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63. Winding up of co-operative societies.
- If the Registrar, after an inquiry has been held under section 55, or an inspection has been made under section 56, or on receipt of an application made by not less than three-fourths of the members of a co-operative society, is of opinion that the society ought to be wound up, he may issue an order directing it to be wound up.
- The Registrar may of his own motion make an order directing the winding up of cooperative society
- Where it is a condition of the registration of the society that the society shall consist of at least ten members and the number of members has been reduced to less than ten, or
- Where the co-operative society has not commenced working or has ceased to function in accordance with co-operative principles.
- The Registrar may cancel an order for the winding up of a co-operative society, at any time, in any case where, in his opinion, the society should continue to exist.
- A copy of such order shall be communicated by registered post to the society and to the financing institutions, if any, of which the society is a member.
- Notwithstanding anything contained in this section no co-operative bank shall be wound up except with the previous sanction in writing of the Reserve Bank.
64. Winding up of co-operative bank at the direction of the Reserve Bank.
Notwithstanding anything to the contrary contained in this Act, the Registrar shall make an order for winding up of a co-operative bank, if so required by the Reserve Bank in the circumstances mentioned in section 13D of the Deposit Insurance Corporation Act, 1961.
65. Reimbursement to the Deposit Insurance Corporation by the liquidator.
Where a co-operative bank being an insured bank within the meaning of the Deposit Insurance Corporation Act, 1961, is wound up, or taken into liquidation, and the deposit Insurance Corporation has become liable to the depositors of the insured bank under sub –section(1) of section 16 of that Act, the Deposit Insurance Corporation shall be reimbursed by the liquidator or such other person in the circumstances to the extent and in the manner provided in section 21 of the Deposit Insurance Corporation Act, 1961.
- Where the Registrar has made an order under section 63 for the winding up of a co-operative society, the Registrar may appoint a liquidator for the purpose and fix his remuneration.
- A liquidator shall on, appointment, take into his custody or under his control all the property, effects and actionable claims to which the society is or appears to be entitled and take such steps as he may deem necessary or expedient, to prevent loss or deterioration of, or damage to such property, effects and claims. He may carry on the business of the society so far as may be necessary with the previous approval of the Registrar.
- Where an appeal is preferred under section 76, and order of winding up of a co-operative society made under section 63 shall not operate thereafter until the order is confirmed in appeal.
Provided that the liquidator shall continue to have custody or control of the property, effects and actionable claims mentioned in sub-section (2) and have authority to take the steps referred to in that sub-section.
- Where and order of winding up of a co-operative society is set aside in appeal, the property effects and actionable claims of the society shall revest in the society.
67. Power of liquidator.
- Subject to any rules made in this behalf, the whole of the assets of a co-operative society, in respect of which an order for winding up has been made, shall vest in the liquidator appointed under section 66 from the date on which the order takes effect and the liquidator shall have power to realise such assets by sale or otherwise.
- Such liquidator shall also have power, subject to the control of the Registrar -
- To institute and defend suits and other legal proceedings on behalf of the co-operative society by the name of his office.
- To determine from time to time the contribution (including debts due and costs of liquidation) to be made or remaining to be made by the members or past members or by the estates or nominees, heirs or legal representatives of deceased members or by an officers or former officers or former officers, to the assets of the society.
- To investigate all claims against the co-operative society and subject to the provisions of this Act, to decide questions of priority arising between claimants.
- To pay claims against the co-operative society including interest up to the date of winding up according to their respective priorities, if any in full or rateably, as the assets of the society may permit, the surplus, if any, remaining after payment of the claims being applied in payment of the interest from the date of such order of winding up at a rate fixed by him but not exceeding the contract rate in any case.
- To determine by what persons and in what proportions the costs of the liquidation are to be borne.
- To determine whether any person is a member, past member or nominee of deceased member
- To give such directions in regard to the collection and distribution of the assets of the society as may appear to him to be necessary for winding up the affairs of the society.
- To carry on the business of the society so far as may be necessary for the beneficial winding up of the same.
- To make any compromise or arrangement with creditors or persons claiming to be creditors or having or alleging to have any claim, present or future, whereby the society may be rendered liable.
- To make any compromise or arrangement with the any person between whom and the society there exists any dispute and to refer any such dispute to arbitration.
- After consulting the members of the society, to dispose of the surplus, if any remaining after paying the claims against the society, in such manner as may be prescribed, and
- To compromise all calls or liabilities to calls and debts and liabilities capable of resulting in debts, and all claims, present or future, certain or consignment, subsisting or supposed to subsist between the society and contributory or alleged contributory or other debtor or person apprehending liability to the co-operative society and all questions in any way relating to or affecting the assets or the winding up of the society on such terms as may be agreed and take any security for the discharge of any such call, liability, debt or claim and give a complete discharge in respect thereof.
- When the affairs of a co-operative society have been wound up, the liquidator shall make a report to the Registrar and deposit the records of the society in such place as the Registrar may direct.
68. Priority of contributions assessed by liquidator.
Not withstanding anything contained in the Provincial Insolvency Act, 1920, the contribution assessed by a liquidator shall rank next to debts due to the Government or to any local authority in order of priority in insolvency proceedings.
69. Power of Registrar to cancel registration of a co-operative society.
- The Registrar may after considering report of the liquidator made to him under subsection (3) of the section 67 order the registration of the co-operative society to be cancelled.
- An order passed under sub-section (1) shall be communicated by registered post of the president of the society and to the financing institutions if any, of which the society was a member.
Last Updated Date :- 18-06-2018
Page last updated on: 08-08-2022