Section 29: Priority of claims

29. Priority of claims (1) Notwithstanding any other enactment, a society shall, in respect of a loan or advance made by the society to a member, or in respect of any other sum due by a member or an employee to the society, have a privilege— (a) on the crops or other agricultural produce of that member and on the proceeds from the sale of such produce; (b) on any— (i) livestock; (ii) fish and marine products; (iii) fodder; (iv) seed; (v) fertilizer; (vi) agricultural or industrial machinery; (vii) raw materials; or (viii) finished products, supplied to that member, or purchased, produced or otherwise acquired by him with the loan or advance; and (c) on his salary or wages or other allowances subject to the Employment Rights Act. (2) The privilege referred to in subsection (1) shall rank immediately after the privilege of the Government in respect of taxes or of a landlord in respect of rent. (3) Nothing in this section shall affect the claim of a bona fide purchaser or transferee without notice of the claim of the society. (4) A member may execute an agreement in favour of a society requesting his employer to deduct such amount as he may specify which shall not exceed the amount specified in the Employment Rights Act. (5) Where an employer fails to comply with a request under subsection (4)— (a) the society may recover the amount due from the employer as a debt due by him to the society; and (b) he shall commit an offence and shall, on conviction, be liable to a fine not exceeding 20,000 rupees. (6) A society may, with the approval of the Registrar, cede the priority of claim that it has by virtue of this section to any other person. C49 – 15 [Issue 9] Co-Operatives Act