1

TAMIL NADU CHIT FUNDS RULES, 1984

In exercise of the powers conferred by Section 89 of the Chit Funds

Act, 1982 (Central Act 40 of 1982), the governor of Tamil Nadu, I
consultation with the Reserve Bank of India, hereby makes the following
rules.

Chapter I

Preliminary

[Link] title –(1) These rules may be called the Tamil Nadu Chit
Funds Rules, 1984.

(2) They shall come into force on the 13th April, 1984.

[Link]—In these rules, unless the context otherwise reuires, --

(a) “Act” means the Chit Funds Act, 1982, (Central Act 40 of 1982;

(b) “appendix” means Appendix I or, as the case may be, Appendix II
to these rules:

(c)”authorized agent” means a person duly authorized by power of

attorney executed and authenticated in the manner specified in Section 33
of the registration Act, 1908 (Central Act XIV of 1908) or a person
authorized by a duly stamped power of attorney or a letter of authorization
specified in Form XX by the person concerned;

(d) “form” means a form in Appendix I to these Rules;

(e) “Section” means a section of the Act;

(f) Words and expressions used in these rules but not defined herein
shall have the same meanings respectively assigned to them in the Act.
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Chapter II

Registration

[Link] for obtaining prior sanction for commencement or

conduct of chit—Every application for obtaining prior sanction of the State
Government or the officer empowered by it in this behalf, for
commencement of conduct of a chit shall be made by the foreman in Form I.

[Link] to sanction commencement or conduct of a chit— (1)

where sanction for the commencement or conduct of a chit is refused, the
reasons for such refusal shall be recorded in writing and a copy thereof shall
be communicated to the applicants.

(2) Before refusing such sanction, the State Government or the

Officer empowered by them in this behalf shall issue a notice to the foreman
calling upon him to show cause within a reasonable period to be specified in
such notice as to why sanction be not refused.

[Link] of delay in payment of fees for filing of records

for sanction for commencement or conduct of Chit.—Where it is
proposed to refuse sanction for the commencement or conduct of chit for
delay in payment of fees or filing of any statement or record required to be
paid or filed under the Act or the rules made thereunder, the State
Government or the Officer empowered by them in this behalf shall condone
the delay, if they or the officer so empowered, as the case may be, is
satisfied hearing the foreman or due to other bonafide, provided the
foreman has paid the fees or filed necessary documents on or before the
date of such hearing.

[Link] for registration of a chit.—Every application for the

registration of a chit to be made by the foreman to the Registrar shall be in
Form II.
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[Link] of registration of a chit.—The endorsement of

registration of a chit agreement to be issued by the Registrar shall be in
Form II.

[Link] number of chit.—Every chit registered under the Act

shall be numbered serially by the Registrar in separate series for each
calendar year.

8. Refusal to register a chit.—(1) If the Registrar refused to register

a chit, he shall record the reasons for such refusal in writing and
communicate a copy of the order made in this regard to the applicant.

(2) Before refusing such registration, the Registrar shall issue a notice
to the Foreman calling upon him to show cause within a reasonable period to
be specified in such notice as to why the registration be not refused.

8A. Condonation of delay in payment of fees or filing of records

for registration.—Where it is proposed to refuse registration of a chit for
delay in payment of fees or filing of any statement or record required to be
paid or filed under the Act or the rules made thereunder, the Registrar shall
condone the delay, if he is satisfied on hearing the foreman that the delay
has occurred due to reasons beyond the control of the foreman or due to
other bona fide reasons provided the foreman has paid the fees or filed
necessary documents on or before the date of such hearing.

9. Application for appropriation of any sum from the reserve

fund.—Every application for obtaining prior approval of the Registrar for
appropriation by a company of any sum the reserve fund shall be in Form
IV.

10. Declaration to be filed about subscription to all tickets of a

chit.—Every declaration to be filed by a foreman after all tickets in a chit
specified in the chit agreement have been fully subscribed shall be in Form
V.
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11. Form of commencement of chit.—The certificate of

commencement of a chit to be granted to the foreman shall be in Form VI.

12. Form of certificate about furnishing copy of the chit

agreement to the subscribers of a chit.—The certificate by the foreman
about having furnished a copy of the chit agreement to every subscriber of a
chit to be filed with the Registrar shall be in Form VII.

13. Form of chit agreement.—The chit agreement of every chit

commenced under the Act shall, as far as may be conform to the proforma
set forth in Form VIII.

14. Filling of alteration, addition or omission of chit

agreement.—(1) No alteration, addition or cancellation of any provision in
the chit agreement shall have effect unless such alteration or addition or as
the case may be, cancellation is registered. If the foreman makes any
alteration or addition or cancellation f any provisions in the chit agreement,
he shall submit such alteration or addition, cancellation in duplicate to the
Registrar duly signed and attested by at least two witnesses along with the
application for registration of such alteration or addition or cancellation, as
the case may be, of the chit agreement.

(2) An application to file an alteration of or addition to or cancellation

of any provision in the chit agreement shall be dealt with the same manner
as an application for filing the chit agreement.

15. Data of effect of alteration or addition or cancellation of any

provision in the chit agreement.—An alteration of, or addition to, or
cancellation of any provision in the chit agreement shall not take effect from
a date earlier than the date of such registration of the alteration or addition
or cancellation as the case may be unless otherwise ordered by the
registrar:
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Provided that the Registrar shall not give effect to the alteration or
addition or omission from a date earlier than the date of application for
registration of the alteration or addition or omission of any provision of the
chit agreement, as the case may be.

16. Form of notice to Chit Subscriber.—Every notice to be given by

a foreman to the subscribers in achit under Section 16 shall be in Form IX.
It shall be sent to each subscriber under certificate of posting and shall also
be exhibited on the Notice Board of the office of the foreman.

17. Form of minutes of proceedings.—The minutes of proceedings

of every draw shall, in addition to the particulars specified in sub-section (2)
of Section 17, contain full particulars of the following points, namely:-

(a) Particulars of deposit, if any, of the prize amount under sub-

section (2) of Section 22 since the date of the previous draw;

(b) Particulars of deposit, if any, of money, under sub-section (1) of

Section 22, sub-section (1) of Section 30 and sub-section (4) of Section 33
since the date of the previous draw;

(c) Amount withdrawn from the approved bank (the name of the bank
to be specified) and the purpose for which the amount was withdrawn since
the date of the previous draw;

(d) How the prized subscriber was ascertained according to the terms
of the chit agreement and particulars of tickets and prize amount. If the
ascertainment of the prized subscriber related to a fraction of ac ticket,
particulars in respect of each such fraction shall be entered;

(e) Full particulars of the commission, remuneration or for meeting

the expenses of the chit, paid to the foreman and the amount of divided
assigned each subscriber;
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(f) Names of subscribers or their authorized agents who bid at the

draw, their ticket numbers and signatures.

Chapter III

Foreman

18. Procedure in the case of security given by the foreman.—

[(1)(a)] In case of cash deposited in an approved bank in the name of the
Registrar under sub-clause (i) of clause (a) of sub-section(1) of Section 20,
the receipt or the book issued by the approved bank mentioned in the chit
agreement shall be delivered to the Registrar.

[(1)(b) In case of bank guarantee from an approved bank under sub-

clause (ii) of clause (a) of sub-section (1) of Section 20. The said bank
guarantee shall be delivered to the Registrar].

(2) In case of Government securities transferred in favour of the

Registrar under clause (b) of sub-section (1) of Section 20, the Registrar
shall keep them in safe custody under his control in any Government
Treasury.

(3) If the security charged is movable property other than deposit in

an approved bank or Government securities, the foreman shall make all
necessary arrangements for their deposit with the Registrar or with such
bank or other agency as may be approved by the Registrar for ensuring that
the property deposited is available as security for the proper conduct of a
chit.

(4) In the case of trustee securities to be transferred in favour of the

Registrar under clause (c) of sub-section (1) of Section 20.

(i) where the security is other than immovable property, the value of
the security shall not be less than one and a half times the value of the chit
amount, and
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(ii) in respect of security of immovable property, the value of the

security shall not be less than two times the value of the chit amount.

(5) A foreman of chit proposing to give (movable or immovable

property as security for the proper conduct of a chit shall apply to the
Registrar in Form X. The application under this sub-rule shall clearly furnish
the correct and complete information regarding the property offered as
security. In case the property offered is immovable property, the application
shall be accompanied by the documents of title to the property and an
encumbrance certificate for 30 years relating to the property.

(6) Where the immovable property offered as security is situated

outside the jurisdiction of the Registrar having jurisdiction over the chit, te
inspection of the property shall where the property is situated outside the
State of Tamil Nadu, be made and report sent by the Registrar having
jurisdiction over such property under an order special or general of the
Government to which he is subordinate, who shall forward a report to the
Registrar concerned as to the sufficiency of the security.

(7) If the security offered is accepted as sufficient by the Registrar, he

shall record in writing on the application, a certificate of sufficiency in Form
XI and attach a statement of the valuation made.

(8) If the security offered is not accepted by the Registrar, he shall

give the applicant an endorsement to that effect.

19. Valuation of the chit amount in grain chits.—Ina grain chit for
the purpose of security under Section 20, the grain shall be valued, by the
Registrar as follows:

(a) The total quantity of grain due from all subscribers at one
installment of the chits shall be ascertained;

(b) The market value for the time being of the total quantity referred
to in clause (a) shall then be calculated;
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(c) In assessing the market value, the Registrar shall adopt the
current market price at the nearest taluk town as ascertained from the
Tahsildar having jurisdiction;

(d) One and a quarter times the market value mentioned in clause (b)
shall be taken to be the chit amount for the purpose of furnishing security by
the foreman under sub-section 91) of Section 20.

20. Substitution of security.—(1) During the currency of chit, the

foreman may apply to the Registrar in Form XII for permission to substitute
the security given by him for the proper conduct of the chit by fresh
security.

(2) The Registrar may grant permission after satisfying himself---

(i) that the request of the foreman for substitution of the security
given under Section 20 is for the reasons stated in the application; and

(ii) that the fresh security offered is adequate;

(3) The procedure prescribed in Rule 18 shall apply mutatis mutandis

to the substituted security given by the foreman under this rule.

21. Release of original security in case of substitutions.—(1) The

Registrar shall if so required by the foreman, execute and register a deed of
release in respect of the original security at the cost of the foreman.

(2) If the original security to be returned is Government securities

deposited in a Government treasury, the Registrar shall arrange to return
the securities offered by the foreman after making endorsements of re-
transferin the passbook (receipt) or Government security (or other record)
as the case may be.

(3) If the original security to be returned is movable property other

than Government security, the Registrar shall arrange to return such
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security under proper acknowledgment. He shall, if so required by the

foreman execute a deed of transfer or release at the cost of foreman.

22. Application for release of security.—On termination of the chit,

the foreman may apply to the Registrar for the release of the security, given
by him.

23. Declaration by foreman.—The application for release of security

under sub-section (5) of Section 20 shall contain a declaration separately
signed by the foreman stating that the claims of all the subscribers have
been fully satisfied and that all dues payable by the foreman under the Act
to the Registrar or any other officer have been fully paid.

