Rule No 57. Prohibition against being interested in contracts etc
(1) No officer of a society shall have any interest, directly or indirectly otherwise than as such Officer;—
(a) in any contract made with or by the society; or
(b) in any property sold or purchased by the society; or
(c) in any other transaction of the society, except as investment made or
as loan taken from the society or the provision of residential accommodation by
the society to any paid employee of the society.
(2) No officer of the society shall purchase, directly or indirectly, any property of
a member of the society sold for the recovery of his dues to the society.
Rule No 57A. Motion of no-confidence against the officers of the society
(1) The requisition to call the special meeting of the committee of a society to consider a
motion of no-confldence against the President, Vice-Ptesident, Chairman, ViceChairman,
Secretary, Treasurer or other officer of the society, by whatever
designation called, who holds office by virtue of his elections to that office, shall be
made in Form M-18. The requisition shall be accompanied by;-
(a) the grounds of no-confldence;
(b) the text of the motion of no-confldence to be moved;
(c) the name of the committee members who shall move the motion of
(d) a list of members of the committee specifying their full names, and
address who are, for the time being, entitled to sit and vote at any meeting of
(e) signatures of the members of the committee who are signing the
requisition duly attested by the Chief Executive Officer of the society or Special
Executive Magistrate or Executive Magistrate or any Gazetted Officer of the
(2) The requisition referred to in sub-rule (1) shall be delivered in person to the
Registrar. Such requisition or requisitions shall be delivered in duplicate in each case.
The Registrar on ascertaining that the requisition or requisitions as the case may be,
have been signed by not less than 1/3rd members of the committee who for the time
being are entitled to sit and vote in any meeting of the committee of society;-
(a) receive and acknowledge the requisition under his signature with date and time.
(b) issue notice, within 7 days from the date of receipt of the. requisition,
convening, the special meeting for that purpose specifying therein place, date,
time, name and designation of the officer who shall be presiding over such
meeting, to all the members of the committee, the presiding officer and the
Managing Director, General Manager, Manager, Paid Secretary, Group Secretary
or such employee of the society, to whom the Registrar has directed to produce
minute book of committee meetings of the society. This notice of no-confidence
shall also be issued, to the Officer or officers against whom the motion of noconfidence
is being moved, and shall be accompanied by the copy of the
requisition alongwith enclosures and agenda.
(c) The Registrar shall direct the Managing Director, General Manager,
Manager, Paid Secretary, Group Secretary or any other employee to deliver in
person the minute book Of the committee meetings on the date, time and place
of the meeting, to the Presiding Officer.
(d) The Registrar shall send a notice under certificate of posting, to all the
persons concerned. However, he shall serve or cause to be served the notice on
the officer or officers against whom the motion of no-confidence is proposed to
be moved through the special messenger or the officer or officers, as the case
may be, or in his or their absence on any adult member of his or their families
at the place of residence. If for some reason it is not possible to serve the
notice, the authorised person in this behalf, shall in presence of two witnesses,
affix such notice on any conspicuous place of the residence.
(e) copies of this notice shall be displayed on the Notice Board of the
Registrar, the Presiding Officer and the society. Such display of the notice on the
notice board of the Registrar and the Presiding Officer shall be the conclusive
proof that such notice has been served on all concerned.
(3) Notwithstanding anything contained in the bye-laws of the society regarding
the procedure for convening and holding meeting and recording of minutes, the
procedure adopted by the Registrar, the Presiding Officer and the Authorised Officer
under sub-rule (2), shall be deemed to be the proper procedure under the provisions
of bye-laws of the society.
If the Registrar deems it necessary, he shall require any Officer of the society to
furnish any information to him and it shall be obligatory on the part of such officer to
furnish such information. On failure of the officer to furnish the information, the
Registrar may get it through any person authorising in that behalf. This failure on
part of the officer of the society shall be construed as non-compliance of provisions
as contemplated under
sub-section (1) of Section 79. However, in case of the officer
of the society who holds that office by virtue of his election, including the member of
the committee of management, it shall be construed as breach of provisions under
sub-section (1) of Section 79 and negligence of performance of duties imposed by
the Registrar as contemplated under
subsection (1) of Section 78.
