Cooperative Farming Act, 1976

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THE CO-OPERATIVE FARMING ACT, 1976 
 
 
              
 
 
 
 
CONTENTS 
 
CHAPTER I 
PRELIMINARY 
 
1.  Short title, extent and commencement 
2.  Act to override other laws 
3.  Definitions 
 
CHAPTER II 
REGISTRATION OF SOCIETIES 
 
4.  Conditions of registration 
5.  Procedure of registration 
6.  Evidence of registration 
7.  Amendment of the bye­laws of a society 
 
CHAPTER III 
MEETINGS 
 
8.  General meeting 
9.  Special general meeting 
 
CHAPTER IV 
MANAGING COMMITTEE AND RIGHTS AND LIABILITIES OF MEMBERS. 
 
10.  Managing committee of a society 
11.  Pooling of land 
12.  Liability of members 
13.  Evaluation of land, etc. 
14.  Withdrawal from membership 
15.  Admission of new members 
 
 
 
 

 
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CHAPTER V 
PRIVILEGES AND LIABILITIES OF SOCIETIES 
 
16.  Societies to be bodies corporate 
17.  Office of society 
18.  Copy of Act, etc., to be open to inspection 
19.  Liability in respect of encumbrances on land 
20.  Audit and accounts 
21.  Transfer of interest on death of a member 
 
CHAPTER VI 
PROPERTY AND FUNDS OF THE SOCIETY 
 
22.  Assets of the Society 
23.  Provisions for Reserve Fund, Development Fund and other expenses 
24.  Distribution of produce income of co­operative farm 
25.  Distribution of profits 
26  Rights of tenants, etc. 
 
CHAPTER VII 
LIQUIDATION AND WINDING UP 
 
27.  Winding up 
28.  Winding up if membership is reduced 
29.  Effect of winding up 
30.  Power of Chairman of District Co­operative Federation to assess damage 
31. Bar of suit 
32.  Arbitration 
33.  Attachment before award 
34.  Recoveries of dues 
 
CHAPTER VIII 
FEDERATION OF THE SOCIETIES 
 
35.  District Co­operative Federation 
36.  Fund and functions of District Co­operative Federation 
37.  Provincial Co­operative Federation 
38.  Fund and functions of the Provincial Co­operative Federation 
39. District Co­operative Council 
40.  Functions of the District Co­operative Council 
41.  Provincial Co­operative Council 
42.  Functions of the Provincial Co­operative Council 
43.  National Co­operative Council 
44.  Functions of the National Co­operative Council 
 
 
 
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CHAPTER IX 
INSPECTION OF AFFAIRS 
 
45.  Inquiry by Chairman District Co­operative Federation 
46.  Inspection of books of indebted society 
47.  Power of Chairman, District Co­operative Federation to exercise powers under 
 section 30 in the course of an inquiry or inspection 
 
48.  Costs of inquiry 
49.  Recovery of costs 
 
CHAPTER X 
MISCELLANEOUS 
 
50.  Amalgamation or transfer of societies 
51.  Powers to exempt from stamp duty or registration fee, etc. 
52.  Exemption from Income­tax 
53.  Notice necessary in suits 
54.  Power of revision 
55.  Transitional provisions 
56.  Power to make rules 
57.  Repeal 
 
  
 
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THE CO-OPERATIVE FARMING ACT, 1976 
  
ACT NO. LII OF 1976 
 
[19th July, 1976] 
 
An Act to provide for the formation, working and promotion of co-operative farming 
 
WHEREAS it is expedient to provide for the formation, working and promotion of co- 
perative farming and setting up of allied agro-based industries on the basis of self-help and mutual 
aid amongst the farmers and matters ancillary thereto or connected therewith ; 
 
 AND WHEREAS  the  Provincial  Assemblies  of  the  Provinces  of  Baluchistan,  the 
North-West Frontier, the Punjab and Sind have passed resolutions under clause (1) of Article 144 
of the Constitution of the Islamic Republic of Pakistan to the effect that Parliament may, by law, 
regulate the formation, working and promotion of co-operative farming and setting up  of allied 
agro-based  industries  on  the  basis of self-help  and  mutual  aid  amongst  the farmers ; 
 
It is hereby enacted as follows:― 
 
CHAPTER I 
PRELIMINARY 
 
 1.  Shot title, extent and commencement.―(1)  This  Act  may  be  called  the Co-operative 
Farming Act, 1976. 
 
(2) It extends to the whole of Pakistan.  
 
(3) It shall come into force at once.  
 
 2. Act to override other laws.―The provisions of this Act and the rules shall have effect 
notwithstanding anything contained in the Co-operative Societies Act, 1925 (Act VII of 1925), or 
in any other law for the time being in force relating to the rights of landlords and tenants. 
 