24. Procedure for release of security.—(1)(a) The Registrar may

for the purpose of releasing the security under sub-section (5) of Section 20
call upon the foreman to produce a copy duly certified to be a true copy of
any register and books of account maintained by the foreman and shall
exhibit a notice on his office notice board stating that the security is
proposed to be released and that nay person objecting to such release may
file with the Registrar his statement of objections, if any, within fifteen days
from the date of exhibition of the notice;

(b) If no objections are received within the period specified in the

notice, the Registrar shall release the security.

(2) If any objections are received, the Registrar shall enquire into the
objections summarily within fourteen days after the date of expiry of the
period specified in the notice referred to in sub-rule (1)(a) and record his
decision in writing and forward a copy thereof to the foreman and to the
objector.

(3) The procedure prescribed in Rule 21 for re-transfer of the property

by the Registrar shall apply mutatis mutandis to the release of security
made under this rule.
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25. Books of account to be maintained by the foreman.—In

addition to the book of minutes of draws mentioned in Section 17, every
foreman shall keep the following registers and books of accounts in the
forms mentioned against each or in the forms as near thereto as possible.

(1) A register of subscribers in Form XIII;

(2) A ledger in Form XIV;

(3) A day book in Form XV;

(4) A receipt book in Form XVI duly certified by the Foreman as to the
number of pages in duplicate;

(5) A book containing copies of all notices issued by the Foreman to

the subscribers;

(6) A file containing the letters of authorization of the subscribers, for

subscribing his name in the chit agreement and for participating in the
auction of the chit;

(7) A file containing the vouchers for payment made by the foreman;

(8) A file containing documents relating to securities offered by the

prized subscribers.

(9) A register in Form XXII showing the amounts deposited in

approved banks in respect of all chit conducted by the foreman.

26. Accounts to be written up promptly.—(1) Every entry in the

register of subscribers, the ledger or the day book mentioned in Rule 25
shall be made as and when the particular event occurs.

(2) On receipt of any money, a receipt shall immediately be prepared

or cause to be prepared by the foreman in Form XVI and delivered to the
payer.
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(3) The foreman shall at the time of issuing every notice prepare a
copy thereof in the book mentioned under clause (5) of Rule 25, certify it to
be true copy and enter therein under his Signature the date of dispatch of
the notice.

(4) A voucher duly signed by the recipient shall be obtained by the

foreman at the time any payment is made to him and such voucher shall be
immediately filed in the file specified in clause (7) of Rule 25 after due
verification of all the particulars entered therein.

(5) Every document relating to the security given by prized subscribers

shall as soon as it is received be filed in the file mentioned in clause (8) of
Rule 20. The file shall contain an index for facilitating the scrutiny of the
documents.

27. Filing of vouchers.—As soon as each payment is made the

foreman shall obtain a voucher from the payee. He shall verify whether the
voucher specifies the proposed for which the payment was received and
whether it is properly signed by the recipient and preserve it in the file
mentioned in clause (7) of Rule 25 after assigning a serial number thereto
for each calendar month.

28. Date for submission of balance sheet.—(1) The balance sheet

referred to in Section 24 shall be prepared within period of two months from
the expiry of the period with reference to which it is prepared.

(2) receipts and expenditure account and statement showing the

assets and liabilities of the individual chit group shall be filed in the Form XXI
with Registrar within a period of two months from the termination of the chit
when the duration of the chit does not exceed one year and when the
duration of chit exceeds one year on expiry of every period of twelve months
and also on the termination of the chit.
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29. Audit by a chit auditor.—(1) If a foreman desires to have the

balance sheet and profit and loss account audited by a chit auditor appointed
under sub-section (2) of Section 61, the foreman shall immediately after the
preparation of the balance sheet make an application for such audit to the
Registrar within whose jurisdiction the chit is conducted, specifying whether
the audit shall be at the premises of the foreman or not. The application
shall e accompanied by the amount of fee set out in appendix II.

(2) The Registrar shall forward the application to the concerned Chit
Auditor to have the balance sheet and profit and loss account and receipt
and expenditure account of individual chit audited by him as early as
possible. On receipt of the application, the chit auditor shall call upon the
foreman to produce the chit records on such date, time and place as he may
fix and the foreman shall produce all registers, books of accounts and other
records relating to the chit accordingly and furnish such information and give
such facilities as may be necessary or required for the proper audit of the
balance sheet and profit and loss account and receipt and expenditure
account of individual chit at the time and place fixed by the chit auditor.

(3) Notice of not less than seven days shall be given to the foreman as
to the date of audit in the premised of the foreman or for the production of
registers, books of account and other records relating to the chit business,
as the case may be.

30. Audit certificate and report of the chit auditor to be in

quadruplicate.—The chit auditor shall prepare his report and audit
certificate in quadruplicate and shall send two copies to the foreman so that
he can keep one copy with him and file the other copy under Rule 31, the
third copy to the Registrar and keep the remaining copy for his own file.
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31. Time for filing balance sheets audited by a chit auditor or

other auditors:- (1) Where the audit is done by the chit auditor. the
foreman shall file with the Registrar a copy of balance sheet and profit and
loss account together with the audit certificate and the Auditor’s report
within one month from the date of the receipt of the audit certificate and
audit report from the chit auditor or within three months from the last day of
the period covered by the balance sheet whichever is earlier.

(2) In the case of audit by an auditor qualified to act as auditor of

companies under the Companies Act, 1956 ( Central Act 1 of 1956 ), the
foreman shall file with the Registrar the documents referred to in sub-rule
(1) within three months from the last date of the period covered by the
balance sheet prepared under Section 24 and in the case of individual chit as
referred to sub-rule (2) of Rule 28 within a period of two months.

Chapter IV

Winding up of Chits

32. From of petition for winding up winding up and

presentation:- A petition for winding up of a chit shall contain the
following particulars namely:-

(1) Full name, description, occupation and address of the petitioner;

(2) Address of his advocate, if any, for the service of all notices,
process, etc.,;
(3) Address of the foreman;
(4) Particulars of the chit-
(i) Number the date of registration of the chit agreement;
(ii) Office where the chit agreement was registered;
(iii) The chit amount;
(iv) The total number of tickets;
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(v) The number of subscription and the number of tickets

subscribed by each subscriber;
(vi) The number of non-prized subscribers on the date of the
petition;
and
(vii) The number of unpaid prized subscribers, if any;
(5) Facts on which the petitioner relies in support of the petition;
(6) particulars relation to the award and execution of other process
which has been returned unsatisfied in whole or in part, if the
ground of the petition is that execution of other process issued on
an award of order of the Registrar in favour of any subscriber in
respect of the amounts due to him from the foreman was returned
unsatisfied in whole or in part;
(7) Full details to show that the condition prescribed in clause (a) of the
proviso to Section 49 is satisfied if the winding up of the chit is
applied for under clause (d) of Section 48;
(8) Whether the previous sanction of the State Government has been
obtained, if clause (b) of the proviso to Section 49 applies. (A copy
of the relevant order of the State Government shall be attached).

33. Proposals for collection and distribution of chit assets:-

(1) The Receiver shall as soon as possible settle and submit to the
Registrar a statement (hereinafter referred to as the “Provisional
Statement”) showing-
(a) The names of subscribers and other persons from whom
money are due to the chit;
(b) The names of the subscribers and other persons to whom
moneys are due from the chit;
(c) Proposals as to how the chit assets are to be collected and
applied in the discharge of its liabilities; and
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(d) The amount proposed to be paid to each of the persons

specified in clause (b).

(2) Notice of the preparation of the provisional statement

accompanied by a copy there of shall be published and be served
on the petitioner, the subscribers and other persons mentioned by
the Receiver in such manner as the Registrar may direct. If the
number of persons on whom notice is to be served is large, the
notice may, in the discretion of the Registrar, be served on the
petitioner only and advertised in one or more daily newspapers.
The notice shall specify the date on which objections to the
provisional statement will be herd and shall call upon any person
having such objections,

(i) to submit his statement of objections and the grounds there

for supported by an affidavit before the date appointed by the
Registrar in this behalf; and

(ii) to appear in person or by advocate on the date of hearing

with all the evidence in support of his objections.

34. Set –off to be allowed:- When money is due from the foreman
to a subscriber and also from the subscriber to the foreman, the subscriber
shall be allowed the benefit of a set-off.

35. Hearing of objections to the provisional statement:- On the

date fixed for the hearing of the objections under sub-rule (2) of Rule 33,
the Registrar shall enquire into the objections and after considering the
evidence, if any, adduced in support there of pass orders on the objections
and call upon the Receiver to revise if necessary, the provisional statement
in accordance with his orders. The Registrar shall fix a date by which such
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revision is to be made and intimate orally or in writing such date to the

persons who have appeared in person or through their advocated on the
date of the hearing.

[Link] order of settlement by Registrar:-- (1) As soon as

possible thereafter and at least ten days before the date fixed under Rule35,
the receiver submit to the Registrar a fresh list of subscribers or other
persons to whom or from whom moneys are due and fresh proposals for the
distribution of the available chit assets after making such further enquiry as
may be necessary. The Registrar shall thereupon consider the said list and
proposals and approve or modify them in such manner as consider the said
list and proposals and approve or modify them in such manner as considers
necessary. The Registrar shall pass final orders accordingly on the date
fixed under Rule 35 for the collection and distribution of the chit assets. The
Registrar may also pass such orders as may be necessary for the distribution
of the available chits assets in case such asset happen to be insufficient to
meet the sums which have to be paid to the subscribers.

(2) The final order passed by the Registrar under this rule shall be
conclusive evidence of the several claims to met out of the chit assets.

37. Provision for expenses of winding up.—In making proposals for

the distribution of the chits assets, the Receiver shall specify the estimated
amount of the cost of winding up including remuneration for the Receiver
and such other types of expenditure as are incidental to the winding up and
such estimated amount shall first be provided for and deducted from the
value of the chit assets and the balance amount shall also be proposed for
distribution in the provisional statement and the fresh list mentioned in Rule
36.

38. Filling of final accounts by Receiver:-- (1) Upon the termination of

the proceeding relating to the winding up, the Receiver shall file his final
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accounts with the Registrar and within fifteen days of such final accounts
being passed by the Registrar the balance of money in the hands of the
Receiver shall be paid the Registrar. The Receiver shall also state how the
balance amount may be disposed of together with the reasons for his
proposals. He shall also deposit with the Registrar all books, accounts and all
other records relating to the chit which has been wound up.

(2) The Receiver may thereafter apply to the Registrar for a certificate of
discharge from the duties as Receiver and for the vacating of his
recognizance bonds entered into by him and the sureties, if any. On receipt
of such application, the Registrar may pass orders of such discharge and
vacating of the bonds and for the disposal of the final balance of the chits
assets, if any.

39. Final order of winding up by the Registrar:-- (1) After the affairs of
a chit have been completely wound up, the Registrar shall make an order
recording the fact of such winding up.

(2) A copy of such order shall be exhibited on the notice board of the
Registrar.

(40). Disposal of records.-- The books and papers of a chit which has
been completely wound up and of the Receiver shall be retained and
disposed of in such manner as the Registrar may direct.

