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THE NATIONAL COOPERATIVE
DEVELOPMENT CORPORATION
ACT, 1962

(No. 26 of 1962)

(As modified upto 13th March, 1974)

NATIONAL COOPERATIVE DEVELOPMENT CORPORATION
4, Siri Institutional Area, Hauz Khas,
New Delhi-110 016.

  PREFACE

As a result of the recommendations of the Expert Committee appointed by the Government of India in 1970 to review the working of the National Cooperative Development Corporation, the National Cooperative Development Corporation act, 1962 (26 of 1962) under which the Corporation was set up, has been modified in 1973 and 1974 through two amendments passed by Parliament. These changes have been carried out in the principal Act. The two amendments as passed by the Parliament, are also reproduced at Annexures I & II.

  1. The amendments of 1973 extending, among others, the jurisdiction of the NCDC to the State of Jammu & Kashmir came into force w.e.f. 21st August, 1973, while the changes except those relating to the constitution of the General Council and the Board of Management, contemplated in second amendments, were brought into force by the Government of India, with effect from 1st April, 1974, vide notification No.L.12011/3/74-MWS, dated the 26th March, 1974, a copy of which is at Annexure-III. The provisions regarding constitution of the General Council and Board of Management have been enforced w.e.f. 7th April, 1975 vide Notification No. F.L.12011/3/74-MWS dated 4th April, 1975 (Annexure IV).
  2. The NCDC Act has been extended to Sikkim from 2nd October, 1975 vide Notification No. L-12012/19/73-CMP dated 22nd September, 1975 (Annexure V).

M.S.Gill
Managing Director.

New Delhi-110019, National Cooperative Development Corporation 1st June, 1976.

SHORT TITLE EXTENT AND COMMENCEMENT

DEFINITIONS

28 of 1956

2 of 1912

5 of 1970

2 of 1934

23 of 1955

Construction of reference to any law not in force or any functionary not in existence in the State of Jammu and Kashmir.

Establishment of National Cooperative Development Corporation .

37 of 1964

58 of 1962

15 of 1948

DISQUALIFICATIONS FOR BEING A MEMBER OF CORPORATION

TERM OF OFFICE OF MEMBERS OF CORPORATION.

REMOVAL FROM OFFICE OF MEMBER, ETC.

MEETINGS ETC. OF CORPORATION

OFFICERS AND OTHER EMPLOYEES OF CORPORATION

FUNCTIONS OF CORPORATION

61 of 1956

BOARD OF MANAGEMENT OF THE CORPORATION .

OTHER COMMITTEES

GRANTS BY THE CENTRAL GOVT. TO CORPORATION

POWER OF CORPORATION TO BORROW MONEY

CORPORATION TO MAINTAIN FUND

RETURNS AND REPORTS

DIRECTIONS BY CENTRAL GOVERNMENT.

SUBMISSION OF PROGRAMME OF ACTIVITIES AND FINANCIAL ESTIMATES

ACCOUNTS OF BOARD AND AUDIT.

VACANCIES, ETC. NOTTO INVALIDATE ACTS AND PROCEEDINGS OF THE CORPORATION

DELEGATION

DECLARATION OF FIDELITY AND SECRECY

DISSOLUTION OF CORPORATION

POWER OF MAKE RULES.

POWER OF CORPORATION TO MAKE REGULATIONS

REPEAL AND SAVING

28 of 1956

THE NATIONAL COOPERATIVE DEVELOPMENT CORPORATION ACT, 1962 (No. 26 of 1962)

****

(31st August, 1962)

  • An act to provide for the incorporation and regulation of a corporation for the purpose of planning and promoting programmes for the production, processing, marketing, storage, foodstuffs and certain other commodities on cooperative principles and for matters connected therewith.

Be it enacted by Parliament in the Thirteenth year of the Republic of India as follows:-

  1. (1) This Act may be called the National Cooperative Development Corporation Act, 1962.
  2.  It extends to the whole of India.
  3.  It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act.

2. In this Act, unless the context otherwise requires:-

  1. "agricultural produce" includes the following classes of commodities, namely:-
  1. edible oil seeds;
  2. Cattle fodder, including oil cakes and other concentrates;
  3. Raw cotton, whether ginned or unginned and cotton seed;
  4. Raw jute, and
  5. Vegetable oils.

(aa) "bank" means a nationalized bank and includes a scheduled bank;

(ab) "Board" means the Board of Management of the Corporation constituted under section 10;

(b) "Central Warehousing Corporation" means the Central Warehousing Corporation established under Section 17 of the Agricultural Produce (Development and Warehousing) Corporation Act, 1956.

