Division of profits

(1) Unless otherwise authorised by the Minister under section 34 (3) of the Act no dividend or payment on account of profits shall be made by a society registered with unlimited liability until the reserve fund has reached a proportion of not less than one-tenth of the society’s total liabilities. (2) No registered society shall pay a dividend if the rate of interest on loans granted by it to its members exceeds twelve per cent per annum. (3) No registered society shall pay a dividend on share capital exceeding six per cent per annum. Any dividend authorised shall be paid on all shares fully paid-up and in the possession of the same member throughout the previous fiscal year, except that shares which become fully paid-up during the previous fiscal year shall be entitled to a proportionate part of such dividend from the first day of the month following such payment in full, 10 (4) Subject to the provisions of section 34 (3) of the Act relating to a registered society with unlimited liability a bonus based on wages, or on the value of the products, of a member, or a bonus or rebate on patronage calculated in proportion to the amount of the business done by each member with the registered society may be distributed periodically to the members from surplus funds after the deduction of all expenditure and after making provision for bad and doubtful debts and making allocation to the reserve fund.