(41). Meetings.-- When the number of subscribers is large and the

Registrar, whether on application of the Receiver or not, at any stage
considers that a meeting of all such parties is necessary in order to ascertain
their wishes in any matter, the Registrar may pass an order for holding such
a meeting. The Registrar may direct the manner in which and the time and
place at which the meeting shall be held and the Receiver shall convene and
hold the meeting accordingly.
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Chapter v

Fees

42. Table of fees.—The fees payable to the Registration for matters

specified in Section 62 and Section 63 shall be as set out in Appendix II and
shall be paid in cash.

43. Receipt of fees.—The Registrar shall grant receipts for all fees
received by him.

44. Refund of fees.—The Registrar my refund any fee paid to him to

excess of the amount prescribed or any fee that is unearned.

Explanation.—The expression “fee that is unearned” in this rule means fees

paid in connection with the registration of the chit agreement, the filing of a
document or other service to be performed by the Registrar where such
registration or filing is not actually effected or the service is not actually
rendered.

Chapter VI

Disputes and Arbitration

45. Reference of dispute.—A reference of a dispute under Section 64 shall

be made in writing to the Registrar in form XVII Wherever necessary, the
Registrar may require the party feferring the dispute to him to produce a
certified copy of the relevant records on which the dispute is based and such
other statements or records as may be required by him, before the
proceeding with the consideration of such reference.

46. Registrar’s satisfaction regarding existence of a dispute.-

Where any reference of a dispute is made to the Registrar or any matter is

brought to his notice, the Registrar shall, on the basis of the reference (if
 19

any) made to him in Form XVII and the relevant records and statements
submitted to him, record his decision together with the reasons therefor,
whether he is or is not satisfied about the existence of a dispute within the
meaning of Section64. Such recording of decision shall be sufficient proof of
the Registrar’s satisfaction whether the matters is or is not a dispute as the
case may be.

47. Disposal of a dispute or reference to a nominee.—(1) Where the

Registrar is satisfied that there is a dispute the Registrar may decide the
dispute himself or refer it for disposal to his nominee.

(2) Neither the Registrar nor his nominee shall take up for consideration
any dispute, unless the parties concerned comply with the conditions of
affixing the Court fees specified in Rule 57 for determining the dispute.

48. Qualifications for appointment as Registrar’s nominees.—

(1) The State Government may appoint a person to be a Registrar’s nominee

provided that,--

(a) he has practiced as an Advocate, Pleader or Vakil for not less than
five years,or

(b) he is enrolled as an Advocate, or holds a degree or other qualification

in law of any University established by law or of any other authority which
entitles him to be enrolled as an Advocate, and either(i) has held office not
lower in rank than that of Deputy Registrar of Chits for not less than five
years or (ii) possesses good knowledge and experience of chit funds
legislation and practice.

(2) The State Government may, by notification in the official Gazette,

appoint as many persons as might be necessary to act as Registrsr’s
nominees for settlement of disputes arising under the Act.
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(49) Procedure for hearing and decision of disputes.—(1) The

Registrar or his nominee shall record in the official language in vogue in the
State, evidence of the parties to the dispute and the witnesses who attend.
Upon the evidence so recorded and upon consideration of any documentary
evidence produced by the parties, a decision shall be given by him in writing.
Such decision shall be pronounced in the open Court, either at once or as
soon as may be practicable on some future day, of which due notice shall be
given to the parties.

(2) Where neither party appears when the dispute is called out for
hearing, the Registrar or his nominee may make an order that it be
dismissed for default.

(3) Where the opponent appears and the disputant does not appear
when the dispute is called out for hearing, the Registrar or his nominee may
make an order that the dispute be dismissed, unless the opponent admits
the claims or a part thereof, in which case the Registrar or his nominee, as
the case may be, may make an order against the opponent upon such
admission, and where, part only of the claim is admitted, may dismiss the
dispute in so far as it relates to the remainder.

(4) Where the disputant appears and the opponent does not appear
when the dispute is called out for hearing, then if the Registrar or his
nominee is satisfied from the record and proceeding that the summons was
duly served, the Registrar or his nominee may proceed with the dispute ex
parte. Where the summons is served by any officer of the Registrar or his
nominee, he shall make his report of service on oath.

(5) The Registrar or his nominee may not ordinarily grant more than
two adjournments to each party to the dispute at his request. The Registrar
or his nominee may, however, at his discretion grant such further
 21

adjournments on payment of such costs to the other side and such fees to
the Registrar or his nominee, as the case may be, may direct.

(6) Any party to a dispute may apply for and obtain a certified copy of
any order, judgment or award made by the Registrar or his nominee on
payment of copying fees, at the rate prescribed Appendix II.

(50) Summonses, notices and fixing of dates, places, etc., in

connection with the disputes.—(1) The Registrar or, as the case may be,
his nominee, may issue summonses or notices at least fifteen days before
the date fixed for the hearing of the dispute requiring.

(i) the attendance of the parties to the dispute and of witnesses, if any;
and

(ii) the production of all books and documents relating to the matter in
dispute.

(2) Summonses or notices issued by the Registrar or his nominee may be

served through a Tahsildar or any employee of the Chit Department or by
registered post with acknowledgment due.

(3) The Officer serving a summons or notice shall, in all cases in which
summons or notice has been served, endorse annex or cause to be endorsed
on or annexed to, the original summons or notice, a return stating the time
when, and the manner in which, the summons or, notice as the case may be
was served, and the name and address of the person(if any) identifying the
person served and witnessing the delivery or tender of the summons or the
notice.
 22

(4) The Official issuing the summons or notice my examine the serving
officer on oath or cause him to be so examined by the Officer through whom
it is served and may make such further inquiry in the matter as he thinks fit;
and shall either declare that the summons or, notice as the case may be,
has been duly served or order it to be served in such manner as he thinks
fit.

(5) The mode of serving summonses and notices as laid down in Sub-
rules (1) to (4) shall mutatis mutandis apply to the service of summonses or
notices issued by the Registrar or the person authorized by him when acting
under Section46.

51. Investigation of claims and objections against any

attachment.—Where any claim or objection has been preferred against the
attachment of any property under Section 68 on the ground that such
property is not liable to such attachment, the Registrar, or as the case may
be, his nominee shall investigate into the claim or objection and dispose it of
on merits:

Provided that no such investigation shall be made when the Registrar

or his nominee considers that the claim or objection is frivolous.

52. Procedure for the custody of property attached under Section

6.—(1) Where the property to be attached is movable property, other than
agricultural produce in the possession of the debtor, the attachment shall be
made by actual seizure and the attaching officer shall keep the property in
his own custody or in the custody of one of his subordinates, or of a
Receiver, if one is appointed under sub-rule (2) and, shall be responsible for
the due custody thereof:
 23

Provided that, when the property seized is subject to speedy and natural
decay, or when the expenses of keeping it in custody is likely to exceed its
value, the attaching officer may sell it at once.

(2) Where it appears to the officer ordering conditional attachment

under Section 68 to be just and convenient, he may appoint a Receiver for
the custody of the movable property attached under that Section and his
duties and liabilities shall be identical with those of a Receiver appointed
under Order XL in the First Schedule to the Code of Civil Procedure,1908.

(3) (i) Where the property to be attached is immovable, the attachment

shall be made by an order prohibiting the debtor from transferring or
charging the property in any way, and all persons from taking any benefit
from such transfer or charge.

(ii) The order shall be proclaimed at some places on, or adjacent, to

such property by beat of drums or other customary mode, and a copy of the
order shall be fixed on a conspicuous part of the property and upon
conspicuous part of the village chavadi and where the property is land
paying revenue to the State Government also, in the office of the Collector
of the district, the Revenue Divisional Officer and Tahsildar within whose
jurisdiction the property is situated.

53. Procedure for attachment and sale of property for realization of

any security given by person in course of execution proceedings.—
The procedure laid down in Rules 51 and 52 shall mutatis mutandis apply for
attachment and sale of property for the realization of any security given by a
person in the course of execution proceedings.

54. Issue of proclamation prohibiting private transfer of property.—

The Registrar when acting under clause(a) of Section 71 shall, at the time of
signing a certificate affecting any property, issue a proclamation in Form
 24

XVIII and in the case of immovable property shall also forward a copy of the
proclamation to the Tahsildar or any other revenue officer within whose
jurisdiction the property is situated, who shall cause an entry about such
certificate to be made in the Record of Right.

55. Procedure for execution of awards.—(1) Every order or award

passed by the Registrar, or his nominee under Section 68 or 69 shall be
forwarded by the Registrar t the foreman or to the party concerned with
instructions that the foreman or as the case may be, the party concerned
should initiate execution proceedings forthwith according to the provisions of
Section 71.

(2) If the amount due under the award is not forthwith recovered, or
the order thereunder is not carried out, it shall be forwarded to the
Registrar with an application for execution along with all information
required by the Registrar, for the issue of certificate under Section 71. The
applicant shall state whether he desires to execute the award through a Civil
Court or through the revenue authorities as provided under Section 71.

(3) On receipt of such application for execution, the Registrar shall

forward the same to the proper authority for execution along with a
certificate issued by him under Section 71 and a proclamation issued under
rule 54 in the manner prescribed therein.

56. Transfer of property which cannot be sold.—(1) When in

execution of an order sought to be executed under Section 71, any property
cannot be sold for want of buyers, of such property is in the possession of
the defaulters or of some person on his behalf or of some person claiming it
under a title created by the defaulter subsequent to the issue of the
certificate by the Registrar under clause (a) or (b) of the said section the
officer conducting the execution shall a soon as practicable report the fact to
 25

the Courtor the Collector or the Registrar, as the case may be, and the
judgment creditor applying for the execution of the said order.

(2) On receipt of a report under sub-rule (1), the judgment creditor

may, within six months from the date of the receipt of the report or within
such further period as may for sufficient reasons be allowed in any particular
case by the Court or the Collector or the Registrar, submit an application in
writing to the Court, the Collector or the Registrar, as the case may be
stating whether or not he agrees to take over such property.

(3) On receipt of an application under sub-rule (2) notices, shall be

issued to the defaulter and to all persons known to be interested in the
property, including those whose names appear in the Record of Rights as
persons holding any interest in the property, about the intended transfer.

(4) On receipt of such a notice, the defaulter, or any person owning

such property, or holding an interest therein by virtue of a title acquired
before the date of the issue of a certificate under Section 71, may, within
one month from the date of the receipt of such notice, deposit with Court or
the Collector or the Registrar, for payment to the foreman a sum equal to
the amount due under the order sought to be executed together with
interest thereon and such additional sum for payment of costs and other
incidental expenses as may be determined in this behalf by the Court or the
Collector or the Registrar, as the case may be.

(5) On failure of the defaulter, or any person interested, or any

person holding any interest in the property, to deposit the amount under
sub-rule (4), the Court or the Collector or the Registrar, as the case may be,
shall direct the property to be transferred to the judgment creditor on the
conditions stated in the certificate in form XIX.
 26

(6) The certificate granted under sub-rule (5) shall state whether the
property is transferred to the judgment creditor in full or partial satisfaction
of the amount due to him from the defaulter.