(c) "Cooperative society" means a society registered or deemed to be registered under the Cooperative Societies Act, 1912 or under any other law with respect to cooperative societies for the time being in force in any State, which is engaged in any of the activities specified in sub-section (1 of section 9 and includes a cooperative land mortgage bank;

(d) "Corporation" means the National Cooperative Development Corporation established under sub-section (1) of Section 3.

(da) "foodstuffs", include

  1. coconuts and arecanuts;
  2. eggs and egg products;
  3. fish, whether fresh, frozen, dried or preserved;
  4. fruits, whether fresh, dried or dehydrated;
  5. honey;
  6. meat, whether fresh, frozen, dried or preserved;
  7. milk and milk products;
  8. vegetables;

(db) "General Council" means the General Council of the Corporation constituted under sub-section 4 of Section 3;

(dc) "Managing Director" means the managing director of the Corporation;

(dd) "Nationalised Bank" means a corresponding new banks as defined in the Banking Companies (Acquisition, and Transfer of Undertakings) Act, 1970;

(e), "Notified Commodity" means any commodity (other than agricultural produce and foodstuffs), which the Central Government may, by notification in the Office Gazette, declare to be a notified commodity for the purposes of this Act, being a commodity with respect to which Parliament has power to make laws by virtue of Entry 33 in List III in the Seventh Schedule to the Constitution;

 (f)"Prescribed" means prescribed by rules made under this Act;

  (g)"Reserve Bank" means the Reserve Bank of India constituted under the Reserve Bank of India Act, 1934;

(ga) "Scheduled Bank" means a bank for the time being included in the second schedule to the Reserve Bank of India Act, 1934;

(h)"State Bank" means the State Bank of India constituted under the State Bank of India Act, 1955;

  (i)‘Year means the financial year.

2A. Any reference in this Act to any law which is not in force, or any functionary not in existence, in the State of Jammu and Kashmir, shall, in relation to that State, be construed as a reference to the corresponding law in force, or to the corresponding functionary in existence, in that State.

3.(1) The Central Government shall, by notification in the official Gazette, establish with effect from such date as may be specified in the notification, a Corporation by the name of the National Cooperative Development Corporation which shall be a body corporate having perpetual succession and a common seal with power to acquire, hold and dispose of property and to contract and may, in the said name, sue and be sued.

(2) The head office of the Corporation shall be in New Delhi.

(3) The Corporation shall carry on its functions through the General Council and the Board.

(4) The General Council shall consist of the following members, namely:-

(i) a President and a Vice-President both to be nominated by the Central Government;

(ii) eight members, ex-officio to be nominated by the Central Government from such of its Ministries dealing with economic matters as it may think fit;

(iii) Deputy Governor of the Reserve Bank in-charge of rural credit, ex-officio;

(iv) Managing Director of the State Bank, ex-officio;

(v) Managing Director of the Food Corporation of India, constituted under Food Corporation act, 1964, ex-officio;

(vi) Managing Director of the Central Warehousing Corporation, constituted under the Warehousing Corporation Act, 1962, ex-officio;

(vii)Chairman of the Industrial Finance Corporation of India, constituted under the Industrial Finance Corporation Act, 1948, ex-officio;

(viii)A member representing banks, to be nominated by the Central Government;

(ix)Chairman of the National Cooperative Union of India, ex-officio;

(x)Chairman of the National Agricultural Cooperative Marketing Federation, ex-officio;

(xi)Chairman of the National Federation of Cooperative Sugar Factories, ex-officio;

(xii)Chairman of the All India Federation of Cooperative Spinning Mills, ex-officio;

(xiii)Chairman of the All India State Cooperative Banks’ Federation, ex-officio;

(xiv)eleven members other than those nominated under clause (xv), representing the States and the Union Territories, to be nominated by the Central Government, provided that not more than one person shall be so nominated from each State or Union Territory;

(xv)eleven members to be nominated by the Central Government from among the Chairman of the State level cooperative federations from the States and Union territories, provided that not more than one person shall be so nominated from each State or Union Territory;

(xvi)four members representing persons having special knowledge of, or practical experience in agricultural cooperative development, to be nominated by the Central Government;

(xvii)three members representing national level organizations engaged or interested in the promotion and development of cooperative programmes to be nominated by the Central Government; and

(xviii)the managing director.

(5) The powers and functions of the Corporation shall be exercised or discharged, as the case may be, by the General Council, and references elsewhere in this Act to the Corporation shall, unless the context otherwise requires, be construed as references to the General Council.

