Section 67 of the Chit Funds Act, 1982: Procedure for Settlement of Disputes and Powers of Registrar or Nominee

Section 67 lays down the procedural powers available to the Registrar or nominee while hearing a chit-business dispute under Section 66. It gives specified Civil Court-type powers, regulates representation by legal practitioners, and permits necessary changes to the parties to a dispute.

In brief: The provision enables effective adjudication by allowing summons, discovery and inspection, affidavit evidence, requisition of public records and commissions. It also deals with legal representation, joinder or substitution of parties, striking out improperly joined parties, and claims for multiple reliefs arising from the same cause of action.

What Section 67 covers

Section 67 - Statutory text

67. Procedure for settlement of disputes and powers of Registrar or nominee.—(1) The Registrar or the nominee hearing a dispute under section 66, shall, in addition to the powers conferred on him under that section, have the same powers as are vested in a Civil Court while trying a suit under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following matters, namely:—

(a) summoning and enforcing the attendance of persons and examining them on oath;

(b) requiring the discovery and inspection of documents;

(c) receiving evidence on affidavits;

(d) requisitioning any public record or copies thereof from any court or office;

(e) issuing commissions for the examination of witnesses or documents; and

(f) any other matter which may be prescribed.

(2) Except with the permission of the Registrar or the nominee, no party shall be represented at the hearing of a dispute by a legal practitioner.

(3) (a) If the Registrar or the nominee is satisfied that any person, whether he is a subscriber or not, has acquired any interest in the property of a person who is a party to a dispute, he may order that the person who has acquired the interest in the property may be joined as a party to the dispute, and any decision that may be given by the Registrar or the nominee on the dispute shall be binding on the party so joined, in the same manner as if he were an original party to the dispute.

(b) Where a dispute has been referred in the name of a wrong person, or where all the necessary parties have not been included, the Registrar or the nominee may, if he is satisfied that it was due to a genuine mistake, order any other person to be substituted or added as parties to the dispute at any stage of hearing of the dispute on such terms as he thinks just.

(c) The Registrar or the nominee may, at any stage of the proceedings, either upon or without the application of either party and on such terms as may appear to the Registrar or the nominee to be just, order that the name of any party improperly joined be struck off.

(d) Any person who is a party to the dispute and entitled to more than one relief in respect of the same cause of action may claim all or any such reliefs, but if he omits to claim any such relief, he shall not be entitled to claim that relief, except with the leave of the Registrar or the nominee.

Meaning and practical effect of Section 67

1. Civil Court-type procedural powers

Section 67(1) does not convert the Registrar or nominee into a Civil Court for every purpose. Instead, it expressly confers the same powers as a Civil Court in the listed procedural matters. These include compelling attendance, examining persons on oath, discovery and inspection, affidavit evidence, obtaining public records and issuing commissions.

2. Appearance through a legal practitioner

Under Section 67(2), representation by a legal practitioner is not automatic. Permission of the Registrar or nominee is required. A party seeking professional representation should therefore consider the applicable procedural rules and any direction made by the adjudicating authority.

3. Addition, substitution and removal of parties

Section 67(3) gives the Registrar or nominee procedural flexibility to ensure that the dispute is determined with the proper parties before the authority. A person acquiring an interest in relevant property may be joined; a wrong party may be substituted or a necessary party added where omission resulted from a genuine mistake; and an improperly joined party may be removed.

4. Claiming all available reliefs

Where a party is entitled to more than one relief arising from the same cause of action, Section 67(3)(d) permits all or any of those reliefs to be claimed. An omitted relief ordinarily cannot be claimed later unless leave of the Registrar or nominee is obtained. Care is therefore required when framing the relief sought in the original dispute.

How Section 67 fits with Sections 64 to 70

The dispute-resolution scheme should be read as a sequence. Section 64 identifies disputes relating to chit business that are referred to the Registrar; Section 65 deals with limitation; Section 66 provides for settlement by the Registrar or a nominee; Section 67 supplies procedural powers; Section 68 deals with attachment before judgment and other interlocutory orders; Section 69 concerns the decision; and Section 70 provides for appeal.

Official legal source

For the authoritative Central Act and its current consolidated text, consult the official India Code copy of the Chit Funds Act, 1982. The Act is Central Act No. 40 of 1982.

Official India Code - Chit Funds Act, 1982 (PDF)

Note: This page is intended for general legal information. State rules, notifications and procedural requirements may also be relevant to a particular chit or dispute.