SOCIETIES

(a) societies (herein called ” mutual provident societies “) established for the object of promoting thrift, of giving relief to members in times of sickness or distress, of aiding them when in pecuniary difficulties, and for making provision for their widows and orphans ;

(b) societies for any purpose which the Minister may, by notification in the Gazette, authorize as a purpose to which the powers and facilities of this Ordinance ought to be extended (herein called ” specially authorized societies “).

(1) No society can be registered under this Ordinance which does not consist of seven persons at least, and has not a subscribed capital of al least ten thousand rupees.

(2) For the purpose of registry an application to register the society, signed by seven members and the secretary, and two written or printed copies of the rules, shall be sent to the Registrar.

(3) No society shall be registered under a name identical with that under which any other existing society is registered, or so nearly resembling such name as to be likely, in the opinion of the Registrar, to deceive the members of the public as to its identity ; and no society shall change its name without sanction of the Registrar, or otherwise than as hereinafter provided.

(4) The words ” Society, Limited ” shall be the last words in the name of every society registered under this Ordinance.

(5) The Registrar, on being satisfied that a society has complied with the provisions as to registry in force under this Ordinance, shall issue to such society an acknowledgment of registry.

(6) If the Registrar refuses to register any society, or any rules, the society may appeal from such refusal to the Court of Appeal , *[who may make rules and orders as to the form of appeals and the hearing thereof and otherwise relating thereto]

(7) If the refusal of registry be overruled on appeal, an acknowledgment of registry shall thereupon be given to the society by the Registrar.

(8) The acknowledgment of registry shall be conclusive evidence that the society therein mentioned is duly registered, unless it be proved that the registry of the society has been suspended or cancelled.

(1) The Registrar may cancel the registry of a society, by writing under his hand-

(2) The Registrar in any case in which he might with the approval of the Minister, cancel the registry of a society, may suspend the same, by writing under his hand, for any term not exceeding three months, and may, with the approval of the Minister, renew such suspension from time to time for the like period.

(3) Not less than two months’ previous notice in writing, specifying briefly the ground of any proposed cancelling or suspension, of registry, shall be given by the Registrar to a society before the registry of the same can be cancelled (except at its request) or suspended; notice of every cancelling or suspension shall be published in the Gazette as soon as practicable after the same takes place.

(4) A society may appeal from the cancelling of its registry or from any suspension of the same which is renewed after six months, in manner herein provided for appeals from the Registrar’s refusal to register.

(5) A society whose registry has been suspended or cancelled shall, from the time of such suspension or cancelling (but if suspended, only whilst such suspension lasts, and subject also to the right of appeal hereby given), absolutely cease to enjoy as such the privileges of a registered society, but without prejudice to any liability actually incurred by such society, which may be enforced against the same as if such suspension or cancelling had not taken place.

(1) The rules of every society sent for registry shall contain provisions in respect of the several matters mentioned in the Schedule.

(2) No amendment of a rule made by a registered society shall be valid until the same has been registered under this Ordinance, for which purpose copies of the same, signed by three members and the secretary, shall be sent to the Registrar.

(3) The provision herein contained as to appeals from a refusal of registry shall apply to amendments of rules.

(4) The Registrar shall, on being satisfied that any amendment of a rule is not contrary to the provisions of this Ordinance, issue to the society an acknowledgment of registry of the same, which shall be conclusive evidence that the same is duly registered.

(5) A copy of the rules of a registered society shall be delivered by the society to every person on demand on payment of a sum not exceeding twenty-five cents.

(1) Every society shall-

(2) Every return and other document required for the purposes of this Ordinance, shall be made in such form, and shall contain such particulars, as the Registrar prescribes.

(3) All documents required by this section to be sent to the Registrar shall be deposited with the rules of the societies to which the same respectively relate, and shall be registered or recorded by the Registrar with such observations thereon, if any, as the Registrar shall direct.

(1) The registration of a society shall render it a body corporate by the name described in the acknowledgment of registry, by which it may sue and be sued, with perpetual succession and a common seal, and with limited liability, and shall vest in the society all property for the time being vested in any person in trust for the society.