(6) Notwithstanding the expiry of the prescribed term of his office, every member of the General Council shall continue to hold office as such, until his successor in such office has assumed charge of such office.

(7) Members of the General Council, other than the managing director, shall be entitled to receive such sittings fees as may be specified by regulations made by the corporation under this Act, for attending any meeting of the General Council, Board or any committees of the Corporation.

Provided that no official member shall be entitled to receive any sitting fee.

4.  A person shall be disqualified for being chosen as and for being a member of the Corporation:-

  1.  
    1. if he is, or at any time has been adjudicated insolvent or has suspended payment of his debt or has compounded with his creditors, or
    2. if he is or has been convicted of any offence involving moral turpitude and sentenced in respect thereof to imprisonment for not less that six months, unless a period of five years has elapsed from the date of expiry of the sentence; or
    3. except in the case of managing director, if he is a salaried official of the Corporation.

5.(1) The term of office of members of the Corporation and the manner of filling vacancies among members shall be such as may be prescribed.

(2) Any member of the Corporation other than an ex-officio member may resign his office by giving notice in writing to the Central Government and on such resignation being accepted, he shall be deemed to have vacated his office.

6.The Central Government may, at any time remove from office any member other than an ex-officio member of the Corporation after giving him a reasonable opportunity of showing cause against the proposed removal.

7.(1) The Corporation, shall ordinarily meet twice a year at such times and places and shall, subject to the provisions of sub-sections (2) and (3), observe such procedure in regard to transaction of business at its meetings (including the quorum at meetings) as may be provided by regulations made by the Corporation under this Act.

(2) The President or in his absence the Vice-President or in the absence of both the President and the Vice-President, any member chosen by the members/represent from amongst themselves, shall preside at a meeting of the Corporation.

(3) All questions at a meeting of the Corporation shall be decided by a majority of votes of the members present and voting, and in the case of an equality of votes the President or, in his absence, the Vice-President or in the absence of both the President and the Vice-President, the person presiding shall have and exercise a second or casting vote.

8.(1) The Central Government shall, in consultation with the Corporation, appoint a person to be the Managing Director.

(2) Subject to such rules as may be made by the Central Government in this behalf, the Corporation may appoint such other officers and employees as it considers necessary for the efficient performance of its functions.

(3) The methods of appointment, the condition of service and the scales of pay of the officers and other employees of the Corporation shall,

(a)as respects the Managing Director be such as may be prescribed; and

(b)as respects the other officers and employees, be such as may be determined by regulations made by the Corporation under this Act.

(4) The Managing Director shall exercise such powers and perform such duties as the Board may entrust or delegate to him.

9. (1)Subject to the provisions of this Act, the functions of the Corporation shall be to plan and promote programmes, through cooperative societies, for:-

(a) the production, processing, marketing, storage, export and import of agricultural produce, foodstuffs, poultry feed and notified commodities;

(b) the collection, processing, marketing, storage and export of minor forest produce.

(2) In particular and without prejudice to the generality of the foregoing provision, the Corporation may

(a) advance loans or grant subsidies to State Governments for financing cooperative societies and for employment of staff for implementing programmes of cooperative development;

(b) provide funds to State Governments for financing cooperative societies for the purchase of agricultural produce, foodstuffs and notified commodities on behalf of the Central Government;

(c) plan and promote programmes through cooperative societies for the supply of seeds, manures, fertilizers, agricultural implements and other articles for the development of agricultural produce.

(d) provide loans and grants directly to the national level cooperative societies and other cooperative societies having objects extended beyond one State.

(e) provide loans to cooperative societies on the guarantee of State Governments or in the case of cooperative societies in the Union Territories, on the guarantee of Central Government;

(f) participate in the share capital of the national level cooperative societies and other cooperative societies having objects extending beyond one State.

(3) The Corporation shall so exercise its functions under this section as not to interfere with the activities of the Khadi and Village Industries Commission established under the Khadi and Village Industries Commission Act, 1956.

10. (1) There shall be a Board of Management of the Corporation which shall consist of the following members, namely:-

(i) the Vice-President of the General Council, who shall be the Chairman;

(ii) three members of the General Council, to be nominated by the Central Government from among the members referred to in Clause (ii) of Sub-Section (4) of Section 3;

(iii) the member of the General Council referred to in clause (iii) of Sub-Section (4) of Section 3;

(iv) one member of the General Council, to be nominated by the Central Government from among the members referred to in clauses (ix), (x), (xi), (xii) and (xiii) of Sub-section (4) of Section 3;

(v) two members of the General Council, to be nominated by the Central Government from among the members referred to in clause (xiv) of Sub-Section (4) of Section 3;

(vi) two members of the General Council to be nominated by the Central Government from among the members referred to in clause (xv) of Sub-Section (4) of Section 3;

(vii) one member of the General Council to be nominated by the Central Government from among the members referred to in clauses (xvi) of Sub-Section (4) of Section 3;

(viii) the managing director.

