GOSRI CHIT FUNDS PVT LTD Vs. DHARMAPALAN

JUDGEMENT

(1.) In this appeal brought at the instance of the plaintiff from the judgment and decree of Additional Sub Court, Ernakulam question for a decision is whether that Court has jurisdiction to try the suit. Learned Sub Judge held that in view of S.64 of the Central Chit Funds Act, 1982 (for short, 'the Act') that Court has no jurisdiction and consequently dismissed the suit.

(2.) Appellant plaintiff claimed that it had started a Kuri from its branch at Bangalore. Respondent defendant No. 1 joined that Kuri and prized it on 03/04/1988. He received the amount and executed agreement along with respondents 2 and 3 undertaking to pay the future instalments without default. As per that agreement, respondents were liable to pay interest at the rate of 12% per annum in case of default in payment of future instalments. Alleging that respondent No. 1 defaulted payment from 03/08/1992 onwards appellant laid the suit in the Second Additional Sub Court, Ernakulam for recovery of future instalments with interest. Respondents contended inter alia, that the Court has no jurisdiction to try the suit in view of S.64 of the Act. Learned Sub Judge accepted that contention and dismissed the suit.

(3.) S.64(1) the Act states that notwithstanding anything contained in any other law for the time being in force, any dispute touching the management of chit business shall be referred by any of the parties to the dispute, to the Registrar for arbitration. It is not disputed before me that the claim made by the appellant against the respondents in this case falls within the expression 'dispute touching the management of a chit business' as stated in the explanation to S.64(1). S.64(3) states that no Civil Court shall have jurisdiction to entertain any suit or other proceedings in respect of any dispute referred to in sub-section (1).