The Assam Co-operative Societies (Amendment) Act, 1975

^j-12 Registered Mo.—A-12 Fhs Assam Gazette EXTRAORDINARY 3T3 W/'M l*RT SRjfw PUBLISHED BY AUTHORITY 134 22 1975, 30 1397 ’<•. 134 Dispur, Wednesday, October 22, 1975, 30th Asviea 1897 (S. E.) GOVERNMENT OF ASSAM ORDERS BY THE GOVERNOR LAW DEPARTMENT NOTIFICATION The 21st October 1975 No.LJL. 581/74/28. —The following Act of the Assam Legislative Assembly which received the assent of the President of Indi, is hereby 924 H E ASSAM ( AZETTE, EXTRAORDINARY, OCT. 22, 1975 ______---------------------------------— ---------------- - r publ’shcd for general information. ASSAM ACT XIII OF 1975 (Received the assej.t of the Fresident of India or the 17th day of October, 1975) THE ASSAM CO-OPERATIVE SOCIETIES (AMENDMENT) ACT, 7975 XcZ Further to amend the Assam Co-operative Societies Act, 1949. Preamble Whereas it is expedient further to amend the Assam Co-operative Societies Act, 1949 (Assam Act I of 1950) hereinafter called the principal Act in the manner here­ inafter appearing; It, is hereby enacted in the twenty sixth year of the Republic of India as follows :— Sh< rt title, 1. (i) This Act may be called the Assam Co-operative ext' nt ana Societies (Amendment) Act, 1975, con mence- mer>t. (ii) It shall have like extent as the Principal Act. (iii) Sections 2, 7, 8 and 9 shall be deemed to have i come into force with effect from 1st November, 1974. The remaining sections shall come into force at once. 2. In Section 2 of the Principal Act, after clause (r), Insertion of two new :ub'aie following shall be added as a new clause, namely:— sections 2. (s') and (t). (s) "Bank” means— (i) A Banking Company as defined in the Banking Regulation Act, 1949. (ii) The State Bank of India constituted under the State Bank of India Act, 1955. (iii) A subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959. ((iivv)) A. corresponding new Bank constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970. THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 925 (v) The Agricultural Refinance Corporation constituted under the Agricultural Refinance Cor­ poration Act, 1963. (vi) Agricultural Finance Corporation Limit­ ed, a company incorporated under the Indian Com­ panies Act, 1956; and (t) A "Financing Bank” means a bank as de­ fined in clause (s) of Section 2 of this Act or a Co-operative Bank providing working capital to a registered Co-operative Society. of'section ^ 3- For Section 4 of the Principal Act the following of A s s a mshall be substituted, namely:— Act J of 1950. "4(1) Societies which may be registered—A Society which has as its objects the promotion of the economic interests or general welfare of its members or of the public in accordance with the Co-operative principles, or a Society established with the object of facilitating the operations of any society may be registered under this Act with limited liability. (2) No society shall be registered if in the opinion of the Registrar, its declared objects are unlikely to be achieved or if it is likely to be economically unsound or if it may have an adverse effect upon any registered society or the Co-operative movement as a whole.” Amendment 4.(a) In Section 14 of the Principal Act:— of Section 14 of Assam in the heading, in between the words "society” and Act I of 1950. "to” the words "or financing Bank” shall be inserted. (b) In sub-section (2) clauses (i) and (ii) the following shall be substituted:— "(i) When it appears to an affiliating society or a financing bank that an amendment of the bye-laws of a registered society which is a member of such society or debtor of financing bank is necessary in the interest of the society it may suggest to the affiliated society or the debtor society, as the case may be, to make such amend­ ment within such time as it may specify. The affiliating society or the financing bank shall forward to the affiliat­ ed society or the debtor society, as the case may be, a draft of the suggested amendment of the bye-laws. (ii) If the society fails to make the amendment with­ in the time specified, the affiliating society or the financ­ ing bank may forward to the Registrar the amendment and the Registrar, if satisfied that the amendment is necessary in the interest of the society and not contrary to the provisions of this Act or rules, may thereupon after giving an opportunity of x 926 THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 showing cause to the society concerned against the proposed amendment register the amendment and forward to the socie­ ty a copy thereof together with a certificate signed by him. The certificate shall be conclusive evidence that the amend­ ment has been registered and such amendment shall thereupon be binding upon the society and its members. (iii) If the Registrar considers that the amendment re­ ferred in clause (ii) above is not acceptable, he shall submit a report to the Government. (iv) An affiliating society or a financing bank or the