National Consumer Disputes Redressal
Kovilakam Chits And Financial Service ... vs K.L. Benny on 30 April, 2003
Equivalent citations: III(2003)CPJ87(NC)
ORDER
B.K. Taimni, Member
1. Appellant was opposite party before the State Commission where the respondent/complainant had filed a complaint alleging deficiency in service on the part of the appellant.
2. Facts leading to filing of complaint was that the complainant was a subscriber to 'Kuri' for which, under agreed arrangement, he was paying his contribution on daily collection basis. In a draw held on 27.12.1999 the complainant was the winner of prize amount of Rs. 10 lakhs, but was denied the prize on the ground that the complainant has been a defaulter from 9th instalment, thus forfeiting his right to the prize. It is in these circumstances that the complainant filed complaint before the State Commission, (sic)ho after hearing the parties held the appellant deficient in rendering service and directing the appellants to pay the prize money, on the complainant executing necessary bond and producing the security. Complainant was also awarded cost of Rs. 2,000/-. Aggrieved by this order the appellant has filed this appeal before us.
3. The sole point argued by the learned Counsel for the appellant was on the question of jurisdiction of the Consumer Forums to entertain complaints relating to Chit Fund Schemes. Our attention was drawn to Section 64 of the Chit Fund Scheme, which provides for its own redressal mechanism. Section 64(1) clearly bars the jurisdiction of any other Forum to hear such cases. Only authority competent to hear cases is the Registrar under the provisions of the Act and the modus operandi is arbitration.
4. Our attention was drawn towards two judgments of Tamil Nadu State Consumer Disputes Redressal Commission. In Selvan Chit Funds v. Alagh Sundram, II (1996) CPJ 437, the Tamil Nadu State Commission held that complaint against chit fund could not be decided in Consumer Forum while in III (1996) CPJ 523, the same Commission gave a contrary view.
5. We have heard the arguments and perused the material on record. Section 64 of the Chit Fund Act reads as follows :
"Disputes relating to chit business--(1) Notwithstanding anything contained in any other law for the time being in force, any dispute touching the management of a chit business shall be referred to by any of the parties to the dispute, to the Registrar for arbitration if each party thereto is one or the other of the following, namely :
(a) a foreman, a prized subscriber or a non-prized subscriber, including a defaulting subscriber, past subscriber or a person claiming through a subscriber, or a deceased subscriber to a chit;
(b) a surety of a subscriber, past subscriber, or a deceased subscriber, Explanation.--'For the purposes of this subsection, a dispute touching the management of a chit business shall include--
(i) a claim by or against a foreman for any debt or demand due to him from a subscriber or the nominee, heir or legal representative of a deceased subscriber whether such debt or demand is admitted or not;
(ii) a claim by a surety for any sum or demand due to him from the principal borrower in respect of a loan by a foreman and recovered from the surety owing to the default of the principal borrower, whether such sum or demand is admitted or not; and
(iii) a refusal or failure by a subscriber, past subscriber or the nominee, heir or legal representative of a deceased subscriber to deliver possession to a foreman of land or any other asset resumed by him for breach of conditions of the assignment.
(2) Where any question arises as to whether any matter referred to for the award of the Registrar is a dispute or not for the purposes of Sub-section (1), the same shall be decided by the Registrar whose decision thereon shall be final.
(3) No Civil Court shall have jurisdiction to entertain any suit or other proceedings in respect of any dispute referred to in Subsection (1)."
6. Section 64(1) reads "Notwithstanding anything contained in any law for the time being in force..." There is no dispute that Chit Fund Act is a statute of 1982 whereas Consumer Protection Act is a statute of 1986, whose Section 3 read as follows: "Act not in derogation of any other law. The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force."
7. C.P.A., 1986 was not in force in 1982, whereas opposite is true. The intent of the legislation is clear that remedy under C.P.A. was in addition to any law in force at that time. The provision of subsequent legislation i.e. CPA in such a situation shall override the provision of older Statute i.e., Chit Fund Act, 1982.
8. Seeing from another angle, it is pertinent to note that Section 64(3) bars the jurisdiction of Civil Court whereas the Consumer Forums have been held to be not a Civil Court. In view of above without going into this controversy of orders passed by Tamil Nadu State Commission we have no hesitation in holding that Chit Fund cases fall very much within the ambit of Consumer Forums and Chit Fund falls within the definition of service as defined in Section 2(1)(o) of C.P.A. Order of State Commission cannot be faulted on this ground. This being the sole point raised before us, we find no merit in the plea taken by the appellant before us. This appeal has no merit, hence dismissed. No order as to costs.