ANDHRA PRADESH CHIT FUNDS ACT, 1971

CHAPTER 1 Preliminary

Section 1 Short title, extent and commencement

(1) This Act may be called the Andhra Pradesh Chit Funds Act, 1971.

(2) It extends to the whole of the State of Andhra Pradesh.

(3) It shall come into force on such date as the Government may, by notification, appoint, and different dates may be appointed for different areas and for different provisions of this Act.

Section 2 Definitions

In this Act, unless the context otherwise requires:-

(1) "approved bank" means a bank approved by the Government:

(3) "Chit agreement" means a document containing the articles of agreement between the foreman and the subscribers relating to the chit and filed under Section 6;

(4) "chit amount" means the sum total of the subscriptions payable by all the subscribers for any instalment of a chit without any deduction for discount or otherwise;

(5) "defaulting subscriber" means a subscriber who has defaulted in the payment of subscriptions due according to the terms of the chit agreement;

(6) "discount" means the sum of money or the quantity of grain or other commodity, which a prized subscriber has under the terms of the chit agreement to forego and which is set apart under the said agreement to meet the expenses of running the chit or for distribution among the subscribers or both;

(7) "dividend" means the share of a subscriber in the discount available under the chit agreement for rateable distribution among the subscribers at each instalment of the chit;

(8) "drawing" means ascertaining of the person or persons entitled to the prize amount at any instalment of a chit;

(9) "firm" means a firm registered under the Indian Partnership Act,1932;

(11) "Government" means the State Government;

(12) "non-prized subscriber" does not include a defaulting subscriber;

(13) "notification" means a notification published in the Andhra Pradesh Gazette;

(14) "prescribed" means prescribed by rules made under this Act;

(15) "Prize amount" means the difference between the chit amount and the discount, and, in the case of a fraction of a ticket means the difference between the chit amount and the discount proportionate to the fraction of the ticket; and when the prize amount is payable otherwise than in cash the value of the prize amount shall be the value at the time it becomes payable;

(16) "prized subscriber"means a subscriber who has either received or entitled to the prized amount;

(17) "Registrar" means a Registrar appointed under sub-section (1) of Section 51;

(18) "Subscriber" includes a person who holds a fraction of a ticket and also a transferee of a ticket or a fraction thereof by assignment in writing or by operation of law.

(19) "ticket" means the share of a subscriber in a chit and the expression "fraction of a ticket" shall be construed accordingly.

CHAPTER 2 Constitution and Registration

Section 3 Registration of bye-laws

(1) Save as otherwise provided in this Act, no person shall start or conduct any chit unless he has registered with the Registrar the proposed bye-laws of the chit.

(2) For the purpose of registration. there shall be filed with the Registrar the bye-laws of the chit in duplicate signed by the foreman and attested by atleast two witnesses.

(3) The Registrar, on being satisfied that the bye-laws are not contrary to this Act or to the rules made thereunder, shall issue to the foreman, a certificate of registration and such certificate shall be conclusive evidence that the bye-laws of the chit therein mentioned are duly registered.

(4) The Registrar shall retain one copy of the bye-laws of the chit and return the duplicate of the bye-laws to the foreman, with an endorsement that the bye-laws have been registered.

Section 4 Prohibition of invitation for subscription to chit of which bye-laws have not been registered

No person shall issue or publish any notice, circular, prospectus or other document containing the terms and conditions of any chit or inviting the public to subscribe for tickets in any chit unless such notice, circular, prospectus or other document relates to a chit the bye- laws of which have been registered.

