Management of deficit

General200162 sections8 chapters

Chapter 5 FINANCE

Statutory text

(1) Deficit, if any, arising out of the business of a Co-operative in a financial year, shall be fully settled by debiting a part or all of the deficit to the deficit cover fund, if any, and/or as deficit charge, among its members: Provided, that nothing in this sub-section shall preclude a Co-operative from proceeding against its directors, or employees for recovery of amount contributing to the deficit, where such deficit is the result of deviation from the approved plan and/or budget, and where such deviation does not receive the approval of the general body, or is the result of gross negligence or mismanagement: Provided further that where such amounts are recovered, the general body may resolve to credit a part or all of the amount to the deficit cover fund and/or to the account of each member in proportion to the deficit charge levied on him/her in this regard.
(2) No member shall be allowed to withdraw from the membership of the Co-operative without paying his/her share towards clearing the deficit, if any.

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