consignment basis 10 years

57. Accounts and registers for consignment stock or for agency stock 10 years

58. General current or correspondence register 5 years

59. Correspondence files- L.Dis K.Dis D.Dis 1 Year 3 years 10 years 30 R.Dis Permanent

60. Periodical current register and periodical reports 3 years

61. Staff attendance register 3 years

62. Casual leave register 1 year

63. Casual leave applications 1 year

64. Other leave applications 3 years

65. Service register Permanent

66. Stock register of books and forms 10 years

67. Register of library books Permanent

68. Register for issue of library books 10 years

69. Money order (inwards) register 5 years

70. Registered tapal (inwards) register 3 years

71. Tapal register 3 years

72. Despatch register 3 years

73. Postage or stamp account book 3 years

74. Notice for confirmation of balances 3 years

75. Confirmations received but not attached to final audit memorandum 3 years

76. Final Audit Memorandum and Audit Certificate Permanent

77. Defects rectification register in respect of audit and Inspection 10 years

78. Visitors remarks book Permanent

79. Register of affiliated societies Permanent

80. Register of office-bearers of affiliated societies 3 years

81. Register of delegates of affiliated societies 5 years

82. Tour programme and diary of field officers or staff 5 years

83. Rotation register regarding inspection or visit to co-operative societies 5 years

84. Inspection reports of affiliated societies 5 years

85. General information register of affiliated societies Permanent 31

86. Register showing the particulars of various accounts, books and records maintained by the society in every co-operative year Permanent

(2) Accounts, books and records other than those specified in sub- rule (1) maintained by a society shall be retained by the society for such period as the Registrar may specify from time to time by general or special order:

Provided that where there is no period fixed either in this rule or by the Registrar, the accounts, books and records maintained by the society shall be retained for such period not less than three years from the date of issue of the last audit certificate to which they relate as may be decided by the board.

(3) It shall be the duty of the chief executive or the president where there is no chief executive, to arrange for the safe custody of the accounts, books and records of the society.

(4) Every society shall prepare periodically and atleast once in a year a list of accounts, books and records that may be destroyed and such accounts, books and records shall be actually destroyed only after obtaining specific orders from the chief executive or from the president, where there is no chief executive which shall not be granted unless the chief executive or the president as the case may be, satisfies himself that the retention of such accounts, books and records is no longer necessary.

(5) Notwithstanding the period of retention specified in sub rule (1) and (2) above, the chief executive or the president, where there is no chief executive, may while scrutinising the list of records to be destroyed, order that a particular account, book or record be retained for a longer period or permanently.

(6) Notwithstanding anything contained in the foregoing sub- rules, where the Registrar requires retention of any account, book or record in connection with any action taken or proposed to be taken under the Act and these rules or for any other purpose specified by him in writing the chief executive or the president, where there is no chief executive, shall order the 32 retention of such account, book and record to be retained for such period as may be specified by the Registrar.

22. Power of Registrar to direct accounts, books and records to be written up. __

(1) The Registrar may, by order in writing, direct any society to get any or all of the accounts, books and records required to be kept by it under rule 20 written up to such date and within such time as he may direct. Where any society fails so to do, the Registrar may depute an officer subordinate to him or authorise any employee of the financing bank or of the federal society concerned to write up the accounts, books and records. In such cases, the Registrar may by order, to determine with reference to the time involved in the work and the emoluments of the officer deputed or any employee of the financing bank or the federal society authorised to do it, the charges which the society concerned shall pay to the Government or the financing bank or the federal society and to direct its recovery from the society.

(2) The officer deputed or the employee of the financing bank or of the federal society authorised by the Registrar under sub-rule (1) to write up the accounts, books and records of a society shall have the power to requisition:-

(i) any person in possession of, or responsible for the custody of, any accounts, books, records, documents, securities, cash or other properties to produce the same at the head quarters of the society; and

(ii) any person who has the knowledge of any of the transactions of the society to furnish such explanation or information as he may require.

23. Power of Registrar to freeze credit or any other assistance. __ Where the Registrar is satisfied that any society has not maintained the accounts, books and records required to be maintained by it under rule 20 or prevented in any manner the officer deputed or employee of the financing bank or federal society authorised by the Registrar under sub-rule (1) of rule 22 to write up the accounts, books and records, the Registrar may, without prejudice to any other action that may be taken under the Act and these rules, freeze such credit or other assistance as the Registrar may deem fit: 33

Provided that no order shall be passed by the Registrar under this rule without giving an opportunity to the society to make its representation.