Section 5 Form of chit agreement

Every chit agreement shall be in duplicate and shall be signed by the subscriber or by persons authorised in that behalf in writing by the subscribers and the foreman and attested by at least two witnesses and it shall contain the following particulars namely:

(1) the full name and the permanent residential address of every subscriber;

(2) the ticket held by each subscriber;

(3) the number of instalments and the mount payable in respect of each ticket for each instalment;

(5) the mode of ascertaining the prized subscriber;

(6) the amount of discount which the prized subscriber at any instalment has to forego;

(7) the mode and proportion in which the discount is distributable by way of dividend, foreman's commission or remuneration and other expenses, if any;

(8) the date, time and place at which the chit is to be drawn;

(9) if under the chit agreement the foreman is entitled to the chit amount, the instalment at which the foreman is to get the chit amount;

(10) the approved bank in which chit moneys shall be deposited by the foreman under the provisions of this Act

(11) the manner in which a chit shall be continued, where a foreman who is an individual dies or becomes of unsound mind or is otherwise incapacitated; and

Section 6 Filing of chit agreement

(1) Every chit agreement with its duplicate shall be filed with the Registrar.

(2) The Registrar shall retain the chit agreement and return the duplicate chit agreement to the foreman with an endorsement that the chit agreement is filed.

Section 7 Commencement of chit business

(1) No person shall commence any auction or drawing of any chit unless he has obtained a certificate of commencement from the Registrar.

(2) The Registrar shall, on being satisfied that the bye-laws of the chit have been registered and the chit agreement has been filed and the security required under section 12 has been furnished by the foreman, grant a certificate of commencement.

Section 8 Copies of bye-laws and chit agreement to be given to subscribers

(1) The foreman shall, as soon as may be after he has obtained the certificate of commencement referred to in section 7, but not later than the date of the first drawing of the chit, furnish to every subscriber a copy of the bye-laws of the chit and of the chit agreement certified by him to be a true copy.

(2) The foreman shall, within the fifteenth day of the month succeeding the month in which the first instalment of the chit is drawn, file with the Registrar a certificate to the effect that he has complied with the provisions of sub-section (1).

Section 9 Alteration etc., of chit agreement

(1) The Chit agreement shall not be altered, added to or cancelled except with the consent in writing of the foreman and all the subscribers to the chit.

(2) Every such alteration, addition, or cancellation, shall be intimated to the Registrar who shall record it in the copy of the chit agreement retained with him.

Section 10 Minutes of proceedings

(1)Minutes of the proceedings of every drawing shall be prepared and entered in a book to be kept for that purpose and shall be signed by the foreman and all the subscribers present. It shall also be signed by the prized subscriber or his authorised agent.

Section 11 Copy of minutes to be filed with the Registrar

Every foreman shall, within the fifteenth day of the month succeeding the month in which one or more instalments of the same chit or one or more instalments of any other chit are drawn, file with Registrar a copy of the minutes, referred to in section 10 in respect of the drawings at all such instalments and certified by the Foreman to be a true copy.

CHAPTER 3 Foreman

Section 12 Security to be given by the foreman

(2) Where a foreman conducts more than one chit, he shall furnish security in accordance with the provisions of sub-section (1) in respect of each such chit.

(4) The Registrar shall, after the termination of a chit and after satisfying himself that the requirements under clauses (i) to (iii) of sub-section (3) have been complied with release the property charged by way of security or order the release of the cash security or the Government securities referred to in-sub- section (1) in such manner as may be prescribed.

(5) The Registrar may, on the application of any foreman, instead of releasing the security under sub-section (4), accept the same as security in respect of any other chit or chits conducted by the same foreman. If the value or amount of the security so accepted is less than the value or amount specified in sub- section (1), the Registrar shall require the foreman to furnish additional security to make up the deficiency. If the value or amount of such security is in excess of the value or amount required, the Registrar shall release such excess.

(6) Notwithstanding anything to the contrary contained in any other law, the security furnished under this section shall not be alienated in any manner by the foreman during the currency of the chit and any such alienation by way of transfer, charge, mortgage. or other encumbrance shall be null and void.

Section 13 Rights of the foreman

(2) In case of any dispute in regard to the value of the property offered as security under clause (d) of sub section (1) the matter shall be referred to the Registrar, whose decision thereon shall be final

Section 14 Duties of the foreman

(2) If owing to the default of the prized subscriber the prize amount due in respect of any drawing remains unpaid before the date of the next succeeding drawing, the foreman shall deposit the same forthwith in an approved bank mentioned in the chit agreement and intimate in writing the fact of such deposit to the prized subscriber.