Registered Society if aggrieved by a decision of the Regis­ trar may prefer an appeal to the Government, The orders of the Government on such appeal shall be final. • (v) The State Government may out of its own motion or the Registrar subject to such direction as may be given by the Government amend the bye-laws of any society or gioup of societies in the interest of public service.” Amendment 5, i Section 15 of the principal Act, for sub-section n :ff I:CamnA t(3)’thefo,low ia8 shall he substituted, namely:— 5 c 1 of 1955, “(3) (a) Notwithstanding anything container! in sub­ sections (1) and (2) of this Section if the Registrar is of opinion that for reasons of ensuring economic viability of any registered society or societies or avoiding overlapping or conflict of jurisdictions of registered societies in any area or in order to secure proper management of any Co-operative Society, or in the public interest or in the interest of the Co-operative movement in the State as a whole, or in the interest of depositors and the Co-cparative banking system in the State as a whole, it is necessary to divide, amalgamate or merge fully or partially any such society or societies with any specified society, he may, by an order published in the official Gaaette make a scheme for division, amalgamation or merger, with prior approval of the State Government. Explanation.—In this section the society which is divided, amalgamated or merged shall be referred to as “Transferor” society and the societies which are formed out of any division, amalgamation or merger under this section shall be referred to as “Transferee” society or societies. (b) A scheme referred to in sub-section (a) in respect of division, amalgamation or merger may provide for ail or any of the following matters, namely :•— (i) The transfer of the business, properties mova­ ble or imm< vable‘ assets including cash balances and reserve iund, rights, privileges, liabilities, debts Z THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 927 and obligations of the transferor society or societies to the transferee society or societies on such terms and conditions as may be specified in the said scheme. (ii) The reduction of the interest or rights which the members, depositors and other creditors have in or against the transferor society or societies before division, amalga­ mation or merger to such extent as the Registrar considers necessary in the public interest or in the interest of the mem­ bers, depositors and other creditors for the maintenance of the business of such society or societies having due regard to the assets and liabilities of the transferor society or societies. (iii) The payment in cash or otherwise to the depositors and other c: editors in full satisfaction of their claims:— (a) in respect of their interest or rights in or against the traisferor society or societies before or after division, merger or amalgamation, or (b) where the interest or rights as aforesaid, in or against the transferor society or societies has or have been reduced under clause (ii), in respect of such interest or lights as so reduced. (iv) (a) The allotment of shares in the transferee society to the members of the transferor society against the shares held by them in the transferor society or societies, before the division, amalgamation or merger, or (b) where it is not possible to allot shares in the transferee society or societies to such members against the shares held by them in the transferor society or societies, the payment to such members in cash in full satisfaction of their claims in respect of their interest in the shares of the transferor society or societies or where such interest has been reduced under clause (ii), in respect of thdir interest in the shares as so reduced : Provided that an aforesaid scheme shall secure— (i) that allotment or shares or payment in cash in favour ot the members of the tiansferor society or societies under this clause shall not be made until all the depositors and creditors of the transferor society or societies have been paid under sub-clause (a) of this clause, or, as the case may be, undar sub-clause (b) of clause (iii), and 928 THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 (ii) that such allotment of share or payment in cash in favour of the members of the transferor society or societies shall be made only out of the surplus of the assets of the transferor society or societies, if any, that may be left after payment to the depositors and the creditors as indicated in sub-clause (i). (v) The continuance t of the service of all or any of the employees of the transferor society or societies in the transferee society or societies on such terms and conditions of service as may be determined in this behalf : Provided thet, if any employee is found to be ineligible for continuance in service of the transferee society under the terms and conditions of the scheme, the services of such employee shall stand terminated on and from the