Chapter XII SUSPENSION, CANCELLATION AND DISSOLUTION

1. (1) Where the District Registrar has reasonable cause to believe that a society is defunct and is not carrying on business or operations, he shall issue a show cause notice to such society at its registered office to show cause as to whether it is carrying on its business or operations and directing it to file such documents or returns, within a period of ninety days from the date of issue of such notice.
2. (2) Where the defunct society responds to such notice within the specified period and submits the requisite documents or informs along with evidence that it is carrying on business or operations, the District Registrar shall, after due verification of records, pass an appropriate order.
3. (3) If the District Registrar receives a reply from the defunct society to the effect that it is not carrying on any business or operations, he may direct the society to convene a meeting of its General Body, pass a special resolution for its dissolution after settling all its liabilities and shall apply for dissolution of the society within a period of thirty days from the date of such resolution.
4. (4) Where the District Registrar does not receive any reply within a period of ninety days referred to in sub-section (1), he shall cause a public notice to be issued stating that on the expiration of such period as may be specified in such notice, the registration of such defunct society shall be suspended.
5. (5) If no response is received from the defunct society, or from its members, creditors or claimants, within the period specified in the public notice issued under sub-section (4), the District Registrar shall order suspension of registration of such society and after passing of such order, the society shall not carry on any business.
6. (6) The District Registrar shall cause to be notified an order passed, suspending the registration of a society under sub-section (5), through a public notice for the information of general public.
7. (7) The society or any of its member, creditor or claimant, aggrieved by an order of suspension passed under sub-section (5), may, within a period of three months from the date of the order of suspension, submit a representation to the District Registrar.
8. (8) The District Registrar may, on being satisfied and for reasons to be recorded in writing, that the society, at the time of its suspension, was carrying on business or operations, or otherwise, and it is just and equitable that the name of the society be restored to the register, revoke the suspension.
9. (9) The society whose registration is restored under sub-section (8) shall be deemed to have continued in existence, as if its registration had not been suspended.
10. (10) No claims, whatsoever, shall be valid and entertained against a society on the expiry of a period of three months from the date of suspension of its registration.
11. (11) If no representation against the suspension order is received within a period of three months from the date of suspension of registration, the District Registrar may, unless contrary is shown, strike off the name of the society from the register of societies and cancel its registration.

A society, which has no assets or liabilities to its account and is not desirous of carrying on with its business or operations, may, after passing a special resolution, apply for cancellation of its registration to the District Registrar and the District Registrar shall, after giving a public notice of not less than ninety days inviting objections, strike out its name from the register of societies after considering objections, if any.

1. (1) The Registrar may, if he is satisfied that––
   • (a) the business of any such society is conducted, fraudulently; or
   • (b) the society is declared insolvent; or
   • (c) the society is carrying on any unlawful activity or allowing unlawful activity to be carried on in the premises under its control, order an inquiry to be conducted by the District Registrar or any other officer authorised by him in accordance with the procedure contained in sections 31 to 33 and submit a report thereof within the period specified in such order. Explanation.––For the purposes of this sub-section, an activity shall be treated as unlawful, if such activity is an offence punishable under the provisions of any law for the time being in force.
2. (2) On receipt of the report referred to in sub-section (1) from the District Registrar, the Registrar shall issue a public notice inviting objections, if any, as to why the registration of the society should not be cancelled.
3. (3) After considering the objections filed by the society and public, and after giving a reasonable opportunity of being heard to the society, the Registrar may cancel the registration.

When the registration of a society is cancelled, the society shall forthwith cease to carry on its business, except in so far as it may be required for the beneficial winding-up of its affairs, for which purpose it shall pass a special resolution and dissolve itself in the manner as provided in this Regulation:

Procedure on cancellation of registration

1. (1) Where the registration of a society is cancelled, the District Registrar shall––
   • (a) direct the society to complete the process of its dissolution, that is, pass a special resolution, collect all its receivables and settle all its liabilities, provide the details of any of its assets left over after settlement of the liabilities, and submit a proposal for transfer of its left over assets to any other society in existence with identical aims and objects;
   • (b) assess the credentials of a society to whom any such assets are proposed to be transferred by the society referred to in clause (a) and may, either approve such proposal, or direct the society to place such assets at the disposal of the District Collector;
   • (c) constitute a committee of members of such society to carry out the process of its dissolution, where it has no Governing Body or General Body to carry out his directions under clauses (a) and (b);
   • (d) be competent to complete the dissolution of the affairs of the society on his own or appoint any of his subordinates to do the needful or associate any two members from any other society in existence for the purpose.
2. (2) If on dissolution and after settlement of all the claims and liabilities, a society is left with any movable or immovable assets, the District Registrar shall, in the first instance, make efforts to transfer all such assets to any other society in existence with identical aims and objects in operation against a proper receipt and submit a report thereof to the Registrar General, failing which, all such assets shall vest in the custody of the District Collector.
3. (3) Where any asset is placed at the disposal of the District Collector, he may, either direct the transfer thereof to a society in operation with identical aims and objects or use such assets preferably for the same purpose or for any other public purpose.

1. (1) A society may resolve to dissolve itself by passing a special resolution in a meeting of its General Body convened for the purpose.
2. (2) On passing of the special resolution under sub-section (1), the Governing Body shall take all necessary steps for settlement of all claims and liabilities, as it may consider appropriate in accordance with its bye-laws and if there are no bye-laws, in accordance with the provisions of this Regulation.
3. (3) If any dispute arises amongst the members of the society, the Governing Body, or the special committee, regarding the winding-up of the affairs of the society, it shall be referred to the District Registrar for such directions, as he may consider appropriate: Provided that the special resolution for dissolution of the society shall not be a matter in dispute.
4. (4) If the Central Government or the Government or any of its instrumentalities is a member of or a contributory to or otherwise interested in any society, such society shall not be dissolved without the consent of the Central Government or the Government, as the case may be.
5. (5) After all necessary steps have been completed, the Governing Body shall send a report to the District Registrar, mentioning about the surplus assets, if any.
6. (6) The District Registrar shall thereupon cause a public notice issued at the expense of the society inviting objections from any person interested in the affairs of such society within the period specified in such notice, which shall not be less than three months.
7. (7) If no objection is received from any claimant, creditor or member of the society within three months from the date of issue of such public notice, and after the surplus assets, if any, have been disposed of as provided in this Regulation, the District Registrar shall make an order confirming the dissolution and thereupon the society shall stand dissolved and the District Registrar shall record the order of dissolution in the register maintained in his office and strike off the name of the society from the register of societies.
8. (8) If any objection is received from any claimant, or creditor, or member, or any other interested person, within a period mentioned in sub-section (7), the District Registrar shall not make an order confirming the dissolution of the society unless he is satisfied that the relevant claim or liability have been duly settled and the surplus assets, if any, have been disposed of as provided in this Regulation.

1. (1) Where the Government decides to dissolve a society under sub-section (10) of section 33 or where the registration of a society is cancelled and it is found to be fit for dissolution under section 39, the Registrar General or the Registrar, as the case may be, shall order dissolution of such society in accordance with the procedure specified under the said sections.
2. (2) Upon passing an order for dissolution of a society under sub-section (1), the Registrar General or the Registrar or the District Registrar, as the case may be, shall take action for winding-up the affairs of the dissolved society in accordance with the provisions of this Regulation.

1. (1) Notwithstanding anything contained in section 38, after the settlement of claims and liabilities of society, where any surplus assets are left, such assets shall not be paid to or distributed amongst the members of the society, but shall be taken over and vest in the custody of Government: Provided that in case of a housing society or where a resident welfare association is registered as a society, the operation, management and maintenance of facilities for the residents or civic amenities of any defined area, the successor-in-interest shall step in the shoes of original member, subject to fulfilment of qualifications as laid down in the bye-laws of the society and the provisions of this Regulation.
2. (2) The Government shall place such assets at the disposal of the District Collector, who may,––
   • (i) in the first instance identify any other society in operation with identical aims and objects and transfer such assets to such society;
   • (ii) use such assets, preferably for the purpose for which such assets were created; or
   • (iii) for any other public purpose, as deemed appropriate.
3. (3) The records of accounts shall be maintained for a period of three years from the date of dissolution and in case any matter pertaining to any such society is pending before any court, such records shall be maintained till the final disposal of such matter by the competent court.