(4) The time of the meeting shall be between Office hours of the authorised
officer. The meeting shall be held either in the office of the society or at any other
place which may, as far as possible, be public place or any other place specified by
the District Deputy Registrar.
(5) No other subject, except the motion or motions of no-confidence shall be kept on the agenda.
(6) The Registrar or the officer authorised to preside over the meeting shall,
(a) announce or cause to be announced the commencement of the meeting,
(b) take possession of the minute book of the committee meetings from
the officer of the society. However, for some reasons, if it is not possible for him
to take possession of the minute book of the committee meetings of the society,
at the commencement of the meeting, he shall record proceedings in the
register kept for that purpose in his office. The text of the minutes of the
meeting recorded in the minute book kept in the office of the Registrar shall be
incorporated in the minute book of the society.
(c) record the date, time, place, names of members of the committee
present at the commencement of the meeting, in the minute book of the society
or kept by him, as the case may be, in his own hand and cause all the members
of the committee who are present, to sign it and it shall be obligatory on their
part to do so. The signature of the members on the minute book shall be the
concrete proof of their attendance.
(d) riot allow any other person to enter the place of meeting except the
person or persons appointed to assist him, the officer of the society who has
produced the minute book, the officer or officers against whom the motion of
no-confidence is moved, the members of the committee who are for the time
being entitled to sit and vote in any meeting of the committee, who are present
at the commencement of the meeting and police officer or officers if called by
him to maintain the law and order.
(e) record or cause to be recorded, the proceedings of the meeting and
thereafter allow those members who desire to sign the proceedings. Signature of
the members on the minute book shall be the conclusive proof of their
(f) not allow the discussions on any other subject than the subject on agenda.
(g) declare the motion or motions as rejected and take a note to that effect
with reasons, in the minute book under the following circumstances;—
(i) if no member of the committee present;
(ii) none of the members of the committee, who are present refuse to sign the requisition;
(iii) 2/3rd members are not present at the commencement of the meeting (i) 2/3rd is fraction, it shall be rounded to next higher number.
(i) read or cause to be read the text and grounds of no-confldence motion
and allow any of the member, who have signed the requisition to move the motion
and to speak in support of the motion.
(ii) allow the member against whom no-confldence motion is moved or any
other member on his behalf to defend.
(j) the Presiding Officer shall not speak or give any decision on the merit or
otherwise of no-confidence motion.
(k) issue certificate in Form M-19 in favour of the society.
Rule No 58. [Disqualification for membership of committee
(1) No person shall be
eligible for appointment, or election or nomination or co-option or being continued as
member of the committee or District Loan Committee of State Land Development
Bank, if he is in default to any society, in respect of any dues from him either as
borrower or is a defaulter within the meaning of
Section 73FF or has incurred
disqualification under Clauses (ii), (iii), (iv), (v), and (iv) of sub-section (1) of Section
(2) When any member incurs disqualification as mentioned in sub-rule (1) the
Chief Executive Officer or whatsoever name called, shall communicate, the
members, thathe has ceased to be a member of the committee, under certificate of
posting. The Chief Executive Officer shall also report alongwith a copy of
communication to the Registrar and also affix a copy thereof on the notice board of
the society. The publication of such copy of the notice of the receipt of such copy of
the notice in the office of the Registrar, shall be the conclusive proof of the fact that
the person has duly received the communication. When any member ceased to be a
member of the committee, the seat of such member shall be deemed to have fallen
vacant from the date of such communication. The society shall not allow such
persons to exercise any powers, enjoy any rights and privileges and perform
functions as member of the committee, under the Act and the rules and bye-laws
made thereunder. If the Chief Executive Officer fails to take action as contemplated
above, the Registrar shall after giving an opportunity to the person disqualified, issue
communication of cessation of membership of such person from the committee of
the society under certificate of posting and also by publishing a copy on the notice
board of his office.]
Rule No 58A. Bond to be executed by elected Members of Managing Committee
Every elected member of the Managing Committee shall execute a bond in Form M20
within fifteen days of his assuming the office. Such bond shall be executed on the
stamp paper as provided under the Bombay Stamp Act, 1958. The expenditure on
stamp paper shall be borne by the society. The Chief Executive Officer/Secretary of
the society shall receive such bonds and keep them on record of the society and
accordingly inform the Registrar within fifteen days from formation of the
Rule No 59. First general meeting
(1) Within three months from the date of registration
of a society, the Chief Promoter thereof, shall convene the first general meeting of all
persons who had joined in the application for registration of the society. Where the
Chief Promoter fails to convene the meeting as aforesaid, it shall be convened by any
person authorised in that behalf by the Registrar.
