REGISTRAR, CHIT FUNDS vs ASHWANI KUMAR

THIS revision petition arises from the order passed by the State Commission setting aside the order of the District Forum which had allowed the complaint.

BARE facts necessary to understand the case are that the respondent/complainant was a subscriber to the Chit Fund by the name of CMS Chit Fund Pvt. Ltd., Mr. H.S. Bajaj and Mr. Madan Kishore were its Directors. This company ceased to exist in 1989. Not getting his money back, the complainant filed a complaint before the District Forum who after hearing both the parties and based on a compromise reached between the parties, passed an order on 4.7.1996 directing the opposite parties to pay Rs. 84,000/- with interest @ 18% within a period of one month. No appeal was filed against his order. When the order passed by the District Forum was not complied with, the complainant moved for proceedings under Section 27 of C.P.A. When at this stage non-bailable warrants were issued against the Directors of the Chit Fund Company, then one of the Directors, Mr. Madan Kishore filed an appeal before the State Commission who after hearing the appellant disposed it off with a direction to the Registrar of the Chit Funds to release a sum of Rs. 84,000/- in favour of the complainant. It is against this order of the State Commission that this revision petition has been filed by the petitioner, Registrar, Chit Fund Scheme. His main ground for assailing the order of the State Commission is that order was passed by the State Commission behind his back. He was neither a party nor was he given any notice. There is a proper procedure/prescribed format in which the company has to apply for release of funds lying with the Registrar as a security which has not been done. Even under law, these funds cannot be attached in execution. The order of the State Commission is bad in law and facts hence need to be set aside.

On perusal of record, it becomes clear that the order dated 4.7.1996 passed by the District Forum had became final as it had not been appealed against. In execution proceedings, the State Commission in our view exceeded its jurisdiction by granting relief to the Chit Fund Company and its Directors by transferring the liabiliity to pay, to the Registrar Chit Fund who was not a party before the State Commission. We fail to appreciate as to on what grouds, such relief-different from the original order, which had became final-was granted to the respondent on an appeal, being filed by one of its Director ? On points of law and facts, as brought out by the Registrar, its logic appears to be quite convincing. Whatever money is lying with Registrar as security can be obtained by the Directors/Chit Fund Company on making an application in a prescribed form, brought on record by the petitioner. We also see that Registrar, Chit Fund was not a party and was not made a party before the State Commission, yet the State Commission decided to pass order directing him to do something which is against the Rules on the subject. This is totally unacceptable. We also see the total money which can be given out by petitioner, if at all, is about Rs. 50,000/- only. Directing the Registrar to pay Rs. 84,000/- to the complainant amounts to attachment of the security amount lying with him which cannot be done as per law-Section 12(3) of the Madras Chit Fund Act, as extended to Delhi. In our view, the State Commission went wrong on all points of fact and law, topping it up, with passing order directing the Registrar Chit Fund without hearing him or giving him an opportunity to present his case. In view of all this, the order of the State Commission cannot be sustained and is set aside. Petition is allowed. Order of the District Forum is restored who may proceed with the case as per law. No orders on costs. Revision Petition allowed.