(3) Every payment of the prize amount, the deposit of the amount of future subscriptions under sub-section (1) and the deposit of the prize amount under sub-section (2) shall be intimated to the subscribers at the next succeeding drawing, and particulars of such payment or deposit entered in the minutes of the proceedings of that drawing.

Section 15 Registers and books of account

The foreman shall keep such registers and books of account, and in such form, as may be prescribed.

Section 16 Balance sheet

(1) Every foreman shall prepare and file with the Register in such manner and within such time as may be prescribed, a balance sheet relating to the period of account audited either by qualified auditors under the Companies Act, 1956, or by a chit auditor appointed under sub-section (2) of section 51.

Section 17 Liability of the foreman to the subscribers

(1) Every foreman shall be liable to account to the subscribers for the amounts due to them.

(2) Where there are more than one foreman each one of them jointly and severally or if the foreman is a firm each one of the partners thereof jointly and severally and if the foreman is a body corporate, the body corporate as such shall be liable to the subscribers in respect of the obligations arising out of the chit.

Section 18 Withdrawal of a foreman

No foreman or where there are more than one person as foreman in a chit none of them, shall withdraw from the chit until the termination of the chit unless such withdrawal is assented to by all the non-prized subscribers and unpaid prized subscribers and a copy of such assent has been filed as required by section 32. Such withdrawal shall not, however, affect the security given under Section 12.

CHAPTER 4 Non-prized Subscribers

Section 19 Non-prized subscriber to pay subscription and get receipt

Every non-prized subscriber shall pay his subscription at the time and place mentioned in the chit agreement and shall on such payment be entitled to get a receipt from the foreman.

Section 20 Removal of defaulting Subscribers

(1) A non-prized subscriber who defaults in paying his subscription in accordance with the terms of the chit agreement shall be liable to have his name removed from the list of subscribers. Every such removal shall, with the date thereof, be entered in the relevant book maintained by the foreman. A written notice of such removal shall be given by the foreman to the defaulting subscriber within fourteen days of such removal.

(2) A true copy of the entry referred to in sub-section (1) shall be filed by the foreman with the Registrar within fourteen days from the date of such removal.

(3) Any defaulting subscriber aggrieved by the removal of his name from the list of subscribers may within seven days of the communication to him of the notice of removal, appeal to the Registrar.

(4) The Registrar may, after giving the parties an opportunity of making a representation pass such order on the appeal as he thinks fit and the decision of the Registrar be final

Section 21 Substitution of subscribers

(2) Every substitution referred to in sub-section (1) shall, with the date thereof, be entered in the relevant book maintained by the foreman. A true copy of every such entry shall be filed by the foreman with the Registrar within fourteen days from the date of substitution.

Section 22 Amount due to defaulting subscriber how dealt with

When a substituted subscriber draws the prize amount the defaulting subscriber shall be entitled to recover from the foreman his contributions subject to such deductions as may be provided for in the chit agreement. The foreman shall on demand made by the defaulting subscriber and on his executing an acknowledgment duly signed be bound to pay to the defaulting subscriber the amount due to him before the date of the next succeeding instalment. If the defaulting subscriber fails to furnish the acknowledgment as aforesaid, the foreman shall, before the date of the next succeeding instalment deposit in an approved bank the amount due to the defaulting subscriber. The amount so deposited shall not be withdrawn by the foreman for any purpose other than for payment to the defaulting subscriber.

CHAPTER 5 Prized Subscriber

Section 23 Prized subscriber to give security

Before receiving the prize amount without deducting all future subscriptions, every prized subscriber shall furnish and the foreman shall take sufficient security for the due payment of future subscriptions and if the foreman is the prized subscriber, he shall give security for the due payment of future subscriptions to the satisfaction of the Registrar.

Section 24 Prized subscriber to pay the subscription regularly

Every prized subscriber shall pay his subscriptions regularly at the time and place and on the date mentioned in the chit agreement and on his failure to do so, he shall be liable to make a consolidated payment of all the future subscriptions at once.