(7) If the property is transferred to the judgment creditor in partial

satisfaction of the amount due to him from the defaulter, the Court or the
Collector or the Registrar, as the case may be, shall on the production by the
judgment creditor of a certificate signed by the Registrar, recover the
balance due in the manner laid down in Section 71.

(8) The transfer of the property under sub-rule (5) shall be effected
as follows:-

(i) In the case of movable property--

(a) Where the property is in the possession of the defaulter

himself or has been taken possession of on behalf of the Court or the
Collector or the Registrar, it shall be delivered to the judgment creditor.

(b) Where the property is in the possession of some person on

behalf of a defaulter, the delivery thereof shall be made by giving notice to
the person in possession directing him to give actual peaceful possession to
the judgment creditor and prohibiting him from delivering possession of the
property to any other person.

(c) The property shall be delivered to a person authorized by

the party to take possession on behalf of the judgment creditor.

(ii) In the case of immovable property--

(a) Where the property is growing or standing crop, it may be

delivered to the judgment creditor before it is cut and gathered and the
judgment creditor shall be entitled to enter on the land and to do all that is
necessary for the purpose of tending and cutting and gathering it.
 27

(b) Where the property is in the possession of the defaulter or

of some person on his behalf or some person claiming under a title created
by the defaulter subsequent to the issue of a certificate under Section 71,
the Court or the Collector or the Registrar, as the case may be, shall order
delivery to be made by putting the judgment creditor or any person whom
he may appoint to receive delivery on his behalf in actual possession of the
property and if need be by removing any person who illegally refuses to
vacate the same.

(c) Where the property is in the possession of a tenant or other

person entitled to hold the same by a title acquired before the date of issue
of a certificate under Section 71, the Court or the Collector or the Registrar,
as the case may be, shall order delivery to be made by affixing a copy of the
certificate of transfer of the property and proclaiming to such person by beat
of drum or other customary mode at some convenient place that the interest
of the defaulter has been transferred to the judgment creditor.

(9) The judgment creditor shall be required to pay expenses incidental

to sale including the cost of maintenance of livestock, if any, according to
such scale as may be fixed by the Registrar from time to time.

(10) Where land is transferred to the judgment creditor under sub-

clause (a) of clause (ii) of sub-rule (8) before the growing or standing crop is
cut and gathered, the judgment creditor shall be liable to pay the current
year’s land revenue on the land.

(11) The judgment creditor shall forthwith report any transfer of

property under sub-clause (b) or (c) of clause (ii) of sub-rule (8) to the
Village Administrative Officer for information and entry in the Record of
Rights.
 28

(12) The judgment creditor to whom property is transferred under

sub-rule (5) shall maintain for each such defaulter a separate account
showing all the expenses incurred including payment to outside
encumbrances, land revenue and other dues on the property and all the
income derived from it.

(13) The judgment creditor to whom property is transferred under

sub-rule (5) shall use his best endeavour to sell the property as soon as
practicable to the best advantage of the foreman as well as that of the
defaulter, the first option being always given to the defaulter who originally
owned the property. The sale shall be subject to confirmation by the
Registrar. The proceeds of the sale shall be applied to defraying the
expenses of the sale and other expenses incurred by the judgment creditor
and referred to in sub-rules (9) and (12) and to the payment of the arrears
due by the defaulter under the order in execution, and the surplus (if any),
shall then be paid to the defaulter.

(14) Until the property is sold, the judgment creditor to whom the
property is transferred under sub-rule (5) shall use his best endeavour to
lease it or to make any other use that can be made of it so as to derive the
largest possible income from the property.

( 15) When the judgment creditor to whom property is transferred

under sub-rule (5) has realized all his dues, under the order in execution of
which the property, the property, if unsold shall be restored to the defaulter.

[Link] of fees for decisions of disputes.-- (1) The Registrar

or his nominee, as the case may be, on application in form XVII and
payment of fees prescribed in Appendix II may take a dispute and file.
 29

(2) No document of any of the kinds specified below shall be filled

before the Registrar or his nominee unless it is affixed with the proper court-
fee stamp as specified against it.

Proper Court-fee

Rs. p.

(i) Vakalatnama 2.00

(ii) Application for adjournment 10.00

(iii) Application for interim stay or relief 25.00

(3) (a) The Registrar or his nominee deciding any dispute may require
the party or parties to the dispute to deposit such sum as may be in his
opinion be necessary to meet the expense, including payment of fees to the
Registrar or his nominee as the case may be.

(b) The Registrar or his nominee shall have power to order the fees
and expenses of determining the dispute to be paid by the foreman out of
his funds or by such party, or parties to the dispute, as he may think fit,
according to the scale laid down by the Registrar, after taking into account
the amount deposited as above.

(c) The Registrar may be general or special order specify the scale of
fee and expenses to be paid to him or his nominee.

Chapter VII

Miscellaneous

58. 1[Appeal].--2[(1) An appeal under Section 70 or sub-Sections (1)

and (2) of Section 74 shall be made in writing and shall be either presented
in person or sent by registered post to the appellate authority.
 30

Explanation.--For the purpose of this rule and rule 59, appellate

authority means--

(a) in respect of an appeal under Section 70, the State

Government;

(b) in respect of an appeal under sub-sections (1) and (2) of

Section 74, the State Government or such officer or authority as may be
empowered by a notification in the Official Gazette by the State Government
in that behalf.]

1. Substituted by G.O. Ms. No. 408, dated 17-11-1992.

2. Substituted by G.O. Ms. No. 408, dated 17-11-1992.

(2) The appeal shall be in the form of a memorandum accompanied

by fee prescribed in Appendix II.

(3) Every appeal shall--

(a) specify the names and addresses of the appellant as well as

the respondent;

(b) state by whom the order appealed against was made;

(c) set forth concisely and under distinct heads the grounds of
objections to the order appealed against with a memorandum of evidence;

(d) state precisely the relief which the appellant claims;

(e) give the date of the order appealed against.

59. Hearing and disposal of the appeal.-- (1) On receipt of the

appeal, the appellate authority shall as soon as possible examine it and
ensure that,
 31

(a) Whether relevant fee has been paid on the appeal

memorandum;

(b) the person presenting the appeal has the locus standi to do
so;

(c) it is made within the specified time-limit; and

(d) it conforms to all the provisions of the Act and these rules.

(2) In the proceedings before the appellate authority the appellant

and the respondent may be represented by an agent holding on power of
attorney or by a legal practitioner.

(3) The appellate authority, on the basis of the enquiry conducted and
with reference to the records examined, pass such order on appeal as may
deem just and reasonable.

(4) Every order of the appellate authority under sub-rule (3) shall be
in writing and it shall be communicated to the parties concerned and the
Registrar.

60. Period of retention of records by the Registrar.-- The

records of a chit including registers and books of account, shall be preserved
in the office of the Registrar for eight years--

(a) from the release of the security in the case of chits which
are terminated ; and

(b) from the date when the affairs of the chit are completely
wound up in cases dealt with in Chapter X of the Act and if orders passed
under that Chapter are appealable, from the date of disposal of the appeal.
 32

61. Register of records kept.-- Every Registrar shall keep a

separate register in which shall be entered particulars of all records, relating
to chits registered in his office.

` 62. Compounding of offences arising under the Act.-- (1) Any

officer empowered by the State Government shall issue a show cause notice
before taking any action under Section 76 or 77 of the Act against any
person who has committed, or reasonably suspected to have committed any
offence under the Act, or rules made there under asking him to show cause
within a period of fifteen days, why action under the said Section 76 or as
the case may be, under Section 77 of the Act should not be taken against
him.

(2) Notwithstanding anything contained in the said provision--

(i) any officer empowered by the State Government to

compound the offence committed under the Act or reasonably suspected to
have committed any offence under the Act and Rules made there under may
compound the said offence committed by any person, either before or after
the institution of the criminal proceedings under the Act :

provided that the said proposal to compound the offence is accepted

by any officer authorized by the State Government.

(ii) On an approval of the said proposal by the officer

empowered to approve such a proposal referred to above, the officer
empowered to compound the offence shall send an intimation in writing in
that behalf to that person specifying therein--

(a) a sum determined by way of composition;

(b) the date on or before which the sum shall be paid.

 33

1
[63. Rate of interest for defaulted instalment of subscription
by a non-prized subscriber].-- The rate of interest payable by a
defaulting subscriber in pursuance of the proviso to sub-section (1) of
Section 28 of the Act shall not exceed twelve per cent per annum.

Case Law

Interest payable by a defaulting subscriber at 12% cannot be said to

be unreasonable.

See : Soudambika finance Pvt. Ltd. vs. Union of India, AIR 1993 Mad,
190 at 213, para 30.
 34

APPENDIX II

Levy of fees under section 62 and 63 of the Chit Funds Act, 1982

(Central Act 40 of 1982)

(See rule 42 of the [Link] Funds Rules, 1984)

TABLE OF FEES

[Link] Description of Instrument

1 For the application for previous sanction to Commence or

conduct a chit under Sub-Section (2) of Section 4.

a) When the duration of the chit Rs.20/- per ticket or

does not extend beyond a year instalment whichever
is higher subject to a
minimum of Rs.500.00

b) When the duration of the chit

extends beyond a year.

i) When the chit amount does not Rs.30/- per ticket or

exceed Rs.5,000/- instalment whichever
is higher subject to a
minimum of Rs.500/-

ii) When the chit amount exceeds Rs.50/-per ticket or

Rs. 5,000/- but not exceed Rs. instalment whichever
10,000/- is higher subject to a
minimum of Rs.800/-

iii) When the chit amount exceeds Rs.80/- per ticket or

Rs.10,000/- but does not exceed instalment whichever
Rs. 20,000/- is higher subject to a
minimum of Rs.1200/-
 35

iv) When the chit amount exceeds Rs.120/- per ticket or

Rs.20,000/- but does not exceed instalment whichever
Rs.30,000/- is higher subject to a
minimum of Rs.1600/-

v) When the chit amount exceeds Rs.160/- per ticket or

Rs.30,000/- but does not exceed instalment whichever
Rs.40,000/- is higher subject to a
minimum of Rs.2000/-

vi) When the chit amount exceeds Rs.200/- per ticket or

Rs.40,000/- but does not exceed instalment whichever
Rs.50,000/- is higher subject to a
minimum of Rs.2500

vii) When the chit amount exceeds Rs.250/- per ticket or

Rs.50,000/- but does not exceed instalment whichever
Rs.1,00,000/- is higher subject to a
minimum of Rs.3000/-

viii) When the Chit amount Rs.300/- per ticket or

exceeds Rs.1,00,000/- but does instalment whichever
not exceed Rs.2,00,000/- is higher subject to
minimum of Rs.3500/-

ix) When the Chit amount exceeds Rs.350/- per ticket or

Rs.2,00,000/- instalment whichever
is higher subject to
minimum of Rs.4000/-

2 a) For filing the chit agreement Rs.100/-

with the Registrar and the
Registration of chit under Section
7

b) For every application for Rs.400/-

Registration of alteration, addition
to or cancellation of a chit
agreement under section 15
andRule14.
 36

3 For filing the declaration with the Rs.60/-

Registrar and the grant of a
certificate of commencement under

Sub-Section(1) of Section 9

4 For filling the certificate under Sub- Rs.50/-

Section (2) of section10

5 For filing a copy of minutes of the Rs.50/-

proceedings under section 18.