date on which the division, amalgamation or merger takes effect and the transferee society shall within three months of the afore­ said date, make payment to such employee such compensa­ tion as suth employee may be entitled under any law relat­ ing to industrial dispute in force in the State and pension, gratuity, provident fund and other retirement benefits as are ordinarily admissible to him under the rules of the trans­ feror society in force immediately before the division, amal­ gamation or merger. (vi) The scheme for division shall provide division of the assets and liabilities, the area of operation, the employees and the members of such society among the new societies into which such society is to be divided. (e) (i) No order referred to in sub-sec’ion (a) shall be made unless a copy of the proposed order including the scheme is sent to the societies affected calling upon them to invite ■ objections or suggestions from the members, creditors and suggestions together with their own suggestions and objections, if any, to the Registrar within thirty days from the date of receipt of the copy of the proposed order by such societies. (ii) The Registrar shall consider the suggestions and objections which may be received under (i) above within the period referred to therein and may make such modifi­ cations in the proposed order including the scheme as he thinks just and fit and finalise the proposed order including the scheme in consultation with the State Government: Provided that such order shall not be passed with­ out the prior approval of the Reserve Bank of India in case of any society coming under the purview of the j. HE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 929 ---------;---------------;------------------------------;-------------------------— Banking Regulation Act, 1949 (as applicable to Co-operative Societies) (Central Act No. 10 of 1949). (d) An order referred to in clause (a) may contain such incidental, consequential and supplemental provisions as the Registrar in consultation with the State Government may consider necessary to give effect to the propored division, amalgamation or merger and shall have effect on - nd from such date as may be specified in the final order referred to in sub clause (ii) of c’ause (c). (e) On and from the date from which the division, amalgamation or merger, take effect, the assets and liabilities of the societies referred therein shall stand divided, amalga- , mated or merged wi'h the assets and liabilities of the socieiies formed out of such division or amalgamation or merger and the members, credito s and debtors of such societies, shall be deemed to be members, creditors and debtors, as the case may be of the new society or societies as ordered . by the Registrar. (f) (i) Notwithstanding anything contained in thie, Act, the Registrar shall register all new societies created after divi­ sion of an existing society under this Act and such registra­ tion shall be effective from the dato on which the division takes effect and the registration of the society osdered to be divided shall be deemed to have been cancelled from the said date and such registration and cancellation shall be effective from the date on which the division takes effect notwithstanding the actual registration is done later on. (ii) In case of the society directed to amalgamate or merge, the registration or the transfe:or society or societies shall be deemed to have been cancelled from he date on which the amalgama’ioa or merger takes effect. (g) The provisions of this section shall have effect notwithstanding anything to the contrary elsewhere in this Act or in any other law or agreement, award or other ins­ trument for tie time being in force. (h) (i) Notwithstanding anything contained in the Transfer of Property Act, 1882, or the Registration Act, 1908, an order issued under this section shall be sufficient conveyance to divide or to transfer the assets and liabili ies of the society or societies covered by any order passed under sub-clause (ii) of clause (c)i (ii) Notwithstanding a n y th in g contained in any other law for the time being in force no civil court 930 THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 > shall exercise any jurisdiction in respect of any action taken or order passed under this section and nothing done or order passed in exercise of any power under this section shall be called in question in any such court.” Insertion of 6. After Section 35 of the Principal Act, the following a new Sec­ tion 35 A in shall be inserted as a new section, namely :— Assam Act 1 of 195°- “35A. Notwitlis anding anything contained in any law for the time being in force, the Registrar may at any time direct a particular society or a class of societies to appoint only persons having such qualifications as may be prescribed by him from time to time.” Insertion 7, After Section 42 of the Principal Act, the following Section 42 A be inserted as a new section, namely :•— in