The Maharashtra Cooperative Societies Act 1960

Chapter: VII - MANAGEMENT OF SOCIETIES

Section 74 to 80

1 Section 74 - Qualification and appointment of Manager, Secretary and other officers of societies and Chief Officer and Financial Officer for certain societies

(1) The qualifications for appointment of the Chief Executive Officer, Finance Officer, Manager, Secretary, Accountant or any other officer of a society or a class of societies and his emoluments and perquisites shall be such as may be determined by the Registrar, from time to time.

(2) In the society or class of societies, as the State Government may, from time to time, notify in the Official Gazette, there shall be a Chief Executive Officer and a Finance Officer, who shall be appointed by the society from a panel of persons selected by a body of such persons not exceeding five as may be prescribed.

(3) The Chief Executive Officer so appointed shall be ex-officio member of the committee but he shall have no right to vote at the meeting of the committee.

Footnote:
1. Section 74 was substituted by Mah. 20 of 1986, s. 37.

Section 75 - Annual general meeting

(1) Every society shall,within a period of three months next after the date fixed for making up its accounts for the year under the rules for the time being in force, call a general meeting of its members:
1 [Provided that, the Registrar may, by general or special order, extend the period for holding such meeting for a further period not exceeding three months however, in the case of the specified societies and urban co-operative banks such extension shall be granted only after recording the reasons in writing and after obtaining the previous approval of the Government for granting such extension.]
Provided further that if in the opinion of the Registrar, no such extension is necessary, or such meeting is not called by the society within the extended period (if any) granted by him, the Registrar or any person authorised by him may call, such meeting in the manner prescribed, and that meeting shall be deemed to be a general meeting duly 2 [called by the society,and the Registrar may order that the expenditure incurred in calling such a meeting shall be paid out of the funds of the society or by such person or persons who in the opinion of the Registrar, were responsible for the refusal or failure to convene the general meeting].

(2) At every annual general meeting of a society, the committee shall lay before the society 3 [a statement showing the details of the loans (if any) given to any of the members of the committee or any member of the family (as defined in the Explanation 4 [to clause (v) of sub-section (1) of section 73FF of any committee-member (including a society or firm or company of which such member or member of his family is a member, partner or director, as the case may be), and the details of re-payment of loan made, during the last preceding year and the amount outstanding at the end of that year,] and] a balance sheet and profit and loss account for the year in the manner, prescribed by the Registrar by general or special order for any class or classes of societies.
Explanation.--In the case of a society not carrying on business for profit; an income and expenditure account shall be placed before the society at the annual general meeting instead of profit and loss account, and all references to profit, and loss account and to"profit" or "loss" in this Act shall be construed in relation to such society as references respectively to the " 5 [excess of] income over expenditure", and "excess of expenditure over income".

(3) There shall be attached to every balance sheet laid before the society in general meeting,a report by its committee with respect to (a) the state of the society's affairs; (b) the amounts, if any, which it proposes to carry to any reserve either in such balance sheet, or any specific balance sheet; and (c) the amounts, if any, which it recommends,should be paid by way of dividend,bonus or honoraria to honorary workers. The committee's report shall also deal with any charges,which have occurred during the year for which the accounts are made up, in the nature of the society's business the committee's report shall be signed by its Chairman, or any other member authorised to sign on behalf of the committee.

(4) At every annual general meeting the balance sheet, the profit and loss account 6 [the audit memorandum submitted by the auditor appointed under section 81] and the committee's report shall be placed for adoption and such other business will be transacted as may be laid down in the by-laws and of which due notice has been given.

(5) If default is made, in calling a general meeting within the period or 'as the case may be' extended period 'prescribed under sub-section (1)' or in complying with subsections (2), (3) or (4) the Registrar may by order declare any officer or member of the committee whose duty it was to call such a meeting or comply with sub-section (2), (3) or (4) and who without any reasonable excuse failed to comply with any of the aforesaid subsections disqualified for being elected and for being any officer or member of the committee for such period not exceeding three years, as he may specify in such an order and, if the officer is a servant of the society, impose a penalty on him to 7 [pay] an amount not exceeding one hundred rupees.Before making an order under this sub-section, the Registrar shall give, or cause to be given, a reasonable opportunity to the person concerned of showing cause against the action proposed to be taken in regard to him.

