KARNATAKA ACT NO.

03 OF 2013

(First published in the Karnataka Gazette Extra-ordinary on the

Eleventh day of January , 2013)

THE KARNATAKA CO-OPERATIVE SOCIETIES (AMENDMENT) ACT, 2012

(Received the assent of the Governor on the tenth day of January, 2013)

An Act further to amend the Karnataka Cooperative Societies

Act, 1959.
Whereas it is expedient further to amend the Karnataka Cooperative
Societies Act, 1959 (Karnataka Act, No 11 of 1959) for the purposes hereinafter
appearing.
Be it enacted by the Karnataka State Legislature in the sixty third year of the
Republic of India as follows:-
1. Short title and commencement.-This Act may be called the Karnataka
Cooperative Societies (Amendment) Act, 2012.
(2) It shall come into force on such date as the State Government may, by
notification, appoint.
2. Amendment of the long title and preamble.- In the Karnataka
Cooperative Societies Act, 1959 (Karnataka Act 11 of 1959) (hereinafter referred to
as the Principal Act), in the long title and in the preamble at the two places, for the
words, “to consolidate and amend the laws relating to cooperative societies", the
words, "to promote voluntary formation, autonomous functioning, democratic
control and professional management of cooperative societies" shall be substituted.
3. Amendment of section-2.- In section 2 of the Principal Act,-
(i) existing clauses (a-1) and (a-1-1) shall be renumbered as
(a-1-1) and (a-1-2) respectively.
(ii) after clause (a), the following shall be inserted, namely:-
“(a-1) ‘Area of operation’ means jurisdictional area from
which the membership is drawn or as specified in the bye-laws
of the society”.
(iii) for clause (a-2-1), the following shall be substituted, namely:-
“(a-2-1) “Backward Classes” means such class or classes of
citizens as may be classified as Backward Classes and notified by
the Government from time to time.”
(iv) for clause (b), the following shall be substituted, namely:-
“(b) ‘Board’ means the board of directors or the governing
body of a cooperative society, by whatever name called, to which
the direction and control of the management of the affairs of the
society is entrusted to.”
(v) after clause (b-4), the following shall be inserted, namely:-
“(b-5), ‘Cooperative Election Commission’ means the
‘cooperative election commission constituted under section 39AA;
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(vi) in clause (d-1),the words “ or year” shall be omitted;

(vii) after clause (e-2), the following shall be inserted, namely:-
“(e-2-1) ‘Director’ means a member of the board duly
elected or nominated or co-opted in accordance with this Act,
the rule and the bye-laws made under this Act”;
(viii) after clause (e-5), the following shall be inserted, namely:-
“(e-6), ‘General Body’ means,-
(i) in relation to a primary cooperative society, all the
members of that cooperative society;
(ii) in relation to a secondary cooperative society, all
the delegates of the member cooperative societies
and the individual members; and
(iii) in relation to a federal cooperative society, all the
delegates of the member cooperative societies.
(e-7), ‘General Meeting’ means a meeting of the
general body called and conducted in accordance with the
provisions of this Act, the rules and the bye-laws made
under this Act.”
(ix) in clause (g), after the word “vice- chairperson”, the words,
“elected secretary or treasurer” shall be inserted.
(x) after clause (i-1), the following shall be inserted, namely:-
“(i-2) ‘Representative’ means a person elected by a group
of individual members of a primary cooperative society or a
secondary cooperative society to represent them and to
participate on their behalf in the representative general body
meeting of the society in accordance with Act, the rules and the
bye-laws made under this Act;
(i-3) ‘Representative General Body’ means all the
representatives of a primary cooperative society or a secondary
cooperative society;
(i-4) ‘Representative General Meeting’ means a meeting of
the representatives called and conducted in accordance with
provisions of this Act or the rules and the bye-laws of the
primary cooperative society or the secondary cooperative
society”.
(xi) after clause (J-5), the following clause shall be inserted,
namely:-
“(J-6)- ‘State Level Cooperative Society’ means a
cooperative society whose area of operation extends to the
whole of the State.”
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4. Substitution for the word ‘Committee’.- In the Principal Act, for

the word ‘committee’ wherever it occurs, the word ‘board’ shall be
substituted.
5. Insertion of new section 11A.- After section 11 of the Principal
Act, the following shall be inserted, namely:-
“11A- Bye-laws.- (1) Every cooperative society shall make its
bye-laws in accordance with the provisions of this Act, and the rules
made there under.
(2) Except on such specific matters which the Act, or the rules have
provided for and which the bye-laws may further regulate on but not
contravene, the functioning of every cooperative society shall be regulated by
its bye-laws”.
6. Amendment of section 12.- In section 12 of the Principal Act,-
(i) for sub-section (1), the following shall be substituted, namely:-
“(1) A cooperative society may amend its bye-laws in conformity
with the provisions of this Act, and the rules made there under from
time to time.
Provided that every cooperative society shall make amendments to its
bye-laws in conformity with the amendments made to this Act or the rules
from time to time within ninety days from the date of coming into force of
the said amendments.”
(ii) sub-sections (5) and (6) shall be omitted.
7. Omission of section 14A.- section 14A of the Principal Act shall be
omitted.
8. Amendment of section 16.- In section 16 of the Principal Act,-
(i) in sub-section (1) in clause (a), after the words “such
cooperative society”, the words, “and is residing in the area of
the operation of the society” shall be inserted;
(ii) in sub section (4), for the words “three months”, the words
“two months”, shall be substituted;
(iii) sub-sections (5), (6) and (7) shall be omitted.
9. Amendment of section 17.- In section 17 of the Principal Act, in
sub-section (1), after clause (d), the following shall be inserted, namely:-
“(e) is not eligible for membership under section 16;
(f) is a paid employee of the society or of its financing bank; or
(g) as such member, has failed to transact, such minimum
business; or utilize such minimum services or facilities in a
year as may be specified in the byelaws for a continuous
period of three years”.
10. Amendment of section 18A.- In section 18A of the Principal Act,
in clause (a), for sub-clause (iii), the following shall be substituted, namely:-
“(iii) disqualification and cessation”
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11. Insertion of new section 19A.- After section 19 of the Principal

