Act Info:
(1) Notwithstanding anything contained in any law for the time being in force, but subject to any prior claim of the Government in respect of land revenue or any money recoverable as land revenue, any debt or outstanding demand owing to a co-operative society by any member or past member or deceased member shall be a first charge upon the crops and other agricultural produce, cattle, fodder for cattle, agricultural or industrial implements or machinery, raw materials for manufacture and any finished products manufactured from such raw materials, belonging to such member, past member or forming part of the estate of the deceased member, as the case may be.
(2) No person shall transfer any property which is subject to a chargeunder sub-section (1) except with the previous permission in writing of the co-operative society which holds the charge.
(3) Notwithstanding anything contained in any law for the time being inforce, any transfer of property made in contravention of the provisions of sub-section (2) shall be void.
(4) The charge created under sub-section (1) shall be available as againstany claim of the Government arising from a loan granted under the1[Karnataka Land Improvement Loans Act, 1963 or the Karnataka Agriculturists Loans Act, 1963], after the grant of the loan by the society.
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1. Adapted by the Karnataka Adaptations of Laws Order, 1973 w.e.f. 1.11.1973.
Section 33 - Charge on land, owned by members or held as tenants by members borrowing loans from certain co-operative societies
(1) Notwithstanding anything contained in this Act or in any other law for the time being in force,--
(i) any person who makes an application to a co-operative society of which he is a member for a loan shall, if he owns any land, or holds any land as a tenant make a declaration in the prescribed form. Such declaration shall state that the applicant thereby creates a charge on the land owned by him or on his interest in the land held by him as tenant and specified therein for the payment of the amount of the loan which the society may make to the member in pursuance of the application and for all future advances, if any, required by him which the society may make to the member as such member subject to such maximum as may be determined by the society together with interest on such amount of the loan and advances;
(ii) a declaration made under clause (i) may be varied at any time bya member with the consent of the co-operative society in favour of which such charge is created;
(iii) no member shall alienate the whole or any part of the land or anyinterest of his in the land specified in the declaration made under clause (i) or varied under clause (ii) until the whole amount borrowed by themember together with interest thereon is paid in full: Provided that standing crops on any such land may be alienated with the previous permission in writing of the society;
1[Provided further that it shall be lawful for a member to mortgage such lands or any part thereof in favour of the State Government or an2[Agricultural and Rural Development Bank]:
Provided also that if a part of the amount borrowed by a member is paid, the co-operative society with the approval of the financing bank to which it may be indebted may, on an application from the member, release from the charge created by the declaration made under clause (i) or varied under clause (ii), such part of the land or of the interest in the land specified in the declaration as it may deem proper, with due regard to the security for the balance of the amount of loan outstanding from the member.]
(iv) any alienation made in contravention of the provisions of clause
(iii) shall be void;
(v) subject to the prior claims of the Government in respect of landrevenue or any money recoverable as land revenue and the prior claims of any person in whose favour alienation of the land or interest in such land has been effected and duly registered, before the date of the grant of the loan by the society, there shall be a first charge in favour of the society on the land or interest in the land specified in the declaration made under clause (i) or varied under clause (ii) for and to the extent of the dues owing by him on account of the loan.
(2) Notwithstanding anything contained in3[the Karnataka Land Revenue Act, 1964 (Karnataka Act 12 of 1964)],-
(i) the record of rights maintained under the said Act shall also includethe particulars of every charge on land or interest in land created under sub-section (1);
(ii) the co-operative society in whose favour a charge is created undersub-section (1) shall communicate the particulars of the charge, and when the loan is discharged, the cessation of the charge, to the Deputy Commissioner or the prescribed officer and he shall cause necessary entries to be made in the record of rights;
(iii) the State Government may, by notification in the official Gazette,make rules to carry out the purposes of clauses (i) and (ii).
Explanation.--For the purpose of this section,--
(1) 'land' shall mean land to which3[the Karnataka Land Revenue Act, 1964 (Karnataka Act 12 of 1964)], is applicable; and
(2) 'co-operative society' shall mean a co-operative society of whichmajority of the members are agriculturists and which is,--
(a) a credit society the primary object of which is to obtain credit forits members; or
(b) any other class of society specified in this behalf by the StateGovernment by general or special order.
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1. Inserted by Act 39 of 1975 w.e.f. 23.9.1975.
2. Substituted by Act 25 of 1998 w.e.f. 15.8.1998.
3. Substituted by Act 39 of 1975 w.e.f. 23.9.1975.
Section 34 - Deduction from salary to meet society's claim in certain cases
(1) Notwithstanding anything contained in any law for the time being in force, a member of a co-operative society may execute an agreement in favour of the society providing that his employer shall be competent to deduct from the salary or wages payable to him by the employer, such amount as may be specified in the agreement, and to pay the amount so deducted to the society in satisfaction of any debt or other demand owing by the member to the society.