the Assam Act 1 of “42A. Notwithstanding any provision contained in 1950, this act, the State Government may, by general or special order direct transfer of any Co-operative Society from one financing bank to another after prior consultation with these banks and the society for the purpose of avaling finance by the society for its credit *nd non-credit operations, on such terms and conditions, as may be considered necessary. Amendment 8 In Section 44 of the Principal Act:—in sub-sec- °zMCt/lon I4 t*on clause (c), for the words “placed with the Assam Act isociety” the words- of 1950 “Charged, hypothecated or pledged with the society,” shall be substituted. Amendment 9. i Section 45 of the Principal Act, for sub-sec­ n (2)SofA°»am tion the following shall be substituted, namel) :•— Act.l of 1950 “(2) Notwithstanding anything contained in this Act or in any other law for the time being in force, (a) a member who makes an application for a loan to a Co-operative Society of which the majority of the members are agriculturists shall, if he owns any land or has any interest in any land as a tenant, make in such form as may be prescribed, a declaration that he thereby creates a charge upon such land or such interest, or such portion thereof, as may be specified in the decla­ ration, for securing the repayment of the loan which the society may make to the members on the application and of future loans, if any, THE ASSAM GAZETTE EXTRAORDINARY, OCT. 22, 197 5 f 31 ’ 7 that may be made to him, from time to time by the society toge her with interest on such loan or loans ; (bl a declaration made under clause (a) may be varied or cancelled at any time bv the member m<<Htsg it, with the consent of the society in whose favour it is made ; (c) any land or interest in land in respect of which a declara'ion has been made under clause (a) or any put of such land or interest, shall not be sold or otherwise transferred by the member making the declaration until the enhre amount of the loan or loans taken by the member from the society together with interest thereon is p«id to the society : Provided that nothing in this clause shall apply to any such pirt of such laid or interest as may lave bjen released from the chirge crea d under this Section under the proviso to clause (d) ; (d) subject to any claim of State Government in respect of land revenue or any sum recoverable as land revenue or as public demand, there shall be a first charge in favour of the society on the land or interest in land specifi d in the declaration made under clause (a) , lor and to the extent of the dues recoverable from the member making the declaration on account of the loan or loans together with any interest thereon made to him by the society: Provided that if a part of such dues is paid by the member, the society may, on the application of the member and with the approval of the financing bank to which it may be indebted, release from the charged such part of the land or interest in the land specified in the declaration made under clause (a) as the society may, having due regard to the security of the outs a ding amount of the loan or loaus made to the member deem proper. (e) Every record of rights prepared and main* tained under the Assam Land and Revenue Regu­ lation, 1886 or any other law for the time being in force shall also include the particulars of every charge on any land or any interest thereon cleared under clause (a).” 932 THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1§ST Insertion of 10. After Section 49 of the principal Act. the following Section^A sha" be inscrtcd as a new section, namely : — in Assam Act I of “49-A (1) Exemption from registration of mortgage 195°- deeds executed in favour of Co-operative and Development Bank or Primary Society:—Notwithstanding anything contained in th; Indian Registration Act, 1908, it shall not be necessary to register mortgages executed in favour of the Co-operative land development bank or a primary soeiety of which the majority of members are agriculturists, for the purpose of securing the repayment of a loan provided that the land development bank or the primary society concerned send within sueh time and in such manner as may be prescribed, a copy of the instrument whereby immovable property is mortgaged for the purpose of securing repayment of the loan to the registering officer within the local limits of whose jurisdiction the whole or ary part of the property mortgaged is situate. (2) On receipt of the copy or copie* of the instrument under the preceding sub-scction, the Registering authority • shall file a eopy or copies as the case may be in his Book No.l prescribed under section 51 of the Indian Registration Act, 1908. (3) The mortgages executed in favour of and all other assets transferred to a Co-operative land develop­ ment bank or a primary Society of which the majo­ rity of members are agriculturists, by the members thereof, as security for repayment of loan, before or af er