Act, the following shall be inserted, namely:-
“19A- Access to information.- Every member of a cooperative
society shall have access to the books, information and accounts of
the cooperative society kept in regular transaction of its business
with such member”.
12. Amendment of section 20.- In section 20 of the Principal Act,-
(i) in sub-section (1),
(a) for the words “no member”, the words “no member, no
representative or no delegate” shall be substituted;
(b) and the proviso thereunder shall be omitted.
(ii) in sub-section (2), after clause (a-iii) and the proviso thereunder,
the following shall be inserted, namely:-
“(a-iv) a member, a representative or a delegate who has
failed to attend three general meetings out of the last five
general meetings;
(a-v) a member or a representative who has failed to
utilize such minimum services or facilities in a co-operative
year as may be specified in the byelaws for three consecutive
cooperative years.”
(iii) in sub-section (2), in clause (b), in sub-clause (iv),-
(a) for the words “seventy five percent”, the words “fifty
percent”, shall be substituted;
(b) in item (a), for the words “seventy five percent”, the words
“fifty percent”, shall be substituted;
13. Amendment of section 21.- In section 21 of the Principal Act, in
sub-section (1),
(a) after the words “every member”, the words and comma, “every
representative,” shall be inserted;
(b) and the following explanation shall be inserted at the end, namely:-
“Explanation: For the purposes of section 20 and this section and
wherever else it occurs, the word ‘delegate’ means a member of a
cooperative society to represent that society in other cooperative
societies.”
14. Amendment of section 26.- In section 26 of the Principal Act,-
(i) in sub-section (2), for the words “the Registrar may amend the bye-
laws of the cooperative society”, the words “the general body of a
cooperative society may amend its byelaws” shall be substituted;
(ii) for sub-sections (3) and (4), the following shall be substituted;
namely:-
“(3)- The amendments of the bye-laws made under sub-section (2)
shall be sent to the Registrar for approval under section 12.”
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15. Amendment of section 27.- In section 27 of the Principal Act, in

sub-section (1),-
(i) for the words “thirtieth day of September”, the words “twenty
fifth day of September”, shall be substituted;
(ii) in clause (n), the word “and” at the end shall be omitted;
(iii) after clause (n), the following shall be inserted, namely:-
“(n-1)-review of the use of the services of the society by the
members and directors of the society;
(n-2)- consideration of the loans and advances made to the
directors and their relatives, the defaults, if any, and the
action taken for recovery thereof;
(n-3)- consideration of the inquiry and inspection reports, if
any, and the compliance report of the board on the action
taken regarding the rectification of defects and remedying of
the irregularities pointed out in the said reports;
(n-4)- appointment of auditors;
(n-5)- voluntary amalgamation, division, merger, transfer of
assets and liabilities;
(n-6)- decision on bad debts considered as irrecoverable;
(n-7)- review of the remuneration, TA, DA & other allowances
paid to the directors including the office-bearers in
connection with their duties in that capacity or their
attendance at related meetings;
(n-8) review of the actual utilization of the reserve and other
funds;
(n-9) liquidation of the cooperative society; and”
(iii) the proviso at the end shall be omitted;
(iv) in sub-section (2), clause (b) shall be omitted;
(v) after sub-section (3), the following shall be inserted, namely:-
"(4) The quorum for a general meeting shall be as specified in the bye-
laws, but shall not be less than twenty percent of the members eligible to
vote at the meeting;
Provided that the quorum for a representative general meeting shall
not be less than sixty percent of the representatives eligible to vote at the
meeting;”
16. Insertion of section 27A and 27B.- After section 27 of the
Principal Act, the following shall be inserted, namely:-
“27A Participation of members in the management.- Every
member of a cooperative society shall participate in the management
of the society,-
(a) by attending three out of the last five annual general meetings;
 6

(b) by utilizing every year such minimum services or facilities offered

by the society as may be specified in the byelaws.
Provided that if a member fails to utilize the minimum services or fails to
attend the minimum meetings, he shall lose his right to vote, for a period of
three years.
27B. Returns to be filed with the Registrar.- The board of every
cooperative society shall file the following returns, within six months of
the close of every cooperative year with the Registrar,-
(a) annual report of activities of the society;
(b) audited statements of accounts;
(c) plan for disposal of surplus as approved by the general body;
(d) list of amendments to the bye laws as approved by the general
body of the cooperative society.
(e) declaration regarding the date of holding of the general body
meeting and conduct of elections when due;
(f) misappropriation or embezzlement of funds, if any, and action
taken against the persons responsible for the same including
the civil, criminal and disciplinary actions; and
(g) any other information required by the Registrar in pursuance of
any of the provisions of the Act,”.
17. Amendment of section 28.- In section 28 of the Principal Act, in
sub section (1), the words, “fifty members or”, and the words and comma,
“whichever is less,” shall be omitted.
18. Amendment of section 28A.- In section 28A of the Principal Act,-
in sub-section (2),-
(a) the words “Government nominees and” shall be omitted;
(b) for clause (i), the following shall be substituted, namely:-
“(i) in case of a primary society and a secondary society
whose area of operation extends to,-
(a) a part of taluk, eleven members;
(b) whole of taluk, thirteen members;
(c) beyond a taluk but not beyond a district, fifteen
members:
Provided also that in case of Urban Cooperative Banks having area of
operation not beyond a district the maximum number shall not exceed
seventeen members.
(d) beyond a district, nineteen members;”
(c) in clause (ii), for the word “excluding”, the word “including”
shall be substituted;
(d) clause (iii) shall be omitted;
 7

(ii) in sub-section (3),-

(a) for the words ‘every primary society’, the words ‘every
cooperative society’ shall be substituted;
(b) in clause (ii), for the words “one seat”, the words “two
seats” shall be substituted;
(c) after clause (ii), for the proviso, the following shall be
substituted, namely:-
“(iii) one seats to be filled by election, in favour of the persons
belonging to backward classes.
Provided that such reservation shall be made on the board of every
cooperative society consisting of individuals as members and having
members from such class or category of persons”.
(iii) in sub-section (4),-
(a) for the words “five cooperative years”, the words “five
years from the date of election” shall be substituted.
(b) the explaination after the first proviso shall be omitted.
(c) in the second and third provisos, for the words “five
cooperative years”, the words “five years from the date of
election” shall be substituted.
(iv) after sub-section (4), the following shall be inserted, namely:-
“(4A)- The board of a cooperative society, may co-opt
persons having experience in the field of banking, management,
finance or specialization in any other field relating to the
objects and activities undertaken by the cooperative society to
be the members of the board.
Provided that the number of such co-opted members shall not exceed
two in addition to the maximum number specified in sub-section (2).
Provided further that such co-opted members shall not have a right to
vote in any election of the cooperative society in their capacity as such
members or to be eligible for being elected as office-bearers of the board.
Provided also that the functional directors not exceeding three, if any,
shall also be the members of the board in accordance with the byelaws and
such members shall be excluded for the purpose of counting the total
number of directors specified in sub-section (2).
Provided also that the professional directors and functional directors
shall not form a part of the quorum for the conduct of the board meetings.
(4B)-(1) The State Government may nominate one person as its
representative on the board of every assisted society other than the
board of a primary agricultural credit cooperative society.
Provided that the person so nominated as a member of a cooperative
society shall hold office as such member during the pleasure of the State
Government.
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(2) Where an officer of Government is nominated under clause (1), such

