Section 57B in The Chhattisgarh Co-Operative Societies Act, 1960
57B. Management of short term Co-operative Credit Structure Societies.
(1)Notwithstanding anything contained in this Act or Rules framed thereunder or bylaws of any registered society or orders issued thereunder, the provisions of this chapter shall have overriding effect.(2)In this Chapter, unless the context otherwise requires,(i)"Affiliating Society" means a society of which another society or co-operative is a member;(ii)"Co-operative" means a co-operative as defined under Section 2(f) of Chhattisgarh Swayatta Sahakarita Adhiniyam, 1999 (No. 2 of 2000);(iii)"National Bank" means the National Bank for Agriculture and Rural Development established under Section 3 of the National Bank for Agriculture and Rural Development Act, 1981 (61 of 1981);(iv)"Secondary Co-operative" means a co-operative registered under Chhattisgarh Swayatta Sahakarita Adhiniyam, 1999 (No. 2 of 2000) of which another cooperatives or society is a member;(v)"Short term co-operative credit structure society" includes the State Co-operative Bank, a Central Cooperative Bank and a Primary Agricultural Credit Cooperative Society.(3)(a)Short term co-operative credit structure society shall be eligible to be a member of a secondary co-operative.(b)A co-operative registered under Chhattisgarh Swayatta Sahakarita Adhiniyam, 1999 (No. 2 of 2000) may become the member of an affiliating society registered under this Act.(4)A short term co-operative credit structure society may become a member of an affiliating society or a secondary co-operative of its choice or leave the membership of such society or co-operative.(5)(a)The bylaws or any amendment to the bylaws of a short term co-operative credit structure society shall be registered by the Registrar within thirty days from the date of receipt of the application.(b)If the Registrar is satisfied that the proposed bylaws or the amendments to the bylaws are contrary to the provisions of the Act and the rules made thereunder he shall reject the same duly recording his reasons thereon within thirty days from the date of receipt of the application.(6)(a)Every depositor in a primary agricultural credit co-operative society, subject to the criteria of minimum deposit amount and period, as prescribed by Registrar from time to time, shall be eligible to be a member of the society under sub-section (1) of Section 19 after subscribing the minimum share capital specified in the bylaws of the society and shall have full voting rights of a member.(b)An individual or a group of borrower shall have the right to become member of a primary agricultural credit co-operative society under sub-section (1) of Section 19.(c)Every group of depositor or a group of borrower admitted, as member under sub-section (1) of Section 19, shall be entitled to vote through a delegate nominated by such group.(7)The short term co-operative credit structure society shall be autonomous in all financial and internal administrative matters especially in the following areas:(i)interest rates on deposits and loans in conformity with and subject to Reserve Bank's guidelines,(ii)borrowings and investments,(iii)loan, policies and individual loan decisions.(iv)personnel policy, staffing, recruitment, posting and remuneration to staff, and(v)internal control systems, appointment of auditors and compensation for the audit.(8)The State Government's subscription in the share capital of any short term co-operative credit structure society shall not exceed twenty five percent and the State Government or such society may reduce the State Government's subscription further at its choice.(9)(a)There shall be only one nominee of the State Government in the board of the State Co-operative Bank or a Central Co-operative Bank if the State Government has subscribed to its share capital:Provided that the nominee of the State Government in the board of the State Co-operative Bank or a Central Co-operative Bank shall not take part in election nor shall have any voting right in such election.(b)(i)There shall be only one nominee of the State Government in the board of a primary agricultural credit co-operative society if the State Government has subscribed to its share capital:Provided that the nominee of the State Government in a board in the primary agriculture credit society shall not take part in election nor shall have any voting right in such election.(ii)A short term co-operative credit structure society shall have full freedom to transact with other societies registered under this Act or co-operatives registered under the Chhattisgarh Swayatta Sahakarita Adhiniyam, 1999 (No. 2 of 2000).(10)A short term co-operative credit structure society shall have the freedom of entry and exit at any tier and there shall be no mandatory restrictions of geographical boundaries for its operations.(11)A short term co-operative credit structure society may, subject to the guidelines of the Reserve Bank, invest or deposit its funds in any bank regulated by the Reserve Bank and not necessarily in the affiliating society to which it is affiliated.(12)A short term co-operative credit structure society may obtain loans from any bank regulated by the Reserve Bank and refinance from the National Bank and not necessarily from the affiliating society to which it is affiliated.(13)A primary agricultural credit co-operative society may pay dividend in accordance with the guidelines framed by the Registrar in consultation with the National Bank.(14)No person shall be elected, nominated or co-opted or allowed to continue as a member of the board of a short term co-operative credit structure society, if he(i)is a person who represents a society other than a primary agricultural credit co-operative society on the board of a Central Co-operative Bank or the State Co-operative Bank, if the society he represents has committed a default towards the payments of such bank for a period exceeding ninety days;(ii)is a person who committed a default towards the payments to a primary agricultural credit co-operative society or represents a primary agricultural credit cooperative society on the board of a Central Co-operative Bank or the State Co-operative Bank, it the society he represents has committed a default towards the payments of such bank for a period exceeding one year unless the default has been cleared;(iii)is a person, who represents a society whose board is superseded.(15)(a)The board of the State Co-operative Bank and the Central Co-operative Banks shall not be superseded without prior consultation with the Reserve Bank.(b)The board of a primary agricultural credit co-operative society may be superseded only on any of the following grounds, if-(i)the society incurs losses for three consecutive years;(ii)serious financial irregularities as proven in enquiry for the purpose;(iii)fraud has been identified;(iv)lack of quorum in three consecutive meetings.(16)(a)The State Election Commission shall conduct elections to a short term co-operative credit structure society before the expiry of the term of the existing board.