Page 165 - GB SUBJECTS NEW - ALL PAGE NO

`

The bad debts are being reviewed during the meetings of the Managing
Committee periodically and instructions are given to take effective steps for minimising
bad debts to the maximum possible extent. As a result, so many bad debts were cleared
and No Dues Certificates were issued. However, despite the efforts, the bad debts
shown in above table could not be recovered. Though there are chances of recovering
dues from recently released loans, the chances of recovering amounts from loans issued
two to three decades back are almost nil.

The society is not having the loan applications, agreement, documents and as
such, the society management is not in a position to file arbitration against the above bad
debts. Further, the files pertaining to notices issued to bad debtors from time to time are
also not available in the society except the new file where notices were served recently.
The Cooperative Department itself during inspection of the society pointed out in its
defects that the record maintenance in the society is very poor. Most of the records were
dumped in the records room which were attacked by termite and thus destroyed the old
records.

As per Sec.45(3)(c) of A.P. Cooperative Societies Act, 1964 read with Rules
36,64,36A,36B of A.P. Cooperative Society Rules, 1964, a society shall credit such
portion of the profits, as may be prescribed, to the Bad Debts reserve. Accordingly,
provision was made in the byelaws of the society for keeping 10% of net profits towards
Bad Debts reserve. As per existing Byelaw No.30 of the society, ‘Bad Debts Reserve
fund’ allocated from Net Profits of the society every year after approval of the General
Body. As per Un-Audited Balance Sheet of the society for the FY 2022-23, the Bad Debts
Reserve fund for Rs.2,09,10,193.63 is available as liability.

Further, as per Byelaw No.15(23)(d) under “Powers and Functions of the
Managing Committee”, the Managing Committee shall prepare and place before the
General Body, information relating to write off bad debts. Further, as per Byelaw
No.14(b)(xv) under “Authority and functions of General Body”, the General Body of the
society is the authority to take decision on Bad Debts considered irrecoverable.

When the subject was placed before the General Body with the then list of bad
debts, for taking a decision on writing off the Bad Debts, the General Body vide
Res.No.4, dt.19.5.2023 deferred the subject.

Hence, the subject is once again placed before the Board of Directors with latest
list of Bad Debts for taking a decision on writing off irrecoverable bad debts. In the Board
of Directors Meeting, it was resolved vide Board Res.No.671,dt:8.2.2024 the following.

(a) Resolved to take the subject to the General Body for taking a decision. The G.B
agenda shall contain all the details of bad debt that are existing as on today and
as well cases which were settled / cleared after assumption of office of the present
Board.

(b) Resolved to display the Bad Debts (NPA) and Defaulters list in Notice Board of
society as required under APCS Act, Rules and byelaws

Hence, the subject is placed before Board for taking a decision on Bad Debts
write off before place it General Body.

138