officer may, if unable to be present himself at any meeting of the board,
depute a subordinate officer to the meeting as his representative and such
subordinate officer shall be deemed to be a person nominated as a
representative of the State Government for the purpose of such meeting.”
19. Amendment of section 28B.- In section 28B of the Principal Act,
for sub-section (1), the following shall be substituted, namely-
“ (1) The election of a board shall be conducted before the expiry
of the term of the board so as to ensure that the newly elected
members of the board assume office immediately on the expiry of the
term of office of the members of the outgoing board”.
20. Insertion of section 28C.- After section 28B of the Principal Act,
the following shall be inserted, namely:-
“28C- Powers and functions of the board.-(1) The board of a
cooperative society may exercise all such powers and perform all such duties
as may be necessary or expedient for the purpose of carrying out its
functions under the Act,, the rules and the bye-laws.
(2) Without prejudice to the generality of the foregoing powers, such
powers and duties shall include the following:-
(a) to admit members;
(b) to dispose of applications for allotment of shares;
(c) to mobilize resources and invest funds;
(d) to provide services or facilities including sanction of loans and
advances to the members and determination of the security to be
taken;
(e) to elect the chairperson and such other office-bearers;
(f) to acquire or dispose of moveable and immoveable property
required for achieving the objectives of the society;
(g) to determine the cadre strength of the establishment of the society,
qualifications, pay scales and other allowances admissible to each
employee and other conditions of service of the employees;
(h) to appoint the chief executive and such other employees as are not
required to be appointed by the chief executive of the society
subject to the provisions of section 29G;
(i) to lay down conduct and discipline rules, initiate disciplinary
action against the delinquent employees and impose penalties
proportionate to the gravity of the charges subject to the provisions
of the bye-laws of the society;
(j) to set up specific goals to be achieved towards the organizational
objectives;
(k) to approve the expenditure necessary for the business of the
society subject to the provisions of annual budget;
 9

(l) to cause the audit of accounts of the society within the specified
time limit and obtain the audit report within the said period;
(m) to consider the audit report, take action for rectification of the
defects and remedying the irregularities pointed out, if any, in the
audit, cause compliance report and place the reports before the
general body;
(n) to consider the enquiry or inspection reports, if any, take action for
rectification of the irregularities pointed out, if any, in the enquiry
or inspection, cause compliance report and place the reports before
the general body;
(o) to place the annual report, annual financial statements, annual
plan and budget for the approval of the general body;
(p) to institute, defend or compromise legal proceedings;
(q) to initiate civil, criminal and disciplinary action, as the case may
be, against any person who may have incurred civil or criminal
liability by way of misappropriation or causing loss to the society;
(r) to convene annual general meeting in time and special general
meetings whenever necessary and on requisition;
(s) to frame regulations necessary for the proper and effective
functioning of the society;
(t) to take such other measures or to do such other acts as may be
required under this Act, the rules or as may be specified in the
byelaws or as may be delegated by the general body.
21. Omission of section 29.- section 29 of the Principal Act, shall
be omitted.
22. Amendment of section 29C.- In section 29C of the Principal
Act,-
(i) In sub section (1),-
(a) In clause (c), the words “or any of his near relation” and the
proviso at the end shall be omitted;
(b) In clause (f), in the explanation, the words “and clause (c)” shall
be omitted.
(c) In clause (o), in sub clause (i), for the word ,“member”, the word,
“director” shall be substituted.
(d) after clause (o), the following shall be inserted, namely:-
“(p) he has absented himself for three consecutive meetings of the
board of such society , without leave of absence.”
(ii) after sub-section (2), the following shall be inserted, namely:-
“(3) If the board of a cooperative society fails,-
(a) to assist the cooperative Election Commission for conducting
elections as per section 39A and section 29F; or
 10

(b) to call the annual general meeting under section 27 or special

general meeting when required under section 28; or
(c) to present the audited accounts and annual report in the annual
general meeting,
every member of such defaulting board shall be disqualified for being
elected or appointed or continued as a member of the board of the society
for a period of five years from the date of the order of disqualification”.
(iii) after sub-section (9), the following shall be inserted, namely:-
“(10) No director of a cooperative society shall be eligible for being
elected or appointed or continued as a delegate of another society, if he
suffers from any disqualification mentioned in sub-section (1). The
provisions of sub-section (8) shall, mutatis-mutandis, apply.
(11) No member of a cooperative society shall be eligible for being
elected or appointed or continued as a representative, if he suffers from
any disqualification mentioned in sub-section (1) other than clauses (m)
and (n) thereof. The provisions of sub-section (8) shall, mutatis-
mutandis, apply”.
23. Amendment of section 29E.- In section 29E of the Principal Act,
the following proviso shall be inserted at the end, namely:-
“Provided that the cooperative election commission shall conduct the
election to fill up any vacancy in the office of the director of the board if the
remaining term of office of the board is more than half of its original term.

Provided further that the board may fill up a casual vacancy on the board
by nomination out of the same class of members in respect of which the
casual vacancy has arisen, if the remaining term of office of the board is less
than half of its original term”.
24. Amendment of section 29 F.- In section 29F of the Principal Act,-
(i) for sub-sections (4) the following shall be substituted, namely:-
“(4) The term of office of the office-bearers of a cooperative
society shall be five years from the date of election and shall be co-
terminus with the term of the board.
(5) The Cooperative Election Commission shall conduct
elections to the board and also to the office of President or Chair
person, Vice President or Vice-Chairperson and such other office-
bearers as are required to be elected as per the bye-laws of the
cooperative society within fifteen days from the date of constitution or
deemed constitution of the board after a general election.
(6) The cooperative election commission shall conduct elections
within sixty days from the date it being notified about the occurrence
of any casual vacancy in the office of a director or any office bearer of
a co-operative society to fill up such casual vacancy”.
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(ii) sub sections (5), (6), (7) and (8) shall be omitted.
25. Amendment of section 29-G.- In section 29G of the Principal
Act, after sub-section (4B) , the following shall be inserted, namely:-
“(4C) The Chief Executive of a Cooperative Society shall not have
a right to vote in the election of the office bearers of the board”.
26. Substitution of section 30.- For section 30 of the Principal Act,
the following shall be substituted, namely:-
“30-Supersession or suspension of the board.- (1) Notwithstanding
anything contained in any law of the time being in force, no board of a
cooperative society shall be superseded or kept under suspension for a
period exceeding six months.