(2) The Vice-Chairman of the Board shall be nominated by the Central Government.

(3) Subject to the general control, direction and superintendence of the General Council, the Board shall be competent to deal with any matter within the competence of the Corporation.

(4) The Board shall meet at such times and at such places and shall observe such procedure in regard to transaction of business at its meetings (including the quoram at meetings) as may be provided by regulations made by the Corporation under this Act.

(5) The confirmed minutes of every meeting of the Board shall be laid before the General Council at its next following meeting.

11. The Corporation may constitute such other committee for general or special purposes as it deems necessary for the efficient performance of its functions under this Act.

12. The Central Government shall, after due appropriation made by Parliament by law in this behalf, pay to the Corporation:-

(a) by way of grant each year, such sum of money as is required by the Corporation for giving subsidies to State Governments and for meeting its administrative expenses.

(b) by way of loan, such sum of money on such terms and conditions as the Central Government may determined; and

(c ) such additional grants, if any, for the purposes of this Act.

12A. (1) The Corporation may, for the purposes, of carrying out its functions under this Act, and with the previous approval of, and subject to the directions of the Central Government, borrow money from:-

(a) the public by the issue by sale of bonds or debentures, or both, carrying interest at such rates as may be specified therein;

(b) any bank or other financial institutions;

(c ) any other authority, organization or institution as may be specially approved by the Central Government in this behalf.

(2) The Central Government may guarantee the repayment of the moneys borrowed by the Corporation under clause (a) or clause (b) or clause (c) of sub-section (1) and the payment of interest thereon and other incidental charges.

13 (1) The Corporation shall maintain a fund called the National Cooperative Development Fund (hereinafter referred to as the Fund) to which shall be credited -

(a) all moneys and other securities transferred to it under clause (a) of Sub-section (2) of Section 24;

(b) the grants and other sums of money by way of loan paid to the Corporation by the Central Government under Section 12;

(ba) all moneys borrowed under section 12A.

(c ) such additional grants, if any, as the Central Government may make to the Corporation for the purposes of this Act; and

(d) such sums of moneys as may, from time to time, be realized out of repayment of loans made from the fund or from interest on loans or dividend or other realization on investments made from the Fund.

(2) The moneys in the Fund shall be applied for -

(a) advancing loans and granting subsidies to State Governments on such terms and conditions as the Corporation may deem fit for the purposes of enabling State Governments to subscribe to the share capital of cooperative societies or for otherwise financing cooperative societies;

(b) meeting the pay and allowances of the Managing Director, officers and other employees of the Corporation and other administrative expenses of the Corporation; and

(c ) carrying out the purpose of this Act.

(3) All moneys in the fund shall be deposited in the Reserve Bank or the State Bank or a nationalized bank.

14. (1) The Corporation shall furnish to the Central Government at such times and in such form and manner as may be prescribed or as the Central Government may direct, such returns and statements and such particulars in regard to the discharge of its functions under this Act as the Central Government may, from time to time require.

(2) Without prejudice to the provisions of Sub-Section (1), the Corporation shall, as soon as possible after the end of the each year, submit to the Central Government a report, in such form and manner and before such date as may be prescribed, giving a true and full account of its activities policy and programme during the previous year.

(3) A copy of the report received under Sub-Section (2) shall be laid before both Houses of Parliament.

15. In all matters including matters of policy, the Corporation shall be guided by such directions as may be given to it by the Central Government.

16. (1) The Corporation shall prepare before the commencement of each year a statement of programme of its activities during the forthcoming year as well as a financial estimate in respect thereof.

(2) A statement prepared under Sub-section (1) shall, not later than three months before the commencement of each year, be submitted to the Central Government for approval.

17. (1) The Corporation shall maintain proper account and other relevant records and prepare an annual statement of accounts in such form as may be prescribed in consultation with the Comptroller and Auditor-General of India.

(2) The account of the Corporation shall be audited annually by the Comptroller and Auditor-General of India or any person authorized by him in this behalf and any expenditure incurred in connection with such audit shall be payable by the Corporation.

(3) The Comptroller and Auditor-General of India and any person authorized by him in connection with the audit of the accounts of the Corporation shall have the same rights, privilege and authority in connection with such audit as the Comptroller and Auditor – General has in connection with audit of Government accounts and in particular, shall have the right to demand the production of books, accounts, connected vouchers and other documents and papers and to inspect any office of the Corporation.