(6) Any penalty imposed under sub-section (5) or under 8 [section76], may be recovered in the manner provided by the 9 [Code of Criminal Procedure,1973], for the recovery of fines imposed by a Magistrate, as if such fine was imposed by the Magistrate himself.

Footnote:
1. This provison was substituted by Mah. 41 of 2000, s. 4, (w.e.f. 23-8-2000).
2. This portion was substituted for the words "called by the society" by Mah. 33 of 1963, s.16(a).
3. This portion was inserted by Mah. 27 of 1969, s. 13.
4. This portion was substituted for the words, brackets and figure "to section (6) of any committee member,during the last preceding year," by Mah. 20 of 1986, s. 38(a).
5. These words were inserted by Mah. 33 of 1963, s. 16(a).
6. These words and figureswere substituted for the words "the auditor's report" by Mah. 33 of 1963, s. 16(c).
7. This word was inserted,by Mah. 33 of 1963, s. 16(d).
8. This was substituted for the words, "the next succeeding section" by Mah. 20 of 1986, s. 38(b)(i).
9. These words and figures substituted for the words and figures "Code of Criminal Procedure, 1898", by Mah. 20 of 1986, s. 38(b)(ii).

Section 76 - Special general meeting

(1) A special general meeting may be called at any time by the Chairman or by a majority of the committee and shall be called within one month--
(i) on a requisition in writing of one-fifth of the members of the society or of members the number of which is specified in the bye-laws for the purpose, whichever is lower, or
(ii) at the instance of the Registrar, or
(iii) in the case of a society, which is a member of a federal society, at the instance of the committee of such federal society.

(2) Where any officer or a member of the committee, whose duty it was to call such meeting without reasonable excuse, fails to call such meeting, the Registrar may by order declare such officer or member disqualified for being a member of the committee for such period not exceeding three years, as he may specify in such order; and if the officer is a servant of the society, he may impose on him a penalty not exceeding one hundred rupees. Before making an order under this sub-section, the Registrar shall give, or cause to be given a reasonable opportunity to the person concerned of showing case against the action proposed to be taken in regard to him.

(3) If a special general meeting of a society is not called in accordance with the requisition referred to in sub-section (1) the Registrar or any person authorised by him in this behalf, shall have power to call such meeting, and that meeting shall be deemed to be a meeting duly called by the committee.

(4) The Registrar shall have power to order that the expenditure incurred in calling a meeting under sub-section (3) shall be paid out of the funds of the society or by such person or persons who, in the opinion of the Registrar, were responsible for the refusal or failure to convene the meeting.

Section 77 - Acts of societies etc., not to be invalidated by certain defects

(1) No act of a society or a committee or any officer, done in good faith in pursuance of the business of the society shall be deemed to be invalid by reason only of some defect subsequently discovered in the organisation of the society, or in the constitution of the committee, or in the appointment or election of an officer, or on the ground that such officer was disqualified for his office.

(2) No Act done in good faith by any person appointed under this Act, the rules and the bye-laws shall be invalid merely by reason of the fact that his appointment has been cancelled by or in consequence of any order subsequently passed under this Act, Rules and the Bye-laws.

(3) The Registrar shall decide whether any act was done in good faith in pursuance of the business of the society; and his decision thereon shall be final.

