Govt firms up winding up process for co-operatives

Course of Action

- All funds mandated to be deposited as specified by Central Registrar

- Central Registrar may also fix the amount of remuneration for the liquidator

New Delhi: In a bid to streamline the liquidation of multistate co-operative societies, the government has laid down the winding up procedure. As soon as the closure of a multistate co-operative society is made, the liquidator issues a public notice to this effect. The claims have to be submitted within two months of the publication of the notice, official sources told Bizz Buzz.

The Ministry of Co-operation has stipulated that the liquidator would scrutinize and prioritize all claims. He also takes all sums and other properties of the society in his custody. If needed, he also files suits for recovery. The liquidator can also empower any other person to make collections and grant valid receipts on behalf of the liquidator.

All funds in the charge of the liquidator are mandated to be deposited in post office savings schemes, co-operative banks, or any other bank as specified by the Central Registrar. The Central Registrar may also fix the amount of remuneration, if any, for the liquidator. The remuneration will be part of the cost of liquidation. The liquidator shall also send a quarterly report to the Central Registrar.

At the conclusion of the liquidation, the liquidator (or the person authorized by him) shall call a general meeting of the members of the dissolved society. He shall take a vote regarding the disposal of the surplus funds, if any. The liquidator shall submit a final report to the Central Registrar, along with a copy of the proceedings in the general meeting.

If any claimants are not traceable, their respective amounts would be deposited in a co-operative bank and would be available to them if and when they claim it. A liquidator is appointed in accordance with Section 89 of the Multi-State Co-operative Societies Act-2002: “A liquidator shall, on appointment, take into his custody or under his control all the property, effects and actionable claims to which the multi-state co-operative society is or appears to be entitled and shall take such steps as he may deem necessary or expedient to prevent loss or deterioration of, or damage to, such property, effects and claims and he may carry on the business of the multi-state co-operative society so far as may be necessary with the previous approval of the Central Registrar.”