24. Manner of certifying copies of entries in books, documents, etc. __

(1) For the purposes of sub section (1) of section 47 or section 133, a copy of any entry in a book of a society or of any document or any entry in such document shall be certified __

(a) by the chief executive, or the president of the society if there is no chief executive and by not less than two members of the board; or

(b) where an administrator has been appointed under sub – section (12) of section 33, by such administrator ; or

(d) where a liquidator has been appointed under sub section (1) of section 138, by such liquidator.

(2) Every certified copy shall be in the following form duly signed by the officers, if any, who have prepared and checked the same and by the certifying authority specified in sub-rule

(1) and bear the seal of the society:- Prepare by me with reference to the original. Checked by me with the original and found to be correct. Certified that the above is a true copy of entry or entries in the document obtained and kept by …… the society. Signature of the Signature of the Signature of the Preparing Officer. Checking Officer. Certifying Authority.

(3) The rates of charges to be levied for the supply of certified copies shall, subject to a minimum of two rupees be-

(i) for every one hundred and seventy- five words or fraction thereof or written or typed matter Seventy paise; and 34

(ii) where copies are supplied in printed forms Twenty- five paise per form plus the charges calculated at the rate specified in item (i) in respect of the written or typed matter:

Provided that the board may, subject to the minimum of two rupees, fix any rate not exceeding the rates specified above.

25. Statement and returns to be furnished by a society to Registrar. __

(1) Every society shall prepare for each financial year and submit to the Registrar within a period of three months from the close of the financial year,-

(a) a statement showing the receipts and disbursements for the year or trial balance at the end of the year;

(b) a profit and loss account;

(d) such other statement or return as the Government may from time to time specify.

(2) (a) Every society shall also furnish a copy of the statements or returns submitted to the Registrar under sub-rule (1) to the financing bank and the federal society concerned simultaneously.

(b) In respect of societies affiliated to a federal society, the federal society concerned and in respect of societies not affiliated to a federal society but affiliated to a financing bank, the financing bank concerned shall submit to the Registrar a consolidated statement or the statements and returns received under sub-clause (a) within a period of two months from the close of the financial year.

(3) Every agricultural producers marketing society, consumer society, dairy society, industrial society, oil seeds growers society, processing society and weavers society and such other society as the Government may, from time to time, specify by general or special order, shall, in addition to the statements and returns referred to in sub rule (1), submit with in a period of one month from the close of the financial year to the Registrar a statement of verification of the stock at the close of the financial year of articles in which the society transacts business.

(4) Where any society fails to submit any statement or return specified in sub-rule (1),(2) or (3) within the time specified therein, the Registrar may depute an officer of the Government or 35 authorise an employee of the financing bank or federal society concerned to prepare the necessary statement or return and the Registrar may determine, with reference to the time involved in the work and the emoluments of the officer deputed or of the employee of the financing bank or the federal society authorised to do it, the charges which the society concerned shall pay to the Government or the financing bank or the federal society concerned, as the case may be.

(5) Every society shall prepare a list of its members as on the last date of each financial year, and furnish a copy of the same to the Registrar within one month from the close of such year. 25-A. Manner of placing the audit report of apex society before the Legislative Assembly of the State. __

(1) The chief executive that is the principal paid officer by what ever designation he is called, of every apex society shall send three copies of the final audit report of each financial year including receipt and charges or trial balance, balance sheet and profit and loss account duly signed by him and by the auditor or auditing firm and by not less than two members of the board to the Registrar within one month from the date of receipt of the final audit report.

(2) The Registrar shall send two copies of such final audit report, referred to in sub-rule

(1), to the Secretary to Government of the concerned administrative department within a month from the date of its receipt by him. The Secretary to Government of the concerned administrative department shall, as soon as possible after its receipt, cause to place such final audit report of the apex society on the table of the Legislative Assembly of the State before the close of the succeeding financial year.

CHAPTER IV MEMBERS OF CO-OPERATIVE SOCIETIES AND THEIR RIGHTS AND LIABILITIES 36

26. Classes of societies in which persons who are minors or of unsound mind may be admitted as members and the privileges, rights and liabilities of such members. __

(1) (a) Subject to the provisions of sub-rule (2), persons who are minors or of unsound mind may be admitted as members in the following societies, namely:-

(i) agricultural producers marketing societies;

(ii) consumer societies;

(iii) credit societies other than financing banks and employees credit societies;

(iv) dairy societies;

(v) farming societies;

(vi) fisheries societies;

(vii) industrial societies;

(viii) irrigation societies;

(ix) oil -seeds growers societies;

(x) processing societies; and

(xi) weavers societies.