commencement of this Act. shall, with effect fiom the date of such execution or transfer be deemed to have been executed or transferred by such society in favour of »r to the financing bank.” Amendment 11. In Section 52 of the principal Act, in sub-section (1) of Section d “twenty” occurring between the words ‘'than” and wor Assam Act “per” shall be substituted by the words “twenty-five”. I ef 1950 Amendment 12. In Section 53 of the principal Act, for the punctua- °f Section tj f ll-stop “(.)” occurring at the end, the punctuation on u 5Act 1 o?co^on “('•)” shall be substituted and the following proviso 1950 shall thereafter be added, namely :— - - - — - - - -- - “Provided that a registered Co-operative Society of which the majority of members are agriculturists and one of the objects is the creation of fund to be lent to its member* shall carry not less than 15% >-XHE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 933 of its net profit in any year to the Agricultural Credit Stabilisation Fund as may be prescribed.” . 13. After Section 61 of the principal Act, the following Insertion of i f d section, namely :— nser e as a new Section 61A in the Assam “61-A (i) A financing bank shall have the right to Act I of inspect the books of any Co-eperative Society which has 1950. either applied to the bank for financial assistance or is indebted to the bank on account of financial assistance granted earlier. (ii) The inspection maybe carried out by an officer or any other member of the paid staff of the financing bank with previous sanction of the Registrar in writing. (iii) The officer or any other member of the paid staff of the financing bank undertaking such inspection, shall, at all reasonable time, have access to the books of accounts, documents, securities, cash and other properties belonging to or in ths custody of the Ce-operative Society inspected by him, and shall also be supplied by such ssciety such information, statements and returns as may be required by him to assess the financial conditions of the society and the safety of the financial assistance to be made to the society or already made to it”. Amendment 14. In Section 63 of the principal Act, in clause (d) of Section 63for the punctuation full-stop “(.)” occurring at the end, of Assam Actthe punctuatios semi-colon “(;)” shall be substituted and the 01 j 50' following clause (el shall thereafter be added, namely:— “(e) a registered society and a financing bank.” Amendment 15. In Section 64 of the principal Act,— of Section 64 (3) (b)0f in clause (b) of sub-section (3), the punctuation com­ A»sam Act 1 of 1950. mas “(,)” occurring in between the words “may” and “unless” and the words “furnished” and “direct” and the words “unless adequate security is furnished” shali be deleted. Amendment 16. For Section 70 of the principal Act, the ? following of Section shall be substituted, namely:— 70 of Assam Act I of 1950. “70. Power of Registrar to direct payment of dues: — Notwithstanding anything contained in Chapter X the Registrar or such other person as may be authorised by him in this behalf may, on— 934 THE ASSAM GAZETTE, EXTRAORDINARY OCT. '2, 1975 . >■ his own motion or on the written requisition of a registered society or an affiliating society or a financing bank tor the re ov ry of any loan or any o her demand due by a defaulting member, after making such enquiry as he deems fit, grant a Co operative Demand Certificate ror the recovery of the amount found to be due.” Insertion 17. Af er Sec'ion 70 of the principal Act, tha following -ofanrw shall be inserted as a new section, namely:— Section 70 \ in Assam Act I of 1950. ”70-A(l). If any insta'ment of loan or interest payable by a member of a Co-operative Society or any part of such instalment has remained unpaid for more 1h;.n 30 days from the date on which it fell due, the Managing Committee of the society may, in addition to any other remedy available t» it, apply to the Registrar or any other offi er authorised by him lor the teeovery of such ins'alment or part thereof by distr -int a d sale of the produce of the charged land including the standing c op. (2) On receipt of such application the Registrar or the person aut orhel by hi n may, r.otvvi hstanding any hing cont inc J in the Transfer of Property Act, 1,82 take actioa in the manrer as prescribed for the purpose of distraining and selling such produce : Provided that no distraint shall be ma^e af‘er the expiry of twelve months from the date on whieh the instalment fell due. (3) The value of the property dis'raired shall be, as nearly as possible equal »o the amount duv and the expenses of the distraint a d the costs of the sale.” THB ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 191i 935 Insertion of 18. After section 83 of the principal Act, the "**83^°" f°U°wing »hall be inserted as a new section, namely:- ‘ 83(A) (1). A copy of the Co-operative Demand Certificate prepared under sections 70 and 83 of this Act : hall be served in