Section 25 Foreman to demand future subscriptions by written note

(1) The foreman shall not be entitled to claim consolidated payment of all the future subscriptions from a defaulting prized subscriber unless he shall have demanded the same in writing.

(3) Any person who holds an interest in the property furnished as security or any part thereof shall be entitled to make payment under sub-section (2)

(4) All consolidated payments of future subscriptions realized by a foreman shall be deposited by him in an approved bank before the date of the next succeeding instalment. The amount so deposited may be withdrawn only for payment of future subscriptions. When any property is acquired in lieu of the consolidated payment it shall remain as security for the due payment of future subscriptions.

CHAPTER 6 Transfer

Section 26 Restrictions on transfer of rights of foreman

(1) No transfer of the rights of a foreman to receive subscriptions from prized subscribers shall be made without the previous sanction in writing of the Registrar.

(2) Any such transfer of the rights of a foreman to receive subscriptions from a prized subscriber shall, on application by the subscriber and if it is likely to affect prejudicially the interest of any non-prized subscriber or unpaid prized subscriber, be set aside by such officer as may be empowered by the Government in this behalf.

(3) When under sub-section (2), a transfer is disputed by a subscriber, the burden of proving that the foreman was in solvent circumstances at the time of the transfer and that the transfer is not likely to affect prejudicially the interests of any such subscriber is upon the transferee.

Section 27 Transfer of non-prized subscriber's rights to be in writing

Every transfer by a non-prized subscriber of his rights in the chit shall be in writing duly attested by at least two witnesses and shall be filed with the foreman.

Section 28 Recognition of transfer by the foreman

Every transfer under section 27 shall be recognised by the foreman unless the transferee is not solvent or the transfer was effected with a view to defeat the provisions of any law.

Section 29 Entry of transferee's name in the books

Every transfer made under Section 26 or Section 27 shall be entered by the foreman in the books of the chit forthwith and a true copy of such entry shall be filed by the foreman with the Registrar within fourteen days from the date of such entry.

CHAPTER 7 Termination of Chits

Section 30 Provisions for continuation of chits in certain cases

Where the foreman, who is an individual, dies or becomes of unsound mind or is otherwise incapacitated, the chit may be continued in accordance with the provisions of the chit agreement.

Section 31 Termination of chit

A chit shall be deemed to have terminated

(a) When the period fixed in the chit agreement has expired provided payment of dues to all the subscribers has been completed; or

(b) When all the non-prized and unpaid prized subscribers consent in writing to the termination of the chit and a copy of such consent is filed as required by Section 32; or

Section 32 Copy of assent or consent to be filed with the Registrar

A true copy of every consent mentioned in Section 18 and of every consent mentioned in Section 31, with the date of such assent or consent shall be filed by the foreman or by the surviving partner, as the case may be, with the Registrar within fourteen days from the date of such assent or consent.

Section 33 Refund of non-prized subscriber's contribution

Except in the three cases referred to in clauses (a) and (b) of section 31

(b) if the chit terminates on a date earlier than the date originally fixed in the chit agreement, the non-prized subscriber's claim shall be deemed to have arisen on the date on which he has notice thereof.

Section 34 Subscriber's dues to be first charge on chit assets

Where there are debts due from the foreman of a chit in relation thereto and also other debts due from such foreman, the chit debts due to the subscribers shall be a first charge on the chit assets.

CHAPTER 8 Inspection of Documents

Section 35 Foreman to allow subscriber to examine chit records

Every foreman shall, on payment of such fee not exceeding five rupees as may be specified in the chit agreement allow non-prized and unpaid prized subscribers all reasonable facilities on all days of drawing of chit or on such days and within such hours as may be provided for in the chit agreement for the inspection of security bonds and documents, receipts and other records taken from the prized subscribers or furnished by the foreman himself in his capacity as a subscriber and all chit records including books of accounts and pass books, the balance sheets and profit and loss accounts and such other records as may show the actual financial position of the chit scheme.

