Madras High Court
V.C.Selvan vs The Secretary To Government on 4 July, 2011
Author: Vinod K.Sharma
Bench: Vinod K.Sharma
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 04/07/2011 CORAM THE HONOURABLE MR.JUSTICE VINOD K.SHARMA W.P.(MD).No.588 of 2006 V.C.Selvan ... Petitioner Vs. 1.The Secretary to Government, Commercial Taxes (G) Dept., Fort ST. George, Chennai-6. 2.The Deputy Registrar of Chits Kanyakumari at Nagercoil. 3.Rethna Chit Funds (P) Ltd., Palliyady, Kanyakumari District, Represented by its Managing Director, Mr.Kanagaraj ... Respondents PRAYER Writ Petition is filed under Article 226 of the Constitution of India praying to issue a Writ of Certiorari, calling for the records relating to the proceedings of the first respondent in G.O.(D)No.418, dated 12.10.2004 Commercial Taxes (G) Department, confirming the order passed by the 2nd respondent in Chit No.64/2001, dated 14.08.2002 and quash the same. !For Petitioner ... Mr.G.Godwin ^For R.1 and R2 ... Mrs.S.Barathi Government Advocate For R3 ... Mr.R.Subramanian :ORDER
******** The petitioner has invoked the jurisdiction of this court under Article 226 and 227 of the Constitution of India, for issuing a writ of certiorari quashing the order passed by the arbitrator as also the order of the appellate authority confirming said the order.
2.The petitioner was a subscriber in Palliyadu Retna Chit Fund, in a chit group as Ticket No.60, for the value of Rs.10,00,000/- [Rupees Ten lakhs only] per chit payable at the rate of Rs.25,000/- [Rupees Twenty five thousand only] per month for a period of 40 months. The petitioner was holding ticket No.60 for 40/250 shares of the full ticket. The share of the petitioner was Rs.1,60,000/- [Rupees One lakh and Sixty thousand only] and the monthly subscription amount Rs.4,000/-. Though, the petitioner paid the initial two installments on the due dates, thereafter, he paid a consolidated amount of Rs.12,000/- [Rupees Twelve thousand only] on 15.09.1999 as subscription for 3rd, 4th, 5th and 6th installments. He also paid Rs.7000/-as advance for the 7th installment.
3.However, the petitioner failed to pay the subsequent installments. This fact of payment of subscription being the dispute between the parties, the reference was made to the arbitrator under section 64 of the Chit Funds Act 1982.
4.The arbitrator answered the reference against the petitioner, by holding that the petitioner, has defaulted in payment of regular instalments.
5.The petitioner preferred an appeal against that order. The appellate authority, after considering the arguments raised, dismissed the appeal, by recording as follows:-
"The respondent appeared for the personal hearing and deposed that the appellant subscribed for four chits Rs.1.60 lakhs each for 3 chits and Rs.20,000/- for another chit, totally Rs.5,00,000/-/. He paid two installments. On 15.09.1999, when a latter was sent to the appellant for payment of subscription, he has replied pleading for financial difficulty and as per his request, the respondent had paid the amount for the Chit No.60, he was defaulted from 8th chit onwards and a latter was sent to him for payment of subscription. He did not make payment for 8th to 19th installments. He has stated that the subscription amount paid by the appellant with interest of Rs.23,829.15/- has been refunded to him as per District Registrar's letter, dated 23.09.2002. The appellant has again stated that he has received the money with protest and the date of receipt is disputed. The appellant paid the first two installments on the due dates. After that he paid a consolidated amount of Rs.12,000/- on 15.09.1999 as subscription for the third, fourth, fifth and sixth installments. On the same day he paid another Rs.4,250/- as advance for the 7th installment. The Foreman retained Rs.1,250/- after deducting Rs.3,000/- for the 7th installment. The appellant stopped payment of further subscription. Even after reminders by the Foremen, the appellant has not paid the subscriptions. On receipt of petitions from the appellant, the Deputy Registrar directed to pay the defaulted subscription with 12% interest. Even after this, the appellant did not pay the defaulted subscriptions with 12% interest. If he had paid the defaulted subscriptions with 12% interest, as directed by the Deputy Registrar he might not have been removed from the subscribers list and he would have continued as a subscriber in the said chit. As he had not paid the subscriptions regularly, as per the chit agreement his name had been removed from the subscribers list. It is the duty of the subscriber to pay the subscriptions regularly. He cannot expect the agent to come and collect the money. As per the request of the appellant, the money paid by him had been refunded with interest.
In this circumstances, it is found that the order of the Deputy Registrar of Chits,Kanniyakumari, is well within the norms stipulated in the Chit Funds Act, 1982. Hence, the Government see no reason to interfere with the order of the Deputy Registrar. Accordingly, the appeal filed by Thiru.V.C.Selvan against the order dated 14.08.2002 of the Deputy Registrar of Chits, Kanniyakumari in Case No.64/01 is dismissed as devoid of merits."
6.The learned counsel appearing for the petitioner challenged the impugned orders, by contending that the appellate authority as well as the learned arbitrator have completely misread the facts on record to treat the petitioner as defaulter.
7.The contention of the learned counsel appearing for the petitioner was that the learned arbitrator ignored the fact that the 3rd respondent had refused to receive the cheque. Therefore, it could not be said that the petitioner was defaulter to deny his bona-fide claim under the chit fund.
8.The other contention of the learned counsel appearing for the petitioner is, that once the amount was demanded from the petitioner on 31st July 2001, which was remitted by the petitioner on 13.07.2001 by way of cheque, it was not open to the learned arbitrator or the appellate authority to answer the reference against the petitioner. Therefore, the impugned orders are perverse.
9.It is also the contention of the learned counsel for the petitioner, that the respondent failed to give benefit of dividend, therefore, non deposit of amount by the petitioner within the stipulated period could not be said to be a default to non-suit the petitioner.
10.On consideration, this Court does not find any force in the contention raised by the learned counsel for the petitioner. A reading of the appellate authority order clearly shows, that the petitioner was given an opportunity by the Deputy Registrar of Chits, to pay the defaulted subscription with 12% interest. Inspite of the order of the Deputy Registrar, petitioner failed to deposit the amount.
11.It is not in dispute, that the petitioner did not pay the installments regularly due to the financial crisis and further failed to deposit the amount in compliance with the order of the Deputy Registrar. It was in view of this, that the membership of petitioner was cancelled on 7th July 2001, this order of cancellation was not challenged and the dispute was raised only with regard to the chit payment.
12.The 3rd respondent Company did not act in arbitrary manner rather the amount deposited by the petitioner was paid back to him with interest. As already observed, the Deputy Registrar directed the petitioner to pay the defaulted due, but the petitioner failed to deposit the due with interest 12%.
13.No fault therefore can be found with in the impugned orders passed by the learned arbitrator and the appellate authority. Thus, being no merit in the writ petition, it is ordered to be dismissed. No costs.
er To,
1.The Secretary to Government, Commercial Taxes (G) Dept., Fort ST. George, Chennai-6.
2.The Deputy Registrar of Chits Kanyakumari at Nagercoil.
03.The Government Advocate, Madurai Bench of Madras High Court, Madurai.