Provided that in case of a cooperative society carrying on the business

of banking, the provision of this clause, shall have effect as if for the words
“six months”, the words “one year” had been substituted.
(2) If in the opinion of the Registrar, the board of a cooperative society-
(i) persistently makes default or is negligent in the performance of the
duties imposed on it by this Act, or the rules or the bye-laws; or
(ii) commits any act, which is prejudicial to the interest of the society
or its members; or
(iii)where there is a stalemate in the constitution or functioning of the
board; or
(iv) has serious financial irregularities or frauds which have been
detected; or
(v) fails to provide books and records, necessary information and
assistance to the election commission as per the calendar set out
by the election commission to conduct elections to the board within
the stipulated time and as a result or otherwise, the election
commission has failed to conduct elections to the board within the
stipulated time;
Registrar, may, after giving the board an opportunity to state
objections, if any, by order in writing, superceed or suspend the
said board and appoint an administrator to manage the affairs of
the society for such period not exceeding six months.
Provided that the board of any cooperative society shall not be
superseded or kept under suspension where there is no Government
share holding or loan or financial assistance or any guarantee by the
Government.
Provided further that the supersession or suspension of the
board of a cooperative bank shall be done only after consultation with
 12

the Reserve Bank of India / National Bank as the case may be and the
provisions of Banking Regulation Act,, 1949 shall also apply.
(3) The administrator so appointed shall, subject to the control of the
Registrar and such instructions as he may give from time to time, exercise
all or any of the functions of the board or of any office- bearer of the co-
operative society and take such action as he may consider necessary in the
interest of the society.
(4) In case of supersession of a board, the administrator shall, before
the expiry of his term of office, arrange for the conduct of elections and the
constitution of a new board in accordance with this Act,, the rules and the
bye-laws of the co-operative society and hand over management to the
elected board.
(5) In case of suspension of a board, the Registrar shall reinstate the
said board and the administrator shall, on the expiry of his term of office,
handover the management to the said board and the period of
suspension shall be reckoned while computing the original term of office of
the board.
(6) Notwithstanding anything contained in this Act,, the Registrar
shall, in the case of a cooperative bank, if so required in writing by the
Reserve Bank of India, in public interest or for preventing the affairs of the
cooperative bank being conducted in a manner detrimental to the interest of
the depositors or for securing the proper management of the cooperative
bank, by order in writing, remove the board of that cooperative bank and
appoint an administrator to manage the affairs of the cooperative bank for
such period not exceeding one year as may be specified by the Reserve Bank
of India.
(7) Any officer or employee of the Government or a Cooperative
organization may be appointed as administrator of a cooperative society-
(i) if he is appointed on full time basis, his pay and other
allowances shall be borne by the cooperative society. The
service rules applicable to him in the department or
organization shall continue to govern his service as
administrator of the society;
(ii) if he is appointed as administrator in addition to his regular
post, he shall be paid remuneration at the rate of ten percent of
his basic pay out of the funds of the cooperative society. The
service rules applicable to him in the department or
organization shall continue to govern his service as
administrator of the society;
27. Amendment of section 34.- In section 34 of the Principal Act, in
sub-section (1), the following provisos shall be inserted, namely:-
 13

“Provided that the employee shall obtain prior concurrence in writing

of the employer agreeing to deduct from his salary or wages such an amount
as specified in such agreement.
Provided further that the liability of the employer shall be limited to
the extent of deduction of an amount which if included makes the total of all
the deductions from the salary not to exceed fifty percent of the salary of the
employee.
Provided also that the board of the cooperative society shall determine
the amount of loan and the number of instalments to be granted to the
employee in such a manner that the total of all deductions including the
deduction on account of the loan instalment alongwith interest thereon shall
not exceed fifty percent of the salary of the employee”.
28. Substitution of section 39A.- For section 39A of the Principal
Act, the following shall be substituted, namely:-
“39A- Conduct of elections.- (1) Every general election of the members
of the board and election of the office-bearers of a cooperative society
including any casual vacancy to the extent applicable shall be held subject
to the superintendence, direction and control of the Cooperative Election
Commission.
(2) The general elections of the members of the boards of the
cooperative societies shall be held in four stages as under,-
(a) the elections in respect of primary cooperative societies shall be
held in the first stage;
(b) in the second stage, the electoral process for holding elections to
the secondary societies shall commence fifteen days after the
completion of the elections of the primary societies;
(c) in the third stage, the electoral process for holding election to
the federal societies shall commence thirty days after the
completion of the elections of the secondary societies; and
(d) in the fourth stage, the electoral process for holding election to
the apex societies shall commence thirty days after the
completion of the elections of the federal societies.
Provided that the cooperative election commission may start the
preparatory work for the preparation of the electoral rolls for
and the conduct of the elections during the last six months
prior to the expiry of the term of office of the board of a
cooperative society.
(3)Notwithstanding anything contained in this Act,, the rules or the
bye-laws of any cooperative society, the elections to the boards and
consequent election of the office-bearers which are due during March and
April 2013 shall be held;
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(i) before the thirtieth day of September 2013 in respect of the

primary cooperative societies;
(ii) before the thirty first day of October 2013, in respect of the
secondary cooperative societies;
(iii) before the thirtieth day of November 2013 in respect of the
federal societies;
(iv) before the thirty first day of December 2013 in respect of the
apex cooperative societies;
Provided that the incumbent boards of all such cooperative societies
shall continue to be in their respective offices till the conduct of the elections
as above.
39AA Cooperative Election Commission.-(1)The State Government
shall, by notification in the Official Gazette, constitute a Cooperative
Election Commission consisting of a cooperative election commissioner and
a secretary.
(2)The cooperative election commission shall be vested with the
superintendence, direction and control of the preparation of the electoral
rolls for, and the conduct of, all elections to the cooperative societies in the
State.
(3)The Governor shall appoint a person who is or has been an officer
of the rank of Principal Secretary or Secretary to the State Government to be
cooperative election commissioner on the recommendation of the Chief
Minister and such cooperative election commissioner shall hold office for a
term of five years.
(4)The State Government shall appoint a person who is or has been an
officer of the rank of Additional Registrar of Cooperative societies to be the
Secretary of the Cooperative Election Commission.
(5)The conditions of service including the salary and allowances of the
cooperative election commissioner and the secretary shall be such as may
be prescribed.
(6)Subject to the provisions of sub-section(8), the Co-operative
Election Commissioner shall be removed from his office only by an order of
the Governor on the ground of proved misbehavior or incapacity after an
enquiry ordered by the Governor and conducted by a Judge of the High
Court, who has on inquiry, reported that the Election Commissioner ought
to be removed on such ground.