(b) The admission of any person who is a minor or of unsound mind as a member of any class of societies specified in clause (a) and his transactions with the society shall be only through his guardian.

(c) A person who is a minor or of unsound mind admitted through his guardian as a member of any class of societies specified in clause (a) shall be liable to all the obligations of a member and shall be eligible to enjoy all the rights of a member except the right to vote in the general meeting or in any election and the right to contest for election to the board and hold office, as a member of the board.

(2) Notwithstanding anything contained in sub-rule (1), a person who is a minor above the age of twelve years and who is a student may be admitted directly as a member of any consumer society formed for the benefit of students and shall be eligible to enjoy all the rights of membership except the right to contest for election to the board or hold office as a member of the 37 board and shall be liable to all the obligations of a member but the liability of such member shall be limited to his subscribed share capital.

27. Form of application for, and manner of, admission as a member. __

(1) Every individual seeking admission as a member of any society under clause (i) of sub section (2) of section 21 shall make an application in Form No.16.

(2) The application shall be sent to the society by registered post with acknowledgement due or personally handed over under acknowledgment to an officer or servant of the society authorised in this behalf by the society.

(3) Every individual seeking admission as a member of any society under clause (i) of sub-section (2) of section 21 shall, along with the application for admission pay the value of atleast one share or the first installment of the share, where share capital is payable in instalments and also the entrance fees. Such payment may be made either by sending the required amount by money order or postal order sent by registered post with acknowledgement due or by making direct remittance into the society or by any other mode approved for the purpose by the society or the Registrar.

(4) The Secretary or where there is no secretary, the chief executive or where there is no secretary or chief executive, the president shall place or cause to be placed all applications for membership before the board or the general body, where there is no board for its decision and arrange to communicate the decision of the board or the general body, as the case may be, granting or refusing to grant admission to the applicant within a period of sixty days from the date of receipt of the application in the office of the society.

(5) Every member admitted or deemed to have been admitted as such, shall, for exercising the rights of a member, pay, within a period of one month from the date of admission or the date on which he is deemed to have been admitted as a member all the amounts required of him under the by-laws.

28. Procedure for removal of an individual deemed to have been admitted as a member.- Every order under clause (ii) of sub-section (2) of section 21 shall be passed by the 38 Registrar within a period of ninety days from the date of information about the ineligibility of a member or from the date of receipt by him of the application, as the case may be.

29. Procedure for refund of value of share or interest in the capital by financing bank or apex society to individual members on the cessation of membership. __

(1) The financing bank or apex society shall, within thirty days from the date specified in the notification issued under clause (b) of sub-section (1) of section 21 by notice in writing, require the individual concerned or his nominee, heir or legal representative, as the case may be, to receive his share or interest in the capital and other moneys due to such individual within thirty days from the date of receipt of the notice.

(2) If the individual concerned or his nominee, heir or legal representatives, as the case may be, fails to receive the share or interest in the capital and other moneys due to him within thirty days from the date of receipt of the notice under sub-rule (1) the amount representing the share or interest due to him shallforth with be credited to a suspense account.

30. Membership in more than one society of certain classes of societies. __

(1) Any person who is already a member of any one of the categories of societies specified below may become a member of any other category of societies so specified.:-

(i) primary agricultural service society;

(ii) primary land development bank; and

(iii) urban bank.

(2) Any person who is already a member of a primary agricultural service society or a primary land development bank may become a member of any one or more other societies of any one such category or both such categories, if such person owns or cultivates lands within the area of operations of the respective societies:

Provided that the total outstanding by way of borrowing from all such societies shall not exceed the individual maximum borrowing power either on the security of immovable property mortgaged or on personal surety. 39

(3) Any person who is a member of an agricultural producers marketing society may become a member of any one or more other agricultural producers marketing societies if such person owns or cultivates lands within the area of operations of the respective societies.

(4) Any person who is already a member of a consumer society may be admitted as a member of another consumer society:

Provided that no person who is already a member of an employees’ co-operative stores shall be admitted as a member of another employees’ co-operative stores.

(5) Every person seeking admission in another society of the same class or category as specified in sub - rule (2), (3) or (4) shall, in his application for admission, disclose his membership in such other society or societies.

