(1) Every person who is a member of more than one resource society (other than a Land Development Bank or a Co-operative Bank or a Marketing society) dispensing credit shall, if he has not already made, make a declaration in Form “N” that he will borrow only from one such society to be mentioned in the declaration and shall send a copy of such declaration duly attested to all societies of which he is or has become a member.
(2) Any person who continues to be a member of more than one such society without complying with the provision of this rule shall be liable to be removed from the membership of any or all such societies upon receiving a written requisition from the Registrar to that effect:
Provided that the society from which a person has borrowed may permit him to borrow from any other society of which he is a member to such extent and subject to such conditions as may be laid down by it.
(3) The Registrar may, for reasons to be recorded in writing, exempt any person or persons from the operation of this rule or prohibit any person or persons from borrowing from more than one society, not withstanding that permission of the society under proviso to sub-rule (2) has been obtained by him.