Sri Lanka Consolidated Acts

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Co-operative Societies Loans (Special Provisions) Act (No. 14 of 1969) - Sect 2

Special provisions applicable in the case of loans granted by Co-operative Societies for agricultural purposes on the security of certain bonds

2.
(1) A Co-operative Society shall have power to grant a loan for agricultural purposes to any person who is a member of that Society on the security of a bond which stipulates, inter alia, that in the event of default in the repayment of such loan, such person shall surrender on demand his rice ration book and those of the members of the family of such person, and accordingly-
(a) the grant of such loan shall be deemed, for all purposes, to be an object or purpose for which that Society may utilize its funds, notwithstanding anything in any relevant written law applicable to that Society;
(b) that Society, or any of its officers on behalf of that Society, shall have authority to do all such acts or things as may be necessary to give full force and effect to the preceding provisions of this sub-section;
(c) such person shall have power to enter into such bond, and to sign such bond on behalf of the minor members of his family, and is hereby authorized and required to do all such acts or things as may be necessary to comply with the terms of such bond and the provisions of this Act which are applicable in the event of default in the repayment of such loan;
(d) each adult member of the family of such person shall have power to sign such bond, and is hereby authorized and required to do a such acts or things as may be necessary to enable such person to comply with the term of such bond and the provisions of this Ac referred to in paragraph (c) of this sub-section;
(e) such loan shall be deemed, for all purposes, to be validly given, notwithstanding that i was so given on the security of such bond and
(f) such bond shall be deemed, for all purposes, to be valid, notwithstanding that it contain the stipulation referred to in the preceding provisions of this sub-section.
(2) The form of the bond referred to in sub-section (1) shall be as determined, from time to time, by the Co-operative Society by which the loan to which the bond relates is granted.

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