(7) The Governor may suspend from office, and if deemed necessary
prohibit also from attending the office during inquiry, the election
commissioner in respect of whom an enquiry has been ordered under sub-
section (6) until the Governor has passed orders on receipt of the report of
the High Court Judge.
 15

(8) Notwithstanding anything contained in sub-section(6), the

Governor may by order remove from office the cooperative election
commissioner if the cooperative election commissioner,-
(a) is adjudged an insolvent; or
(b) has been convicted of an offence which, in the opinion of the
Governor involves moral turpitude; or
(c) has engaged during his term of office in any paid employment
outside the duties of his office; or
(d) is, in the opinion of the Governor unfit to continue in office by
reason of infirmity of mind or body; or
(e) has acquired such financial or other interest as is likely to affect
prejudicially his functions as the election commissioner.
(9) If the Cooperative election commissioner any way, concerned or
interested in any contract or agreement made by or on behalf of the
Government of Karnataka or participates in any way in the profit thereof or
in any benefit or emolument arising there from otherwise than as a member
and in common with the other members of an incorporated company, he
shall, for the purposes of sub-section(6) be deemed to be guilty of
misbehavior.
(10)The cooperative election commission shall in consultation with the
State Government determine the number of officers and other employees
required for the discharge of the functions conferred on it under sub-
section(2) and require the State Government to provide the services of such
officers and employees.
(11)The State Government shall, when so requested by the cooperative
election commission, make available to the cooperative election commission
such staff as may be necessary for the discharge of the functions conferred
on the cooperative election commission under sub-section(2).
(12) The salary, allowances, terms and conditions of services of the
officers and the employees of the cooperative election commission shall be
such as may be prescribed.
(13) Subject to the provisions of this Act, procedure and guidelines for
the conduct of election shall be such as may be prescribed.
(14)The cost of preparation of electoral rolls for, and the conduct of the
elections shall be met in such manner as may be prescribed.
(15)The board of every cooperative society shall,-
(a) inform the cooperative election commission about the expiry of
its term of office at least six months before the date of expiry of
such term;
(b) furnish such books, records and information as the commission
may require as per the calendar prescribed by the Cooperative
Election Commission; and
 16

(c) provide all necessary help, assistance and cooperation for the
smooth preparation of electoral rolls for and the conduct of
elections.”
29. Omission of section 53A.- section 53A of the Principal Act, shall
be omitted.
30. Amendment of section 56.- In section 56 of the Principal Act, in
sub-section (2), for the second proviso, the following shall be substituted,
namely:-
“Provided further that no director shall be paid travelling allowance,
daily allowance or such other allowances or fees for attending meetings of
the board or committees or sub-committees or for performing any other
functions as a director at a rate higher than the maximum rate specified in
the byelaws for the purpose, having regard to the financial position and
profitability of the society”.
31. Insertion of new section 57A.- After section 57 of the Principal
Act,, the following shall be inserted, namely:-
“57A- Cooperative Education and Training.-(1) The cooperative
education fund shall be utilized for the purpose of promotion of the
cooperative movement in the State and for providing education to the
members, directors and cooperators of the cooperative societies and the
general public and training to the employees of the cooperative societies.
(2) Every co-operative society shall pay its contribution to the
Karnataka State Cooperative Federation within thirty days from the date of
its annual general meeting.
(3) All contributions made by the cooperative societies towards co-
operative education fund, grants received from the Government of India or
the State Government and donations, if any, made by any person shall be
credited to the cooperative education fund.
(4) The cooperative education fund shall be maintained and
administered by the Karnataka State Cooperative Federation Limited for
such programmes and in such manner as may be prescribed.
(5) No expenditure out of the cooperative education fund shall be
incurred without the approval of an advisory committee constituted for the
purpose as prescribed”.
32. Amendment of section 58.- In section 58 of the Principal Act,-
(i) in clause (e),-
(a) the words “or financial institution” shall be omitted.
(b) for the word “Registrar”, the words, “general body of that society
till the date of the next annual general body meeting”, shall be
substituted.
 17

(ii) the first proviso shall be omitted.

33. Amendment of section 59.- In section 59 of the Principal Act, for
sub-section (2), the following shall be substituted, namely:-
“(2) Notwithstanding anything contained in sub-section (1), the
general body of a cooperative society shall have power to permit the society
to borrow from a credit agency subject to such conditions as may be
stipulated in the resolution of the general body.
Provided that such resolution is valid till the date of the next annual
general meeting”.
34. Substitution of section 63.- For section 63, the following shall be
substituted, namely:-
“63 Audit.- (1) Every Cooperative society shall get its accounts
audited at least once in a year before the first of September following the
close of the cooperative year by an auditor or an auditing firm appointed by
the general body of the cooperative society from a panel of auditors or
auditing firms approved by the Director of cooperative audit;
Provided that the Director of co-operative audit shall be the authority
competent to prepare and maintain a list of auditors and auditing firms who
satisfy the prescribed qualification and experience for undertaking the
audit of accounts of co-operative societies in the state.
Provided further that the Director of cooperative audit shall
communicate a panel of auditors and auditing firms, not exceeding ten, to
every cooperative society within thirty days from the close of the co-operative
year.
(2) The general body of every cooperative society shall at its general
meeting appoint an auditor or an auditing firm to audit the accounts of the
society for the cooperative year in which the general meeting is held.
(3) The manner of preparation of the list of auditors and auditing firms
by the Director of co-operative audit and the procedure for giving the panel
to each co-operative society shall be such as may be prescribed.
(4) The audit under sub-section (1) of this section or under section
98U or section 98V shall include an examination of overdue debts, if any,
the physical verification and valuation of the assets and liabilities,
verification of the cash balance and securities, certification of the profits or
losses, compliance with the transparency law and other laws applicable to
the cooperative societies including the instructions and directives of
NABARD or Reserve Bank of India and an examination of the working and
the other prescribed particulars of the society.
(5) The auditor or auditing firm shall at all times have access to all
the books, accounts, documents, papers, securities, cash and other
properties belonging to the society or in the custody of any member of the
 18