(2) The rules of the society shall bind the society and all members thereof, and all persons claiming through them respectively, to the same extent as if each member had subscribed his name thereto, and there were contained in such rules a covenant on the part of himself, his heirs, executors, and administrators to conform thereto, subject to the provisions of this Ordinance.

(3) All moneys payable by a member to the society shall be a debt due from such member to the society, and whatever may be the amount claimed shall be recoverable in an action filed in the District Court.

(4) A member of the society not being under the age of sixteen years may, by writing under his hand delivered at or sent to the registered office of the society, nominate any person, not being an officer or servant of the society, unless such officer or servant is the husband, wife, father, mother, child, brother, sister, nephew, or niece of the nominator, to whom his interest in the society shall be payable at his decease, provided that the amount credited to him in the books of the society does not exceed five hundred thousand rupees, and may from time to time revoke or vary such nomination by a writing under his hand similarly delivered or sent, but not otherwise; and every such society shall keep a book wherein the names of all persons so nominated shall be regularly entered, and the interest comprised in any such nomination shall be payable to the nominee, and on receiving satisfactory proof of the death of a nominator the committee of the society shall pay to every person entitled thereunder the full value of his interest.

(5) If any member of a society entitled to any interest in the society not exceeding five hundred thousand rupees dies intestate, and without having made any nomination under this Ordinance which remains unrevoked at his death, such interest shall be transferable or payable, without letters of administration, to or among the persons who appear to a majority of the committee, upon such evidence as they may deem satisfactory, to be entitled by law to receive the same.

(6) Whenever the committee, after the decease of any member, makes any payment to any person who at the time appears to them to be entitled under this section, the payment or transfer shall be valid and effectual against any demand made upon the committee or the society by any other person.

(7) When any person in whose name any property belonging to any such society is standing, either jointly with another or others, or solely, as a trustee therefor, is absent from Sri Lanka, or becomes bankrupt, or files any petition, or executes any deed for liquidation of his affairs by assignment or arrangement, or for composition with his creditors, or becomes a person of unsound mind, or is dead, or has been removed from his office of trustee, or if it be unknown whether such person is living or dead, the Registrar, on application in writing from the secretary and three members of the society, and on proof satisfactory to him, may direct the transfer of the property into the names of any other persons as trustees for the society ; and such transfer shall be made by the surviving or continuing trustees, and if there be no such trustees, or if such trustees refuse or be unable to make such transfer, then by the Registrar, who is hereby indemnified for anything done by him in pursuance of this provision against any claim or demand of any person injuriously affected thereby.

(8) A person under the age of eighteen years, but above the age of sixteen, may be a member of a society, unless provision is made in the rules thereof to the contrary, and may, subject to the rules of the society, enjoy all the rights of a member (except as herein provided), and execute all instruments and give all acquaintances necessary to be executed or given under the rules, but shall not be a member of the committee, trustee, manager or treasurer of the society.

(9) A promissory note or bill of exchange shall be deemed to have been made, accepted, or endorsed on behalf of any society if made, accepted or endorsed in the name of the society, or by or on behalf or on account of the society, by any person acting under the authority of the society.

(10) Any register or list of members kept by any society shall be prima facie evidence of any of the following particulars entered therein:-

(11) Contracts on behalf of the society may be made, varied, or discharged as follows :-

and all contracts which may be or have been made, varied, or discharged, according to the provisions herein contained, shall, so far as concerns the form thereof; be effectual in law, and binding on the society and all other parties thereto, their heirs, executors, or administrators, as the case may be.

(1) A society may (if its rules do not direct other- wise) hold, purchase, or take on lease in its own name any land, and may sell, exchange, mortgage, lease, or build upon the same (with power to alter and pull down buildings, and again rebuild), and no purchaser, assignee, mortgagee, or tenant shall be bound to inquire as to the authority of any such sale, exchange, mortgage, or lease by the society, and the receipt of the society shall be a discharge for all moneys arising from or in connection with such sale, exchange, mortgage, or lease.

(2) The rules may provide for the advancing of money by the society to members on the security of movable or immovable property.

(3) In the rules or any schedule thereto may be set forth the forms of conveyance, surrender, admittance, mortgage, transfer, agreement, bond, or other instrument necessary for carrying the purposes of the society into effect.

(4) The profits of the society may be applied to any lawful purpose.