3.  Definitions.―In  this  Act,  unless  there  is  anything  repugnant  in  the  subject  or 
context,― 
 
(a)       ‘agricultural year’ has the same meaning as in the West Pakistan Land Revenue 
 Act, 1967 (W. P. Act No. XVII of 1967) ; 
 
(b)       ‘bye-laws’ means bye-laws registered under this Act ; 
 
(c)       ‘committee’ means the managing committee of a society ; 
 
(d)       ‘co-operative farm’ means the total land pooled by the members of a society ; 
 
 (e)        ‘District Co-operative Council’ means a District Co-operative Council formed 
under section 39 ; 
 
 (f)       ‘District Co-operative Federation’ means a District Co-operative Federation of 
 Co-operative Farming Societies formed under section 35 ; 
 
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(g)       ‘member’ means a member of a society ; 
 
(h) ‘National Co-operative Council’ means the National Co-operative Council 
constituted under section 43 ; 
 
(i) ‘nation building department’ means the departments which the Provincial 
Government may, by notification in the official Gazette, designate as such for 
the purposes of this Act ; 
 
(j) ‘net profits’ means net profits as defined in sub-section (3) of section 87C 
of the Companies Act, 1913 (VII of 1913) ; 
 
(k) ‘office-bearers’ means the Chairman, Vice-Chairman, Secretary and 
Treasurer of a Committee ; 
 
(l)        ‘prescribed’ means prescribed by rules ; 
 
(m) ‘produce index units’ means the measures in terms of which the comparative 
productivity of an area of land of a particular kind in a particular assessment 
circle or  area is  computed and expressed for the p urposes of the  schemes 
relating to the re-settlement of displaced persons on land and, in respect of any 
assessment circle or  area wh ere no  such units have been determined, such 
measures as may be prescribed ; 
 
(n) ‘produce income’ means  the total income derived from  all earnings of 
the co-operative farm before deducting any expenses ; 
 
(o) ‘Provincial Co-operative Council’ means a Provincial Co-operative Council 
formed under section 41; 
 
(p) ‘Provincial Co -operative Federation’ means a Provincial Co -operative     
Federation of Co-operative Farming Societies formed under section 37 ;  
 
(q)       ‘Registrar’ means a person appointed to perform the duties of Registrar of 
 Co-operative Societies under the Co-operative Societies Act, 1925 (Act VII of 
 1925), and includes an officer authorised by Government to perform the duties 
of Registrar under this Act ; 
 
(r)        ‘rules’ means rules made under this Act ; 
 
(s)       ‘society’ means a co-operative farming society registered under this Act ; 
 
(t)        ‘tenant’ means tenant as defined in the Punjab Tenancy Act, 1887 (Punjab Act 
 No. XVI of 1887) ; and 
 
(u)       ‘value’ in relation to land, means the value as evaluated under section 13. 
 
 
 
 
 
 
 
 
 
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CHAPTER II 
REGISTRATION OF SOCIETIES 
 
4. Conditions of registration.―(1) A co-operative farming society which fulfils the 
following conditions may apply to the Registrar for registration under this Act, namely :― 
 
(a)     it consists of not less than twenty members ; 
  
(b)      the total land pooled by its members is— 
 
(i) in the case of the Provinces of Baluchistan, the Punjab and Sind, not 
less than five hundred acres ; and 
 
(ii) in case of the North-West Frontier Province, not less than three 
hundred acres ; and 
 
(c)       the land pooled by its members forms one contiguous farm. 
 
(2) An application under sub-section (1) shall be made in such form, and be accompanied by 
such documents, as may be prescribed. 
 
5. Procedure of registration.―If, after making such enquiry as he considers necessary, the  
Registrar  is  satisfied  that  a  co-operative  farming  society applying  for  registration  is eligible for 
registration under this Act, and that the bye-laws proposed to be framed by it are not inconsistent 
with any of the provisions of this Act, or the rules, he shall register it, and its bye-laws, within fifteen 
days from the receipt of its application. 
 
6. Evidence of registration.―A certificate of registration signed by the Registrar shall be 
conclusive evidence that the society mentioned therein is duly registered, unless it is proved 
that the registration of the society has been cancelled. 
 
 
 
7. Amendment of the bye-laws of a society.―(1) No amendment of the bye-laws of a society 
shall be effective unless it is registered with the Registrar. 
 
(2) If the Registrar is satisfied that an amendment of the bye-laws proposed to be made 
by a society is not inconsistent with any of the provisions of this Act or the rules he shall register 
the amendment. 
 
CHAPTER III 
 MEETINGS 
 
8.  General meeting.―Every society shall call an annual general   meeting  of  its members 
and not less than one other general meeting in an agricultural year.
9. Special general meeting.―(1) On a requisition signed by not less than one-fifth of the 
total number of members of a society, the Chairman shall call a special general meeting of the society 
within thirty days of the receipt of the requisition. 
 
 
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(2) If the Chairman does not call the meeting within the time specified in sub-section (1), the 
Registrar shall direct the Chairman to call the meeting with in a period of seven days and, if the  
Chairman fails to do so, may himself call the meeting. 
 
CHAPTER IV 
MANAGING COMMITTEE AND RIGHTS AND LIABILITIES OF MEMBERS. 
 