1 Section 77A - Appointment of member of committee, new committee or Administrator, where there is failure to elect member, to constitute committee or where committee does not enter upon office

(1) Where the Registrar is satisfied that,--
2 [(1-a) a provisional committee has failed to make necessary arrangements for holding election for the constitution of the first committee, before the expiry of its term as specified in sub-section (1A) of section 73;]
(a) at the first constitution of the committee of any society there is a failure to elect all or any of the members of the committee;
(b) the term 3 [or extended term as the case may be,] of the committee of any society or of any of its members has expired or for any other reason election is held and there is a failure to elect all or any of the members required to fill the vacancies;
(c)any committee is prevented from entering upon office;
(d) anew committee has failed to enter upon office on the date on which the term of office of the existing committee expired; or
(e)4 [* * *]
5 [(f) where more than one group of persons in a society is claiming to be elected as the committee members and proceedings in respect thereof have been filed in the Co-operative Court;]

the Registrar may, either suo-motu or on the application of any officer of the society, by order appoint--
(i) any member or members of the society to be the member or members of the committee to fill the vacancies:
(ii) a committee, consisting of not more than three members of the society; or one or more administrators, who need not be members of the society, to manage the affairs of the society till a new committee enters upon office:

Provided that, before making such order, the Registrar shall publish a notice on the notice board at the head office of the society, inviting objections and suggestions with respect to the proposed order within a period specified in the notice and consider all objections and suggestions received by him within that period:
Provided further that, it shall not be necessary to publish such notice in any case where Registrar is satisfied that immediate action is required to be taken or that it is not reasonable practical to publish such notice.

(2) The committee or administrator so appointed shall,subject to the control of the Registrar and to such instructions as he may, from time to time, give, have power to discharge all or any of the functions of the committee or of any officer of the society and take all such action as may be required to be taken in the interests of the society.

6 [(3) The Committee or Administrator so appointed shall hold office for a period of six months from the date of assuming the management of the society and shall make necessary arrangements for constituting anew committee within the said period and for enabling the new committee including any new committee referred to in clause (f) of subsection (1), which is determined by the Court to have been legally elected, to enter upon office.]
7 [Provided that, if a new committee is not, or can not be constituted at the expiry or termination of the term of office of the committee or Administrator, for any reason beyond the control of the committee or Administrator, the term of office of the committee or Administrator, as case may be, shall be deemed to be extended, until the new committee is duly constituted.]

8 [(4) The Registrar shall have the power to change the committee or any or all members thereof or any or all the administrators appointed under sub-sections (1)at his discretion even before the expiry of the period specified in the order made under sub-section (1).

(5) The provisions of sub-section (2A)of section 78 shall apply mutatis mutandis for fixation of remuneration to be paid to the members or administrators appointed under subsection (1).]

Footnote:
1. Section 77A was inserted by Mah. 36 of 1975,s. 5.
2. Clause (1-a) was inserted by Mah. 13 of 1994,s. 6.
3. These words were inserted by Mah. 20 of 1986, s. 39(a)(i).
4. Clause (e) was deletedby Mah. 34 of 2001, (w.e.f. 7-9-2001) s. 7.
5. Clause (f) was inserted,by Mah. 20 of 1986, s. 39(a)(ii).
6. Sub-section (3) was substituted,by Mah. 20 of 1986, s. 39(b).
7. This provison was added by Mah. 7 of 1997, s. 10.
8. Sub-sections(4)and (5) were added, by Mah. 20 of 1986, s. 39(c).

Section 78 - 1 [Power of removal of committee or member, thereof]

2 [(1) If, in the opinion of the Registrar, the committee of any society or any member of such committee makes default, or is negligent in the performance of the duties imposed on it or him by this Act or the rules or the bye-laws, or commits any act which is prejudicial to the interests of the society or its members, or wilfully disobeys directions issued by the State Government, or by the Registrar for the purposes of securing proper implementation of co-operative policy and development programme approved or undertaken by the State Government or is otherwise not discharging its or his functions properly and diligently 3 [or where a situation has arisen in which the committee or any member of such committee refuses or has ceased to discharge its or his functions] and the business of the society has or is likely to come to a stand-still or where any member of such committee stands disqualified by or under this Act for being a member, the Registrar may, after giving the committee or the member, as the case may be,an opportunity of stating its or his objections, if any,within 15 days from the date of receipt of notice and after consultation with the federal society to which the society is affiliated, by order--
(a) (i) remove the committee, and
(ii) appoint a committee consisting of three or more members (who shall not be the members of the committees so removed) of the society in its place, or appoint one or more Administrators who need not be the members of the society, but who shall not be the members of the committee so removed, to manage the affairs of the society for a period not exceeding six months, which period, at the discretion of the Registrar, be extended by a further period not exceeding three months so, however, that the total period does not exceed nine months in the aggregate.:
Provided that, the Registrar shall have the power to change the committee or any member thereof or the Administrator or Administrators appointed under paragraph (ii) at his discretion even before the expiry of the period specified in the order made under this sub-section:

