Procedure for making good losses caused to a society.

The Chhattisgarh Co-operative Societies Act, 1960

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Statutory text

(1) Notwithstanding anything contained in this Act or the rules or the byelaws of a society where the State Government has contributed to its share capital or has given loans or financial assistance or has guaranteed the repayment of loans, debentures, advances or has given grants in any other form and if in the course of an audit, inquiry, inspection or the winding up of a society or otherwise, it is found that any person who is or was entrusted with organisation or management of such society or any deceased, past or present Chairman or Secretary, member of the Committee, Officer or employee of the society has made any payment contrary to the provisions of this Act or the rules made thereunder or byelaws of a society or has caused any deficiency or loss by gross negligence or misconduct or has misappropriated or fraudulently retained any money or other property belonging to such society, the Registrar may on his own motion or on the application of the committee, liquidator or any creditor, enquire himself or direct some person authorised by him, by an order in writing in this behalf, to enquire into the conduct of such person within two years of the date of the report of audit, enquiry or inspection, or winding up, as the case may be; Provided that no such enquiry shall be instituted against a person unless the person concerned is given a reasonable opportunity of being heard.
(2) If, on enquiry made under sub-section (1), the Registrar is satisfied that there are reasonable grounds for an order under this sub-section, he may make an order requiring such person, or in the case of a deceased person, his legal representative who inherits his estate, to repay or restore the money or property or any part thereof, with interest at such rate, or to pay contribution and costs or compensation to such extent as the Registrar may consider just and equitable: Provided that no order under this sub-section shall be made unless the person concerned is given a reasonable opportunity of being heard in the matter. Provided further that the liability of a legal representative of the deceased shall be to the extent of the property of the deceased which has come to the hands of such legal representative.
(3) Any person aggrieved by the order made under sub-section (2), may within thirty days from the date of communication of the order to him appeal to the State Government. Provided that in computing the period of limitation, the time requisite for obtaining a copy of the order appealed against shall be executed.
(4) Any order made under sub-section (2) or sub-section (3) shall be enforced in accordance with the provisions of section 85.
(5) If the Registrar is satisfied by an affidavit, enquiry or otherwise that any person with intent to delay or obstruct the enforcement of any order that may be made against him under this Section-
- (a) is about to dispose of the whole or any part of his property : or
- (b) is about to remove the whole or any part of his property from the jurisdiction of the Registrar; he may, unless adequate security is furnished, direct the conditional attachment of the said property or such part thereof as he thinks necessary.

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