board or the office-bearer or the chief executive or any other employee of the
society and may summon any person in possession or responsible for the
custody of any such books, accounts, documents, papers, securities, cash
or other properties to produce the same at the registered office of the society
or any branch thereof or at any public office at the headquarters of the
society.
(6) Every person who is, or has at any time been, an officer or
employee of the society and every member and past member of the society
shall furnish such information in regard to the transactions and working of
the society as the Auditor or Auditing firms approved by the Director of
Cooperative Audit may require.
(7) The board of every cooperative society shall ensure that the annual
financial statements like the receipts and payments or income and
expenditure, profit and loss and the balance sheet along with such
schedules and other statements as may be prescribed as at the end of a
cooperative year are prepared and presented for audit before the auditor or
auditing firm within thirty days of the closure of that cooperative year.
(8) The Auditor or Auditing firm shall conduct and complete the audit
of accounts as provided for in this Act, or the rules and send copies of the
audit report and communicate the results of audit to the cooperative society,
the Registrar, the Director of co-operative audit and to the financing bank or
credit agency, and if the society is affiliated to any other cooperative society,
to such cooperative society, as early as possible but within the first day of
September every year.
(9) The auditor or auditing firm shall have right to receive all notices
and every communication relating to the general meeting of a cooperative
society and, at the cost of the cooperative society, shall be entitled to attend
such meeting and to be heard at the general body meeting, in respect of all
or any part of the business with which he is concerned as auditor or
auditing firm.
(10) If the result of the audit held under sub-section(1) discloses any
defects in the working of the society, the board shall take steps to rectify the
defects and remedy the irregularities pointed out in the audit report and
place the audit report along with the action taken report before the general
meeting to be held before the twenty-fifth day of the September every year
and explain therein the said defects or the irregularities. The board shall
continue to take steps for rectification of all the defects and remedying of all
the irregularities in the audit report and appraise the general meetings every
year till all the defects are rectified and the irregularities are remedied. The
board shall send report of action taken to the Registrar and Director of Co-
operative Audit within thirty days from the date of the general meeting.
 19

(11) The Director of Co-operative Audit shall submit the audit reports
of an Apex cooperative society to the State Government annually for being
laid before the legislature in the manner prescribed.
(12) If it appears to the general body of a co-operative society that
there is a prima-facie case of fraud or misappropriation or embezzlement of
funds not detected or properly examined by the auditor during the regular
audit or misclassification of accounts, the general body may resolve to
provide for a re-audit of any account of the society with a view to truly
reflect the financial position of the society and the provisions of the Act, and
the rules applicable to the audit shall apply to such re-audit;
(13) If it appears to the State Government on an application by a
cooperative society or otherwise that it is necessary or expedient to re-audit
the accounts of a society, the State Government may, by an order provide for
such re-audit and the provisions of the Act, and the rules applicable to the
audit shall also apply to such re-audit.
Provided that such re-audit shall be ordered only when there is a
prima-facie case of fraud or mis-appropriation or embezzlement of funds not
detected or properly examined by the auditor or auditing firms during
regular audit or misclassification of accounts or for any other valid reasons
with a view to truly reflect the financial position of the society.
(14) Without prejudice to the provisions of sub- sections (5) and (6),
the auditor shall inquire;
(a) Whether loans and advances made by the co-operative society on
the basis of security have been properly secured and whether
terms on which they have been made are not prejudicial to the
interests of the co-operative society or its members;
(b) Whether transactions of the co-operative society which are
represented merely by book entries are not prejudicial to the
interests of the co-operative society;
(c) Whether personal expenses have been charged to revenue account;
(d) Where it is stated in the books and papers of the co-operative
society that any shares have been allotted for cash, whether cash
has actually been received in respect of such allotment, and if no
cash has actually been so received, whether the position as stated
in the account books and the balance sheet is correct, regular and
not misleading; and
(e) Whether any special issue or subject matter referred to for enquiry
by the Reserve Bank or National Bank has been duly enquired into
and report thereof is submitted to the Reserve Bank or National
Bank as the case may be.
(15) The auditor shall make a report to the cooperative society on the
accounts examined by him and on every balance sheet and profit and loss
 20

account and on every other document required to be part of or annexed to

the balance sheet or profit and loss account. The report shall state whether,
in his opinion and to the best of his information and according to the
explanations given to him, the said accounts give the information required
by this Act, in the manner so required and give a true and fair view,-
(a) in the case of the balance sheet, of the state of the cooperative
society’s affairs as at the end of the year; and
(b) in the case of the profit and loss account, of the profit or loss for the
year.
(16) The auditor’s report shall also,-
(a) state whether he has obtained all the information and
explanations which to the best of his knowledge and belief were
necessary for the purpose of his audit;
(b) state whether in his opinion, proper books of accounts have
been kept by the co-operative society so far as appears from his
examination of those books and proper returns adequate for the
purpose of his audit have been received from branches or offices
of the co-operative society not visited by him;
(c) state whether the report on the accounts of any branch office
audited by a person other than the co-operative society’s auditor
has been forwarded to him and how he has dealt with the same
in preparing the auditor’s report;
(d) state whether the co-operative society’s balance sheet and profit
and loss account dealt with by the report are in agreement with
the books of account and returns;
(17) The audit report shall have,–
(a) all particulars of the defects or the irregularities observed in audit
and in case of financial irregularities and misappropriation or
embezzlement of funds or fraud, the auditor/auditing firm shall
investigate and report the modus operandi, the entrustment,
amount involved, and fix the responsibility for such
misappropriation or embezzlement of funds or fraud, on the
members of the board or the employees of the society or any other
person as the case may be with all necessary evidence.
(b) accounting irregularities and their implications on the financial
statements to be indicated in detail in the report with the
corresponding effects on the profit and loss.
(c) the functioning of the general body, board and sub-committees of
the Co-operative Society to be checked and any irregularities or
violations observed reported duly fixing the responsibilities for such
irregularities or violations.
(d) all schedules and other statements as may be prescribed.
 21