Section 36 Preservation of chit records by foreman

All the records pertaining to a chit shall be preserved in tact by the foreman and kept for a period of six years from the date of the termination of the chit.

Section 37 Inspection of chit books and records

(1) The Registrar, or any officer authorized by the Director of Chits in this behalf may inspect the chit books and all records after giving ordinarily seven days notice in writing to the foreman.

CHAPTER 9 Winding up of Chits

Section 38 When chit may be wound up

The City Civil Court in respect of a chit registered in the area comprised within the jurisdiction of the Municipal Corporation of Hyderabad and the District Court having jurisdiction in respect of a chit registered elsewhere may wind up a chit for all or any of the following reasons, namely:-

(a) if the chit has terminated under clause (c) of Section 31.

(b) if the foreman fails to give the security specified in Section 12 or if he commits any such act in respect thereto as is calculated to impair materially the nature of the security or the value thereof, or

(c) if he fails to deposit the chit moneys in accordance with the provisions of this Act, or

(d) if it proved to the satisfaction of the court that the foreman is unable to pay the amounts due to the subscribers, or

(e) if execution or other process issued on a decree or order of any court in favour of any subscriber in respect of amounts due to him from the chit is returned unsatisfied in whole or in part, or

(f) if it is proved that there has been fraud or collusion on the part of the foreman in the matter of taking securities from prized subscriber, or

(g) if the foreman has appropriated the prize amount in his capacity as a subscriber without furnishing sufficient security for future subscriptions, or

Section 39 Application for winding up

The application to the court for the winding up of a chit shall be by a petition presented by any non-prized subscriber or unpaid prized subscriber or by the Registrar, signed and verified in the manner prescribed by the Code of Civil Procedure, 1908 and shall contain such particulars as may be prescribed:

Section 40 Insolvency or liquidation a bar to winding up proceedings

Notwithstanding anything in Sections 38 and 39, no petition for the winding up of a chit shall be entertained by a court if proceedings under the law relating to insolvency for the time being in force are pending against the foreman for adjudicating him an insolvent or when the foreman is a company, if proceedings for winding up.the company are pending against such company in a court.

Section 41 Commencement and effect of winding up order

An order for the winding up of a chit shall operate in favour of all the subscribers to whom amounts are due from the chit and it shall be deemd to have commenced from the time of the presentation of the application for the winding up.

Section 42 Injunction Order

The court may, upon the application of the foreman or of any subscriber to whom amounts are due in respect of the chit at any time after the presentation of the application for the winding up of a chit under this Act and before the making of an order for the appointment of an interim Receiver or for winding up the chit, restrain further proceedings in any suit or proceeding instituted against the foreman for the realization of amounts due from the chit upon such terms as the court thinks fit.

Section 43 Powers of court on hearing the application

On hearing the application, the court may dismiss it with or without costs or adjourn the hearing conditionally or unconditionally or make an interim order or any other order that it deems fit.

Section 44 Chit assets to vest in court for distribution

On the making of an order for the winding up of a Chit, the entire chit assets shall vest in the court for distribution amongst the subscribers to whom amounts are due in respect of the chit and the court shall pass such orders in the matter including the appointment of Receiver, as it deems fit.

Section 45 Suits stayed on winding up orders

When a winding up order has been made by a court, no suit or other legal proceedings shall be continued or commenced against foreman by a subscriber for the realization of amounts due to him in respect of the chit except with the leave of the court and on such terms as the court may impose.

Section 46 Copy of winding up order to be filled with the Registrar

(2) On the filing of a copy of the winding up order, the Registrar shall make an entry thereof in his books relating to the chit and shall notify in the District Gazette that such an order has been made.

Section 47 Stay of winding up proceedings on insolvency of foreman and transfer of insolvency proceedings

When during the pendency of the proceedings for the winding up of a chit, the foreman is adjudicated an insolvent or when the foreman is a company, the company has been ordered to be wound up by the court the winding up proceedings under this Act, shall cease and the distribution of the chit assets, shall, subject to the provisions contained in Sections 34 and 42, be made by the insolvency court or the court winding up the company, as the case may be. Where insolvency proceedings, against the foreman are pending in different courts, the High Court may transfer the proceedings from one court to another as it may deem fit.