the manner prescribed upon the person from whom the amount is due. (2) On receipt of a copy of the Co-operative Demand Certificate the person from whom the amount is due shall pay the same within a period of thirty days from the date of service of the Certi­ ficate ; provided that the period during which the payment is to be made may be extended by Registrar for another period not exceeding thirty days for reasons to be recorded in writing. (3) Any person violating the provision of sub­ section (2) above shall, on conviction be punished with imprisonment of either description for a ter* which may extend to 6 months or with fine which may extend to one thousand rupees or with both,” Amendment 19. The prescribed form in the “Schedule A” •1 Sche- f Assam Co-operative Societies Act, 1949 o "c ' (Asssm Act 1 of 1950) shall be substituted by the following form, namely:— SCHEDULE“A” Ferm ( Under Section 83 ) I “Co-operative Demand Certificate granted under Section 83 (1) of the Assam Co operative Societiee Act, 1949 (Act, I of 1950) as amended. (To be realised as an arrear of land revenue by the revenue authority within whose jurisdiction th* judgement debtor’s property is situated.) Case No. of 19 Distric /Subdivision. In the matter of.......................................... Versus Whereas as a result of my enquiry I decide that a sum of Rs.......................(Rupees.................................) 936 THE ASSAM GAZETTE EXTRAORDINARY, OCT. 22, 1*75 bv way of..........................under section 70 of the Assam Co operative Societies Act, 1949 (Act I of 1950) as amended and sum of Rs............................ (Rupees......................................................) by way of interest is/are due from you and you have not paid; Whereas...............................has made a reference ia writing to me complaining that a sum of determining Rs.. , .................. upees...........................) by way of.......................................under section........................of the Assam Co operative Societies Act, 1949 (Act I of 1950) as amended and a sum of Rs . .............. (Rupees.......—..................................) by way interest is/are due horn you and you have evaded payment of the same and whereas a notice of demand calling on you to pay the dues within the specified time was served with notice to show cause; And whereas you have not pa d up your dues specified in the notice ; And whereas you have not submitted explana- tion/your explanation is unsatisfactory ; Now, therefore, I, under authority of section 70 of the Assam Co-operative Societies Act, 1949 as arrended/sub-section (I) of section 83 of the Assam Co-operative Societies Act, 1949 as amen­ ded do hereby order that the above-mentioned sum of Rs.........................................................is due to the above-named from you and that you will pay further interest en the principal sum at the rate of ......................................per cent per annum from............................................ together with all cost till the date of realisation. I further order that right, title and interest of ....................................... in the properties set out and described in the schedule below be sold as an arrear of land revenue under the provisions of the Assam Land & Revenue Regulation, 1886 (Regu­ lation I of 1886) and that, if the sale proceeds should be found insufficient to discharge the dues with subsequent interest at the above rate till the date of realisation and costs in full, the balance be realised by attachment and saie of other mo­ vable snd immovable property of the judgement debtor as an arrear of land revenua. THE ASSAM GAZETTE, EXTRAORDINARY, OCT. 22, 1975 937 Further take no dee that if you fail to pay the amount as ordered above within a period of thirty days from the date of service of the Certi­ ficate you shall also be liable to prosecution under sub-section 3 of section 8'-i(A) of the Assam Co­ operative Societies Act, 1949 as amended, in addition to other measures for recovery of the amount payable by you. SCHEDULE Dated Gavhati The........................ Registrar, Co-operative Societies, Assam Officer empowered under section 70/section 83(1) of Assam Co-operative Societies Act, 1949 (Act I of 1950) as amended, A. B : The irrelevant words/portions may be struck off and relevant entries may be made where necessary.” 20. (1) The Assam Co-operative Societies (Amend- SP vin« meat) Ordinance, 1975 is hereby repealed. A’*am oaavings. i nance II ef 1975 (2) Notwithstanding such repeal anything done or any action taken under the Ordinance so repealed, shall be deemed to have been done or taken, as the case may be, under the corresponding provisions of this Act. MD. J5AADULLAH, Joint Secretary to the Govt, of Assam, Law Department. Gawhati:—Printed and published by the Supdt., i/c., Printing Press, Directorate of Ptg. & Sty., Govt. af Assam (Ex-Gaaetia) No.267 -1,56«+1,500—22-10-W5.