6 For the audit of balance sheet under section 24 by the Chit

Auditor:-

(a) When the aggregate chit Rs.500/-

amount of chits covered by
the balance sheet does not
exceed Rs.10,000/-

(b) When such amount exceeds Rs.100/-

Rs.10,000/- for every
Rs.1000/- or part thereof in
excess of Rs.10,000/-

7 For filing the audited balance

sheet under section-24

(a) When the aggregate chit Rs.200/-

amount of chits covered
by the balance sheet does
not exceed Rs.5,000/-

(b) When such amount exceeds Rs.500/-

Rs.5,000/- but does not
exceeds Rs.10,000/-

(c) When such amount exceeds Rs.800/-

Rs.10,000/- but does not
exceeds Rs. 20,000/-
 37

(d) When such amount exceeds Rs.1000/-

Rs.20,000/- but does not
exceed Rs.30,000/-

(e) When such amount exceeds Rs.1200/-

Rs.30,000/- but does not
exceed Rs.40,000/-

(f) When such amount exceeds Rs.1500/-

Rs.40,000/-

8 For the audit of accounts under

sub-section-(4) of the section 61
by the Chit Auditor:-

(a) When the chit amount does Rs.200/-

not exceed Rs.5,000/-

(b) When the chit amount Rs.400/-

exceeds Rs.5,000/- but does
not exceeds Rs.10,000/-

(c) When the chit amount Rs.800/-

exceeds Rs.10,000/- but does
not exceeds Rs.20,000/-

(d) When the chit amount Rs.1200/-

exceeds Rs.20,000/- but does
not exceeds Rs.30,000/-

(e) When the chit amount Rs.1600/-

exceeds Rs.30,000/- but does
not exceeds Rs.40,000/-

(f) When the chit amount exceeds Rs.2000/-

Rs.40,000/- but does not
exceeds Rs.50,000/-

9 If the balance sheet or accounts Rs. 100 plus any

are audited under section 24 of amount equal to the
 38

sub-section (4) of section 61 at Travelling Allowance

the premises of the foreman or and Daily Allowance
outside the office of the Registrar admissible to the Chit
for each such audit, in addition to Auditor under the
fee payable under Articles 6 and 8 Tamil Nadu Travelling
Allowance Rules

10 a) For application for extension of Rs.500/-

time for filing the declaration
under sub-section (3) of
Section7

b) For the application for approval Rs.1000/-

to appropriate sums from
reserve fund under sub section
(4) of section 8

c) For the application to offer as security the immovable

property under sub rule (5) of Rule 18.

i) Situated outside the jurisdiction Rs.400/-

of the Registrar but within the
state

ii) Situated outside the State. Rs.1000/-

(iii) For inspecting the immovable Rs.1000/-

property offered as security
under section 20 to fix value
of the property by the Deputy
Registrar of Chits

d) For the application for Rs.1000/-

permission to substitute the
 39

security during the currency of

the chit under sub-section 3 of
section 20.

e) For the application from the Rs.400/-

foreman to conduct any draw
in the presence of the
Registrar or the person
deputed by him under Sub-
Section(3) of Section16

f) For the application for the prior Rs.1000/-

approval of the Registrar to
open a new place of business
under Sub-section(1) of Section
19

g) For the application for extension Rs.600/-

of time to file copies of
documents under Section75

h) For the application to award Rs.250/-

compensation against frivolous
of vexatious petition for winding
up of chit under the sub-section
(1) of Section 58

i) For the application for injunction Rs.200/-

order under Section52

j) For the application for leave to Rs.200/-

continue legal proceedings
against Foreman under Section
55

k) Application for attachment of Rs.2000/-

property under sub-section (1)
of Section 68
 40

11 A fee of Rs.100/- shall be levied in

each case filling with the Registrar.

a) A copy of each entry relating to

the removal of defaulting
subscriber under sub-section(3)
of Section 28

b) A copy of each entry relating to

the substitution of subscriber
under sub Section(2) of
Section29

c) A copy of entry relating to

transfer of the rights of
Foremen under Section 37

d) A copy of entry relating to

transfer of non prized
subscriber’s right under Section
37

e) A copy of assent of all non-

prized and unpaid prized
subscribers for withdrawal of a
foreman of chit under section
41.

f) A copy of consent of all non-

prized and unpaid prized
subscribers to the termination
of Chit under Section 41.

12 Fee for petition for decision of Fifty Rupees for every

dispute thousand or part
thereof of the amount
of claim in dispute.

13 Fee for application for winding up of chit:-

 41

(a) when the chit amount does not Rs.400/-

exceed Rs.5,000/-

(b) When the chit amount exceeds Rs.800/-

Rs.5,000/-

14 Fee for adjournment of any Rs.500/-

proceeding under the Act.

15 Fee for application for interim stay Rs.500/-

or relief other than appeals to the
Government or any other authority
under the act.

16 Fee for appeal to the State

Government or any other
authority :-

(a) when it relates to a chit with Rs.500/-

a chit amount not exceeding
Rs.5,000/-

(b) when such chit amount Rs.800/-

exceeds Rs.5,000/- but does not
exceed Rs.10,000/-

(c) when such chit amount Rs.1200/-

exceeds Rs.10,000/- but does not
exceed Rs.1,00,000/-

(d) when such chit amount Rs.2000/-

exceeds Rs.1,00,000/-
 42

17 For inspection of one or more Rs.100/-

records relating to a chit under
Section 62 for each inspection

18 For every 100 words or fraction Rs.20/-

thereof of a copy or extract of the
records relating to a chit furnished
under Section 64

19 For every 100 words or fraction Rs.20/-

thereof of a certified copy of any
order or judgment or award made
by the Registrar or his nominee
under Section 69.
 43

APPENDIX –

FORM I

(See Section 4(2) and Rule 3)

FORM OF APPLICATION TO BE USED BY A FOREMAN FOR OBTAINING

PREVIOUS SANCTION TO COMMENCE OR CONDUCT A CHIT

From Place:
Date:

To
The Secretary to the Govt.
of
(The Authorised officer by designation)

Sir,

I Son / Wife / Daughter

(here state profession or occupation) residing at I /
We, the Chairman and Secretary respectively* on behalf of (name of the firm,
Company, Corporation, Coop-Society etc.) situated at having its registered
office at
desire to commence and conduct a chit as
foreman at (here specify the place with postal address in detail). Full
particulars in this regard are given in the Annexure hereto.

2. A certified true copy of the resolution passed by the Managing

Committee / Board of Directors at its meeting held on the
for commencing and conducting the chit in question
is enclosed.

3. I / We remit herewith a sum of Rs (Rupees in words)

only) being the fees prescribed for the purpose.
 44

4. I / We hereby certify that the aggregate chit amount of the chits run by
me / us is Rs (Rupees only) on the date of this application and does not
exceed the aggregate chit amount prescribed by Section 13 of the Chit Funds Act, 1982
(Central Act No. 40 of 1982).

5. I / We request you to accord your sanction for commencing and

conducting the Chit. On receipt of such sanction further steps for registration etc., of the
chit will be taken.

6. We further undertake in register the chit within 12 months from the date
of sanction by the State Government as per Section 4(1).

We have read the provisions of the Chit Fund Act, 1982 (Central
Chit Fund Act No. 40 of 1982) and the Rules framed thereunder and agree to
abide by the same in the conduct of the chit business.

Yours faithfully,

Chairman :

Secretary :
Encl: Sheets

for or on behalf of

----------------------------------------------------------------------------------------------------------------

Strike out or delete whatever is not applicable.

* Insert the designation as may be appropriate to the

applicant. @ Here enter the name of the applicant

institution, if any.

--------
 45

ANNEXURE

STATEMENT OF PARTICULARS

1. Name and address of the company

association of individuals / coop.
Society, partnership / sole
proprietorship (address of the
registered as well as the Head Office
/ administrative office, if any, should
be given).

2. Constitution i.e., whether

incorporated as company / co-op.
Society or registered / un- registered
association of individuals /
partnership / sole proprietorship
(also specify the provision of the Act
under which incorporated /
registered along with the date of
incorporation / registration.

3. Name and addresses of the branches

/ Offices if any.

4. Main objects of the institution

(enclose a copy of the memorandum
and Articles of Association or as the
case may be of the Byelaws or rules
regulating the activities of the
institution).

5. Names, occupations and residential

address of the directors or as the
case may be, of the promoters /
members of the committee of
management / partners etc.

6. Name and residential address of the

Chief Executive Officer and two other
officers immediately next to him, in
the managerial setup.

7. Names of the Bankers and their

addresses.
 46

8. Names of the auditors and their

addresses.

9. Particulars of the chit(s) to be started

(such as the chit amounts, duration
of the chit, frequency of the draws,
manner of draws, etc, also attach a
copy of the draft of the chit
agreement to be entered into with
the subscribers).

10. Places where the chit scheme(s)

are proposed to be conducted.

11. Names and addresses of the

associates companies /
cooperative societies /
associations of
individuals / partnerships / sole
proprietorships.

12. Names,occupations and residential

addresses of the directors or as the
case may be of the promoters /
members of the committee of
management etc of the institutions
referred to in item 11
I / We* solemnly declare that the facts stated herein as also in the
enclosures are true in the best of my / our knowledge, information and belief.

Dated this day of 200 at .

Name (s) Signature (s)

Designation (s)

For and behalf of

* Here enter the name of the applicant institution, if any, strike out whatever is not
applicable.

Note : (1) If the space against any items is inadequate for furnishing full
particulars, the required information should be given in separate sheets indicating
the cross reference against the relative item of this statement.
(2) A copy each of the latest available audited balance sheet and profit and loss
account if any, should be attached.
 47

FORM – IA

FORM OF REPLY TO THE FOREMAN FOR THE COMPLIANCE OF HIS

REQUEST FILED IN FORM – I

FROM

OFFICE OF THE REGISTRAR OF CHITS,

TO

The Foreman

I hereby acknowledge the receipt of form of application filed by you

(Foreman) for obtaining previous sanction to commence or
conduct a Chit. Your request can be complied with and the order of prior
sanction will be issued to you on . His request cannot be
complied with for the reasons which are contravening provision of
Appeal under section lies with
within 30 days from the date of receipt of this order.

(Seal) Signature of the Registrar

of Chits with date.
 48

FORM – IB

(See Section 4)

After careful examination of the Form-I, dated and also

the connected records submitted by M/s. , the
undersigned in exercise of the powers conferred on him / her under Section 4 of
the Chit Funds Act, 1982 read with Notification No. hereby
issues the “PREVIOUS SANCTION” for the Chit, the details of which are given
below:

Name of the Foreman :

Chit Amount :
Installment Amount (without
dividend and any other
deductions allowed) :

No. of Installments :

No. of Tickets :

The previous sanction issued in this order shall lapse if the chit is not
registered within 12 months from this day

Place :
Date : Registrar of Chits
 49

FORM – II

(See Section 7 and Rule 5)

APPLICATION FOR REGISTRATION OF THE CHIT AGREEMENT

To
The Registrar of Chits,

Dear Sir,

(a) I S/o Sri. being the

foreman conducting chit under the name and style of * .