(b)remove the member and appoint any person as member of such committee in his place,or direct the society to elect or appoint a member in his place,for the remainder of the term of office of the member so removed.]
4 [Provided that, the member who has been so removed, shall not be eligible to be reelected, re-appointed,re-nominated, or re-co-opted, as a member of the Committee till the expiry of the period of next one full term of the committee from the date on which he has been so removed or till such lesser period as may be laid down under the provisions of section 73FFF or 144E, as the case may be.]

5 [(1A) When a notice is issued against any committee or member under sub-section (1),if resignation from any office is tendered by the committee or member, it shall not be valid or effective until two months have elapsed from the date of issue of the notice or until it is permitted to be accepted by the Registrar, whichever is earlier.]

(2) The committee or Administrator so appointed shall,subject to the control of the Registrar and to such instructions as he may from time to time give, have power to exercise all or any of the functions of the committee or of any officer of the society and take all such action as may be required in the interests of the society.
6 [The committee or Administrator appointed as aforesaid shall, not withstanding anything contained in the bye-laws, have power to call a special general meeting of the society to review or to reconsider the decision or the resolution taken or passed at the general meetings called by the previous committee or to endorse action taken by it.]

7 [(2A) The Registrar may fix the remuneration payable to the administrators and any expenses of management which shall be payable out of the funds of the society within such time and at such intervals as the Registrar may fix, and if such remuneration or expenses are not paid within such time or at intervals the Registrar may direct the person having custody of the funds of the society topay to the administrators such remuneration and expenses in priority to any other payments (except land revenue, any arrears of land revenue, or any sum recoverable from the society as arrears of land revenue) and he shall, so far as the funds to the credit of the society allow, comply with the orders of the Registrar.]

(3) If at anytime during any period, or extended period referred to in sub-section (1),it appears to the Registrar, that it is no longer necessary to continue to carry on the affairs of the society as aforesaid the Registrar may, by an order 8 [****] direct that the management shall terminate; and on such order being made, the management of the society shall be handed over to anew committee duly constituted.

(4) The committee or administrator shall, at the expiry or termination of it or his term of office, arrange for the constitution of a new committee in accordance with the bye-laws of the society:
9 [Provided that, if a new committee is not, or cannot be, constituted at the expiry or termination of the term of office of the committee or administrator, for any reason beyond the control of the committee or administrator, the term of office of the committee or the administrator, as the case may be, shall be deemed to be extended, until the new committee is duly constituted.] 10

(5) All acts done or purported to be done by the committee or administrator during the period the affairs of the society are carried on by the committee or administrator appointed under sub-section (1), shall be binding on the new committee.

Footnote:
1. This marginal note was substituted by Mah. 33 of 1963,s. 17(d).
2. Sub-section (1) was substituted, by Mah. 20 of 1986,s. 40.
3. This portion was inserted by Mah. 10 of 1988,s. 15.
4. This provison was substituted by Mah. 7 of 1997,s. 11.
5. Sub-section (1A)was inserted by Mah. 27of 1969,s. 14(b).
6. This portion was added by Mah. 33of 1963,s. 17(b).
7. Sub-section (2A)was inserted by Mah. 33of 1963s. 17(c).
8. The words "published in the Official Gazette" were deleted by Mah. 27of 1969,s. 14(c).
9. This provison was deemed always to have been added by Mah. 48of 1972,s. 2.
10. For validation of Acts, see Mah. 48of 1972,s. 3.

