COMMISSIONER AND SECRETARY TO GOVERNMENT COMMERCIAL TAXES AND RELIGIOUS ENDOWMENTS DEPARTMENT Vs. MURUGAN FINANCING CORPORATION COIMBATORE

JUDGEMENT

(1.) THESE appeals arise out of the common judgment of the Madras High court in a batch of writ petitions in switch the respondents challenged the validity of the amendments effected to Article I and insertion of Article 8-A to Appendix II of the T. N. Chit Fund Rules, 1964 (for short 'the Rules'). The High court in its judgment dated 20/03/1985 has struck down as invalid the impugned amendments.

(2.) THE Tamil Nadu Chit Funds Act, 1961 (the Act) provides for the regulation of chit funds in the State of Tamil Nadu. 'Chit' is a transaction by which its foreman enters into an agreement with a number of subscribers that every one of them shall subscribe certain sum by instalments for a definite period and that each subscriber in his turn as determined by lot or by auction, shall be entitled to a prize amount. THE sum total of the subscription payable by all the subscribers for any instalment of a chit without any deduction for discount or otherwise is chit amount.

(3.) THE provisions of the Act impose duties on the Registrar and are intended to regulate the conduct of the business. THE Registrar has to take adequate security and keep the same intact until the claims of all subscribers are satisfied and till the termination of the chit, the Registrar is required to discharge several duties.