31. Restriction on admission of certain individuals. __

(1) No individual other than an individual who is qualified for admission with reference to the principal object of the society shall be eligible for admission as a member of the society;

Provided that this rule shall not apply for admission of individuals as associate members in accordance with rule 32:

Provided further that every society having individual members not qualified for admission as a member with reference to the principal object of the society on the date of commencement of these rules shall within three months thereof issue notice to each such member requiring him to receive his share or interest in the capital of the society and other moneys due to him within thirty days from the date of receipt of such notice.

(2) If the individual concerned fails to receive his share or interest in the capital and other moneys due to him within thirty days from the date of receipt of the notice under sub- rule (1), the amount representing the share or interest in the capital and other moneys due to such individual shall forthwith be credited to a suspense account.

32. Admission of associate members. __

(1)Persons possessing the qualifications specified in sub-rule (2) may, if the by-laws so provide, be admitted as associate members in the following classes of societies, namely:- 40

(i) agricultural producers’ marketing societies;

(ii) consumer societies;

(iii) credit societies;

(iv) dairy societies;

(v) farming societies;

(vi) housing societies;

(vii) industrial societies (other than societies under the control of Khadi and Village Industries Board);

(viii) labour contract societies;

(ix) oil seeds growers’ societies; and

(x) processing societies ;and

(xi) weavers’ societies.

(2) (i) Any person interested in the property being mortgaged by a member in favour of the society for the purpose of joining in the execution of the mortgage deed or any other document by such member; or

(ii) any person borrowing on the security of gold jewels, silverwares, fixed deposit receipts, life insurance policies, warehouse receipts or securities specified in section 20 of the Indian Trusts Act, 1882 (Central Act II of 1882); or

(iii) any depositor seeking cash credit or overdraft facility; or

(iv) any person desiring to discount any bill, cheque or other instruments; or

(v) any person desiring to avail of any service other than credit rendered by the society; or

(vi) any paid officer or servant of the society or of its financing bank for any of the purposes specified in sub-clauses (i), (ii) and (v) provided that the prior approval of the Registrar is obtained for the purposes specified in sub-clauses (ii) and (v), may be admitted as an associate member in any credit society other than a financing bank. 41

(3) (i) Any person desiring to borrow for the purpose of self employment including starting or running any small scale or cottage industry or for any other purpose as may be permitted by the National Bank for Agriculture and Rural Development or the Registrar from time to time; or

(ii) any person borrowing on the security of gold jewels, silverware, fixed deposit receipts, life insurance policies, warehouse receipts or securities specified in section 20 of the Indian Trusts Act, 1882 (Central Act II of 1882); or

(iii) any depositor seeking cash credit or overdraft facilities; or

(iv) any person desiring to discount any bill, cheque or other instruments; or

(v) any paid officer or servant of the bank or of any society for which it is the financing bank for the purpose specified in sub-clause (ii) with the prior approval of the Registrar, may be admitted as an associate member in a financing bank.

(4) (i) Any trader, commission agent or merchant engaged in business in commodities dealt with by the society having dealings with the society, or

(ii) any paid officer or servant of the society or of its financing bank desiring to avail of the services of the society, with the prior approval of the Registrar, may be admitted as an associate member in an agricultural producers’ marketing society, a dairy farm, a milk producers’ society or an oil-seeds growers’ society:

Provided that the provisions in clause (i) shall not apply to oil -seeds growers’ society:

Provided further that the transactions with any associate member by any society specified in this sub-rule shall be subject to such monetary limits and conditions as may be prescribed in the bylaws or as may be specified by the Registrar from time to time. (4-A) any person desiring to invest his money in fixed deposits, may be admitted as an associate member in an oil-seed growers’ society.

(5) Any person interested in the lands being pooled and cultivated by the society or by the member of the society, may be admitted as an associate member in a farming society. 42

(6) Any person interested in the property being mortgaged by a member in favour of the society for the purpose of joining in the execution of mortgage deed or any other document by such member, may be admitted as an associate member in a housing society.

(7) any manufacturer of, or dealer in appliances, dyes raw materials and other accessories used by the society or by its members in the processing or production of any commodity or any trader or commission agent or merchant dealing in the commodities produced by the society, may be admitted as an associate member of an industrial society (other than a society under the control of Khadi and Village Industries Board) or a processing society:

Provided that the transactions with any associate member by any society specified in this sub-rule shall be subject to such monetary limits and conditions as may be prescribed in the bylaws or as may be specified by the Registrar from time to time .