(2) At the first general meeting, the following business shall be transacted:-
(i) Election of a president for the meeting;
(ii) Admission of new members;
(iii) receiving a statement of accounts and reporting all transactions entered
into by the promoter upto 14 days before the meeting.
(iv) Constitution of a provisional committee until regular elections are held
under the by-laws. The provisional committee shall have the same powers and
functions as the committee elected in accordance with the by-laws;
(v) Fixing the limit up to which the funds may be borrowed;
(vi) Any other matter which has been specifically mentioned in the by-laws.
Rule No 60. General meetings
(1) All general meetings of a society excepting the first general meeting shall be
convened by the Secretary or any other officer authorised by and under the by-laws
to convene such meetings under intimation to the Registrar, who may attend such
meetings or authorise some person to attend such meetings on his behalf. The
President of the Society or in his absence the Vice-President or, in the absence of
both, a member elected by the members present at the meeting shall preside over
the meeting unless the by-laws specify that the President of the meeting elected by
(2) No general meeting shall be held or proceeded with unless the number of
members required to form a quorum as specified in the by-laws are present.
(3) The Secretary or any other officer convening the meeting shall read out the
notice convening the meeting and the agenda for the meeting and then the subjects
shall be taken up for consideration in the order in which they are mentioned, in the
agenda unless the members present, with the permission of the President, agree to
change the order. Unless otherwise specified in the Act, these rules and the by-laws,
the resolutions will be passed by a majority of the members present. The President
will have a casting vote.
(4) When the members are divided on any resolution, any member may
demand a poll. When a poll is demanded, the President shall put the resolution for
(5) Voting may be by show of hands or by ballot as may be decided by the
members present at the meeting, unless otherwise specified in the by-laws.
Notwithstanding anything contained in the by-laws, election of office bearers of a
Society having members share capital in excess of Rs. 10,000, including Government
share capital, if any, shall be by ballot.
(6) When voting is to be by ballot, the President shall take necessary steps for
the issue of ballot papers and counting of votes.
(7) The result of voting shall be announced by the President.
(8) If all the business in the agenda cannot be transacted on the date on which
the general meeting is held, the meeting may be postponed to any other suitable
date not later than thirty days from the date of the meeting as may be decided by
the members present at the meeting.
(9) The remaining subject or subjects on the agenda shall be taken up for
consideration at the postponed meeting.
(10) If the general meeting cannot be held for want of quorum, if shall be
adjourned to a later hour on the same day as may have been specified in the notice
calling the meeting or to a subsequent date not earlier than seven days and at such
adjourned meeting the business on the agenda of the original meeting shall be
transacted whether there is a quorum or not.
(11) No resolution regarding expulsion of a member of the society, removal of a
member of the committee or amendment of by-laws shall be brought forward in any
general meeting, unless dtie notice thereof is given in accordance with the provisions
of the Act, these rules and the by-laws of the society.
Rule No 61. Annual statements of accounts including balance sheet, etc
Within forty-five days of the close of every co-operative year, or within such extended
period as may be specified by the Registrar, in the case of any society or class of
societies, the committee of every society shall prepare annual statements of
(i) receipts and disbursements during the previous co-operative year;
(ii) the profit and loss account for the year; and
(iii) the balance sheet as at the close of the year.
These statements of accounts shall be open to inspection by any member during
office hours at the office of the society and a copy thereof shall be submitted, within
fifteen days from the date of preparation, to the auditor appointed by the Registrar
for the audit of that society.
Rule No 62. Form for the balance sheet and the profit and loss account
(1) The balance sheet and the profit and loss account to be laid before the annual 'general
meeting of a society by the committee shall ordinarily be in Form N :
Provided that it shall be competent for the Registrar to permit a society or class
of societies to adopt such other form as he may deem fit.
