Section 37 in The Bihar Co-operative Societies Rules, 1959
37. Division of societies.
(1)Any registered society may, at a general meeting of the society held for the purpose of which at least seven days notice shall be given to its members, resolve to divide itself into two or more registered societies.The resolution (hereinafter in this Rule referred to as preliminary resolution) shall contain proposal for the division of the assets and liabilities of the society among the new societies into which it is proposed to divide it and may prescribe the area of operation of, and specify the members who will constitute, each of the new societies.(2)A copy of the preliminary resolution shall be sent to all the members and the creditors of the society and notice thereof shall be given to all other persons whose interests may be effected by the division of the society.(3)Any member of the society may, notwithstanding any bye-law to the contrary, by notice given to the society within a period of one month from the receipt of the preliminary resolution, intimate his intention not to become it member of any of the new societies.(4)Any creditor of the society may, notwithstanding any agreement to the contrary, by notice given to the society within the said period, intimate his intention to demand a return of the amount due to him.(5)Any other person whose interests may be affected by the division may, by notice to the society within the said period, object to the division, unless his claim is satisfied.(6)After the expiry of the month from the receipt of the preliminary resolution by all the members and creditors of the society and of the notice by other persons given under sub-Rule (2) of this Rule, another general meeting of the society, of which at least fifteen days' notice shall be given to its members, shall be convened for considering the preliminary resolution. If at such meeting, the preliminary resolution is confirmed by a resolution passed by a majority of the members present, either without changes or with such changes as in the opinion of the Registrar are not material, he may, subject to the provisions of sub-Rule (9) and Rule 4, register the new societies and the bye-laws thereof; and on such registration the registration of the old society shall be deemed to have been cancelled.(7)The opinion of the Registrar as to whether the changes made in the preliminary resolution are not material shall be final.(8)At the general meeting referred to in sub-Rule (6) provision shall be made by another resolution for-(i)the payment of the share capital of all the members who have given notice under sub-Rule (3);(ii)the satisfaction of the claims of all creditors who have given notice under sub-Rule (4); and(iii)the satisfaction of the claims of such of the other persons who have given notice under sub-Rule (5) for securing their claims in such manner as the Registrar directs :Provided that no member or creditor or other person shall be entitled to such payments or satisfaction of the claim until the preliminary resolution is confirmed as provided in sub-Rule (7).(9)If within such time as the Registrar considers reasonable the share capital of the member referred to in sub-Rule (8) is not repaid or the claims of the creditors or other persons referred to therein are not satisfied or secured, the Registrar may refuse to register the new societies.(10)On the registration of the new societies, the assets and liabilities of the original society shall vest in the new societies in the manner specified in the preliminary resolution and confirmed under sub-Rule (6):[Provided that in special circumstances in the interest of co-operative movement in general and a co-operative society or a class of co-operative societies in particular, where the State Government deems it fit and expeditious division of a society or class of societies is necessary, the Government may by special order in writing exempt a society or a class of societies from the application of any or all of the provisions of sub-Rule (9) to (10) of Rule 37 and in such cases the preliminary resolution adopted under Rule 37(1) shall be deemed to be the resolution adequate to effect the division of the societies and for registration of the new society or societies in accordance with Rule 4 emerging from such division. The existing societies so divided shall continue to exist under the same registered number and date with necessary amendments as registered by the Registrar, Co-operative Societies as a result of division.In the event of such exemption having been ordered by the State Government in respect of any society it shall be incumbent upon the old registered society as well as upon the newly registered societies created by the division to receive notices of objections by any member, creditor or other person affected by the division up to one month from the date of registration of the divided new societies and to satisfy their claim in the proportion based upon the division of their assets and liabilities finalised by the Extraordinary General Meetings of the divided societies called on 15 days notice and as approved by the Registrar Co-operative Societies, whose decision in this regard shall be final.] [Added by G.S.R. 80 dated 26.12.1980.]