Section 79 - Registrar's power to enforce performance of obligations

(1) The registrar may direct any society or class Of societies, to keep proper books of accounts with respect to all sums of money received and expended by the society, and the matters in respect of which the receipt and expenditure take place all sales and purchases of goods by the society, and the assets and liabilities of the society, and to furnish such statements and returns and to produce such records as he may require from time to time; and the officer or officers of the society shall be bound to comply with his order within the period specified therein.

(2) Where any society is required to take any action under this Act, the rules or the byelaws, or to comply with an order made under the foregoing sub-section, and such action is not taken--
(a) within the time provided in this Act, the rules or the bye laws, or the order as the case may be, or
(b) where no time is so provided, within such time, having regard to the nature and extent of the action to be taken, as the Registrar may specify by notice in writing.

the Registrar may himself, or through a person authorised by him, take such action, at the expense of the society; and such expense shall be recoverable from the society as if it were an arrear of land revenue.

(3) Where the Registrar takes action under sub-section (2), the Registrar may call upon the officer or officers of the society whom he considers to be responsible for not complying with the provisions of this Act, the rules or the bye-laws, or the order made under sub-section (1) and after giving such officer or officers an opportunity of being heard, may require him or them to pay to the society the expenses paid or payable by it to the State Government as a result of their failure to take action and to pay to the assets of the society such sum not exceeding twenty-five rupees as the Registrar may think fit for each day until the Registrar's directions are carried out

1 Section 79A - 2 [Government's power] to give directions in the public interest, etc.

(1) 3 [If the State Government, on receipt of a report from the Registrar or otherwise,is satisfied] that in the public interest or for the purposes of securing proper implementation of co-operative production and other development programmes approved or undertaken by Government, or to secure the proper management of the business of the society generally, or for preventing the affairs of the society being conducted in a manner detrimental to the interests of the members or of the depositors or the creditors thereof, it is necessary to issue directions to any class of societies generally or to any society or societies in particular, 4 [the State Government may issue] directions to them from time to time, and all societies or the societies concerned, as the case may be, shall be bound to comply with such directions.

(2) 5 [The State Government may] modify or cancel any directions issued under subsection (1),and in modifying or cancelling such directions may impose such conditions as 6 [it may deem fit.]

7 [(3) Where the Registrar is satisfied that any person was responsible for complying with any directions or modified directions issued to a society under sub-sections (1) and (2) and he has failed without any good reason or justification, to comply with the directions, the Registrar may by order--
(a) if the person is a member of the committee of the society, remove the member from the committee and appoint any other person as member of the committee for the remainder of the term of his office and declare him to be disqualified to be such member for a period of six years from the date of the order:
(b) if the person is an employee of the society,direct the committee to remove such person from employment of the society forthwith, and if any member or members of the committee,without any good reason or justification, fail to comply with this order,remove the members, appoint other persons as members and declare them disqualified as provided in clause (a) above:

Provided that, before making any order under this sub-section, the Registrar shall give a reasonable opportunity of being heard to the person or persons concerned and consult the federal society is affiliated.
Any order made by the Registrar under this section shall be final.

Footnote:
1. Section 79A was inserted by Mah. 27 of 1969, s. 15.
2. These words were substituted for the words "Registrar's power" by Mah. 36 of 1975,s.5(c).
3. These words were substituted for the words "Subject to the rules made in that behalf, where the Registrar is satisfied" by Mah. 27 of 1971, s. 5(a)(i).
4. These words were substituted for the words "he may issue" by Mah. 27 of 1971, s. 5(a)(ii).
5. These words were substituted for the words "The Registrar may" by Mah. 27 of 1971, s. 5(b)(i).
6. These words were substituted for the words "he may deem fit", by Mah. 27 of 1971, s. 5 (b)(ii).
7. These words were substituted for the words "he may deem fit", by Mah. 27 of 1971, s. 5 (b)(ii).