(2) On the execution of such an agreement the employer shall, if sorequired by the co-operative society by requisition in writing and so long as such debt or demand or any part of it remains unpaid, make the deduction in accordance with the agreement and pay the amounts so deducted to the society within fourteen days from the date of the deduction.
(3) Nothing contained in this section shall apply to persons employed in railways as defined in Article 366 of the Constitution, mines and oil fields.
Section 35 - Charge and set off in respect of shares or interest of members in the capital of a co-operative society
A co-operative society shall have a charge upon the share or interest in the capital and on the deposits of a member or a past member and on any dividend, bonus or profits payable to a member or a past member in respect of any debt or outstanding demand owing to the co-operative society and may set off any sum credited or payable to a member towards payment of any such debt or outstanding demand:
Provided that no financing bank to which a co-operative society is affiliated shall have a charge upon any sum invested in the financing bank as reserve fund by the society if the bank is not the sole creditor of the society, or be entitled to set off any such sum credited or payable to the society towards any debt due from such society.
Section 36 - Shares or interest not liable to attachment
Subject to the provisions of section 35 the share or interest of a member in the capital of a co-operative society shall not be liable to attachment or sale under any decree or order of a court in respect of any debt or liability incurred by such member or past member, and an official assignee or a receiver under any law relating to insolvency shall not be entitled to, or have any claim on, such share or interest.
Section 37 - Exemption from certain taxes, duties and fees
The State Government, if in its opinion it is necessary in public interest so to do, may, by notification in the official Gazette, and subject to such restrictions and conditions as may be specified in such notification, reduce or exempt in respect of any class of co-operative societies,--
(a) the tax payable under the 1 [Karnataka] Agricultural Income-tax Act, 1957 (1 [Karnataka Act] 22 of 1957) for the time being in force;
2 [(b) the tax payable under the Karnataka Sales Tax Act, 1957 (Karnataka Act 25 of 1957);]
(c) the duties with which any instrument executed by or on behalf ofaco-operative society or by an officer or member thereof and relating to the business of such society, or any class of such instruments or in respect of any award or order made under this Act, are chargeable under the 1 [Karnataka] Stamp Act, 1957 (1 [Karnataka Act] 34 of 1957) for the time being in force;
(d) the fees payable in respect of any document under the 1 [Karnataka] Court-Fees and Suits Valuation Act, 1958 (1 [Karnataka Act] 16 of 1958) for the time being in force;
(e) any fee payable under the Indian Registration Act, 1908 (Central ActXVI of 1908) for the time being in force.
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1. Adapted by the Karnataka Adaptations of Laws Order, 1973 w.e.f. 1.11.1973.
2. Omitted by Act 16 of 1967 w.e.f. 01.01.968 and inserted by Act 25 of 1998 w.e.f. 15.8.1998.
Section 38 - Exemption from compulsory registration of instruments
Nothing in clauses (b) and (c) of sub-section (1) of section 17 of the Indian Registration Act, 1908 (Central Act XVI of 1908), shall apply to,--
(a) any instrument relating to shares in a co-operative societynotwithstanding that the assets of the society consist in whole or in part of immovable property;
(b) any debentures issued by any such society and not creating,declaring, assigning, limiting or extinguishing any right, title or interest to or in immoveable property except in so far as it entitles the holder to the security afforded by a registered instrument whereby the society has mortgaged, conveyed or otherwise transferred the whole or part of its immoveable property or any interest therein to trustees upon trust for the benefit of the holders of such debentures, or
(c) any endorsement upon or transfer of any other debenture issued byany such society.
Section 39 - Registration of documents executed on behalf of co-operative societies
(1) Notwithstanding anything contained in the Indian Registration Act, 1908 (Central Act XVI of 1908), it shall not be necessary for any member of a committee,1[Chief Executive] or other1[office bearer of a co-operative society] or any officer of the Department of Co-operation to appear in person or by agent at any registration office in any proceeding connected with the registration of any instrument executed by him in his official capacity on behalf of a co-operative society or to sign as provided in section 58 of that Act.
(2) Where any instrument is so executed, the registering officer to whomsuch instrument is presented for registration may, if he thinks fit, refer to such member, secretary or officer for information respecting the same, and on being satisfied of the execution thereof, shall register the instrument.
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1. Substituted by Act 25 of 1998 w.e.f. 15.8.1998.