(b) We the Chairman and Secretary respectively of the

foreman conducting chit business under the name and style of
* at hereby apply for
registration of the Chit Agreement.

(2) The Chit Agreement in duplicate is attached herewith together with a sum
of Rs. being the registration fees as required under the Act of Chit Funds Rules,
2008.

(3) The number of current chits which are running as on the date of this
application is and the aggregate chit amount of these chits involved
therein is Rs. which is within the limits specified in Section 13 of the Chit Funds Act,
1982 (Central Act No. 40 of 1982).

(4) A certified true copy of the sanction obtained in Form IB under Section 4
of the above Act for commencement and conduct of the chit in question is enclosed. A
copy of the application dated the together with its
enclosures made to the State Government / authorized officer in this behalf is also
enclosed for information and ready reference.
 50

(5) I / We remit herewith a sum of Rs. (Rupees

only) being the fee prescribed for the purpose.

DECLARATION

(6) I / We have read the Chit Funds Act, 1982 (Central Act No. 40 of 1982)
and the Rules made by the State Government thereunder and I / We declare that the
chit agreement has been drawn up in confirmity with the provisions of the said Act and
the Rules.

The above statements are true and complete to the best of my / our
knowledge, information and belief.

Yours faithfully,

Chairman

Secretary

Name(s)

Designation (s)

* for and on behalf of Foreman

Note 1. * Here enter the name of the applicant institution if any.

2. Strike out or delete whatever is not applicable insert the designation(s)

as may be appropriate to the applicant.
 51

FORM – III

(See Section 7(2) and Rule 6))

ENDORSEMENT OF REGISTRATION

I hereby certify that the chit agreement relating to the chit proposed to be
conducted by (the name and address of the foreman
should be filled in here) as a foreman has this day of 2008
been registered by me under sub-section(2) of Section 7 of the Chit Funds Act, 1982
(Central Act No. 40 of 1982) as Chit No. of 2008 at .

Given under my hand and seal this day of 2008 at

.

Date : Signature of Registrar

(SEAL)
 61

FORM IV

(See Section 8(4) and Rule 9)

Place :
Date :

The Registrar of Chits,

Dear Sir,

In terms of sub-section(4) of Section 8 of the Chit Funds Act, 1982 (Central

Act No. 40 of 1982) we hereby seek approval for appropriating sum of Rs.
(Rupees in words) company. This withdrawal has
been necessitated by the following circumstances:

(Here state the circumstances under which withdrawal from the reserve fund
has become necessary).

2. We enclose for your information a copy each of the profit and loss account and
the balance sheet for the last two accounting years as also a proforma of the balance
sheet and profit and loss account for the current year ended 200 . A true copy of
the resolution passed by the managing Committee / Board of Directors on the for
appropriation of the said sum from the reserve fund is also enclosed. We shall be glad to
furnish such further information as may be required by you.

3. We remit herewith a sum of Rs (Rupees only)

being the fees prescribed for the purpose.
 61

4. We shall be glad if you will kindly grant us permission to withdraw a sum of

from the reserve fund.

Yours faithfully,

Chairman

Secretary

* (for and on behalf of Company)

----------------------------------------------------------------------------------------------------------------

* enter the name of the applicant / company.

 61

FORM IV – A

(See Section 8(4) Rule 9)

FORM OF REPLY TO THE FOREMAN FOR COMPLIANCE OF HIS REQUEST

FILED IN FORM IV

FROM

OFFICE OF THE REGISTRAR OF CHITS

To
The Foreman,

I, hereby acknowledge the receipt of Form of application filed by you

(Foreman) for grant of permission to withdraw a sum of Rs.
(Rupees in words) from the reserve fund.

A sum of Rs. (Rupees in words) is in credit in your reserve fund

account. Your request can be complied with for the circumstances stated in your
application under which withdrawal from the reserve fund has become necessary
and permission will be accorded in From IV on .

Your request cannot be complied with for the reasons for

(Reasons for refusal should be mentioned). An appeal U/s lies with
within 30 days from the date of receipt of this order.

(Seal) Signature of the Registrar

of Chits with date.
 61

FORM - V

(See Section 9(1) and Rule 10)

Place:
Date:
To
The Registrar of Chits,

Dear Sir,

By your letter dated the you were pleased to grant me / us

certificate of registration to commence a new chit of a chit amount of Rs
and of a duration months.

2. I / We have subsequently enlisted the required number of members and we

hereby declare in terms of sub-section(1) of Section 9 of the Chit Funds Act, 1982 (Central
Act No. 40 of 1982) that all the tickets specified in the chit agreement have been fully
subscribed.

3. I / We remit herewith a sum of Rs (Rupees in words only) being

the fees prescribed for the purpose of filing this declaration.

Yours faithfully,

Chairman

Secretary

for and on behalf of (Foreman)

----------------------------------------------------------------------------------------------------------------

Strike out or delete whatever is not applicable insert such designation(s) as may be
appropriate to the applicant.
 61

FORM – VI

(See Section 9(2) and Rule 11)

CERTIFICATE OF COMMENCEMENT OF CHIT

Place :
Date :

Office of the Registrar of Chits.

I hereby certify that * is entitled to commence and conduct the

@
chit the chit agreement in respect of which was registered in my
office as Chit No of 200 .

Given under my hand and seal, this day of 200 at

.

Signature of Registrar

(Seal)
----------------------------------------------------------------------------------------------------------------

* Here enter the name of the foreman.

@
Here mention the chit amount and duration etc, of the chit(s).
 61

FORM – VII

(See Section 10(2) and Rule 12)

To
The Registrar of Chits,

Dear Sir,

The Chit Funds Act, 1982 (Central Act No.40 of 1982)

I / We the Foreman of the chit / chairman and secretary on

behalf of the Foreman / Firm / Company conducting the chit, the chit agreement
bearing registration number of 200 has been registered in the office
of the Registrar of Chits do hereby certify that I / We have furnished to
every subscriber of the chit a copy of the said chit agreement duly certified by me /
us to be a true copy. The copies were furnished to each of the subscribers on .

The date of obtaining the certificate of commencement of the said chit granted
under sub-section(2) of Section 9 is .

The first draw of the said chit was held on .

Yours faithfully,

Chairman

Secretary
Place:
Date: for and on behalf of………..
(Foreman)

----------------------------------------------------------------------------------------------------------------
Strike out / delete whatever is not applicable. Insert the designation(s) as may be
appropriate to the applicant.
 61

FORM VIII
(See Section 6 and Rule 13)
Form of Chit Agreement

(Articles of Agreement between the Foreman and the Subscribers)

1. Office where the chit is registered.

2. Year and Registered No. Year No
3. Full name and address of foreman
4. Occupation (if applicable)
5. Age (if applicable)

I. Chit amount and No of tickets.

1. No of tickets or fraction thereof Full
Held by each subscriber 3/4
1/2
1/4
1/8

2. No. of installments and amount payable No. Amount

for each ticket at every installment Rs.

3. Chit amount Rs.

II. Duration of the chit

1. Date of 1st installment.
2. Dates of subsequent installments.
3. Date of termination.
4. Duration of the chit. Years months

III. The place, time and probable date when the chit is to be commenced.

1. Place (give full particulars)

2. Probable date
3. Time of commencement of the proceedings.
 61

IV. Particulars of security given or deposited by foreman.

1. Under Section 20 of the Act, the following security sufficient to the satisfaction
of the Registrar of Chits, the particulars of which are described below, has been given for
the proper conduct of the chit:-

(Here enter description of security such as cash, Government security

(immovable property) etc., (in case immovable property has been charged, its
particulars such as its description / location / market value etc., should be given).

2. No. and date of the certificate of Registrar of Chits regarding, the sufficiency of
security, if obtained.
3. The foreman shall not get release of the security in full until all the liabilities
under the chit are discharged.

V. Mode of conducting the chit.

The foreman shall exhibit a list of non-prized subscribers before every
auction.

1. The subscriber who is to get the prize at any installment shall be determined
by lost or by auction at the time and place specified in Article III.

(Here specify the smallest fraction of a ticket the prize for which will be
determined by lot or by auction, and the time allowed for each purpose).

2. Where the prize is to be determined by auction, a ticket or fraction thereof

shall be auctioned for a sum not less that the chit amount minus foreman’s commission,
and the subscriber who bids for the highest discount not exceeding 40% of the total
amount of the chit shall be entitled to have it confirmed in his name.

Note: Where a fraction of a ticket is auctioned, the subscriber who bids it for the
highest discount is entitled to have confirmed in his name at the same rate as many
such fractions as he wished to bid.
 61

3. In case where the subscribers are not be prepared to bid any ticket or
fraction thereof or where the discount is not sufficient to meet the foreman’s commission,
the subscriber who is entitled to the prize amount shall be determined by lot. The
subscriber so determined shall be deemed to be the prized subscriber who shall be
entitled to the chit amount for his ticket less foreman’s commission for that ticket.

4. A defaulter-subscriber shall not be entitled to take part in the proceedings.

5. If for any reason the subscriber is unable to take part in the proceedings, he
may in writing authorize an agent in that behalf. Such agent shall have all the rights and
privileges of a subscriber of such proceedings.

VI. Mode of payment of each installment:

1. Every subscriber shall on the date of each installment pay in the foreman the
amount due for his ticket for each such instalment and get a receipt in that behalf from the
foreman.

2. In the case of the prized subscriber, if the amount due from him for a
particular instalment is not paid on the date of that instalment, it shall be paid within
(here mention weeks or months) with interest at (here specify the rate) failing which it shall
be competent for the foreman to realize from the defaulter in a
lump sum all the future subscriptions due from him together with the interest due
thereon and other incidental expenses.

3. In the case of a non-prized subscriber, if the amount due from him for a
particular instalment is not paid on the date of that instalment, it shall be paid within
(here mentioned week or months) with interest at (here specify the rate) failing which it
shall be open to the foreman to remove him from the list of subscribers and have another
person substituted for such defaulter subscriber. The foreman shall duly inform the
defaulter subscriber of the action taken against him.
 61

Note: Under clauses (2) and (3), the period within which the amount shall be paid
and the rate at which interest due thereon shall be paid may be such as shall not be
inconsistent with the provisions of the Act or any law for the time being in force.

4. A non-prized defaulting subscriber shall be entitled to the amount paid by him

and the discount due to him on his executing an acknowledgement in writing at the time
the substituted subscriber draws the prize amount of the defaulter- subscriber fails to
obtain the amount due to him, the foreman shall deposit the same in the approved bank. If
the foreman fails to pay such subscriber, the amount so due to him on the due date, it
shall be competent for such subscriber to realize such amount with interest permissible
under the law for the time being in force.

VII. Procedure for receiving the prize amount by a prized subscriber.

1. A prized subscriber or his nominee shall receive from the foreman the prize
amount within (here specify the period) after furnishing to the satisfaction of the foreman
sufficient security, for the payment of future subscriptions.

2. In case the prized subscriber or his nominee fails to receive the prize amount
after furnishing sufficient security the foreman shall deposit the amount in the approved
bank and inform the prized subscriber of that fact.