Section 48 Compensation for frivolous or vexatious application

(1) When an application presented for winding up a chit is dismissed and the court is satisfied that the application if frivolous or vexatious, the court may award against the applicant such amount, not exceeding five hundred rupees as it deems reasonable as compensation to the foreman for the expense or injury occasioned to him by the application and the proceedings thereon and such amount may be realized as if the award were a decree.

(2) The award of any amount under sub-section (1) shall bar any suit for compensation.

Section 49 Right of appeal

The foreman, any subscriber, the Receiver or any other person aggrieved by a decision or order of the court in proceedings for winding up a chit may, within two months from the date of such decision or order, appeal to the High Court.

Section 50 Limitation

(1) Where an order refusing to wind up a chit has been made under this Act, the chit shall be deemed to have been under suspension from the date of the presentation of the application to the date of such order in respect of non-prized subscriber, and notwithstanding any thing in the chit agreement, no non-prized subscriber who was not a defaulter on the date of the presentation of the application for winding up shall be deemed to be a defaulter on the date of its dismissal.

(2) Where an order refusing to wind up a chit has been made under this Act, in computing the period of limitation prescribed for any suit or other legal proceeding (other than a suit or an application in respect of which the leave of the court has been obtained) which might have been brought or instituted, the period from the date of the presentation of the application to the date of the order refusing to wind up the chit shall be excluded.

(3) Nothing in this Act shall affect the right of the subscriber to proceed by suit or application against the foreman personally for the balance, if any, of the amount due to him after the declaration of the final dividend in proceedings for winding up the chit and in computing the period of limitation prescribed for any such suit or application, the period from the date of the presentation of the application for winding up the chit to the declaration of the final dividend shall be excluded.

CHAPTER 10 Officers, Inspection and Fees

Section 51 Appointment of Director of Chits, Inspecting Officers, Registrar and chit auditors

(1) The Government may, by notification appoint a Director of Chits and as many Inspecting Officers and Registrars as may be necessary for the purpose of discharging the duties imposed upon the Director of Chits, the Inspecting Officers and the Registrars by or under this Act.

(2) The Director of Chits may appoint as many chit auditors as may be necessary for the purpose of discharging the duties imposed upon the chit auditors by or under this Act.

(3) All Inspecting Officers, Registrars and chit auditors shall discharge the duties imposed upon them by or under this Act, under the general superintendence and control of the Director of Chits.

(4) If the Registrar is of the opinion that the accounts of any chit are not properly maintained and that such accounts should be audited, it shall be lawful for him to have such accounts audited by a chit auditor. It shall be the duty of the foreman of the chit concerned to produce before the chit auditor, all accounts, with books and other records relating to the chit, to furnish him such information may be required and to afford him all such assistance and facilities as may be necessary or reasonable and may be required in regard to the audit of the accounts of the chit.

(5) The foreman shall pay to the chit auditors such fees as may be prescribed for the audit of the accounts of a chit under sub- section (4)

Section 52 Inspection of documents in the Registrar's office

Any person may, on payment of such fees as may be prescribed

(i) inspect the documents kept by the Registrar; and

(ii) obtain a copy or extract of any document to be certified by the Registrar.

Section 53 Levy of fees

(2) A table of fees payable under sub-section (1) shall be exhibited in a notice board at the office of the Registrar.

CHAPTER 11 Miscellaneous

Section 54 Appeals

(2) Any foreman or any other person aggrieved by an order of the Registrar under sub-section (1) of section 26 or by an order of an officer empowered by the Government under sub-section (2) of that section may, within thirty days of the communication to him of such order, appeal to the Director of Chits.

(3) The Director of Chits may. after giving the appellant an opportunity of making his representation pass such order on the appeal under sub-section (1) or sub-section (2) as he thinks fit.