1 Section 79AA - Registrar's powers to give directions to frame regulations

(1) If the Registrar or an officer not below the rank of District Deputy Registrar is of the opinion that,having regard to the financial condition of the society and financial interest of Government therein, it is necessary to regulate the manner of carrying on its trade or business, he may, subject to any rules made in this behalf, direct such society to make regulations in that behalf and forward them to him for approval.

(2) On receipt of the regulations made by the society, the Registrar or such officer may approve them with or without modifications. On approval of such regulations, the society shall carry on its business in accordance with such regulations.

(3) If any society fails to forward such regulations to the Registrar or such officer when directed by him under sub-section (1)within a period of three months from the date on which the direction is given, the Registrar or such officer shall himself make or cause to be made such regulations and require the society to carry on its business in accordance with such regulations and thereupon the society shall be bound to comply with such requirement.

Footnote:
1. Section 79AAwas inserted by Mah. 20of 1986,s. 41.

1 79B. Registrar's Power to remove member for failure to supply his agricultural produce to processing society

(1) Where any producer-member of a processing society fails to supply his agricultural produce to the society in accordance with the provisions of bye-laws of the society, the Registrar may, on complaint made by the society or suomotu, issue a notice to the member to show cause,within a period specified in the notice, why for such failure he should not be removed from the membership of the society.

(2) After holding such inquiry as he thinks fit and giving a reasonable opportunity of being heard to the member, if the Registrar is satisfied that the member has failed, without any good reason or justification, to supply his agricultural produce to the society in accordance with the provisions of the bye-laws, the Registrar may by order remove the person concerned as a member of the society with effect from such date as may be specified in the order and thereupon the person shall cease to be a member of the society on and from that date. Any order made by the Registrar under this section shall be final.

Footnote:
1. .Section 79Bwas inserted by Mah. 36of 1975,s. 7.

Section 80 - Registrar's power to seize records etc.

(1) Where the Registrar is satisfied that the books and records of a society are likely to be suppressed, tampered with or destroyed, or the funds and property of a society are likely to be misappropriated or misapplied, the Registrar or the person authorised by him may apply to the Executive Magistrate within whose jurisdiction the society is functioning for seizing and taking possession of the records and property of the society.

(2) On receipt of an application under sub-section (1) 1 [ the Magistrate shall forthwith consider such application and, if satisfied that immediate action is required, shall authorise] any police officer, not below the rank of a sub-inspector, to enter and search any place where the records and property are kept or likely to be kept,and to seize them and hand over possession thereof to the Registrar or the person authorised by him, as the case may be.

2 (3) Where the Registrar or an officer not below the rank of District Deputy Registrar (hereinafter referred to inthis section as "the said officer") is satisfied that immediate action is required to be taken or that the Executive Magistrate having jurisdiction is not likely to be available at the head-quarters for a consecutive period of three days or the books and records of a co-operative society are in the immediate danger of being tampered with or funds and property of a society are in the immediate danger of being mis-appropriated or misapplied, the Registrar or the said officer may,notwithstanding anything contained in sub-sections (1)and (2), make an order to seize such books, records or funds of the society either himself or through an officer authorised by him in this behalf, and for that purpose the Registrar or the said officer or the officer so authorised may after reasonable notice at any reasonable time enter and search without warrant any premises where he believes such books, records or funds to be and and inspect and seize such books, records or funds, and the officer or officers of the society responsible for the custody of such books, records and funds shall deliver such books, records or funds forthwith to the Registrar, the said officer or the officer so authorised,who shall acknowledge receipt of the books, records or funds of the society so seized. The Registrar, the said officer or the officer so authorised, may, for the purpose of execution of the said order,request the officer-in-charge of the nearest police station to give him necessary assistance and such police officer shall thereupon give him such assistance.

Footnote:
1. These words were substituted for the words "the Magistrate may authorise" by Mah. 3of 1978,s. 18.
2. Sub-section (3)was added by Mah. 20of 1986,s. 42.

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