3. In case the amount so deposited is not sufficient for the payment of future
subscriptions, it shall be competent to the foreman to realize from such prized subscriber
such amount as may be deficient together with the interest due thereon and all other
incidental charges.

4. In case there remains any portion of the amount deposited after paying the
future subscriptions and other charges such portion shall be payable by the foreman to the
prized subscriber after the termination of the chit, failing which it shall be competent for
the prized subscriber or his nominee to realize from the foreman such portion as remains
together with the interest due thereon from the date of termination of the chit.
 71

5. If at any time after the prize amount is deposited in an approved bank, the
prized subscriber of his nominee furnishes sufficient security, the foreman shall withdraw
the amount so deposited and pay it to the prized subscriber or his nominee after deducting
there from the amount due from him for the payment of the instalment prior to the date
on which the security is furnished.

6. If the foreman fails to pay the prize amount to the prized subscriber or his
nominee furnishing sufficient security, it shall be competent for such subscriber or his
nominee to realize from the foreman the prize amount together with interest due thereon
from the date of furnishing such security.

VIII. Disbursement of Discount

The discount for every ticket auctioned shall be distributed equally between
the prized and non-prized subscribers after deducting there from the foremen’s
commission.

IX. Foreman’s Commission and the installment at which the foreman is to get the prize.

1. (Here specify the date and number of instalment at which the foreman is to get
the prize) First and the last instalment not being subject to auction, the subscribers shall
be liable to pay the full amount of their tickets.

2. Here specify the rate per cent of foreman’s commission and the total amount of
commission chargeable on the chit amount.

Note: Any other amount agreed to by the subscribers for any other purpose may also
be specified here.

X. Transfer how to be effected

1. It shall not be competent to any subscriber to transfer his rights in a chit except
with the consent in writing of the foreman provided that no such consent shall be necessary
in the case of transfer by a subscriber whose name has been removed by the foreman from
the list of subscribers for default of payment of subscriptions. The transferee (whether he
is already a subscriber or not) shall be entitled to no
 71

more rights than the transferer had in the chit in respect of the ticket or fraction
thereof transferred.

2. No transfer of the rights of a foreman to receive subscriptions from the prized

subscribers shall be made without the previous sanction in writing of the Registrar of
Chits. Any such transfer shall, if it defects or delays a non-prized subscriber, be avoidable
at the instance of such subscriber.

XI. Balance sheet and subscribers right to examine Chit Records:

1. On termination of a chit, the foreman shall prepare the balance sheet

containing a summary of the assets and liabilities of the chit and giving such particulars as
will disclose the nature of the assets and liabilities an how the value of the assets has been
arrived at. Such balance sheet shall be made available for auditing by the auditors
specified in Rule 29 and a certificate or such auditing shall be received by the foreman and
kept by him.

2. The foreman shall make available for examination by the subscribers all the chit
records between (here specify the time) on all the dates of the draw.

XII. Banks where chit money may be deposited (Here specify the approved bank(s) the
foreman proposes to deposit chit money).

XIII. Miscellaneous:

1. The subscriber who gets his prize at the last instalment shall be entitled to the
chit amount less the foreman’s commission. The foreman shall pay up such amount within
(here specify the period) from the normal date of last draw or last installment failing
which the prized subscriber shall be competent to realize the amount from the foreman
together with the interest due thereon the date aforesaid.

2. Any amount due to the foeman from any subscriber on account of the chit shall
be a first charge on the subscriptions paid by such subscriber. Similarly, the security and all
chit money deposited by the foreman shall be liable for discharging any amount due from
the foreman to the subscribers.
 71

3. Receipts shall be granted for all payments by the foreman to the subscribers or
by the subscribers to the foreman duly affixing the Revenue Stamp required as per Article
51 of schedule 1 of the Indian Stamp Act, 1899.

4. The chit amount shall in no case be enhanced, but if necessary, it may be

reduced.

5. If all the non-prized and un-paid prized subscribers give consent in writing for
making any alteration in the chit agreement not in consistent with the provisions of the
Act and the Rules made there under the foreman shall convene the meeting for that
purpose.

6. If for any default of the foreman the conduct of the chit is not continued, the
foremen shall pay to the non-prized subscribers their contributions including dividend
within (here specify the period) failing which it shall be competent for such subscribers to
realize the amount together with the interest due thereon from the foreman or from all
or any of the following assets.

a) the security given or deposited by the foreman;

b) other properties belonging to the foreman;
c) the future subscriptions due to the foreman from the prized
subscribers.

7. In case the foreman holds tickets as an ordinary subscriber in addition to the

ticket of which he is entitled to the prize without deduction of the discount, he shall not
have any more rights, or privileges than the other subscribers have in the chit. When the
foreman bids such tickets he shall furnish sufficient security for the payment of future
subscriptions as required by the Act and the Rules made thereunder.

8. If before the termination of the chit, the foreman dies or otherwise becomes
unable to conduct the chit,
 71

a. here specify the arrangements made for the conduct of the chit.
b. In such a case one or more of the non-prized subscribers authorized
by a special resolution may, in the absence of any provision in this
Chit Agreement for the future conduct of the chit, take the place of
the foreman and have the right to continue the chit on to make
suitable arrangements for the future conduct of the chit.

9. Here specify any other provisions that may be agreed to such as payment of
interest or penalty, if any payable or any default in the payment of stipulated installments
etc.,

10. The subscribers who have affixed there signatures hereunder agreed to the
above Articles.
Sl. No. Name and full No. of tickets Subscribers Name,
address of taken signature and Signature and
subscriber date address of
witness
1 2 3 4 5

11. The total number of subscribers should be limited to the total number of drawn
/ auctions that have been agreed to and each subscriber shall be entitled to
the number of chits held by him, in each chit.
 71

FORM IX

(See Section 16 and Rule 16)

Notice to subscribers of Chit Number of 200

Sir,

This is to inform you that the draw in monthly /

quarterly / half yearly / yearly chit No 200 in which you are one of
the subscribers will be held on day (month) 200 at
/ P.M at (address) be present at the draw in
person or by your duly authorized agent.

Yours faithfully,

Secretary

for and on behalf of (foreman)

Strike out or delete whatever is not applicable. Insert such designation(s) as may be
appropriate.
 71

FORM –X

APPLICATION FOR PERMISSION TO FURNISH SECURITY

FOR CONDUCTING THE CHIT

To
The Registrar of Chits,

Dear Sir,

I / We propose to give the undernoted security in respect of the chit proposed

to be started by me / us, the certificate for commencement of which was granted by
you on (vide No dated ) other particulars are also
given below.

1. Name & Address of the Applicant

2. Age and occupation
3. Chit amount
4. Details of cash / Government Security / any other movable security
/ offered as security
5. Details of immovable properties, offered as security :
1.
District
Sub-district
Taluk
Village
[Link].
Area etc.
2.
District
Sub-district
Taluk
Village
[Link].
Area etc.
 71

6. Rights of the applicant over the property :

7. Market value of the property:
8. Details of prior encumbrances if any, on the property:
9. Movable (and immovable) properties belonging solely to the applicant
(to be shown separately)
10. Whether the applicant has any debt and if so, the amount of such debt.
11. Whether the applicant has conducted any chit before and if so, whether
there is any subsisting liability under the same.
I am / we are appending herewith:
(1) title deeds in support of title to the property offered as security; and
(2) the encumbrance certificate of the property for the past 30 years.

The information and particulars furnished herein are true and correct
to the best of my / our knowledge information and belief.

Yours faithfully,
Chairman :
Secretary :

Place : Signatures(s):
Date : for and on behalf of

Note : 1Applicable only when the security offered is immovable property.

2
Insert the designation as may be appropriate to the applicant, Strike out /
delete whatever is not applicable.

DETAILS OF DECISION

(Seal) Signature of Registrar of Chits

 71

FORM –XI

(See Rule 16(3))

CERTIFICATE OF SUFFICIENCY OF SECURITY

Office of the
Registrar of Chits,

Place :
Date :

In the case of

1. Cash / Government security

I hereby certify that I have satisfied myself that the amount / Government
security mentioned herein and deposited in the approved bank / transferred in my
name (should it be in Registrar’s name or on behalf of Government of Andhra
Pradesh) is adequate and that the same is accepted U/s 20 of the Chit Funds Act,
1982 (Central Act 40 of 1982).

(Seal) Signature of the

Registrar of Chits.
 71

FORM XII

(See Section 20(3) and Rule 20)

APPLICATION FOR SUBSTITUTION OF THE SECURITY

Place :
The Registrar of Chits, Date :

Dear Sir,

I / We propose to give the undernoted security in substitution of the original

security for proper conduct of the chit for the commencement of which a certificate
had been granted by you (vide No Dt. ) certain other particulars
are also given below.

1. Name of foreman.

2. Age & occupation if the foreman is

not a firm or a company.

3. The office in which the chit agreement of

the chit has been registered and the
number and year of registration.

4. Chit amount.

5. Details of the original security given.

6. Whether the applicant has any debt and

if so, the amount of any such debt and to
whom they are due.

7. Details of Government security / other

securities offered as substituted security.
 71

I / We hereby declare that the information and particulars furnished herein are
true and correct to the best of my / our knowledge, information and belief.

Yours faithfully

Chairman

Secretary

for and on behalf of

----------------------------------------------------------------------------------------------------------------

Strike out / delete whatever is not applicable. Insert the designation(s) as may be
appropriate to the applicant.

Decision of the Registrar

(Seal) Signature of the Registrar.

 81

FORM XIII

(See Section 23 and Rule 25)

FORM OF REGISTER OF SUBSCRIBERS TO BE MAINTAINED

Office where the chit agreement of the chit is registered .

The Registration number and year of registration of Chit Agreement of the chit
.

S. No. Name and Date of Date of Chit Subscriber

according to full address signing the receipt of
chit of the chit the copy of
agreement subscriber agreement the chit
No. of Amount
agreement
tickets
by the
subscriber
1 2 3 4 5 6

ASSIGNMENT

Name and Date of No. and Amount Date on which

address of the assignment fraction of (Rs.) the Foreman
assigned tickets recognized the
assignment
7 8 9 10 11

SUBSTITUTION

Reason Date of Name & Date of Number Amount Date of R

for the removal address of substitution & intimation E
removal the fraction of the M
of substituted of substitution A
subscriber subscriber tickets to the R
removed K
subscriber S
12 13 14 15 16 17 18 19
 81

FORM XIV

(See Section 23 and Rule 25)

FORM OF THE LEDGER TO BE MAINTAINED

Office where the Chit agreement of the chit is registered

Registration number of the chit agreement

Section I – Receipt and Payments in respect of subscriber

Number of Subscriber
Name of Subscriber
Number of Tickets taken
Chit Amount Rs

Date Number of On what Amount of Dividend due

instalment account subscription for to the
received or each subscriber for
paid by the instalment each
foreman instalment
4 5
1 2 3
(Rs.) (Rs.)

