Section 40(1) in Jharkhand Co-operative Societies Act, 2008
(1)Where as the result of an audit under section 33 or an inquiry under section 35, or an inspection under section 34, section 36, or section 37, or the winding up of a society, if appears to the Registrar that any person who has taken part in the organisation or management of the society or any past or present officer of the society has -(a)made any payment which is contrary to law or to the Rules or bye-laws of the society, or against the directions or instructions of the financing bank for which the society is acting as agent under sub-section (3) of section 16, or(b)by reason of his culpable negligence or misconduct, involved the society, 2[or the financing bank for which it is acting as agent under sub-section (3) of section 16] in any loss or deficiency, or(c)failed to bring into account any sum which ought to have been brought into account, or(d)mis-appropriated or fraudulently retained any property of the society 1[or of the financing bank which it is acting as agent under sub-section (3) of section 16] the Registrar may inquire into the conduct of such person, or officer and after giving such person or officer an opportunity of being heard make and order requiring him to contribute such sum to the assets of the society or of the financing bank as the case may be, by way of compensation in respect of such payment or loss of sum, or to restore such property as the Registrar thinks fit, together with such sum as the Registrar may fix to meet the cost of the proceedings under this section:Provided that, before any order requiring such person or officer to contribute is passed in respect of a payment referred t in clause (a) reasonable time shall be given to such person or officer to recover the amount of such payment from the payee and credit it to the funds of the society, 1[or, as the case may be of the financing bank.Provided further that any order under this sub-section shall be passed for any commission or omission specified in (a), (b), (c) and (d) within six years from the date of Knowledge on the basis of submission of inspection, enquiry and audit report of occurrence or within two years from the submission of the surcharge proposal which ever is earlier.Provided further that in case of Self Supporting Societies, on communication of a Special audit Report under section 33 B or an enquiry report under section 36 to the persons concerned the Registrar, may, where the special audit or enquiry report reveal mismanagement on the part of any or all of the office bearers or directors without prejudice to any civil or criminal proceedings to which they may be liable -(a)direct the Board to convene a General Body meeting within such reasonable time as he may specify, to enable him to bring to the notice of the General Body, either directly or through his nominee the findings of the Special Audit report or enquiry report for necessary action; or(b)Make a prayer to the Co-operative Forum or Co-operative Tribunal as the case may be for necessary action