10. Managing committee of a society.―(1) Each member shall have one vote irrespective 
of the area  of the land pooled by him ; provided that in case of a deceased member all his 
heirs who want to remain members shall be registered and shall have the right to vote. 
 
 (2) The members shall, in their annual general meeting, elect, by majority of votes,— 
 
(a)       a managing committee consisting of not less than seven and not more than 
eleven members, including the office-bearers ; and 
 
(b)       one representative for the District Co-operative Federation. 
 
(3) A member of a committee, including an office-bearer, and the representative shall, unless 
he resigns or is removed from office earlier, hold office for a term of two years. 
 
(4) No member of a committee or an office-bearer or the representative shall hold office 
for more than two consecutive terms. 
 
(5) Subject to such decisions, if any, as may be taken in a general meeting of a society, 
the management of the affairs of a society shall vest in the committee. 
 
(6) A member of a committee, including an office-bearer or the representative, may be 
removed from office by a resolution passed by a majority of the total number of members of a 
society in an annual general meeting or a meeting requisitioned for this purpose by not less than 
one-third of the total number of members. 
 
(7) Any member of a committee, including an office-bearer, may by writing under his hand 
addressed to the Chairman, resign his office. 
 
11. Pooling of land.―(1) Every member shall, subject to the provisions of clause (c) of sub-
section (1) of section 4, pool his entire holding without affecting his ownership of the holding in any 
way : 
 
Provided that a member or group of members owning a subsistence holding may retain 
for his or their personal use an area not exceeding— 
 
(a)       in the case of Baluchistan, two acres ; and 
 
(b)       in the case of the other Provinces, one acre : 
 
Provided further that a member or group of members pooling more than a subsistence holding 
may retain for his or their personal use such area not exceeding— 
 
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(a)       in the case of Baluchistan, four acres, and 
 
(b)       in the case of the other Provinces, two acres ;  
 
as may be determined by the committee : 
 
Provided further that the location of the area to be so retained may be determined by the 
committee : 
 
Provided further that a member owning less than a subsistence holding shall not be entitled to 
retain any land for his personal use. 
 
Explanation.― In this section, ‘subsistence holding’ shall have the same meaning as in the 
Land Reforms Regulation, 1972. 
 
(2) All land pooled for a co-operative farm by members shall, for the purposes of management, 
vest in the society. 
 
12. Liability of members.―The liability of a member shall be limited to the value of the 
land pooled by him. 
 
13.  Evaluation of land,  etc.―(1)  The  land  pooled  by  each  member  for  a co-operative 
farm shall be evaluated by the Managing Committee according to its quality and area on the basis of 
produce index units. 
 
(2) If any land pooled by a member for a co-operative farm contains orchards, ponds or any 
other immovable structures, the value of the orchards, ponds and other structures shall be assessed 
by the Managing Committee and added to the shares of such member : 
 
Provided  that  trees  other  than  orchards  shall  continue  to  be  the  property  of  the member 
and the value thereof shall not be assessed or added to his share : 
 
Provided further that, if the committee decides to remove such trees or structures standing on 
any land, such trees or structures shall be removed on payment to the owner of such land of such 
compensation as may be determined by the committee. 
 
14. Withdrawal from membership.―(1) A member who has been a member of a society for 
not less than three years may, by notice under his hand addressed to the Chairman and delivered to 
him by the thirty-first day of March in any year, withdraw from membership of the society. 
 
(2) Where, due to the death of a member, the rights and liabilities of the member devolve upon 
his legal heirs or successors and any of the heirs or successors is a minor the rights and liabilities of 
the minor shall be the rights and liabilities of his guardian until such time as the minor attains majority. 
 
(3) A minor referred to in sub-section (2) may, after he attains majority, withdraw from 
the membership of the society in the manner provided for in sub-section (1) if the land owned by 
him has formed part of the co-operative farm for not less than three years. 
 
 
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 (4) On a member withdrawing from the membership of a society― 
 
(a)      he shall cease to be member on and from the first day of July following the 
day on which he gives notice of his withdrawal ; 
 
(b)        the land pooled by him shall revert to him on the aforesaid day subject to any 
encumbrances that may have been created on it by the society, to such extent 
as may be determined by the society ; 
 
(c)       he shall not be entitled to any share in the Development Fund or to any right or 
interest in anything established or purchased out of that Fund ; and 
 
(d)        he shall pay to the society, towards the cost of tubewells installed, residential 
houses, sheds or other structures raised, or improvements done, on his land by 
the society, such amount, and in such manner, as may be determined by the 
society. 
 
(5) As soon as may be after a person ceases to be a member, his name shall be notified 
to the Registrar for removal from membership. 
 
 
15. Admission of new members.―(l) Subject to the other provisions of this Act, a committee 
may admit to the membership of the society any owner of land who pools his land : 
 
Provided that no owner of land shall be so admitted except after the close of the agricultural 
year during which the society is registered. 
 
