Kathmandu. The government has put forward a provision to set up a ‘Circular Relief Fund’ to provide relief to the savers of the troubled cooperatives. According to the amended provision of the government, Section 108 of the Cooperative Act has been amended to give priority to the payment of people who have already paid money to the problematic organization or association.

Similarly, under the newly added Article 108B, the government has been empowered to set up a ‘Cyclical Relief Fund’. Through this fund, the savings claimed by the members of the problematic cooperatives can be returned immediately.

The fund will include the amount received from the Government of Nepal, the amount recovered from the concerned cooperatives and the amount collected from other sources. Such amount shall be managed by opening a separate account in a ‘A’ class commercial bank and a clear record of each income and expenditure shall be maintained.

Importantly, the funds in this fund will not be frozen at the end of the financial year, which will ensure a continuous flow of relief. Likewise, the amount provided by the government should be spent only for certain purposes and later the money recovered from the borrowers of the problematic cooperatives would be gradually repaid.

• Section 108B of the original Act. Add. : Section 108A of the Principal Act. Later, the following section 108B. Added:

“108b. Cyclic Relief Treasury{ Establishment : Section 108A. For the purposes of Section 112A. The Government of Nepal may set up a Cyclical Relief Fund in the Management Committee for the purpose of immediately returning the savings to the members of the problematic cooperatives claimed in accordance with the Act.

(2) The fund referred to in Sub-section (1) shall consist of the following amounts:-

(a) Amount received from the Government of Nepal,

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(b) Amount refunded for reimbursement from the concerned institution,

(c) Funds received from other sources.

(3) The amount to be received pursuant to Sub-section (2) shall be deposited by the management committee by opening a separate account of the fund in a commercial bank of class ‘A’ and maintain separate records thereof.

(4) The amount in the account of the Fund shall not be frozen at the end of the fiscal year.

(5) The fund shall have to be spent only for the purpose of clause (a) of Sub-section (1) of Section 108 by maintaining separate records of the income and expenditure of the amount received from the Government of Nepal.

(6) The Management Committee shall gradually reimburse the amount received from the Government of Nepal in the Fund from the movable and immovable property of the borrower and other sources within the jurisdiction of the problematic institution.

(7) Other provisions relating to the operation of the fund shall be in accordance with the procedures framed by the Government of Nepal. “