Chapter 9 DISSOLUTION

1. (1) A Co-operative may, by a special resolution, move for its own dissolution: Provided that a notice of the general body meeting shall be sent by registered post with an invitation to attend such meeting to the Registrar, to the creditors, if any, Secondary Co-operative to which the Co-operative is affiliated, and to any Co-operative with which a partnership contract has been entered into.
2. (2) Invitees specified under the proviso of sub-section
3. (1) shall have the right to make a representation to the general body, if they so wish, on the issue of the proposed dissolution.
4. (3) Within fifteen days of such move for dissolution, the Co-operative shall send to the Registrar a copy by registered post of the move to dissolve the Co-operative.
5. (4) The move approved in pursuance of sub-section
6. (1) is required to set out—
   • (a) the assets and liabilities of the Co-operative;
   • (b) the up-to-date audit report;
   • (c) the claims of creditors;
   • (d) the number of members;
   • (e) the nature and extent of members' interest in the Co-operative; and
   • (f) the name and address of the liquidator appointed by the Co-operative.
7. (5) When the Registrar receives the special resolution passed in pursuance of sub-section (1)—
   • (i) where the Co-operative has no assets and liabilities, he/she may dissolve the Co-operative, strike off its name from the register of Co-operatives and issue a certificate of dissolution; and
   • (ii) where the Co-operative has assets or liabilities, the liquidator shall, within thirty days from the date of passing of special resolution, cause at the expense of the Co-operative a notice of the special resolution to be published once in the gazette and once a week for two consecutive weeks in a newspaper published or distributed in the district where the registered office of the Co-operative is located.
8. (6) In the case of dissolution, under sub-section
9. (5) above, the Registrar may require, till the certificate of dissolution is issued by him/her, from the liquidator appointed by the Co-operative or any other person who is required to furnish information, a periodical return showing—
   • (a) the progress of dissolution;
   • (b) the distribution of any undistributed surplus or reserve; and
   • (c) any other relevant information that he/she may require.

Duties of a liquidator

1. (a) immediately give notice of his/her appointment to the Registrar, the Secondary Co-operative, if any, or to the member Co-operatives, as the case may be, and to each claimant and creditor of the Co-operative;
2. (b) take reasonable steps to give notice of the liquidation where the Co-operative carried on business as referred under sub-section

1. (5) of section 53;
   • (c) place in the notice mentioned in clauses
   • (a) and
   • (b) a provision requiring any person—
     • (i) indebted to the Co-operative to render an account and pay to the liquidator at the time and place specified any amount owing;
     • (ii) possessing property of the Co-operative to deliver it to the liquidator at the time and place specified; and
     • (iii) having a claim against the Co-operative, whether liquidated, unliquidated, future or contingent, to present particulars of the claim in writing to the liquidator not later than sixty days after the first publication of the notice;
   • (d) take into custody and control the property of the Co-operative;
   • (e) open and maintain a trust account for the money of the Co-operative;
   • (f) keep accounts of the moneys of the Co-operative received and paid out by him/her;
   • (g) maintain separate list of the members, creditors and other persons having claim against the Co-operative;
   • (h) where at any time he/she determines that the Co-operative is unable to pay or adequately provide for the discharge of its obligations, seek the suggestion from the general body as to the undischarged liabilities; and
     • (i) deliver to the Registrar/General Body, periodical returns as the Registrar/General Body may require, financial statements of the Co-operative in any form which the liquidator considers proper or of the Registrar/General Body may require.

Powers of liquidator (1)

1. (a) engage lawyers, accountants, engineers, appraisers and other professional advisors;
2. (b) institute, defend or take part in any civil, criminal or administrative proceeding in the name and on behalf of the Co-operative;
3. (c) carry on the business of the Co-operative as required for an orderly liquidation;
4. (d) sell by public auction any property of the Co-operative;
5. (e) do all acts and execute any documents in the name and on behalf of the Co-operative;
6. (f) borrow money on the security of the property of the Co-operative;
7. (g) settle or compromise any claims by or against the Co-operative; and
8. (h) do all other things that he/she considers necessary for the liquidation of the Co-operative and distribution of its property.

1. (2) Where a liquidator has reasons to believe that any person has in his/her possession or under his/her control, or has willfully withheld or misappropriated any property of the Co-operative, he/she may apply to the Court for an order requiring that person to restore the said property.
2. (3) No liquidator shall purchase, directly or indirectly, any part of the stock-in-trade, debts or assets of the Co-operative.

1. (1) A liquidator shall pay the costs of liquidation out of the property of the Co-operative and shall pay or make adequate provision for all claims against the Co-operative.
2. (2) After paying or making adequate provision for all claims against the Co-operative, the liquidator shall apply to the Registrar for approval of his/her final accounts and for permission to distribute in money or in kind the remaining property of the Co-operative in accordance with the articles of association.
3. (3) Where the Registrar approves the final accounts rendered by a liquidator in pursuance of sub-section (2), he/she shall—
   • (a) issue directions with respect to the custody or disposal of the documents and records of the Co-operative; and
   • (b) discharge the liquidator.
4. (4) Where the Registrar discharges a liquidator in pursuance of sub-section (3), he/she shall dissolve the Co-operative, issue a certificate of dissolution and strike off its name from the register of Co-operatives.
5. (5) The Co-operative ceases to exist on the date shown in the certificate of dissolution, which shall not be later than two years after the appointment of the liquidator.