(2) As soon as may be after an owner of land is admitted as a member under sub- section (1), 
his name shall be notified to the Registrar. 
 
CHAPTER V 
PRIVILEGES AND LIABILITES OF SOCIETIES 
 
16. Societies to be bodies corporate.―A society shall be a body corporate by the name 
under which it is registered, having perpetual succession and a common seal, with power to hold 
property, both movable and immovable, and shall by the said name sue and be sued. 
 
17. Office of society.―Every society shall have its office at such place within the co-
operative farm as it may decide. 
 
18. Copy of Act, etc., to be open to inspection.―Every society shall keep open to inspection 
at all reasonable times at the registered address of the society, free of charge,— 
 
 
(a)       a copy of this Act,  
(b)       a copy of the rules governing such society,  
(c)       a copy of the bye-laws of such society, and  
(d)       a register of its members. 
 
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19. Liability in respect of encumbrances on land.―Where the land pooled by a member 
is subject to any encumbrances, such encumbrances shall continue to be the liability of such member. 
 
20. Audit and accounts.―(1) The accounts of a society shall be maintained in the prescribed 
manner, shall be audited every year by an auditor or auditors appointed at each Annual General 
Meeting out of a list of auditors prepared by the Registrar and shall be laid before the Annual General 
Meeting for adoption. 
 
 (2) An auditor appointed under sub-section (1) shall have power— 
 
(a)       to summon at the time of audit any officer, agent, servant and member, past or 
present, of the society whom he has reason to believe can give material 
information in regard to any transaction of the society or the management of 
its affairs ; and 
 
(b)       to require the production of a book or document relating to the affairs of, or 
any cash or security belonging to, the society, by the officer, agent, servant or 
member believed by the auditor to be in possession of such book, document, 
cash or security. 
 
(3) An auditor appointed under sub-section (1) shall hold office until the next Annual General 
Meeting and shall paid such fees as may be determined by the Annual General Meeting. 
 
21. Transfer of interest on death of a member.―On the death of a member, the rights, 
interests and liabilities of the member shall devolve on the legal heirs or successors of the member 
and such legal heirs or successors shall become the members of the society in place of the deceased 
member. 
 
CHAPTER VI 
PROPERTY AND FUNDS OF THE SOCIETY 
 
22. Assets of the Society.―(1) A society shall have its own assets consisting of its properties 
built or acquired out of the Development Fund and such funds and properties as may be prescribed. 
 
(2) A society may purchase any land or other property for the purposes of setting up its 
office or any agro-based industry or for such other projects of public utility. 
 
(3) Subject to such limits as may be prescribed, a society may, in so far as may be necessary 
for the purposes of the society, borrow money on the security of its property or of land forming part 
of the co-operative farm. 
 
(4) Where a society borrows money on the security of its property and also of the land forming 
part of the co-operative farm, the society shall, as far as practicable, repay the loan obtained by it on 
the security of such land in priority to the other loans. 
 
 23. Provisions for Reserve Fund, Development Fund and other expenses.―(1) Every 
society shall maintain a Reserve Fund and a Development Fund. 
 
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(2)  The  Reserve  Fund  shall  be  utilized  to  meet  natural  calamities  affecting  the co-
operative farm or other property of the society and for such other purposes, and in such manner, as 
the committee may determine. 
 
(3) The Development Fund shall be utilized for the development of the co-operative farm and 
establishment of agro-based industries, hospitals and schools and for such other purposes as may be 
determined by the society. 
 
(4) Every society may recover from the produce income of the co-operative farm sufficient 
amount to meet its office expenditure, for the contribution it has to make to the District Co-operative 
Federation and for the payment of fees to the auditors and of such travelling allowance and daily 
allowance to its representatives for attending meetings of the District Co-operative Federation as it 
may from time to time determine. 
 
24. Distribution of produce income of co-operative farm.―Out of the produce income  of  
the  co-operative  farm  the  direct  expenses  on  account  of  agricultural  inputs, including seeds, 
fertilizers, pesticides, water charges, land revenue, maintenance of tractors, tubewells   farm   animals   
and   agricultural   implements,   consumption   of   electricity, depreciation on fixed assets and the 
expenses referred to in sub-section (4) of section 23, shall first be deducted and the balance shall be 
distributed as follows, namely :― 
 
(a)         not less than five per cent each for the Reserve Fund and Development Fund 
shall be set apart ; and 
 
(b)       of  the  remaining  amount,  forty per  cent  shall  be  distributed  amongst  the 
members in proportion to the value of the land pooled by them and sixty per 
cent  amongst  the  workers,  including  working  members,  and  other  staff 
working on the farm according to the quality and quantity of the work done, as 
determined by the committee. 
 
25. Distribution of profits.―The net profits of a society from sources other than the co-
operative farm shall be distributed as follows, that is to say,— 
 
(a)       one-third shall be set apart for credit to the Development Fund and repayment 
of loans, in such proportion as may be determined by the society ; and 
 
(b)       the  remaining  two-thirds  shall  be  distributed  amongst  the  members  in 
proportion to the value of the land pooled by them. 
 
