CCOS Rules 32Chapter IV · Duties, Privileges, Property and Funds of Societies

Section 32 · State aid to societies

(1)

Subject to the provisions of the Act, the State Government may-

(i)

make share capital contribution to a society; or

(ii)

give loans or financial assistance or other to a society; or

(iii)

guarantee the payment of the principal of debentures issued by a society or interest thereon or both; or

(iv)

guarantee the payment of the principal of, and payment of interest on, loans and advances given by the Reserve Bank of India or the State Bank of India or any other authority constituted under any law for the time being in force; or

(v)

grant state aid in any other form to a society under Section 45, on the following terms and conditions, namely:-

(a)

When the State Government purchases shares in a society, it shall be entitled to dividend on the said shares as is declared by the society concerned and is payable to other members of that society;

(b)

A society receiving state aid shall not pay any dividend or distribute or take any profit in excess of such percentage rate upon the amount of the capital of the society as the State Government may, from time to time, fix;

(c)

A society receiving state aid shall, with the approval of the Registrar appoint a paid secretary or manager of the society;

(d)

A society receiving state aid shall be bound-

(i)to comply with any general or special order of the State Government relative to the inspection of the society;

(ii)to permit the inspection of all accounts relative to the society;

(iii)to maintain such accounts and to furnish such statements and returns as the State Government or the Registrar may, from time to time, require; and

(iv)to comply with any order or condition issued or imposed by the State Government as may in its opinion be necessary or expedient to safeguard its interest.

[(1-A) A society receiving state aid shall appoint employees in accordance with a staffing pattern approved by-

(i)the State Government if so directed by the State Government, or

(ii)the Registrar in other cases.]

(2)

If the society to which state aid has been given in any form, fails to comply with any order made under the Act or the rules framed thereunder or commits any breach of any terms or conditions laid down for the grant of state aid, or if on inspection of accounts, returns, statements or audit report of such society the State Government is of opinion that state aid should be Withdrawn, the State Government may after considering any representation which the society may make within such time as the State Government may allow, in this behalf, make an order directing-

(i)

that the balance of any loan outstanding shall be recoverable forthwith;

(ii)

that the guarantee given shall cease from the date of such order;

(iii)

that the full value of any other state aid given and enjoyed till the date of the order shall be payable forthwith and the grant of such state aid beyond such date shall be discontinued.

(3)

The State Government may set out other terms or conditions on which it shall provide state aid to a society.

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