KONAKANCHI MADHU Vs. CHAIRMAN, SHRIRAM GROUP COMPANIES

JUDGEMENT

(1.) This is a consumer complaint filed by a subscriber of chit against the chit fund company represented by opposite parties 1 to 4 being the functionaries at various levels and the State of Andhra Pradesh in control of chits represented by opposite parties 5 to 7 of different functional designations.

(2.) The case of the complainant stated briefly is as follows:

(3.) It seems he joined Sri Ram Chits Private Limited Kodada branch as a chit subscriber with ticket no.25 (usually called as KDLC 5/25) covered by byelaw group 166/2003-2004. Sri Ram Chits Private Limited is a company registered under the Companies Act, 1956. The complainant claimed to have paid a sum of Rs.1,88,015/- towards his chit account by way of subscription. He was a non prized chit holder valued Rs.10,000/-per month spread over 50 months of a chit with a face value of Rs.5 lakhs. He claimed to have joined the chit on 29-7-2003 and paid the last subscription on 27-4-2006. Thereafter, he complained the opposite parties removed him from membership with effect from 20-7-2006 without giving prior intimation as prescribed U/s20 (1) and (2) of A.P.Chit Fund Act. They also gave a go by to the procedure prescribed under U/s.20 (3) and (4) of A.P.Chit Fund Act and substituted themselves as a substituted subscriber contrary to law. By not following law, they deprived him of a chance to prefer an appeal against his removal. As a matter of fact, even when a defaulting subscriber was removed, they are bound to pay him the amount due to the subscriber. Instead of doing that, they obtained a written requisition for adjustment in respect of the amount due from his wife, who was also removed from membership. Likewise, they also appropriated the amount due to him towards the arrears of other subscribers for which he stood as guarantor, though the above chit customers were not defaulters. He submitted that this kind of adjustment, except the adjustment contemplated by the chit agreement in itself, if any, was illegal. Thus he pleaded that the opposite parties were guilty of violation Sec.22 of A.P.Chit Fund Act, 1971 also. He claimed to have approached the Registrar of Chits, opposite party No.5 , with his grievance. He alleged that the opposite parties 1 to 4 stage managed the intimation of his removal to the Registrar of chits by fabricating documents as clearly made out by the fact that the substitution agreement came to be executed on 20-7-2006 but the adhesive stamps thereon were dated 4-10-2006 betraying the fabrication of the said event. The Registrar deliberately failed to discharge his duty by making a relevant endorsement on the said fake document. It is how he added the Registrar as opposite party No.5 and the Commissioner of Chits and the State of Andhra Pradesh represented by the Collector as opposite parties 6 and 7 respectively. In view of these illegal acts, the complainant claimed to have sustained loss and injury and in fact even the opposite parties 1 to 4 were found guilty of violating the provisions of A.P.Chit Fund Act, 1971 as observed in the order passed by the opposite party No.6 in which a penalty (last sheet of Ex.B16)was also imposed against the said Sri Ram Chit Fund, Kodada Branch. It is in these circumstances that he preferred the claim for return of the amount due to him in terms of Section 22 of the A.P.Chit Fund Act, 1971 quantified at Rs.1,88,015 plus dividend of Rs.70,000/- with some penal interest also and further payments for violating the stamps Act and the Chit Fund Act etc. and thereby perpetrating fraud against him. He also claimed costs, damages etc.