(1) Where the State Government has—
(a) subscribed directly to the share capital of a co-operative society under chapter VI,
(b) assisted indirectly in the formation or augmentation of the share capital of a co-operative society as provided in chapter VI, or
(c) given loans or made advances to a co-operative society or guaranteed the repayment of principal and payment of the interest on debentures issued by a co-operative society or guaranteed the repayment of principal and payment of interest on loans or advances to a cooperative society.
The State Government shall have the right to nominate on the committee of management of such society not more than two persons one of whom shall be a government servant, (which will include a professional also if nominated by the Government) so, however, that the Government servant shall not vote at an election of an office- bearer of the society :
Provided that where the society is engaged in production of sugar --
(i) the share capital subscribed to by the State Government is not less than one crore rupees; or
(ii) the share of the State Government in the share capital of the society exceeds fifty percent of the total share capital of the society;
(iii) the State Government has given loans or made advances to the society or guaranteed the repayment of principal or payment of interest on debentures issued by the society or guaranteed the repayment of principal and interest on loans and advances to the society and the amount exceeds fifty percent in the aggregate of the total amount so borrowed by the society.
The State Government shall also have the right to nominate the Chairman of the committee of management, who shall be a Government servant.
(2) A person nominated under sub-section (1) shall hold office during the pleasure of the State Government.
(3) The right of nomination vested in the State Government under this section may be delegated by it to any authority specified by it in that behalf.
Explanation- For the purpose of this section any guarantee given by the central Government on the recommendation of the State Government shall be deemed to be a guarantee given by the State Government.
Supersession or suspension of the committee of management