Section 54 in Sikkim Co-Operative Societies Act, 1955
54. Restriction on Distribution of Profit.
(1)Save as may be prescribed, no distribution of profit shall be made in the case of a registered society with unlimited liability and no part of the net profit or of a fund of any society shall be divided by way of dividend, bonus, rebate or otherwise among its, members, except with the previous approval of the Registrar and as provided in the bye-laws of the society.(2)No dividend, bonus, or rebate shall be paid -(a)otherwise than out of net profits certified by the audit officer to have been actually realized; provided that advance patronage dividend maybe paid in accordance with the directions of the Registrar and on the certificate of an internal auditor approved by the Registrar; or(b)without the previous sanction of the Registrar, if the audit officer report that any asset is bad or doubtful and also recommends that such action is necessary.
