Co-operative Recovery Incentive Scheme


For recovery of outstanding overdue debts of Co-operative sector Banks and Agriculture Co-operative Societies, the recovery will be done by assigning cases to revenue authorities. One percent cash incentive amount and 0.5 percent for stationery will be given to revenue authorities. The plan will continue constantly.

Progress of the Scheme:

Department of Co-operatives

Ministry, Vallabh Bhavan, Bhopal

Bhopal, Dated – 30th August 2001.

Rationalization of Audit Fees:

The State Government hereby using the powers conferred under No. F-5-13-88-Fifteen-1-Madhya Pradesh Co-operative Societies Act - 1960, sub Section - 1 read with Section 95 of No. 17 - 1961 makes following amendments in Madhya Pradesh Co-operative Societies Rules - 1962, viz.


The Following Schedule should be established in place of Schedule - A and Schedule - B of above Rules, i.e.


Calculation of Audit Fees

See Sub Rule– 1 of Rule– 50-A

1. The audit fees will be levied from any society, according to the classifications made by a co-operative society registered under Section - 10 of Madhya Pradesh Co-operative Societies Act - 1960, No-17, year 1961, on the basis of annual turnover, in following pattern:

No. Category of Society Type of Society Basis for levying audit fees
1 2 3 4
1 Consumer Society Primary Total sales
A Except Electricity Society Central ------
    Top ------
B Electricity Society Primary Total Turnover
2 Farming Society Top ------
3 Housing Society Primary Total Turnover
4 Marketing Society Top ------
5 Manufacturer Society Primary Total Turnover
One Except Milk, Oilseeds, and Minor Forest Produce Top ------
Two Milk and Oilseed Society Primary Total Turnover
    Top -------
Three Forest produce Primary Total Turnover
    Central ------
6 Processing society Top ------
One Except Sugar Federation Primary Total sales
    Central ------
Two Top Sugar Federation Top ------
7 Resources Society Primary According to the comment No. 5
8 Multipurpose Society Central Total Sale
9 General Society Top -----
    Primary Total Turnover
    central Working Capital
    Top -----
    Primary -----
    central Total Sale
    Top ------
    Primary -----
    Central Total Sales
    Primary ------
    Primary ------
    Central Total Turnover
    Top ------
  1. The audit fees will be levied on any society within the minimum and maximum limits of audit fees, in respect of its annual turnover, which is more or less than average business, and rates mentioned in clause - 1 and other conditions.
  2. If the annual turnover of a society is less than average business mentioned in corresponding slab, then the audit fees will be levied under minimum limit, and if any society exceeds the limit of average annual business than the audit fees will be levied within the maximum limit. But, the audit fees of Primary Agriculture credit Co-operative Society will be the maximum of Rs. Five Thousand.
  3. Audit fees for the audit of accounts of the society under liquidation, will be imposed at the rate of one percent on the recovered assets
  4. In that case, if a society doing in other form or doing business on agency basis in addition to its own business, then the audit fees will be imposed at rate of 2.5 percent on earned commission and service charges received for rendered services, but the audit fees under this clause will not be applicable in the cases of societies, whose audit fees has been levied on the basis of working capital and total turnover.
  5. Processing unit, local, regional, district and division level branches and sales centers of a society will be treated as a separate branch for the purpose of levy and the additional audit fees will be levied as per the rates mentioned below:-
Sr. No. Specifications Primary Central Top
1 2 3 4 5
1 For Financial Banks 250 500 1000
2 For Other Societies 100 250 500
3 For Processing Units 500 500 500
  1. Levied audit fees will be rounded up to the nearest rupee.
  2. All Central Cooperative Banks, Oil Fed, Regional oilseed Fed, All Dairy Association, District Forest Produce association, Unions and their affiliated members will pay the audit fees for audit of society, and they will be entitled to recover it from member society.
  3.  The concurrent auditing of any government assisted Top society, or Central society and Urban Bank will be conducted by departmental auditors, but in that case, when the chartered accountant is authorized for the final audit of the society, then the audit fees will be levied in the same manner as given in schedule, but the audit fees to be deposited in the treasury, will be calculated by reducing from the amount of remuneration payable to the chartered accountant.
  4. Exemption from payment of audit fees:
      1. The audit fees will not be levied in that case when the society is either inactive or dormant or financially weak, or it is under liquidation or which does not any cash transaction.
      2. Each primary society of each category will be exempted from the payment of audit fees for two accounting year from their date of registration, but the societies driven by women or educated unemployed persons will be exempted for five years.
      3. Sales of government approved and controlled items will be exempted from the levy of audit fees.
    1. Definitions :- Annual Audit means, the audit of accounts of a society for the accounting year, that is to be done after the end of that accounting year. 
    2. Concurrent audit means, the audit of the accounts of any society for an accounting year which is to be done regularly day-to-day, during the current year. 
    3. Periodical Audit means, quarterly auditing of accounts of any society. 
    4. Audit fees means, levied service charges against the services rendered by the department for the auditing, inspection, investigation and supervision of any society. 
    5. Total sales means, the amount obtained from sales of goods during business activities, in which sales returns, transfers sales tax and all other taxes, if charged separately, will not be included. 
    6. Total turnover means the amount of total receipts or total payments whichever is higher, which has been received after the deductions of initial or final cash balance as the case may be, bank deposits or withdrawals from them and headquarters branch adjustment, item, internal transfer adjustment. 
    7. Total of balance sheet is the sum of all items shown in liability side in the balance sheet, in which status quo, accumulated and current year profit, if any, and the difference of branch adjustment is included, but items and accumulated losses are not included in it. 
    1. Remuneration payable to authorized Auditors:
  1. The Chartered Accountant empanelled by the registrar will be called as certified auditor for the audit of any top or central society, or urban bank under Section- 58 (1) of Madhya Pradesh Co-operative Societies Act – 1960.
  2. Payable remuneration will be fixed by the Registrar, Co-operative Societies through the mutual consent of respective society and certified Auditor, under the Rule- 50 (B) of Madhya Pradesh Co-operative societies Rules – 1962.
    1. The amount of remuneration payable to the certified Auditor will be deducted from the levied audit fees and it will be mentioned in Levy Memo according to the Rule - 50 (A) of Madhya Pradesh Cooperative societies Rules – 1962.
      Categorization of Certified Auditors Annual Turnover limit Concurrent, Periodical and Final Audit Annual and Final Auditा Only Final Audit
      1 2 3 4 5
    2. Authorized Certified Auditor will be responsible to the Registrar for the audit of any society.
    3. The remuneration payable to the certified Auditor, shall not exceed the maximum limit given below:
    4. The additional remuneration for concurrent, periodic and annual audit of Branch, processing unit of a society shall not exceed the rates given below.
    5. Additional Remuneration - Category – A, Category – B, Category – C. Per Branch Unit - 1500, 1000, 500.
    6. The maximum period for audit work will be as follows:-
    7. Concurrent, Periodical, Final audit and Annual Final Audit – 6 Months, 4 Months, 2 Months.
    8. Authorized certified Auditors and their assistants will be eligible for reimbursement of charges of travelling, stay, lodging and boarding at the same rate as the accounts in-charge and the Accountant of the respective society are entitled for, according to the travelling allowance Rules.
    9. In the case of delayed submission of audit report after the period prescribed in notification, deduction will be made at the rate of 10 percent per week, from the remuneration payable to the Auditor.