(2) A copy of the balance sheet and profit and loss account to be presented at
the annual general meeting under
sub-section (2) of Section 75 and a copy of the
report of the committee under sub-section (3) of Section 75 shall be fixed on the
notice board of the society at least fourteen days before the date fixed for the annual
Rule No 63. Power to call annual and special general meeting
If the annual general
meeting of a society is not called in accordance with the provisions of
Section 75 or if
the Chairman or a majority of the committee of the society fail to call a special
general meeting in accordance with the provisions of
Section 76, the Registrar may
authorise any person subordinate to him or any officer or employee of a federal
society to call the annual general meeting or the special general meeting, as the
case may be, and such officer or person shall have all the powers and functions of
the officer of the society authorised to convene such annual or special general
meeting, under its bylaws.
Rule No 64. Procedure for appointment, suspension, and removal of members of the
committee and other officers, etc
(1) Notwithstanding anything contained in the
by-laws of a society but subject to the provisions of
Section 78, the Registrar may
[by an order stating the reasons therefor:-]
(a) remove the committee of a society and appoint a new committee in its
place consisting of three or more members of the society to manage the affairs
of the society; or
(b) remove the committee and appoint one or more administrators, who
need not be members of the society, to manage the affairs of the society; or
(c) remove any member of the committee of a society and appoint in his
place such other member as he may deem fit.
(2) Before making any order under sub-rule (I), the Registrar shall consult the
federal society to which the society is affiliated and give an opportunity to the
committee or the member concerned to show cause, within fifteen days from the
date of issue of notice, why such an order shall not be made.
(3) The member appointed under clause (c) of sub-rule (1) shall hold office so
long as the member in whose place he is appointed would have held office, if the
vacancy had not occurred.
(4) Notwithstanding anything contained in the by-laws regarding holding any
meeting of the society, the Registrar may, by special or general order specify the
procedure for holding meetings of the Committee appointed by him under clause (a)
of sub-rule (1).
(5) Immediately after the appointment of a new committee or an administrator
or administrators under sub-rule (I), the committee in whose place such
appointment is made and officers of the society shall give the new committee or the
administrator or administrators, as the case may be, the of the property, documents
and accounts of the society .
Rule No 65. Accounts and books to be kept
(1) Every society shall keep the following accounts and books:-
(1) A register of members including persons nominated under
Section 38 in Form T.
(2) A register of shares.
(3) A register of debentures and bonds (where capital is raised by debentures and bonds).
(4) Minute book recording proceedings of general meetings.
(5) Minute book recording proceedings of committee meetings.
(6) Cash book.
(7) General ledger and personal ledger.
(8) Stock register.
(9) Property register.
(10) Register of audit objections and their rectification.
(11) Such other accounts and books as from time to time be specified by
the State Government by special-or general order for any society or class of
[(2) Where the State Government directs by order as provided under
subsection (2A) of Section 81 that the cost audit of any society or class of societies shall
be conducted, such society or class of societies shall, in addition to the accounts and
books required to be kept under sub-rule (i), also maintain such books, records and
accounts in such manner as the State Government may specify by general or special
order from time to time for the purposes of cost audit.]
Rule No 66. [Copies of monthly returns to be furnished to Registrar
All Registered Co-operative Societies classified by the Registrar as Central Banks or as Urban Banks
shall furnish to the Registrar every month a copy of each of the returns required to
be furnished to the Reserve Bank of India under Sections 18, 24 and 27 of the
Banking Regulation Act, 1949 (10 of 1949).]
Rule No 67. Registrars power to enforce performance of obligations
(1) In addition to the periodical financial statements referred to in Rule 66, the Registrar may, by
special or general order, require any society to furnish to him any other returns in
such forms as may be specified by him, on such date or dates or at such interval or
intervals as may be specified by him, in the order. The salarie officers of the society
shall be responsible for the submission of these returns on' due dates. If there are no
salaried officers of the society or if the executive functions are attended to by the
Chairman or any other member of the committee in an honorary capacity, the return
shall be submitted by the Chairman or such member of the committee.
(2) On failure of the society to furnish any returns on due dates, the Registrar
may, after giving due notice to the person or persons responsible for the submission
of the same, depute an employee of the Co-operative Department or of the Federal
Society to which the society is affiliated to prepare the return or returns and submit
it or them to him. The members of the committee and other officers of the society
shall furnish to the employee of the Co-operative Department or of the federal
society entrusted with the work, all information necessary for preparing the return or
returns. The expenses incurred by the Registrar in getting such return or returns
prepared shall be borne by the society and shall be recovered from the society under
Section 79 as if they were an arrear of land revenue.