(18) Where any of the matters referred to in clauses (a) and (b) of sub-
section (14) or in clauses (a) and (b) of sub section (15) or clause (a) to (d) of
sub-section (16) is answered in the negative or with a qualifying observation,
the auditor’s report shall state the reason for the answer.
(19) The remuneration of the auditor or auditing firm of a cooperative
society shall be borne by the society and shall be at such rates as may be
fixed by general body of the society.
(20) The Director of Cooperative Audit shall maintain a list of
cooperative societies districtwise, the list of working societies, the list of
societies whose accounts are audited, the list of societies whose accounts
are not audited within the prescribed time and the reasons therefor. He
shall co-ordinate with the cooperative societies and the auditors or auditing
firms and ensure the completion of audit of accounts of all the cooperative
societies in time every year.
Explanation: For the purpose of this section,- (i) ‘Auditor’ means an
auditor or an officer of the Department of Cooperative Audit who has
passed, in addition to the graduation or post graduation degree,
Higher Diploma in Cooperative Management / Diploma in Cooperative
Audit / General Diploma in Cooperative management and who has
completed the period of probation successfully and who has a working
knowledge of the kannada language; or a Chartered Accountant
within the meaning of the Chartered Accountants Act, 1949 who shall
have a fair knowledge of the functioning of the cooperative societies
and shall have an experience of at least three years in auditing of
which the auditor would like to be included in the panel and chartered
accountants shall have working knowledge of the Kannada language.
(ii) ‘Auditing firm’ means a firm of more than one Chartered
Accountant within the meaning of the Chartered Accountants Act,
1949 who or which shall have a fair knowledge of the functioning of
the cooperative societies and shall have an experience of at least three
years in auditing of which the auditing firm would like to be included
in the panel and chartered accountants shall have working knowledge
of the Kannada language.
35. Amendment of section 64.- In section 64 of the Principal Act,-
(i) after sub-section (2A), the following proviso, shall be inserted,
namely:-
“Provided that the State Government shall, on a report made by the
Registrar, shall have power to extend the period for holding the enquiry
beyond eighteen months if it is satisfied that, there are genuine grounds
for the extension.”
(ii) in sub-section (3), for clause (b), the following shall be substituted;
namely:-
 22

“(b) the inquiry officer may also summon any officer of a financing
bank or a credit agency as the case may be or any person having
any kind of business relationship with the society or any person
who is connected with the functioning of and who has knowledge
about the affairs of the society to produce any records or
documents, if any, related to the transactions with and working of
the society and furnish such information and the explanations, at
the registered office or branch of the society or at any public office
at the headquarters of the society, as the inquiry officer may
require for the purpose of the inquiry.”
(iii)after sub-section (4), the following shall be inserted, namely:-
“(4A) On receipt of the inquiry report and the result of the inquiry
from the Registrar, it shall be the responsibility of the board to
initiate immediate necessary action for rectification of deficits, if
any, therein and place the report before the annual general
meeting or a special general meeting convened for the purpose at
the earliest.
Provided that the general body of the cooperative society shall not
be competent to pass a resolution negativing the findings of the
inquiry”.
(iv) in sub-section (5), for the words “three months”, the words “forty
five days” shall be substituted”.
36. Amendment of section 65.- In section 65 Principal Act,-
(i) after sub-section (2), the following shall be inserted, namely:-
“(2A) On receipt of the inspection report and the result of the inspection
from the Registrar, it shall be the responsibility of the board to initiate
necessary action for rectification of defects, if any, therein and place the
report before the annual general meeting or a special general meeting
convened for the purpose at the earliest.
Provided that the general body of the cooperative society shall not be
competent to pass a resolution negativing the findings of the inspection”.
(ii) in sub-section (3),
“(a) for the word “inquiry” wherever it occurs, the word “inspection”
shall be substituted.
(b) for the words “three months”, the words “forty five days” shall be
substituted.
37. Amendment of section 68.- In section 68,-
(i) in sub-section (1),
(a) for the words ‘remedy the defects”, the words “rectify the defects
and remedy the irregularities” shall be substituted.
 23

(b) the words “the audit under section 63 or” shall be omitted.
(ii) in sub-section(3), for the words ‘’who shall take action for
incorporation of ”, the words “who shall inform the society auditor
or auditing firm auditing the accounts of the society for
incorporation” shall be substituted.
38. Amendment of section 69.- In section 69 of the Principal Act,
after sub-section (4), the following proviso, shall be inserted, namely:-
“Provided that the State Government shall, on a report made by the
Registrar, may extend the period beyond eighteen months if it is satisfied
that, there are genuine/valid grounds for such extension”.

39. Amendment of section 70.- In section 70 of the Principal Act,-

(i) in sub-section (1) after the words “cooperative society”, the words
“other than a dispute pertaining to the election of the board and
election of the office-bearers” shall be inserted;

(ii) in sub-section (2) clause (c) shall be omitted;

(iii) after sub-section (3) the following shall be inserted, namely:-
“(4) All disputes related to the election of the members of the
board and the election of President, Vice-President, Chairman,
Vice-Chairman or any other office-bearer shall be filed in the
jurisdictional Civil Court.
(5) All disputes pending with the Registrar as on the date of the
constitution of cooperative election commission shall be disposed of
by the Registrar as if this amendment had not been made”.
40. Amendment of section 71.- In section 71 of the Principal Act,
after sub-section (5), the following proviso, shall be inserted, namely:-
“Provided that the State Government shall, on a report made by the
Registrar, may extend the period beyond eighteen months if it is satisfied
that, there are genuine/valid grounds for such extension”.
41. Amendment of section 72.- In section 72 of the Principal Act,-
(i) in sub-section (1),
(a) for the words “an inquiry”, the words, “an audit has been
conducted under section 63 or an inquiry” shall be
substituted.
(b) for the words “he may issue an order”, the words “he may, after
giving the society an opportunity of making its representation,
issue an order” shall be substituted.
 24