Amount paid by the Amount General Signature of the R

subscriber received number in E
Share Interest back by the Day Subscriber Foreman M
Amount subscriber Book A
R
K
S
6 7 8
9 10 11 12
(Rs.) (Rs.) (Rs.)
 81

Section – II – Deposit and Withdrawal Account of the foreman

Name of the Bank in which money is deposited

Date For what Amount Interest Balance Amount

purpose deposited accruing after each withdrawn
deposited or transaction
withdrawn
1 2 3 4 5 6
(Rs.) (Rs.) (Rs.) (Rs.)

Balance Number in the Day Signature of the Remarks

Book Foreman
7 8 9 10
 81

FORM XV

(See Section 23 and Rule 25)

FORM OF THE DAY BOOK TO BE MAINTAINED

Office where the Chit agreement of the chit is registered

Registration number of the chit agreement

DAY BOOK

On what
General account
Date Receipts
Number received
or paid
Withdrawal Other Total
Subscription Interest
from Bank Items Receipts
1 2 3 4 5 6 7 8
Rs. Rs. Rs. Rs.

Reference Expenditure
to receipt in
the receipt
book
Amount Foreman’s Deposit in Other items Total
paid to Commission the bank Expenditure
subscriber
9 10 11 12 13 14
Rs. Rs. Rs. Rs. Rs.

Balance Reference to the Signature of Remarks

page number of the Foreman
voucher in the files
of vouchers
15 16 17 18
Rs.
 81

Note:

1. The balance should be struck in column (15) at the close of each day. The monthly
total of receipts and expenditure shall be struck at the end of each month.
2. In column (2) each transaction shall be assigned a serial number. There shall be one
separate set of serial numbers for each calendar year.
3. If any amount is received from or paid to more than one subscriber at a time the
amount paid to or received from each subscriber should be entered as a separate
item.
4. If more than one amount is received from or paid to the subscriber at a time each
amount paid to or received from the subscriber should be entered as separate
item.
 81

FORM – XVI

(See Section 23 and Rule 25)

Original
Duplicate Receipts Serial Number

Received from to the credit of the amounts

detailed below in respect of the Chit Agreement registered under number of
200 .

Rs. Ps.

Payment for current installment

Arrears of subscription (with details)
Penalty for overdue subscription
Fees for inspection of records
Other receipts (to be specified). -----------------------------
Total
-----------------------------

(in words Rupees only)

Date

Affix revenue
Label here

for and on behalf of foreman

…………………………………………………………………………………………………

Note: Strike out / delete whatever is not applicable. Insert the designation(s) as may
be appropriate to the applicant.
 81

FORM – XVII

(See Section 64 and Rule 45)

APPLICATION FOR REFERENCE OF A DISPUTE TO ARBITRATION BEFORE

THE REGISTRAR / ADDITIONAL / JOINT / DEPUTY ASSISTANT REGISTRAR.

1. Name : Age :
Occupation : Address :
2. Name : Age :
Occupation : Disputants
Address :
3. Name : Age :
Occupation : Address :

Versus

1. Name : Age :
Occupation : Address :
2. Name : Age :
Opponents
Occupation : Address :
3. Name : Age :
Occupation : Address :

(Here give full particulars of the claim or the facts of the case constituting the
cause of action when it arose etc.,)

The disputant / disputants prays / pray as under:-

-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------

In support of the above claim or relief sought I / We enclose documents and

papers as per the list annexed hereto.

Date : Signed
Disputant / Disputants.
 81

I / We Disputant / disputants declare that the facts stated above

are true to the best of my / our knowledge and belief.

Date : Signed (1) :

(2) : Disputants
(3) :

Filed in the office of on 200 .

NOTE :
1. In case there are more disputants or opponents, their names, addresses,
age and occupations should also be mentioned.
2. In disputes relating to monetary claims, the disputants should state the
precise amount claimed but where this cannot be exactly ascertained
the disputants shall state the appropriate amount claimed.
3. When the disputant – foreman is a company / cooperative society or a
partnership firm, a copy of the resolution of its Board of Directors or as
the case may be, Managing Committee shall accompany the application.
 81

FORM – XVIII

(See Section 71 and Rule 54)

PROCLAMATION TO BE ISSUED AT THE TIME OF THE ISSUE OF A

CERTIFICATE

A. In the case of immovable property:

Whereas (Judgement-Creditor) has obtained an Award under

Section 69 of the Chit Funds Act, 1982 (Central Act No. 40 of 1982) for an amount of
Rs. against (Judgement-Debtor) and proposes to execute
the same by sale of the under mentioned property of the said judgement-debtor and
whereas the said Judgement-Creditor has obtained a certificate dated
for execution of the award under Section 71, of the said Act.

Notice is hereby given that any private transfer or delivery of, or encumbrance
or charge on, the property made or created after the issue of the certificate shall be
null and void against the said Judgement-creditor under Section 72 of the Act
aforesaid.

DESCRIPTION OF THE PROPERTY

Date of Names of the Survey Name Area Assessment Other R
award parties number of the or other description E
or order against whom or Village taxes of the M
award or House town property A
order has Number etc., such as R
been passed boundaries K
and a etc., S
certificate U/s
71 has been
issued
1 2 3 4 5 6 7 8

The Notice shall be proclaimed at some place on or adjacent to such property

by beat of drum or other customary mode, and a copy of the said notice shall be
fixed on a conspicuous part of the property and upon a conspicuous part of the
 81

village chavadi and also where the property is land paying revenue to the State
Government in the office of the Collector of the District in which the land is situated.

Place.
Date. Registrar of Chits

B. In the case of movable property, a similar notice may be given with necessary changes
as to the description of the property. A copy of the notice shall be delivered to the
judgement-debtor.
 87

FORM – XIX
(See Rule 56(5))
CERTIFICATE FOR TRANSFER OF PROPERTY

In the case of immovable property:

Where in execution of the award made under Section 69, of the Chit Funds
Act, 1982 (Central Act. No. 40 of 1982) in favour of (hereinafter
referred to as the Judgement Creditor) an order was passed on the day of
200 for sale of the under mentioned property of the person or persons
(debtor or debtors).

And whereas the Court / the Collector / Registrar is satisfied that the said
property cannot be sold for want of buyers;

It is hereby ordered that the rights, title and interest of the debtor in the said
property shall vest in the said judgement-creditor and shall be delivered to him
subject to the terms and conditions laid down in the schedule hereto annexed.

DESCRIPTION OF THE PROPERTY

Survey No. Area and Nature of right title Details of
assessment and interest of the Encumbrances to
defaulter which property is
subject

THE SCHEDULE

The said property is transferred to the Judgement-creditor in full / partial

satisfaction of the amount due to him from the debtor.

Given under my hand and seal of the Court / Collector / Registrar this
day of 200 .

Court / Collector / Registrar of Chits.

 87

In the case of movable property:

(The form shall be similar with necessary changes as regards the description
and the delivery of the property).
 87

FORM – XX
(See clause(c) of Rule 2)
FORM OF LETTER OF AUTHORITY

I, who / am / is of M/s
(name ) (Designation)
being is foreman of the chit series registered under Registration
No. as my authorized representative to attend on my / our / behalf in
the matters connected with the above chit to produce accounts and documents and
to receive on my / our / behalf any notice or document issued and to take all
necessary steps in the matter.

I / We agree to ratify all acts done by the said Shri in

pursuance of this authority.

Date : Signature :
Place : Status :

FORM – XXI
(See Rule 28(2))

Name of the Foreman

i) Office where the bye-laws of the chit
(i) Registration No.
and year of the bye-laws of the chit.
ii) Date of which the balance sheet was
(ii) Name of the Foreman
prepared.
iii) No. of instalments conducted till date of (iii) Chit amounts
balance sheet
(iv) No. of instalments.
 87

I – RECEIPTS AND EXPENDITURE

Receipt Current Total Expenditure Current Total
Year including year including
previous previous
years years
1 2 3 4 5 6
Rs. Rs. Rs. Rs.

1. Subscription paid by the prized and 1. Prize amounts disbursed to prized

non-prized subscribers. subscribers.
2. Receipts under dividend 2. Interest paid to subscribers
3. Interest realized from the subscribers3. Amounts paid to defaulter non-prized
subscribers.
4. Contributions by substituted of 4. Amount contributed by foreman for
assignee non-prized subscribers, in payment of the prize amount.
respect of dues of defaulters.
5. Any other amount received from 5. Foreman’s commission.
subscribers.
6. Amount contributed by the foreman for 6. Amounts on account of interest
payment of prize amount. realized for delayed payments and
forfeited dividend.
7. Interest accrued from investments 7. Dividend paid
8. Other items (details to be annexed) 8. Sinking fund
9. Investments withdrawn 9. Other items (details to be annexed)

10. Investments made

Grand Total : Grand Total :

II - STATEMENT OF ASSETS AND LIABILITIES

S. No. Assets Rs. Ps. Liabilities Rs. Ps.
1. Amounts due on account of arrears of 1. Amounts paid by non-prized
subscription due from prized subscribers (including dividend)
subscribers.
2. Amounts due from the subscribers 2. Amounts due to non-prized
including the subscriptions defaulter subscribers
3. Interest due from defaulter subscribers 3. Arrears of prize amount due to
prized subscribers
4. Investments in Bank (including interest 4. Arrears of prize amount due to
thereon) prized subscribers
5. Other items (details to be annexed) 5. Other items (details to be annexed)
6. Sinking fund 6. Sinking fund

Total Total
 87

III - DETAILS OF INVESTMENTS

Rs. Ps.
1. Investment made on account of the
failure on the part of prized subscribers
to receive the prized amount due to
them
2. Investment made on account of
lumpsum collection made from
defaulter prized subscriber.
3. Amount deposited for payment to non-
prized defaulter subscribers
4. Investments on account of other items
of receipts of the chit (details to be
annexed)

Total

IV – ASSESSMENT OF VALUE OF INVESTMENT

1. Investment in Pass book account number.
2. * Amount due from the future instalments of the chit as per bonds, etc.,
obtained for instalments of the chit including the arrears of Rs. due
on account of defaulting instalments from defaulters.
3. Balance of contributions due from the foreman on account of prize amount
received by him.

Note : To facilitate audit of balance sheets, the following statements of details should
be annexed by the foreman to the balance sheet.
i) Statement of details of receipts and expenditure for each instalments.
ii) Of disbursement.
iii) Of the prize amount in respect of each instalment and
iv) Statement of details of arrears due on the date of the preparation of the
balance sheet from the prized and non-prized subscribers.
----------------------------------------------------------------------------------------------------------------
* Particulars of documents to be entered here.

Security offered by the foreman, hypothecation bonds, etc., executed under

Section 20, and hypothecation bonds etc., obtained from the prized subscribers
under Section 31 of the Act.
 87

V – CERTIFICATE BY FOREMAN

I certify that the above accounts have been prepared correctly and that they
contain a true and complete statement of the affairs of the chit.

Date : Name and signature of foreman

VI – CERTIFICATE BY AUDITOR

Certified that I have examined the chit books and records maintained in
respect of the chit the byelaws of which have been registered in
as number 200 conducted by foreman and
have verified the entries in the accounts with the books. The accounts are
drawn up in conformity with the provisions of the Chit Funds Act, 1982 and the
Rules framed thereunder.

Date : Name and Signature of the Auditor