(5) A receipt under the hands of two members of the committee of the society, countersigned by the secretary in the form contained in the Schedule, or in any form specified by the rules of the society or any schedule thereto, for all moneys secured to the society by any mortgage or other assurance endorsed upon such mortgage or other assurance, shall vacate the same.

(6) A society may, if its rules so allow, invest any portion of the funds of the society, not immediately required for its purposes, upon real or leasehold securities, or in the shares, or on the security of any other society registered under this Ordinance, or of any company registered under the Companies Ordinance, with limited liability, or in the public funds, Government stock, or securities of * [Great Britain, India, Burma or ] Sri Lanka; and a society so investing may make such investment in its registered name, and shall be deemed to be a person within the meaning of the of Companies Ordinance.

(1) Every officer, if the rules of the society require, shall before taking upon himself the execution of his office, become bound, either with or without a surety as the committee require, in a bond according to the form set forth in the Schedule or such other form as the committee of the society approve, or give the security of a guarantee society in such sum as the committee directs, conditioned for his rendering a just and true account of all moneys received and paid by him on account of the society at such times as its rules appoint or as the society or the committee thereof require him to do, and for the payment by him of all sums due from him to the society.

(2) Every officer, his executors, or administrators shall at such times as by the rules of the society he should render account, or upon demand made, or notice in writing given or left at his last or usual place of residence, give in his account as may be required by the society or by the committee thereof, to be examined and allowed or disallowed by them, and shall, on the like demand or notice, pay over all moneys and deliver all property for the time being in his hands or custody to such person as the society or the committee appoint, and in case of any neglect or refusal to deliver such account, or to pay over such moneys, or to deliver such property in manner aforesaid, the society may sue upon the bond or security before mentioned.

(1) Every dispute between a member or person claiming through a member or under the rules of a registered society, and the society or an officer thereof, shall be decided in manner directed by the rules of the society, if they contain any such direction, and the decision so made shall be binding and conclusive on all parties without appeal, and shall not be removable into any court or restrainable by injunction ; and application for the enforcement thereof may be made to the District Court.

(2) The parties to a dispute in a society may, by consent, (unless the rules of such society expressly forbid it), refer such dispute to the Registrar, who shall hear and determine such dispute, and shall have power to order the expenses of determining the same to be paid, either out of the funds of the society or by such parties to the dispute as he shall think fit ; and such determination and order shall have the same effect and be enforceable in like manner as a decision in the manner directed by the rules of the society.

(3) The Registrar may administer oaths and may require the attendance of all parties concerned and of witnesses, and the production of all books and documents relating to the matter in question ; and any person refusing to attend, or to produce any documents, or to give evidence before such Registrar, shall be guilty of an offence under this Ordinance.

(4) Where the rules of a society contain no direction as to disputes, or where no decision is made on a dispute within forty days after application to the society for a reference under its rules, the member or person aggrieved may apply to the District Court, which may hear and determine the matter in dispute.

(5) The court or Registrar may at the request of either party, state a case for the opinion of the Court of Appeal on any question of law, and may also grant to either party such discovery as to documents and otherwise, or such inspection of documents, as might be granted by a District Court, such discovery to be made on behalf of the society by such officer of the same as such court or Registrar may determine.

(1) Upon the application of one-fifth of the number of members of a registered society or of one hundred members in the case of a society of more than five hundred members, the Registrar with the consent of the Minister in every case may-

(2) The application herein mentioned shall be supported by evidence, for the purpose of showing that the applicants have good reason for requiring such inspection to be made or meeting to be called, and that they are not actuated by malicious motives in their application, and such notice thereof shall be given to the society as the Registrar shall direct.

(3) The Registrar may, if he thinks fit, require the applicants to give security for the costs of the proposed inspection or meeting before appointing any inspector or calling such meeting.

(4) All expenses of and incidental to any such inspection or meeting shall be defrayed, either by the members applying for the same or out of the funds of the society, as the Registrar shall direct.

