Amendment status not verified — confirm the current text below against the official source.
Net profits and their disposal.- (1) The net profits of co-operative societies shall be determined in accordance with such rules as may be prescribed and different rules may be made for different classes of co- operative societies. (2) A co-operative society shall, out of its net profit in any year transfer an amount not being less than twenty-five per cent of the profits to the reserve fund. 3 [(2A) A Co-operative Society shall, from out of the balance of its net profits, contribute two percent to the Co-operative Education Fund to be administered by the Karnataka State Co-operative Federation Limited, Bangalore. 4[Provided, urban Co-operative Banks shall contribute one percent of its net profit to the Karnataka State Co-operative Urban Banks Federation in addition to the two percent as prescribed in sub-section (2A).]4 5[Provided further that, out of the total contribution made by a Co- operative society to the account of the Co-operative education fund, every year one fourth shall be remitted to the account of the Sahakara Academy (Reg.), Mysore, registered under the Karnataka Societies Registration Act, 1960 and sponsored by the State Government for the purpose of carrying out co-operative education, training and research.]5 (2B) No Co-operative Society which has failed to contribute to the Co- operative Education Fund shall pay dividend to its members.] 3 (3) The balance of the net profits may 2 [x x x] 2 be utilised for all or any of the following purposes, namely:— 1 [(a) x x x (b) x x x] 1 (c) payment of bonus to members on the amount or volume of business done by them with the society to the extent and in the manner specified in the bye-laws: 1959:KAR.ACT 11] Co-operative Societies 92 Provided that no bonus shall be payable to members in a credit society; (d) constitution of, or contributions to, such special funds as may be specified in the bye-laws; (e) donations of amounts not exceeding ten per cent of the net profits for any charitable purpose as defined in section 2 of Charitable Endowments Act, 1890 (Central Act VI of 1890); and (f) payment of bonus to employees of the society, to the extent and in the manner specified in the bye-laws: Provided that the bonus payable in any year to any employee shall not exceed two months’ pay. 2 [(4) A co-operative society may pay dividend to its members from out of the balance of net profits available after making deductions as provided for under sub-sections (2), (2A) and (3) and the bye-laws of the society.] 2