 
26. Rights of tenants, etc.―(1)The tenants of the land pooled by a member for a co-
operative farm shall stand ejected from such land upon its being so pooled. 
 
(2) The tenants ejected from any land by virtue of sub-section (1) shall be given preference 
in providing employment on the co-operative farm or in the agro-based industries of the society and, 
if a member withdraws from the society or the society is wound up, the tenancy rights of such tenants 
shall stand restored. 
 
 
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CHAPTER VII 
LIQUIDATION AND WINDING UP 
 
 27. Winding up.―(1) If one third of the total number of members of a society apply to the 
Chairman of the District Co-operative Federation for winding up the society and the Chairman, 
after such enquiry as he may deem fit, is of the opinion that the society ought to be wound up, he 
may issue an order directing it to be wound up, and when necessary may appoint a liquidator 
for the pu rpose from amongst the members of the  District Co-operative Federation and fix his 
remuneration. 
 
 (2) A copy of an order passed under sub-section (1) shall be sent to the Registrar. 
 
28. Winding up if membership is reduced.―(1) Where the membership of a society is 
reduced to less than twenty members or the area of the co-operative farm is reduced to less than the 
minimum area specified in clause (b) of sub-section (1) of section 4, the Chairman of the District Co-
operative Federation may, after allowing the society a period of sixty days to make up the deficiency 
by order in writing direct that the society be wound up, and when necessary, may appoint a liquidator 
for the purpose from amongst the members of the District Co-operative Federation and fix his 
remuneration. 
 
 (2) A copy of an order passed under sub-section (1) shall be sent to the Registrar. 
 
 29. Effect of winding up.―When a society is wound up― 
 
(a)       the s tanding crop of the co-operative farm shall be harvested and the produce 
income distributed in accordance with the provisions of this Act ; 
 
(b)       the land comprising the co-operative farm shall revert to the members together 
with improvements, if any, made by the society and subject to the 
encumbrances, if any, created thereon by the society and subject to payment 
by each member of the cost of such improvements on his land as at the time 
of the winding up ; 
 
 (c)       after all the liabilities of the society have been met, the assets of the society, 
including the Reserve Fund, shall, subject to clause (d), be divided amongst the 
members in proportion to the value of the land pooled by them ; and 
 
(d)      the hospitals, schools and other social institutions, if any, established by the 
society s hall stand transferred to, and vest in, the District Co-operative 
Federation and shall be managed by it in accordance with schemes prepared 
by it and approved by the Provincial Co-operative Federation. 
 
30. Power of Chairman of District Co-operative Federation to assess damage.―Where, in 
the course of the winding up of a society, it appears that any person who has taken part in the 
organisation or management of the society or any past or present member or office-bearer of a 
committee or officer of the society has misapplied or retained or become liable or accountable for 
any money or property of the society or has been guilty of breach of trust in relation to the society, 
the Chairman of the District Co-operative Federation may, of his own motion or on the application 
of a liquidator or any other interested person, hold an inquiry into the conduct of such person, member 
 
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or officer and make an order requiring him to repay or restore the money or property or any part 
thereof respectively with interest at such rate as the Chairman thinks just, or to contribute such sum 
to the assets of the society by way of compensation in regard to the misapplication, retainer or breach 
of trust as the Chairman thinks just. 
 
31. Bar of suit.―Save as is otherwise provided in the Act, no civil court shall have jurisdiction  
in  respect  of  any  matter  arising  out  of  any  proceedings  under  this  Act  or connected with the 
winding up of a society nor shall any suit or other legal proceedings lie or be proceeded with against 
the society, except by the leave of the Chairman of the Provincial Co-operative Council and subject 
to such terms as he may impose. 
 
32. Arbitration.―(1) If any dispute with regard to the business of a society other than a 
dispute regarding disciplinary action taken by the society or its committee against a paid servant of 
the society, arises— 
 
(a)       between  the  members  or  past  members of  a  society,  or  persons  claiming 
through a member or past member ; or 
 
(b)       between the members or past members or persons so claiming and any past or 
present office-bearer ; or 
 
(c)       between the society or its committee and any past or present member of the 
society ; or 
 
(d)       between the society or its committee and any past or present office-bearer of 
the society ; 
 
 it shall be reported to the Chairman of the District Co-operative Federation, who shall refer it 
for decision to not more than three arbitrators appointed by him from amongst the members of the 
District Co-operative Federation. 
 
(2) Any party aggrieved by the award of the arbitrators under sub-section (1) may, within one 
month of the date of the communication of the order, prefer an appeal to the District Judge. 
 
 (3) The award of arbitrators, or an award passed in appeal by the District Judge under sub-
section (2), shall, subject to the provisions of section 54, be final and shall not be liable to be called 
in question in any court. 
 
