MARUTHI FINANCIERS Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) the prize chits and money circulation schemes (banning) Act, 1978, is an act brought into force for banning the promotion or conduct of prize chits and money circulation schemes and for matters connected therewith or incidental thereto with effect from 12-12-1978. It is an act enacted by the parliament. Under section 3 of the said Act, no person shall promote or conduct any prize chit or money circulation scheme or enroll as a member to any such chit or scheme, or participate in it otherwise, or receive or remit any money in pursuance of such chit or scheme. Section 4 of the act contemplates imposition of penalty for contravening the Provisions of Section 3 and Section 5 deals with penalty for other offences in connection with prize chits or money circulation schemes.

(2.) the case of the petitioner is thatthe petitioner commenced a scheme called marulhi golden benefit scheme which was closed in the year 1979. It appears that at the instance of the members, the petitioner commenced another scheme in the month of April 1979 called maruthi diamond scheme and the duration of the scheme was 60 months coming to an end in the month of April 1984. It is stated that under the scheme, the petitioner has advanced a sum of Rs. 9 lakhs to 1500 members and Rs. 4,30,0 00/- to another 1000 members, altogether a sum of Rs. 19 lakhs is outstanding according to the petitioner.

(3.) it is stated that the petitioner wasnot aware of the framing of the Karnataka prize chits and money circulation scheme (banning) rules, 1980 which were published in the karnataka, gazette dated 11-12-1980. On 25-3-1983, the sub-inspector of police, shimoga, raided the premises of the petitioner's firm on the ground that the scheme is banned under Section 3 of the act. The petitioner made a representation to the state government seeking permission to complete the scheme by april, 1984. Thereafter, what happened is not known. The petitioner is aggrieved by the seizure of books of account by the sub-inspector of police.