Short Answer

The interest earned on the maintenance fund kept by a cooperative society in a bank is typically utilized for the maintenance and upkeep of the society's common areas and facilities.

Detailed Explanation

Section 70 of the Gujarat Cooperative Societies Act, 1961 deals with the investment of funds by cooperative societies. It allows societies to invest their funds in banks, and any interest earned on such investments can be utilized for the society's purposes. This means that the interest accrued on the maintenance fund kept in a bank can be used for various maintenance-related expenses such as repairs, renovations, or other common area upkeep.

Rule 58 of the Gujarat Cooperative Societies Rules, 1965 provides further guidance on the utilization of interest earned by cooperative societies. It states that the interest on funds invested in banks should be credited to the society's maintenance fund account. This ensures that the interest amount is specifically earmarked for maintenance purposes and cannot be diverted for other uses.

In practice, when a cooperative society maintains funds in a bank, the interest earned on these funds is added to the maintenance fund account. The society's managing committee then decides on the allocation of this interest amount towards different maintenance activities based on the society's needs and priorities. For example, the interest could be used to repaint the common areas, repair the society's infrastructure, or upgrade facilities for the benefit of all members.

Real-world Scenarios

• Scenario 1: A cooperative housing society in Gujarat keeps a substantial amount in a fixed deposit in a bank. The interest earned on this fixed deposit is credited to the society's maintenance fund account. The managing committee decides to utilize this interest amount to install new security cameras in the society premises for enhanced safety and security.

• Scenario 2: Another cooperative society invests a portion of its funds in a savings account in a bank. The interest accrued on this savings account is used to cover the costs of regular maintenance activities such as gardening, cleaning services, and pest control within the society.

• Scenario 3: In a larger cooperative society with multiple amenities like a clubhouse and swimming pool, the interest earned on the maintenance fund kept in a bank is allocated towards the upkeep of these facilities, including equipment maintenance, water treatment, and general repairs.

References

• Section 70 of the Gujarat Cooperative Societies Act, 1961: Official PDF

• Rule 58 of the Gujarat Cooperative Societies Rules, 1965: Official PDF