33. Attachment before award.―Where a dispute  has been referred to arbitration under 
section 32  and  the  arbitrators  are satisfied  on  inquiry or  otherwise that  a party to  such arbitration 
is, with intent to delay or obstruct the execution of any award that may be made, about to dispose 
off the whole or any part of his property, the arbitrators may direct the conditional attachment of the 
said property and such attachment shall have the same effect as if made by a competent civil court. 
 
34. Recoveries of dues.―Every award made under section 32, every order passed in appeal 
under that section, and every order passed under section 5 shall be deemed to be a decree of a civil 
court and shall be executed in the same manner as a decree of such court. 
 
 
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CHAPTER VIII 
FEDERATION OF THE SOCIETIES 
 
35. District Co-operative Federation.―(1) In each district in which not less than two 
societies are in existence, there shall be formed a District Co-operative Federation of Co-operative 
Farming Societies which shall consist of one representative from each society in the district. 
 
(2)  Each  District  Co-operative  Federation  shall  elect  at  its  general  meeting  its office-
bearers, including the Chairman, two representatives for the District Co-operative Council and one 
representative for the Provincial Co-operative Federation, provided that till such  time  as  the  requisite  
number  of  representatives  mentioned  in  sub-section  (1)  are available, two or more representatives 
shall carry out the responsibilities of all the required office-bearers. 
 
(3) The office-bearers, including the Chairman, and representatives shall hold office for a 
term of two years. 
 
(4) A representative for a District Co-operative Council or a Provincial Co-operative 
Federation  may,  by  writing  under  his  hand  addressed  to  the  Chairman  of  the  District Co-
operative Council or, as the case may be, the Provincial Co-operative Federation, resign his office. 
 
(5) The District Co-operative Federation may make bye-laws relating to its meeting and 
procedure and the performance of its functions. 
 
36. Fund and functions of District Co-operative Federation.―(1) A District Co-
operative  Federation  shall  have  a  fund  to  which  shall  be  credited  the  contributions received by 
it from the societies and out of which shall be defrayed the contributions it shall m ake to the 
Provincial Co-operative Federation and the office and other expenses of the District Co-operative 
Federation. 
 
 (2) A  District Co-operative Federation shall deal with matters of mutual interest to the 
societies in the district and make recommendations to the District Co-operative Council on matters 
with which the Provincial Government is concerned. 
 
37.  Provincial Co-operative Federation.―(1) There  shall  be  formed  in  each Province a 
Provincial Federation of Co-operative Farming Societies which shall consist of one representative 
from each of the District Co-operative Federations within the Province. 
 
(2) Each Provincial Co-operative Federation sh all elect in its general m eeting its o ffice-
bearers, including the Chairman, five representatives for the Provincial Co-operative Council and one 
representative for the National Co-operative Council. 
 
 (3) A representative shall hold office for a term of one year. 
 
 (4)   A   representative   for   a   Provincial   Co-operative   Council   or   the   National Co-
operative Council, may, by writing under his hand addressed to the Chairman of the Provincial Co-
operative Council or, as the case may be, the National Co-operative Council, resign his office. 
 
(5) The Provincial Co-operative Federation may make bye-laws relating to its meeting and 
procedure and the performance of its functions. 
 
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38.  Fund and functions of the Provincial Co-operative Federation.―(1)  A Provincial Co-
operative Federation shall have a fund to which shall be credited the contributions received by it from 
the District Co-operative Federations and out of which shall be defrayed its office and other expenses. 
 
(2) The functions of the Provincial Co-operative Federation shall be to deal with matters 
of mutual interest to the societies in the Province and make recommendations to the Co-operative 
Council on matters with which the Provincial Government is concerned. 
 
39. District Co-operative Council.―(1) There shall be formed in each district a District Co-
operative Council which shall consist of the heads of the nation-building departments in the district 
and two representatives of the District Co-operative Federation. Provided t hat, pending the  
availability of the representatives  of  the District Co-operative Federation, the District Co-operative 
Council may consist of only the heads of the said departments. 
 
(2) The elected Chairman of the District Council established under the Provincial Law relating 
to local government shall be the ex-officio Chairman of the District Co-operative Council. 
 
(3) Pending the election of the Chairman of the District Co-operative Council referred to in 
sub-section (2) the Chairman shall be appointed by the Provincial Government from amongst the 
members of the council. 
 
(4) The District Co-operative Council may make bye-laws relating to its meetings and 
procedure and the performance of its functions. 
 
 40. Functions of the District Co-operative Council.―(l) A District Co-operative Council 
shall, of its own motion or on the recommendation of the District Co-operative Federation, co-
ordinate the services of the different nation-building departments and the Dis trict Co-operative 
Federation and extend all possible assistance to the societies within the district. 
 
(2) A District Co-operative Council shall review the decisions taken by it from time to time, 
the progress of co-operative farming mo vement within the district and suggest measures for its 
improvement and future development. 
 
(3) The Provincial Government shall make available to a District Co-operative Council such 
funds as the Provincial Government may consider adequate for enabling the Council to perform its 
functions. 
 