(4) The accounts of the Corporation certified by the Comptroller and Auditor-General of India or any other person authorsied by him in this behalf together with an audit report thereon shall be forwarded annually to the Central Government and that Government shall cause the same to be laid before both Houses of Parliament.

18. No act or proceedings of the General Council the Board or any of the Committee of the Corporation shall be invalid by reason only of the existence of any vacancy among its members or any defect in the constitution thereof.

19. The Corporation may, be general or special order in writing delegate to the President or the Vice-President or any other member or any officer of the Corporation subject to such conditions and limitations, if any, as may be specified in the order such of its powers and functions under this Act, asit may deem necessary.

20. Every member, auditor, officer or other employee of the Corporation shall, before entering upon his duties make a declaration of fidelity and secrecy in the form set out in the schedule.

21. (1) The Central Government, if it is of opinion that the Corporation has failed to carry out its functions under this Act or that for any other reason it is not necessary continue the Corporation may, by notification in the official gazette, dissolve the Corporation from such date as may be specified in the notification.

(2) When the Corporation is dissolved under Sub-Section (1) -

(a) all members of the Corporation shall, from the date of dissolution, vacate their office as such members;

(b) all powers and duties of the Corporation shall, as from the date of dissolution, be exercised and performed by the Central Government or such person or persons as the Central Government may appoint in this behalf;

(c ) all moneys and other properties of the Corporation shall vest in the Central Government.

22. (1) The Central Government may, by notification in the Official Gazette, make rules to carry out the purposes of this Act.

(2) Without prejudice to the generality of the foregoing power, such rules may provide for -

(a)

(b)

(c )

(d) the term of office of members of the Corporation and the manner of filling vacancies among them;

(e) the methods of appointment, the conditions of service and the scale of pay of the Managing Director;

(f)

(g) the returns, statement and other particulars in regard to the discharge of its functions to be furnished by the Corporation to the Central Government;

(h) the form and the manner in which, and the time within which, the Corporation shall furnish to the Central Government returns, statements and other particulars with regard to the discharge of its functions;

(i) the form and the manner in which, and the time within which the Corporation shall furnish to the Central Government a report of its activities, policy and programme; and

(j) any other matter which has to be, or may be prescribed.

(3) Every rule made under this section shall be laid as soon as may be after it is made, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two or more successive sessions and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall there after have effect only in such modified form or be of no effect, as the case may be; so however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

23. (1) The Corporation may, with the previous sanction of the Central Government, by notification in the official Gazette, make regulations not in – consistent with this Act and the rules made there under, to provide for all matters for which provision is necessary or expedient for the purpose of giving effect to the provisions of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for :-

(a) the manner in which meetings of the General Council, the Board and other committees of the Corporation shall be convened, the fees for attending such meetings and the procedure to be followed there thereat;

(b) The methods of appointment, the conditions of service and the scales of pay of the officers (other than the Managing Director and other employees of the Corporation.

(c ) the duties and conduct of officers and other employees of the Corporation; and

(d) any other matter in respect of which the Corporation is empowered or required to make regulation under this Act.

(3) The Central Government may, by notification in the Official Gazette, rescind any regulation which it has sanctioned and there upon the regulation shall cease to have effect.

24. (1) With effect from the date on which the Corporation is established under Section 3, the Agricultural Produce (Development and Warehousing) Corporation Act, 1956 shall, in so far as it relates to the National Cooperative Development and Warehousing Board, stand repealed:-

(2) Notwithstanding such repeal :-

(a) all moneys and other securities belonging to the National Cooperative Development Fund which, immediately before the said date, was maintained by the National Cooperative Development and Warehousing Board established under the repealed Act (hereinafter referred to as the said Board), shall stand transferred to, and be maintained by the Corporation established under Section 3 of the Act.

(b) all moneys and other securities belonging to the National Warehousing Development Fund which immediately before the said date, was maintained by the said Board under the repealed Act, shall stand transferred to and be maintained by the Central Warehousing Corporation;

(c ) all shares in the capital of Central Warehousing Corporation held by the said Board shall stand transferred to the Central Government subject to the same liabilities as the payment of unpaid cells on such shares as the said Board was subject to;

(d) anything done or any action taken (including any loan advanced subsidy granted and appointment, delegation, rule of regulation made) under the repealed Act, shall in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under this Act; and

(e) all rights, liabilities and obligations of the said Board, whether arising out of any contract or otherwise, shall be the rights, liabilities and obligations respectively of the Corporation established under Section 3 of this Act.


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