SHRIRAM CHITS PRAIVATE LIMITED BANGLORE Vs. ADDITIONAL REGISTARAR OF CO-OPERATIVE SOCIETIES INDUSTRIAL CO OPERATIVE BANGLOR

JUDGEMENT

(1.) This group of writ petitions challenge separate orders, with identical findings and reasons, dismissing the appeals filed by the petitioner against separate orders passed by the Deputy Registrar of Co-operative Societies-I, Bangalore District, and nominee of Joint Registrar of Chits, Chamarajpet, Bangalore. In view thereof all the petitions were heard together and are disposed of by this common order. Petitioner-Company is in the business of chit funds regulated by the Chit Funds Act, 1982 (for short 'the Act'). The respondents in these petitions other than the authorities under the Act are subscribers. They subscribed to the chit commenced and conducted by the petitioner between 1995 and 1998. The subscribers had executed on demand pronote for prompt payment of subscription amounts and they had also signed consideration receipts and since they did not comply with the repayment of future liability, the petitioners raised disputes as provided for under Section 64 of the Act.

(2.) The Deputy Registrar while dealing with the disputes on merits framed the following issues for consideration:

(3.) Learned Counsel for the petitioner at the outset submitted that the authorities below overlooked the provisions of Section 114 of the Indian Evidence Act, 1872 to presume that the petitioner commenced and conducted chit in accordance with the provisions of the Act having regard to the admitted facts placed on record. In other words, he submitted that the respondent-subscribers participated in the chit, took all the benefits and when they were supposed to comply with the repayment of future liability they refused and took a defence that the chit was not registered as provided for under Section 4 of the Act. He invited my attention to illustration (f) appended to Section 114 of the Indian Evidence Act in support of this contention. Next he submitted that the authorities below were wrong in not entertaining the dispute on the ground that the chit was not registered and it was commenced without obtaining previous sanction of the State Government. The chit was a contract which is legally enforceable and merely because it was not registered, it does not become void, since it falls within meaning of 'chit' defined by clause (b) of Section 2 of the Act. In support of this contention he placed reliance upon the judgment of Calcutta High Court in Lakhan Jena and Others v. Arjun Naik 24 Ind. Cas. 287 decided on 15th May, 1914. He further submitted that non-registration of chit or commencement of the chit without obtaining previous sanction would at the most attract the penal action contemplated by Section 76 of the Act and that the relief sought in the dispute cannot be refused.