41. Provincial Co-operative Council.―(1) There shall be formed in each Province a 
Provincial Co-operative Coun cil which shall consist of all the Secretaries to the Provincial 
Government in the nation-building departments and five representatives of the Provincial Co-
operative Federation. 
 
(2) The Provincial Minister dealing with the matters relating to co-operation shall be the 
ex-officio Chairman of the Provincial Co-operative Council and the Secretary of the department 
dealing with such matters shall be the ex-officio Secretary of the Council. 
 
(3) The Provincial Co-operative Council may make bye-laws relating to its meetings and 
procedure and the performance of its functions. 
 
Page 16 of 19 
 
42.  Functions of  the  Provincial  Co-operative  Council.―(1)  The  Provincial Co-operative 
Council shall co-ordinate the activities of all the District Co-operative Councils within the Province, 
ensure uniformity of policy throughout the Province and perform at the Provincial level the functions 
assigned by section 40 to the District Co-operative Council at the district level. 
 
(2) The Provincial Government will make available to the Provincial Co-operative Council 
such funds as the Provincial Government may consider adequate for enabling the Council to perform 
its functions. 
 
43. National Co-operative Council.―(1) As soon as may be after the commencement of this 
Act the Federal Government shall constitute the National Co-operative Council which shall consist of 
the following members, namely:— 
 
(a)       the Federal Minister-in-charge of the Ministry dealing with matters relating to 
co-operatives, who shall be the Chairman of the Council ; 
 
(b)       the Provincial Ministers dealing with matters relating to Co-operation in each 
 Province ; 
 
(c)       one representative of each of the Provincial Co-operative Federation ; and 
 
(d)       such other members as the Federal Government may appoint : 
 
Provided that, for the first constitution of the National Co-operative Council, the members 
referred to in clause (c) shall be nominated by the Chairman of the Council. 
 
 (2) The National Council may make bye-laws relating to its meetings and procedure and the 
performance of its functions. 
 
44.  Functions of the National Co-operative Council.―(1) The  N ational  Co-operative 
Council shall co-ordinate the activities of the Provincial Co-operative Councils and ensure uniformity 
of policy in all the Provinces by laying down policy guidelines for the working of the Provincial Co-
operative Councils and the District Co-operative Councils. 
 
(2) The National Co-operative Council shall review its decisions taken from time to time  and  
the  progress  of  the  co-operative  movement  in  all  the  Provinces  and  suggest measures for its 
over-all future development. 
 
(3) The National Co-operative Council shall also maintain liaison between the Federal and 
Provincial nation-building d epartments and arrange for the holding of national and international 
seminars on various aspects of co-operative farming. 
 
(4)  The  Federal  Government  shall  make  available  to  the  National  Co-operative Council  
such  funds  as  the  Federal  Government  may consider  adequate  for enabling the Council to 
perform its functions. 
 
 
 
 
 
 
Page 17 of 19 
 
CHAPTER IX 
INSPECTION OF AFFAIRS 
 
 45. Inquiry by Chairman District Co -operative Federation.―(1) The Chairman of t he 
District Co-operative Federation may, of his own motion, by himself or by a person duly authorised 
by him in writing in this behalf hold an inquiry into the constitution, working and financial condition 
of a society. 
 
(2) The Chairman of the District Co-operative Federation shall hold such an inquiry as is 
contemplated in sub-section (1) of this section— 
 
(a)       on the application of a majority of the committee of the society, or 
 
(b)       on the application of one-third of the members of the society. 
 
(3)  All  officers  and  members  of  the  society whose  affairs  are  investigated  shall furnish 
such information in their possession in regard to the affairs of the society as the person holding 
the inquiry may require. 
 
(4) The result of any inquiry under this section shall be communicated to the society whose 
affairs have been investigated. 
 
46. Inspection of books of indebted society.―(1) The Chairman of the District Co-
operative Federation may, on the application of a creditor of a society, inspect or direct some person 
authorized by him by order in writing in this behalf to inspect the books of the society : 
 
 Provided that the applicant― 
 
 (a)       satisfies  the  Chairman  that  the  debt  is  a  sum  then  due,  and  that  he  has 
demanded  payment  thereof  and  has  not received  s atisfaction  within  a 
reasonable time ; and 
 
(b)       deposits with the Chairman such sum as security for the costs of the proposed 
inspection as the Chairman may require. 
 
 (2) The Chairman shall communicate the result of any such inspection to the creditor. 
 
47. Power of C hairman, District Co-operative Federation to exercise powers under 
section 30 in the course of an inquiry or inspection.―Where, in the course of any inquiry under 
section 45 or an inspection under section 46, it appears to the Chairman of the District Co-operative 
Federation that there exists any such ground as is specified in section 30, he may of his own motion 
or on the application of the person authorized by him under section 45 or section 46, exercise the 
powers specified in section 30. 
 
