If the registrar after holding an inquiry or making an inspection or receiving an application made by at least three quarters of the members is he of the opinion that the society ought to be dissolved he may in writing order its dissolution and subsequent cancellation of registration. Any member who feels aggrieved by this order may within two months after its making appeal against it to the Minister with a final appeal to the tribunal. Where no appeal is filed within the prescribed time the order shall take effect on the expiry of that period but where an appeal is file within time the order shall not take effect unless confirmed by the minister or by the tribunal.
When the registrar makes that order, he must make a further order relating to the custody of the books and documents of the society and the protection of its assets. It should be noted that no society shall be dissolved or wound up except by an order of the registrar. Where a society has less than the prescribed number of members the registrar may in writing order its dissolution and that order takes effect immediately and where registration is cancelled the society ceases to exist as a corporate body from the date the order takes effect.
It should also be noted that Section 64 applies the provisions relating to winding up of companies to winding up of cooperative societies.
Where a registration is cancelled the registrar may appoint one or more persons to be liquidator or liquidators of that society and all the property of such a society vests in him from the date upon which the order of cancellation takes effect. Once a liquidator has been appointed he has the following powers:
(a) To appoint a day in the prescribed manner before which the creditors whose claims are not already recorded in the society books shall state their claims for admission or ask to be excluded from any distribution made before they have proved them;
a. He has the power to institute and defend suits and other legal proceedings by or on behalf of the society in his own name or office and to appear before the tribunal as litigant in person on behalf of the society;
(b) He has the power to appoint an advocate to assist him in the performance of his duties;
(c) He has the power to refer disputes to the Tribunal in the prescribed manner;
(d) He has the power to determine from time to time the contributions to be made by members and past members and by the estates of deceased members to the funds of the society;
(e) He has the power to investigate all claims against the society and to decide questions of priority arising between them;
(f) He has the power to call such meeting of members and creditors as may be necessary for the proper conduct of the liquidation;
(g) He has the power to sell the moveable and immovable property and rights of action of the society by public auction or private contract with power to transfer the same to any person or company;
(h) He has the power to carry on the business of the society as far as may be necessary for the proper liquidation of its affairs;
(i) He has the power to determine from time to time by what persons and in what proportion the expenses of the liquidation are to be borne;
(j) He has the power to take possession of the books, documents and assets of the society;
(k) He has the power to arrange for the distribution of the assets of the society in a convenient manner when a scheme of distribution has been approved by the registrar;
(l) He has the power to give such directions in regard to the disposal of the books and documents of the society as may appear to him necessary for winding up the affairs of the society;
(m) He has the power to compromise with the approval of the registrar any claim by or against the society;
(n) He has the power to apply to the registrar for his discharge from the duties of liquidator after completion of the liquidation proceedings.
In the exercise of his powers he has the power to summon and enforce the attendance of witnesses and to compel the production of documents by the same means and in the same manner as provided in the case of a court under the Civil Procedure Act.
The registrar is required to keep an account called the Cooperative Societies Liquidation Account with such banks as may be prescribed and to be administered in the prescribed manner.
In the exercise of his powers the liquidator is subject to control of the register and also subject to limitations imposed by the registrar and the registrar may do the following things
(a) Rescind or vary any order made by the liquidator and make any new order he thinks proper;
(b) Remover the liquidator from office and appoint a new liquidator in his place;
(c) Call for all books, documents and assets of the society;
(d) By order in writing in any particular case, limit the powers of the liquidator;
(e) At his discretion require accounts to be rendered to him by the liquidator;
(f) Procure the auditing of the liquidators account and authorise the distribution of the assets of the society;
(g) Make an order for the remuneration of the liquidator;
(h) Grant a discharge to the liquidator on application by him after completion of the liquidation proceedings;
(i) Require any member or past member or the society and any trustee banker, receiver, agent or officer of the society to pay deliver, convey, surrender or transfer forthwith or within such a time as he shall direct to t he liquidator any money property books or papers in his hands to which the society appear to be entitled.
(j) Appoint a special manager for the management of society business and determine his remuneration and what if any security he shall give for the proper performance of his duties;
(k) Refer any dispute between a liquidator and a third party to the tribunal if that party consents in writing to be bound by the decision of the tribunal;
(l) Require the indemnification of the liquidator.
The decision of the tribunal on any matter referred to it binds parties and is exercisable in the same manner as an order made by the registrar. Where any matter is referred to a tribunal the cost of reference and award is under discretion of the tribunal. Anyone aggrieved by an order or decision of the registrar or the liquidator may appeal against it to the tribunal within 14 days thereof. Anyone aggrieved by the decision of the tribunal may appeal to the High Court within 14 days thereof.
Any order or decision made on being filed in court may be enforced in court in the same manner as if it were the court decision. If the liquidator of a society whose registration has been cancelled alleges that anyone of the offences specified in the applied sections of the Companies Act has been committed, he shall report the facts to the registrar who shall if he thinks fit, institute such proceedings as may be necessary.
Any person who is convicted of an offence under the applied sections of the Companies Act shall cease to be or remain an officer of a society and shall cease to be concerned in all take part in the management of a society for a period of 5 years from the date of his conviction and if he does so he shall be guilty of an offence and liable to imprisonment for a term not exceeding 2 years.