PUNJAB LAND UTILIZATION AUTHORITY (CREDIT FACILITIES) RULES, 1984

PUNJAB LAND UTILIZATION AUTHORITY (CREDIT FACILITIES) RULES, 1984

[Gazete of Punjab, Part‑‑I 21st November, 1984]

No‑SO (R&E) 7 (1)/83.RF, dated 6th March, 1984,‑‑In exercise of the powers conferred on him by section 24 (bb) of the Punjab Land Utilization Authority Ordinance, 1981 (Punjab Ordinance No.VI of 1981), the Governor of the Punjab is pleased to make the following Rules namely: ‑

1. Short title and commencement.‑‑ (1) These rules may be called the Punjab Land Utilization Authority (Credit Facilities) Rules, 1984,

(2) They shall come into force at once.

2. Definitions.‑ In these rules unless there is anything repugnant in the subject or context:

(a) 'Act' means the Co‑operative Societies Act, 1925;

(b) 'Approved Project' means the scheme prepared by the Authority and approved by the Government under section 8 of the Ordinance.

(c) 'Bank' means The Punjab Provincial Co‑operative Bank Limited, Lahore;

(d) 'Loan' means a loan advanced by the Authority under these Rules in cash or kind and includes interest, penal interest and any other service charges;

(e) 'Ordinance' means the Punjab Land Utilization Authority Ordinance, 1981;

(f ) 'Project Manager' means the officer appointed for implementing an Approved Project of the Authority and includes any person for the time being discharging the functions of 'Project Manager';

(g) 'Registrar' means the Registrar of Co‑operative Societies as defined under the Act or a person exercising the powers of Registrar under the Act;

(h) 'Service Charges' meant cost of services rendered by a Society to its members in procuring, disbursing and recovering loans under these Rules; and

(i) 'Society' means a society registered under the Act.

3. Grant of loan.‑‑(1) A loan under these Rules shall be granted by the Bank out of a fund to be placed at its disposal by the Authority.

(2) No loan under these Rules shall be granted to a person unless:‑

(a) he is an owner of culturable waste land not exceeding 25 acres;

(b) he is a member of a society of a village in which he resides or owns land and that village is included in an Approved Project;

(c) his land in respect of which loan is to be granted is included in an Approved Project; and

(d) he is capable and prepared to meet 20$ costs of installation of tube‑well, levelling /improvement and development of such land.

4. Procedure for Application. ‑‑(i) A person desirous of obtaining a loan under these Rules shall submit to the Project Manager of the Approved project his application in Form A addressed to the Society.

(2) The application shall be scrutinized by the Project Manager who, after verification of the particulars given in the application and giving his remarks thereon, shall forward the same to the Director General.

(3) If the applicant is ineligible or is otherwise unfit for the grant of loan, the Director General may reject the application.

(4) If the applicant is eligible for the grant of loan and is also otherwise considered fit for the grant of loan, the Director General may recommend his application and forward the same to the Society.

5. Procedure to be followed by the Society.‑‑ On receipt of the application duly recommended by the Director General, the Society shall process the application, complete necessary formalities including execution of loan agreement and other documents and sanction the loan in accordance with such procedure and instructions as are in vogue for grant of loan by the co‑operative societies subject to such other instructions as may be given to the society by the Registrar from time to time.

(2) The loan shall be sanctioned against a tangible security which may include mortgage of land and hypothecation of agricultural machinery etc. in favour of the soceity.

(3) After necessary formalities including execution of documents is completed the society shall pass a resolution in respect of the loan and forward the case to the bank alongwith all the documents prepared and executed for the purposes of securing the loan.

(4) The Society shall in turn mortgage/ hypothecate in favour of the Bank the land and agricultural machinery etc., already mortgaged/hypothecated in its favour by the applicant.

(5) The Bank, on receipt of the resolution of the society and on the presentation of all the documents as may be required by it in this behalf, shall grant the loan to the applicant in such manner and form as recommended by the Director General and sanctioned by the Society.

(6) The Bank shall prepare a monthly statement of the loans granted and recoveries made thereof and send a copy of the same to the Director General, Project Manager, the Registrar and the society concerned.

6. Maintenance of Accounts.‑‑The Society shall maintain accounts of all the loans granted through it and recoveries made thereof.

7. Recovery of loan.‑‑ The loan shall be recoverable in five Pnual annual instalments or ten bi‑annual instalments as agreed to be. keen the borrower and the Society at the time of the sanction of the loan. No recovery shall be made during the first two years of the grant of loan. The first instalment shall commence in the third year.

8. Interest.‑‑ The rate of interest chargeable on the loan shall be 8% per annum simple interest but no interest shall be charged for the first two years.

9. Penal interest.‑‑ (1) In case of first default in the payment of any instalment by a borrower, penal interest at the rate of 2$ shall also the charged by the Society in addition to the normal interest accrued on the loan. If the borrower makes a default for the second time the rate of penal interest shall be 5$. If a third default is committed, the Society shall be entitled to recall and recover the entire loan including interest and penal interest, if any, in lumpsum as arrears of land revenue recoverable under the Act and rules framed thereunder for any other law for the time being in force.

(2) In case a borrower fails to fulfil any of the terms and conditions set forth in the loan Agreement, the Society shall have a right to recall and recover the entire loan with interest including penal interest, if any, and such other costs as have been incurred by it in making or recovering such loan.

10. (1) The Society shall be entitled to charge an amount not exceeding 1$ of the principal amount as service charges and shall deposit the balance amount of loan recovered by it alongwith all the interest accrued thereon in the relevant head of account.

(2) The Bank shall credit all recoveries of loan made by the Society under these Rules to the ledger account of the Director General.