48. Costs of inquiry.―Where an inquiry is held under section 45 or an inspection is made 
under section 46, the Chairman of the District Co-operative Federation may apportion the costs, or 
such part of the costs, as he may consider proper between the society, the members of creditor 
demanding the inquiry or inspection, the officers or former officers, and the members or past members 
of the society : 
 
 
 
Page 18 of 19 
 
 Provided that— 
 
(a)        no order of apportionment of the costs shall be made under this section unless 
the society or person liable to pay the costs thereunder has or have been heard 
or has or have had a reasonable opportunity of being heard ; and 
 
(b)       the Chairman shall record the grounds on which the costs were apportioned. 
 
49. Recovery of costs.―Any sum awarded by way of costs under section 48 may be 
recovered,  on  application  by the  Chairman  of  the  Dis trict  Co-operative  Federation  to  a 
Magistrate  having  jurisdiction  in  the  place  where  the  person  from  whom  the  money is claimable 
actually and voluntarily resides, or carries on business, by the distress and sale of any movable 
property within the limits of the jurisdiction of such Magistrate belonging to such person, and 
such Magistrate shall proceed to recover the same in the same manner as if it were a fine imposed 
by himself. 
 
CHAPTER X 
MISCELLANEOUS 
 
50. Amalgamation or transfer of societies.―(1) Any two or more societies may, with  the  
approval  of  the  District  Co-operative  Federation,  by  resolution  passed  by  a th ree-fourths 
majority of the members present at a special general meeting of each such society held for the 
purpose, amalgamate as a single society : 
 
Provided that each member has had fifteen clear days’ notice of the resolution and the date of 
the meeting. 
 
 (2) An amalgamation referred to in sub-section (1) may be effected without a dissolution, or 
a division of the funds, of the amalgamating societies and the resolution of the societies concerned 
shall on such amalgamation, be a s ufficient conveyance to  vest the assets and liabilities of the 
amalgamating societies in the amalgamated society. 
 
(3) Any society may, by a resolution passed in accordance with the procedure laid down in 
sub-section (1) transfer its assets and liabilities to any other society which is prepared to accept them 
: 
 
Provided  that,  when  any  such  amalgamation  or  transfer  of  assets  and  liabilities involves 
the transfer of its liabilities by any society to any other society, it shall not be made without giving 
three months’ notice to the creditors of both or such societies : 
 
Provided further that if a creditor of any of the societies concerned objects to such 
amalgamation or transfer of assets and liabilities and gives written notice to that effect to the society 
or societies concerned one month before the date fixed for the amalgamation or t ransfer, the 
amalgamation or transfer shall not be made until the dues of such creditor have been satisfied. 
 
 51. Powers to exempt from stamp duty or registration fee, etc.―The Provincial 
Government may, by notification in the official Gazette, reduce or remit― 
 
(a) the stamp-duty with which, under any law for the time being in force, any 
instruments executed by or on behalf of a society or by an officer or member 
 
Page 19 of 19 
 
and relating to the business of the society, or security bonds executed by or 
on behalf of officers or servants of a society, or awards of the arbitrators 
under this Act, are chargeable ; and 
 
(b) any fee payable under the law relating to the registration of documents or to 
court-fees for the time being in force. 
 
52. Exemption from Income-tax.―The earnings of a society and the dividend paid by it to 
its members shall be exempt from income-tax. 
 
53. Notice necessary in suits.―No suit shall be instituted against a society or any of the  
office-bearers  in  respect  of  any act  relating  to  the  buiness  of the  society until  the expiration 
of three months next, after notice in writing h as been given to the Chairman of the Dis trict Co-
operative Federation. 
 
54. Power of revision.―The Chairman of the Provincial Co-operative Council may, of his 
own motion or otherwise call for the record of any case or proceedings under this Act for the purpose 
of satisfying himself as to the correctness, legality or propriety of any decision or order passed by 
any authority, and may pass such order in relation thereto as he may think fit : 
 
Provided that no order shall be passed under this section revising or modifying an order 
affecting any person unless such person has been afforded an opportunity of being heard. 
 
 55.  Transitional  provisions.―(1)  Till  such  time  as  the  District  Co-operative Federation 
is formed in a District and its Chairman has been elected,― 
 
 (a) the powers and functions of the District Co-operative Federation under this 
Act   and   the   rules   shall   be   exercised   and   performed   by  the   District 
Co-operative Council ; and 
 
(b)      the powers and functions of the Chairman under this Act and the rules shall be 
exercised and performed by the Chairman of the District Co-operative Council. 
 
(2) Till such time as the Provincial Co-operative Federation is formed in a Province, its 
powers and functions under this Act and the rules shall be exercised and performed by the Provincial 
Co-operative Council. 
 
56. Power to make rules.―The Provincial Government may make rules for carrying out 
the purposes of this Act. 
 
 
157. Repeal.―The Co-operative Farming Ordinance, 1976 (XXII of  1976), is hereby 
repealed. 
 
 
 
______________ 
 
RGN Date: 18-09-2024 
1This section has been omitted to the extent of Islamabad Capital Territory by the Federal Laws (Revision and Declaration) Ordinance, 1981 
(Ordinance No. XXVII of 1981), s. 5 and 4th Schedule.