(b)The State Election Commission shall conduct elections to a short term co-operative credit structure society within six months in case of Primary Agricultural Credit Co-operative Society and twelve months in case of State Co-operative Banks and Central Co-operative Banks from the date of its supersession:Provided that in circumstances beyond control, the Government may allow holding of such elections within a period not exceeding six months from the date of supersession.(c)A member of the board of a primary agricultural credit cooperative society which has been superseded under this Act shall not be entitled to contest the election again for a period of three years from the date of supersession:Provided that where the supersession is owing to the grounds contained in Section 15(b)(iv), the lack of quorum is not due to the absence of such member.(17)The members of the board and Chief Executive Officers of the State Co-operative Bank or the Central Co-operative Banks who do not fulfill the criteria stipulated by the Reserve Bank shall be removed by the Registrar or the Appointing Authority, as the case may be, on the recommendation of the Reserve Bank or the National Bank.(18)(a)Where the number of elected members on the board of a State Co-operative Bank or Central Co-operative Bank does not, in the opinion of National Bank, possess special knowledge or experience in such fields as may be stipulated by the National Bank, the State Cooperative Bank or the Central Co-operative Bank, as the case may be, shall co-opt such number of professional in such field, not exceeding two and the professionals so co-opted shall have full voting rights except the election irrespective of whether such professional is a member of the Society or not.(b)If any person who, in the opinion of the Reserve Bank, has been co-opted as a member of the board under clause (a) of this subsection without having requisite knowledge or experience as stipulated by the Reserve Bank, he shall on being advised by the Reserve Bank or the National Bank, be removed from the office after giving him a reasonable opportunity of being heard.(19)The Chief Executive Officer of the State Co-operative Bank and a Central Co-operative Bank, shall be appointed by the members of the board of the State Co-operative Rank or the Central Co-operative Bank, as the case may be, from among a panel of names not exceeding three persons eligible to hold the office of Chief Executive Officer in accordance with the criteria stipulated by Reserve Bank; and the aforesaid panel shall be recommended by a selection board consisting of the following persons all of whom shall be the members of the board of the State Co-operative Bank or the Central co-operative Bank as the case may be:(i)The nominee of State Government on the board.(ii)The nominee of the National Bank on the board.(iii)One other member of the board whether elected or co-opted.(20)No primary agricultural credit co-operative society or its federation or association (except those which are permitted to act as a bank under Banking Regulation Act, 1949 (10 of 1949) shall be registered with the term 'bank' or any other derivative of the term 'bank' in its registered name or shall use the same as a part of its name:Provided that where any primary agricultural credit co-operative society or its federation or association (except those which has permitted as a bank under Banking Regulation Act, 194P (10 of 1949) has been registered using the term "bank" before the coming into force of this Act, the term "bank" along with its derivatives term shall be omitted within three months from the date of enforcement of this Act:Provided further that where any such society fails to comply with the above provisions within the period specified therein, the Registrar shall order the winding up of such society after giving a reasonable opportunity of being heard.(21)The financial accounts of the State Co-operative Bank or Central Co-operative Bank, as the case may be, audited and certified by an auditor or auditing firms from among the panel of such auditors approved by the Registrar and appointed by the General Body in this behalf.(22)Where the Reserve Bank so requires, the Registrar shall conduct a special audit of the financial accounts of the State Co-operative Bank or the Central Co-operative Banks, as the case may be, conduct the special audit and furnished the report of such audit in such manner and within such time as may be stipulated by the Reserve Bank.(23)No authority other than the board of the short term cooperative credit structure society shall have the power to direct the society that a contribution to be made to any fund other than that required for improving its net worth or the financial position of such society.(24)The prudential norms, stipulated by the Reserve Bank including norms for capital to risk weighted assets ratio, shall be prescribed by the Registrar in consultation with the National Bank in respect of all primary agricultural credit co-operative societies.(25)(i)Where the Reserve Bank prescribe any regulation, including a recommendation of supersession of a board or the winding up of State Co-operative Bank or Central Co-operative Banks, at the case may be, the Registrar shall comply with the same within one month from the date of such communication.(ii)The Registrar shall ensure that the liquidator or the Administrator, as the ease may be, is appointed within one month of being so advised by the Reserve Bank for winding up or supersession.(iii)Where in the opinion of the Reserve Bank, the functioning of the Chief Executive Officer of the State Co-operative Bank or a Central Co-operative Bank, as the case may be, is such that it is not desirable in the interest of the bank to continue the person as the Chief Executive Officer of the bank, it may require the registrar to remove the Chief Executive Officer; and the registrar shall proceed forthwith to remove such Chief Executive Officers after giving a reasonable opportunity of being heard.(iv)Where in the opinion of the Reserve Bank, a person does not possess the requisite special knowledge specified by it, the Registrar shall on being advised by the Reserve Bank, proceed forthwith to remove such co-opted member after giving a reasonable opportunity of being heard.(26)Every employee of short term co-operative credit structure society shall be borne on the cadre of such Society and the Society shall have the full powers in all matters of appointment, promotion, disciplinary action, in respect of such employees:Provided that the terms and conditions of an employee who is there on the date of this Act coming in to force, shall be protected.(27)Where short term co-operative credit structure society is required to be exempted from any of the provisions of this Chapter in the public interest, the State Government shall do so with the prior approval of Reserve Bank.(28)No authority shall do anything or act in any manner which may have the effect of abridging the power of any short term credit structure society under the provisions of this Chapter.][CHAPTER V-B] [Inserted by C.G. Act No. 8 of 2015, dated 26.3.2015.] Insured Co-operative Bank