(1) A special resolution is one which is passed by a majority of not less than three-fourths of such members of a society for the time being entitled under the rules to vote as may be present, in person or by proxy (where the rules allow proxies), at any general meeting, of which notice specifying the intention to propose such resolution has been duly given according to the rules, and which resolution is confirmed by a majority of such members for the time being entitled under the rules to vote as may be present, in person or by proxy, at a subsequent general meeting of which notice has been duly given, held not less than fourteen days nor more than one month from the day of the meeting at which such resolution was first passed. At any meeting mentioned in this section a declaration by the chairman that the resolution has been carried shall be deemed conclusive evidence of the fact.

(2) A society may, by special resolution, with the approval in writing of the Registrar, change its name, but no such change shall affect any right or obligation of the society, or of any member thereof ; and any pending legal proceedings may be continued by or against the society notwithstanding its new name.

(3) Any two or more societies may, by special resolution of both or all such societies, become amalgamated together as one society, with or without any dissolution or division of the funds of such societies or either of them ; and any society may by special resolution transfer its engagements to any other registered society which may undertake to fulfil the engagements of such society.

(4) A society may, by special resolution, determine to convert itself into a company under the * Companies Ordinance, or to amalgamate with or transfer its engagement to any such company.

(5) No amalgamation or transfer of engagement shall prejudice any right of a creditor of either or any society party thereto.

(6) A copy of every special resolution for any of the purposes mentioned in this section, signed by the chairman of the meeting and countersigned by the secretary, shall be sent to the Registrar for registration, and until such copy has been registered such special resolution shall not take effect.

(7) If a society be registered as, or amalgamates with, or transfers all its engagements to, a company, the registry of such society under this Ordinance shall thereupon become void and the same shall be cancelled by the Registrar ; but the registration of a society as a company shall not affect any right or claim for the time being subsisting against such society, or any penalty for the time being incurred by such society ; and for the purpose of enforcing any such right, claim, or penalty, the society may be sued and proceeded against in the same manner as if it had not become registered as a company ; and every such right or claim, or the liability to such penalty, shall have priority as against the property of such company over all other rights or claims against or liabilities of such company.

(1) A society may terminate or be dissolved-

(2) Where a society is wound up the liability of a present or past member of the society to contribute for payment of the debts and liabilities of the society, the expenses of winding up, and the adjustment of the rights of contributories amongst themselves, shall be qualified as follows:-

(3) Where a society is terminated by an instrument of dissolution the following provisions shall apply: –

(1) The Minister may, from time to time make regulations respecting registry and procedure under this Ordinance, and the forms to be used for such registry, and the duties and functions of the Registrar, and the inspection of documents kept by the Registrar, under this Ordinance, and generally for carrying this Ordinance into effect.

(2) All such regulations shall be published in the Gazette.

(3) Until otherwise provided, the forms contained in the Schedule shall be used.

(a) if any person with intent to mislead or defraud gives to any other person a copy of any rules, laws, regulations, or other documents other than the rules for the time being registered under this Ordinance, on the pretence that the same are existing rules of a registered society, or that there are no other rules of such society, or gives to any person a copy of any rules on the pretence that such rules are the rules of a registered society, when the society is not registered ;

(b) if any person obtains possession by false representation or imposition of any property of a society, or, having the same in his possession, withholds or misapplies the same, or wilfully applies any part thereof to purposes other than those expressed or directed in the rules of the society and authorized by this Ordinance;

(c) if any person wilfully makes, orders, or allows to be made any entry or erasure in or omission from any balance sheet of a registered society, or any contribution or collecting book, or any return or document required to be sent, produced, or delivered for the purposes of this Ordinance, with intent to falsify the same, or to evade any of the provisions of this Ordinance ;

(d) if any officer of the society or any person on its behalf uses any seal purporting to be a seal of the society whereon its name is not so engraved as aforesaid, or issues or authorizes the issue of any notice, advertisement, or other official publication, of the society, or signs or authorizes to be signed on behalf of the society any bill of exchange, promissory note, endorsement, cheque, order for money or goods, or issues or authorizes to be issued any bills of parcels, invoice, receipt, or letters of credit of the society wherein its name is not mentioned in manner aforesaid ;

(e) if a registered society or branch or an officer or member thereof fails, for a period of six weeks after request made specially thereto in writing by the Registrar, either to give any notice or to send any return, statement or document, or to do or allow to be done anything which the society, branch, officer or member is by this Ordinance required to give, send, do or allow to be done,