Overview:
(1) The Registrar shall on the application of a federal or a secondary cooperative society to which the cooperative society concerned is affiliated, or of a creditor to whom the cooperative is indebted, or of not less than one third of the Directors, or of not less than one—tenth of the members, hold an inquiry or cause an inquiry into any specific subject relating to any violation of any of the provisions of the Act or bye-laws.
(2) The Registrar shall order an enquiry or reject the application for an enquiry showing the reasons within ten days from the date of receipt of application
(3) The inquiry shall be completed within a period of thirty days from the date of order of the inquiry:
Provided that where the inquiry cannot be completed within a period of thirty days the reasons thereof shall be recorded in writing.
(4) The Registrar shall:
(a) within a period of thirty days from the date of the completion of the inquiry, communicate the report of the inquiry:
- to the cooperative society concerned; and
- to the applicant secondary cooperative society; or
- to the applicant creditor; or
- to the person designated by the applicant Directors; or
- to the person designated by the applicant members, as the case may be;
(b) within a period of fifteen days from the date of expiry of the period mentioned in sub-section (3) communicate the reasons for the non-completion of the inquiry within the specified period along with the period which is likely to be taken for completion of inquiry, to the parties concerned under sub-section 4(a).
(5) The cooperative society concerned shall, on receipt of the report, place it before the next general meeting or in a special general meeting to take such action thereon as the general body may think fit, which may include removal of all or any Directors and election of new Directors or any other action on any employees as required.
(6) A copy of report shall be supplied to any other member of the cooperative society, on payment of such fee as determined by the Registrar.88. Inspection of society:
- Every registered society shall be liable to inspection at any time by the Registrar or any person authorized by him by general or special order and by any affiliating society if so provided in its bye-laws.
- An inspection of a registered society shall also be made by the Registrar or any person authorized by him in this behalf by an order in writing at any time on the application of a creditor of a registered society:
Provided that no inspection shall be made under sub-section unless:
- the creditor deposits with the Registrar such sum as security for the cost of the proposed inspection as the Registrar may require; and
- the creditor satisfies the Registrar that the alleged debt is a sum then due and that he has demanded payment thereof and has not received satisfactory response within a reasonable time:
Provided further that no inspection shall be conducted under this sub-section without giving the society an opportunity of being heard. 4
(3) The result of an inspection under this section shall be communicated to the society and if held at the instance of a creditor, to the creditor.
- A financing bank shall have the right to inspect the books of any cooperative society which has either applied to the bank for financial assistance or is indebted to the bank on account of financial assistance granted earlier;
- the inspection may be carried out by an officer or any other member of the paid staff of financing bank.
- 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 account, documents, securities, cash and other properties belonging to or in the custody of the cooperative society for inspection by him. 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.
(4) The cooperative society concerned shall on receipt of the report, place it before the next Annual General Meeting or Special Annual General Meeting with action taken report and to take such action thereon as the General body may think fit which may include removal of all or any Directors or any other action on employee as required.
(5) A copy of the report shall be supplied to any member on requisition and on payment of fees to be determined by the Registrar.
Cost of inquiry and inspection:
- When an inquiry is held under Section 87 or .an inspection is made under Section 88, the Registrar may, alter giving the parties an opportunity ofbeing heard, apportion the cost or such part of the cost as he may deem fit, between the society, the members thereof or the affiliating society or the creditor or creditors applying for such inspection or inquiry, as the case may be, and the officers, former officers, members and past members of the society.
- No expenditure from the fund of registered society shall be incurred for the purpose of defraying any cost in support of any appeal preferred by any person other than the society itself against an order under sub-section (1). t ‘
- Any person authorized by the Registrar for the purpose of inquiry and inspection under Section 87 and 88 shall have all the powers of the Registrar when acting these sections.
- Any sum awarded By way of cost under this section shall be recoverable as the fees for inquiry or inspection in the manner of realization of audit fees or through a Cooperative Demand Certificate.