(8) Any individual including a paid officer or servant of a society or of its financing bank or any person standing as surety or guarantor in respect of any liability, or any institution or body of persons whether incorporated or not desiring to avail of the services rendered by the society, may be admitted as associate member in a consumer society or a dairy society or a labour contract society.

(9) An associate member shall not be required to contribute to the share capital of the society but shall pay such admission fee as may be specified in the by-laws, which shall not in any case exceed one hundred rupees. The admission fee shall not be refundable.

(10) An associate member of a society shall not be eligible for any patronage rebate, bonus or dividend.

(11) An associate member of a society shall, irrespective of the liability of the society, be liable to contribute to the assets of the society on its being wound up only to the extent of any dues which he may be owing to the society singly or jointly with any other debtor.

(12) No associate member of any society shall be refused admission as a member of any other society only for the reason that he is an associate member of any society. 43

33. Class of persons for purpose of clause (a) of sub-section (3) of section 23. __ The class of persons for the purpose of clause (a) of sub-section (3) of section 23 shall be the discharged prisoners.

34. Procedure for deciding question under sub-section (4) of section 23. __ No question shall be decided under sub section (4) of section 23 without giving an opportunity to the applicant for admission or, as the case may be, the member concerned and to the society, of making his or its representations.

35. Removal of a member of a society. __

(1)The Registrar may of his own motion or on application, by an order in writing, direct the removal of a member of a society from such membership if in the opinion of the Registrar, such member was, or has become, subject to any of the disqualification mentioned in section 23:

Provided that no member of a society shall be removed from such membership under this sub-rule without such member being given an opportunity of making his representations.

(2) Upon the issue of an order under sub -rule (1), the member concerned shall cease to be a member of the society.

36. Time limit to communicate the decision of the board and to apply for redress. __

(1) The decision of the board of a society specified in column (1) of the Table below on the application made by its member under sub-section (2) of section 24 to render him services from such society shall be communicated within the time limit specified in column (2) thereof. THE TABLE Class of society Time limit

(1) (2)

(i) Agricultural producers marketing societies and consumer societies. Fifteen days from the date of receipt of the application by the society.

(ii) All other classes of societies to obtain services for which mortgage of Thirty days from the date of receipts of the application by the society. 44 immovable properties is not required.

(iii) All other classes of societies to obtain services for which mortgage of immovable properties is required. Sixty days from the date of receipt of the application by the society.

(2) Every application for redress shall be made by a member to the Registrar within thirty days from the date of receipt of the communication of the decision of the board of a society refusing any service and where the decision of the board of a society on his application for services has not been communicated to him within the period specified in sub-rule (1), within thirty days from the date of expiry of such period.

37. Manner of giving opportunity to a member before expulsion under section 25. __

(1) On receipt of the requisition in writing under sub – section (1) of section 25, the society shall, within a period of fifteen days from the date of receipt of the requisition in the office of the society, communicate a copy of such requisition to the member concerned calling upon him to make his representation, if any, within a period of fifteen days from the date of receipt by him of such communication.

(2) The member concerned shall also be given an opportunity of being heard at the special meeting convened for the purpose under sub-section (1) of section 25.

38. Restrictions on defaulting member to vote at election or to represent a society in any other society. __ No member shall be entitled to vote at any election in the society of which he is a member or be entitled to be elected or nominated to represent the society in any other society or to vote at any election in the other society if on thirty days prior to the date of election,-

(a) (i) he was in default to the society of which he is a member or any other society, for a period exceeding three months; or

(ii) a decree has been obtained against him and the decree is subsisting; or

(iii) proceedings have been initiated against him under sections 118,119,120 or 144 for 45 recovery of any debts and the debt has not been fully discharged; and ( b) where the member represents a society in any other society, if-

(i) the society he represents is in default to any other society for a continuous period of one year and the default exceeds thirty percent of the sum due by that society; or

(ii) a decree has been obtained against the society he represents and the decree is subsisting.

39. Restrictions on the right of a member to attend and participate in meeting. __ No member shall be entitled to attend and participate in the meeting of the board or of the general body when a subject in which he is interested directly or indirectly is under consideration:

Provided that nothing contained in this rule shall apply to an office-bearer or a member of the board from attending and participating in the special meeting of the board called for the purpose o

The Tamil Nadu Co-operative Societies Rules,1988

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