Section 55 Power of Registrar to condone delay in certain cases

(1) Registrar may, in his discretion and upon an application in writing by any foreman made within the period of fourteen days specified in any of the provisions of sub-section

(2) of section 20, sub-section (2) of section 21, section 29 and section 32, allow to the foreman further time not exceeding fifteen days to file a copy of any document under any of the provisions referred to above.

Section 56 Penalties

(1) Whoever contravenes or abets the contravention of any of the provisions of sub-section (1) of section 3 or section 4, sub-section (1) of section 7 shall be punishable with imprisonment for a term which may extend to one year or with fine which may extend to five hundred rupees or with both.

(3) Whoever in any document required by or for purposes of, any of the provisions of this Act, wilfully makes a statement false in any material particulars knowing it to be false, shall be punishable with imprisonment for a term which may extend to one year or with fine which may extend to five hundred rupees or with both.

Section 57 Cognisance of offences

No court inferior to that of a salaried magistrate of the first class shall try any offence under this Act.

Section 58 Application of fines

The Court imposing any fine under this Act, may direct that the whole or any part thereof be applied in or towards payment of the costs of the proceedings.

Section 59 Power to enter and search any place and to seize documents etc

(2) The Registrar or the Inspecting Officer shall have authority to require any person whose testimony he may require regarding any chit agreement to attend before him or to produce or cause to be produced any document and to examine such person on oath.

(3) The Registrar or the Inspecting Officer may apply for assistance to an officer in charge of a police station and take police officer to accompany and assist the Registrar or the Inspecting Officer in discharging his duties under this Act.

(4) The provisions of section 102 of the Code of Criminal Procedure, 1898 shall, so far as may be, apply to a search under this section.

Section 60 Payment to be evidenced by documents

All payments in respect of a chit whether by the foreman or by the subscriber shall be evidenced by documents in writing.

Section 61 Interest at more than twelve per cent not to be allowed

No court shall award interest on claim arising under this Act at more than twelve per cent per annum simple interest.

Section 62 Power of court to grant relief in certain cases

Nothing in the foregoing provisions of this Act shall affect the powers vested in a court for granting relief against any of the provisions contained in the chit agreement if the same be unconscionable or opposed to the provisions of any law.

Section 63 Power to make Rules

(1) The Government may, by notification, make rules for carrying out all or any of the purposes of this Act.

(3) Every rule made under this Act shall, immediately after it is made, be laid before each House of the State Legislature if it is in session and if it is not in session, in the session immediately follwing, for a total period of fourteen days which may be comprised in one session or in two successive sessions and if, before the expiration of the session in which it is so laid or the session immediately following, both Houses agree in making any modification in the rule or in the annulment of the rule, the rule shall from the date on which the modification or annulment is notified have effect only in such modified form or shall stand annulled as the case may be; so however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

Section 64 Recovery of amounts due from a foreman

All amounts due from a foreman to the Registrar or any other officer under this Act by way of any fee shall be recoverable as arrears of land revenue.

Section 65 Act not to apply to certain chits

The provisions of this Act shall not apply in respect of

(1) any chit started and conducted before the commencement of this Act, or

(2) any chit, the chit amount of which or where two or more chits are started or conducted simultaneously by the same foreman, the aggregate chit amount of which does not exceed one hundred rupees.

Section 66 Power to exempt

The Government may, by notification, exempt any person or class of persons to whom or any chit or class of chits to which this Act applies from all or any of its provisions, subject to such conditions as they deem fit and may cancel or modify any such notification.

Section 67 Amendment of Central Act 2 of 1899

In schedule 1-A to the Indian Stamp Act, 1899 as amended by the Indian Stamp (Andhra Pradesh Amendment) Act, 1922, after entry 18, the following entry shall be inserted, namely. "18-A Chit agreement, that is to say an agreement,. relating "One rupee" to a chit as defined in clause (2) of the Andhra Pradesh Chit Funds Act, 1971 if, either such agreement is executed or the chit is conducted in the State of Andhra Pradesh.