Rule No 67A. Directions of Registrar to the society to make regulations on certain matters
(1) Where, in the course of, or as a result of audit under
Section 81, or
Section 83, or inspections under
Section 84 or
Section 89A or
Section 89A or visit or administrative inspection of any officer of
the Co-operative Department or financial institution, or on the report of federal
society or financial institution, or in any other way, or suo moto or otherwise, the
Registrar is of the opinion that it is necessary, having regard to financial condition of
the society or before after grant of Government financial assistance of any kind
directly or indirectly, including Government guarantee or any other financial interest
of Government accrue or likely to be accrued to regulate the manner of carrying on
trade or business, the Registrar, after making such further enquiry if he deems
necessary and after consulting the committee or any officer of the society and after
examining the record of the society, shall:-
(i) direct the society to make regulations on.the items specified by him;
(ii) direct the society to make regulations in such manner as he specifies
and forward the same to him within three months fom the date of such issue of
directions to him, for approval.
(2) The society shall frame the regulations on items specified by the Registrar
and also in the manner specified by him, if he has so directed while forwarding
regulations and forward the same personally along with copy of resolution within a
period of three months from the date of issue of such directives.
(3) On receipt of regulations, the Registrar or the District Deputy Registrar on
examination may issue an order approving them or modify, eliminate, delete or add
as he deems fit in the interest of the society. The regulations shall be effective from
the date of issue of order of approval by the Registrar and the society shall carry on
its business in accordance with such regulations from the date of order of approval of
(4) If any society fails to submit regulations to the Registrar on any or all the
items forwarded by the Registrar or in the manner directed by him, the Registrar
shall make the regulations on the items and in the manner if directed by him under
sub-section (I) of Section 79AA and issue an order directing the society to carry on
its business in accordance with such resolutions from the date of issue of such order.
It shall be obligatory on the society to carry on its business and trade in accordance
with the regulations so issued.
(a) (the Committee or any officer of the society fails to attend the
consultation, to produce record furnishing the information, attend for satisfying
the doubts of Registrar or to carry out any other act or to comply with any of the
provisions of sub-rules (1), (2) and (3);
(b) after issue of order in sub-rules (3) and (4) of this rule, if the society is
negligent in observance or fails to comply with the regulations, it shall be
construed as non-compliance of direction issued by the Registrar under
subsection (I) of Section 79, if it relates to clause (a) and non-compliance of
directions issued by the Registrar under
Section 79AA, if it relates to clause (b)
and thereupon the provisions of Section 79 shall be applicable mutatis mutandis.
If the committee or elected officer of the society is responsible for noncompliance
of provisions of clauses (a) and (b) of this sub-rule,.it shall, in
addition to non-compliance of directives under sub-section (I) of Section 79 and
Section 79AA, also be construed as negligence in performance of duties imposed
on it or upon him by the Act arid the rules made thereunder and willful
disobedience of instructions issued by the Registrar as contemplated in
subsection (I) of Section 78.]
Rule No 68. Procedure to be adopted for taking possession of books, documents, securities, cash and other properties of society
(1) Where taking possession of books, documents, securities, cash or other properties of a society is considered
necessary and where taking of such possession is resisted or obstructed, the
Registar, the Liquidator or any other person entitled to the same may take or cause
to be taken order for seizing the books, documents, securities, cash or other
properties of the society, as the case may be, in the manner provided in
(2) Any person appointed by the Registrar as a Liquidator of a society or any
person authorised by the Registrar to audit the accounts of a society under Section
81 or any person authorised by the Registrar to hold an inquiry into the constitution,
working and financial conditions of a society under Section 83 or any person
authorised by the Registrar to inspect the books of a society under Section 84 shall,
in cases where the misappropriation of funds, breach of trust or fraud has been
committed or where it is suspected or apprehended that the books, documents,
securities, cash or other properties of a society are likely to be tampered with or
destroyed or removed, and where taking of possession of such books, docurnents,
securities, cash or other properties is considered necessary, shall follow the same
procedure, with the previous permission of the Registrar, as is laid down in Section
80 for the purposes of obtaining such possession.