Rules regulations notifications orders circulars statutory ordinance statutes. For instance, the andhra pradesh chit funds act 1971 had previously required the chit managers in that state to deposit only 50% of the chit value with the registrar of chits prior to the commencement of the chit scheme. A chit fund is a type of savings scheme practised in india, besides other forms of savings scheme offered by various public and private sector banks, post offices, insurance corporations etc. A chit fund company is a company that manages, conducts, or supervises such a chit fund, as defined in section of the chit funds act, 1982. Amended chit fund act brings tighter norms, transparency. The chit funds act 1982 lays down some important ground rules for chit funds. Thus,registration and regulation of chit funds are carried out by state governments under the rules framed by them. The act aims to ban the promotion and circulation of prize chits and money circulation. However, the state acts may override certain provisions as deemed necessary. Discount, divident, drawing, firm, foreman, nonprized subscriber, prize amount, subscriber, ticket.
Banning of unregulated deposit schemes act egazette. One key guideline is regarding the discount that a member is willing to take on the chit. Short title and extent 1 the act may be called the prize chits and. Home actsofparliamentfromtheyear the prize chits and money circulation schemes banning act, 1978 the prize chits and money circulation schemes banning act, 1978 language undefined.
Penalty for contravening the provisions of section 3. The union territory of pondicherry has the pondicherry chit funds act, 1966, which came into force from 1st august, 1967. This recent sca m is con sidered to create a world recor d by slapping nearl y 60 cases a gainst mr. The prize chits and money circulation schemes banning act, 1978. Central government has not framed any rules of operation for them. The prize chits and money circulation schemes banning. Schemes schemes banning act, 1978 and banning act, 1978 and the chit funds act, 1982 and the legislations enacted by the legislations enacted by the sg sg sg have have not been able to completely address the issue of unregulated the issue of unregulated deposit deposit schemes schemes run by unscrupulous run by unscrupulous elements ca. General insurance business nationalization amendment act. Eft services include transfers through automated teller machines, pointofsale terminals, automated clearinghouse systems. Received the assent of the president on the 22nd june 1 961. The biggest chit fund sca m e ver heard in india is the sarad ha group chit fund scam. In this act, unless the context otherwise requires. Recently, while working with one of my clients, i was introduced with the concept of chit funds.
Chit fund act1982 is a central act to provide for the regulations of the chits fund business and for the matters related thereon. The chit funds act, 1982 was enacted to provide for the regulation of chit funds and for matters connected therewith. Regulation e electronic fund transfer act the electronic fund transfer act efta 15 u. Chits and money circulation scheme banning act, 1978. I did good research and thought of sharing my knowled. I an act to provide for the regulation of chit funds in the pstae of tamil nadu. States are responsible for notifying rules and have the power. Prize chits and money circulation schemes banning act, 1978. A prize chit or a money circulation scheme banned under the provisions of the prize. Chit funds act, 1982 mylegalwork online legal help. Employees provident funds and miscellaneous provisions act, 1952 employees state insurance act. Be it enacted by parliament in the thirtythird year of the republic of india as follows.
Circulation schemes banning act, 1978 have been sent by the ministry of finance to. The amendments to chit funds act aim to facilitate orderly growth of the sector and remove bottlenecks being faced by the industry, thereby enabling greater financial access of. Madras chit funds act, 196t as extended to delhi along with delhi chit fund rules, 1964 95. In this act, unless the context otherwise requires, a conventional chit means a transaction whether called chit, chit fund, kuri or by any other name by or under which a person responsible for the conduct of the chit enters into an agreement. An act to provide for the regulation of chit funds and for matters connected therewith. Money circulation schemes are banned under the prize chit and money circulation schemes banning act 1978 and the respective state governments have. Act 28 of 1971 revised edition 20 31st october 20 an act to provide for the licensing and regulation of chit funds. I was aware of sarada chit fund scam but not completely aware of working behind the chit fund. Act to override other laws, memorandium,articles,etc. Now chit funds are trying to carve out a cleaner identity, a campaign that culminated in a slew of amendments to the chit fund act. Be it enacted by parliament in the twentyninth year of the republic of india as follows. No chit shall be commenced or conducted without obtaining the previous sanction of the state government within whose jurisdiction the chit is to be commenced or conducted or of such officer as may be empowered by that government in this behalf, and unless the chit is registered in that state in accordance with the provisions of this act.
If your complaint relates to multilevel marketing scheme or a scheme falling under the price chit and money circulation schemes banning act, 1978, including a company carrying on chit fund business, please lodge your complaint with the ministry of finance, department of economic affairs, government of india. The act classifies chits into conventional chits and prize chits. The estimated turnover of registered chit companies all over india as of now is exceeding rs 35,000 crores per annum. Model rules under the prize chits and money circulation schemes banning act, 1978 have been sent by the ministry of finance to the state. In india, the chit funds are governed regulated by. Police action under prize chits and money circulation schemes. Under the act chit fund act department of goods and. Central chit fund act chit fund companies bangalore. Financial intelligence unit india, ministry of finance, govt. The chit funds act, 1982, is within the leigislative competence of the parliament. With appropriate changes, this act was adopted, with effect from 15th july, 1964, in the union territory of delhi. These changes have become operative from the beginning of this year. It extends to the whole of india except the state of jammu and kashmir. Section 2b of the under chit fund act 1982 defines chit as.
Important parliamentary acts related to banking sector in. Any person or company intends to carry chits business shall obtain prior sanction order p. Organised chit fund schemes are required to register with the registrar of firms, societies and chits. It shall come into force on such date as the central government may, by notification in the official gazette, appoint, and different dates may be appointed for different states. Under the act, the central government can choose to notify the act in different states on different dates. The prize chits and money circulation schemes banning act, 1978 was enacted on 12th december, 1978. In exercise of the powers conferred by subsection 3 of section 1 of the chit funds act. Chit funds in india are governed by the chit funds act, 1982. Before that, chit funds were not governed by any central law. Chit funds act, 1982 in 1982, the ministry of finance enacted the chit funds act to regulate the sector. The kerala chitties amendment act, 1978 act no 19 of 1978 came into force on 03051978 amendment insertion of new section 70 a power to exempt the kerala finance act,2002 wherever 20% of subscribers resides, there must have the office of chitty company. Short title, extent and commencement 1 this act may be called the chit funds act, 1982. The tamil nadu chit funds act of 1961, seeks to regulate the chit fund business in the state of tamil nadu.
Chit funds act 1982 defines a chit fund company as a company which conducts, manages and supervises a chit fund scheme. Copies of chit agreement to be given to subscribers. Chit fund business is regulated under the central act of chit funds act, 1982 and the rules framed under this act by the various state governments for this purpose. Chit funds chitty kuri miscellaneous nonbanking company. Banning of prize chits and money circulation schemes or enrolment as members or participation therein. Under this act, the chit fund businesses can be registered and regulated only by the respective state governments.
358 1164 1556 1080 1133 198 420 867 1179 1359 1191 531 205 1164 1658 784 487 1387 1419 677 398 1326 922 168 423 504 804 543 419 572 30 168