(ii) in sub-section (2), in clause (b), for the words, “or has ceased to
work”, the words “within a period of six months of the date of its
registration or has ceased to function for six months” shall be
substituted.
(iii) after sub-section (4), the following shall be inserted, namely:-
“(5) Notwithstanding anything in this section, the Registrar shall
make an order for the winding up of a cooperative society, if the general
body of the society, by a resolution passed by two thirds majority of the
members present and voting in a general meeting decides for the winding up
of that society”.
42. Amendment of Section 98B.- In section 98B of the Principal
Act,, after the words, “over riding effect”, the words, “except the provisions of
sections 12, 16, 17, 19A, 20, 27, 27A, 27B, 28, 28A, 29C, 29E, 29F, 29G,
30, 31, 39A, 39AA, 56, 57A, 63, 64, 65, 70, 72, 108 & 109” shall be
inserted.
43. Omission of section 98 P.- section 98P of the Principal Act, shall
be omitted.
44. Omission of section 98T.- section 98T of the Principal Act, shall
be omitted.
45. Amendment of section 105A.- In section 105A of the Principal
Act,,(i) in sub-section (1), for the word “Registrar”, the words “general body”,
shall be substituted.
(ii) for sub-section (3), the following shall be substituted; namely:-
“(3)The general body of the cooperative society shall, after giving
a reasonable opportunity to the person concerned to make his
representation, if any, in writing and after considering the reasons
for refusal of membership by the board, direct either that the
person shall be admitted as a member by the cooperative society or
that he need not be admitted by the cooperative society, and in the
former case, the board shall give effect to the decision within ten
days of the resolution of the general body”.
(iii) sub-section (4) and (5) shall be omitted.
46. Amendment of section 106.- In section 106 of the Principal
Act,, after sub-section (5), the following proviso, shall be inserted, namely:-
“Provided that the State Government shall, on a report made by the
Registrar, may extend the period beyond eighteen months if it is satisfied
that, there are genuine/valid grounds for such extension.”
47. Amendment of section 108.- In section 108 of the Principal Act,
for the words, “an appeal has been made to the State Government under
 25

section 106”, the words “an appeal has been made to the State Government
or other authorities under section 106” shall be substituted.
48. Amendment of section 109.- In section 109 of the Principal Act,
after sub-section(16), the following shall be inserted, namely:-
“(17) The members of the board who fails and the chief executive
who fail to submit the accounts and the information required by the
auditor as per section 63 within the stipulated time shall be
punishable with imprisonment for a term which may extend to six
months or with a fine which may extend to five thousand rupees or
with both;
(18) Every member of the board who fails and the chief executive
who fails to get its accounts for the previous year audited as per
section 63 within the stipulated time and present the same before the
annual general meeting shall be punishable with imprisonment for a
term which may extend to six months or with a fine which may
extend to ten thousand rupees or with both;
(19) Every member of the board who and the chief executive who
fail to file annual returns with the Registrar as per section 27B shall
be punishable with imprisonment for a term which may extend to six
months or with fine which may extend to five thousand rupees or
with both;
(20)Every member of the board which fails and the chief
executive who fails to provide necessary books, records and
information within time and assist the cooperative election
commission for the conduct of elections within the time stipulated
under section 39AA shall be punishable with imprisonment for a
term of six months or with fine of ten thousand rupees or with both;
(21)Any person who, before, during or after the election of the
members of the board or office-bearers, adopts any corrupt practice
under section 39C or commits any electoral offences under section
39K shall be punishable with imprisonment for a term which may
extend to six months or with fine which may extend to ten thousand
rupees or with both.”
49. Amendment of section 113.- In section 113 of the Principal Act,
In sub-section (2) in the proviso, the words “with the previous permission of
the Registrar” shall be omitted.
50. Amendment of section 117.- In section 117 of the Principal Act,,
sub-section (2) shall be omitted.
51. Amendment of section 118.- In section 118 of the Principal Act,
in sub-sections (1), for clauses (b) and (c), the following shall be substituted,
namely:-
 26

“(b) the removal of a member or the removal and

disqualification of a director or the removal of a board;
(c) any surcharge application required under section 69 or any
dispute required under section 70 to be referred to the Registrar or
the recovery of moneys under section 100 or the execution of any
award or order referred to the Registrar for execution under section
101;”
52. Amendment of section 124.- In section 124 of the principal Act,
in the proviso, for the words “issued by certificate of posting”, the following
words shall be substituted, namely :-
“published on the notice boards of the society at its registered office and
its branches, and,-
(a) sent by bulk posting at places wherever the facility is available; or
(b) sent by E-mail and S.M.S.; or
(c) sent by ordinary post and published in,-
(i) one Kannada news paper having wider circulation at places
where the co-operative societies whose area of operation is less
than a district, are situated or
(ii) one Kannada newspaper and one English newspaper having
wider circulation at places where the co-operative societies,
whose area of operation extends to a district and above and to
the whole of the state, are situated;”.
53. Amendment of section 129.- In section 129 of the Principal Act,
in sub-section (2),-
(i) after clause (e), the following shall be inserted, namely:-
“(e-1) right of a member to get information regarding his
transaction of business with the society.
(ii) for clause (g), the following shall be substituted; namely:-
“(g) The conditions of service of cooperative election
commissioner”;
(iii) for the clause (l), the following shall be substituted; namely:-
“(l) the procedure for conduct of general meetings including
representative general meetings and board meetings and
requisitioning of a general meeting and board meeting”;
(iv) after clause(l), the following shall be inserted, namely:-
“(l-1) the procedure for the consideration of no confidence against
any director”.
(v) in clause (m), the words “the members of the committee and”
shall be omitted.
 27

(vi) in clause (o), for the word “qualification”, the words “qualification,
experience and procedure” shall be substituted.
(vii) after clause (t) the following shall be inserted, namely:-
“(t-1) procedure for the maintenance and administration
of education fund by the Karnataka State Cooperative
Federation;
(t-2)- the cost of preparation of the electoral rolls for, and
the conduct of, the elections by the election commission”.
(viii) in clause (y), for the word “Societies” and the remuneration
payable to the auditor or auditing firm;” shall be substituted.
(ix) for clause (ii), the following shall be substituted; namely:-
“(ii) Procedure for empanelment of the auditors and auditing firms
to be sent to the cooperative societies”.
54. Power to remove difficulties.-(1) If any difficulty arises in giving
effect to the amendments made by this Act, the State Government may, by
order published in the official Gazette, make such provisions not
inconsistent with the provisions of the Principal Act, and the Constitution
(ninety seventh amendment) Act,, 2011 as appear to it to be necessary or
expedient for removing the difficulty.
Provided that no such order shall be made under this section after the
expiry of two years from the date of commencement of this Act,-
(2) Every order made under this section shall, as soon as may be,
after it is made, be laid before the State Legislature.

By Order and in the name of

the Governor of Karnataka,

(G.K. BOREGOWDA)
Secretary to Government,
Department of Parliamentary Affairs
and Legislation
28