12. The rates of audit fees prescribed in this notification will take effect from the date of its publication in the Gazette of Madhya Pradesh.

In the Name and by the order of The Governor of Madhya Pradesh

Neeraj Kumar Shrivastava, Deputy Secretary.

Computation chart of rates of audit fees

[Sub Clause– 1]

Sr. No. Annual Turnover Limit Average Turnover Levied Audit Fees 0 to 100 Lac Sr. No. Levied Audit Fees 0 to 100 Crore
Rate per Lac Minimum Maximum Rate per Lac Minimum Maximum
1 2 3 4 5 6 7 8 9 10
1 0&1 0-50 150 & 75 20 125 & &
2 1&2 1-50 150 150 225 21 125 12500 18750
3 2&3 2-50 150 300 375 22 100 20000 25000
4 3&4 3-50 150 450 525 23 100 30000 35000
5 4&5 4-50 150 600 675 24 100 40000 45000
6 5&6 5-50 150 750 825 25 100 50000 55000
7 6&7 6-50 150 900 975 26 100 60000 65000
8 7&8 7-50 150 1050 1125 27 100 70000 75000
9 8&9 8-50 150 1200 1275 28 100 85000  
10 9&10 9-50 150 1350 1425 29 100 90000 95000
11 10&20 15-00 150 1500 2250 30 100 100000 150000
12 20&30 25-00 125 2500 3125 31 75 150000 187500
13 30&40 35-00     4375 32     262500
14 40&50 45-00 125 5000 5625 33 75 300000 337500
15 50&60 55-00 125 6250 6875 34 75 375000 412500
16 60&70 65-00 125 7500 8125 35 75 450000 487500
17 70&80 75-00 125 8750 9375 36 75 525000 562500
18 80&90 85-00 125 10000 10625 37 75 600000 637500
19 90&100 95-00 125 11250 11875 38 75 675000 712500

Note:- For annual turnover above 100 Crore, the audit fees of a society will be levied at the rate of Rs. 30/- per Lac and after including minimum Rs. 750/- per Lac will be recovered within the maximum limit of Rs. 50 Lac. but after this notification coming in force, additional audit fees will be levied at the rates prescribed for the turnover of each new branch of the society.