Chit Funds Act, 1982 - Chapter XII: Disputes and Arbitration
Section 68 of the Chit Funds Act, 1982: Attachment Before Judgment and Other Interlocutory Orders
Section 68 empowers the Registrar or the nominee dealing with a dispute referred under Section 64 to protect the effectiveness of a future award. Where the statutory conditions are met, property may be conditionally attached and appropriate interim orders may be made while the dispute is pending.
Text of Section 68
68. Attachment before judgment and other interlocutory orders.—(1) Where a dispute has been referred under section 64 and the Registrar or the nominee hearing the dispute is satisfied on enquiry or otherwise that a party to such dispute, with intent to defeat or obstruct the execution of any award or the carrying out of any order that may be made,—
(a) is about to dispose of the whole or any part of his property; or
(b) is about to remove the whole or any part of the property from the jurisdiction of the Registrar, he may, unless adequate security is furnished, direct conditional attachment of the said property, and such attachment shall have the same effect as if it is made by a competent Civil Court.
(2) Where the Registrar or the nominee directs the attachment of any property under sub-section (1), he shall issue a notice calling upon the person whose property is so attached to furnish such security as he thinks adequate within a specified period, and if the person fails to provide such security, the Registrar or the nominee may confirm the order, and may, after the decision in the dispute, direct the disposal of the property so attached towards the claim, if awarded.
(3) Any attachment made under this section shall not affect the rights, subsisting prior to the attachment of the property, of persons who are not parties to the dispute, or bar any person holding a decree against the person whose property is so attached from applying for the sale of the property under the attachment of such decree.
(4) The Registrar or the nominee may, in order to prevent the ends of justice being defeated, make such interlocutory orders pending the award in a dispute referred to in sub-section (1) as may appear to be just and convenient.
Meaning and scope of Section 68
The power under Section 68 arises in connection with a dispute referred under Section 64. The Registrar or nominee must be satisfied, on enquiry or otherwise, that the relevant party intends to defeat or obstruct execution of an award or implementation of an order and is about to dispose of property or remove it from the Registrar's jurisdiction.
The provision therefore links attachment to both a specified form of conduct involving property and the stated intent to frustrate the eventual result of the dispute. It also gives the affected person an opportunity to furnish adequate security instead of allowing the conditional attachment to continue.
Key requirements at a glance
| Requirement | Effect under Section 68 |
|---|---|
| Pending statutory dispute | A dispute must have been referred under Section 64. |
| Required satisfaction | The Registrar or nominee must be satisfied on enquiry or otherwise about the statutory risk to execution or implementation. |
| Property-related conduct | The party must be about to dispose of property, or remove property from the Registrar's jurisdiction. |
| Security | Adequate security may prevent continuation of the conditional attachment. |
| Notice | After directing attachment, notice must call upon the affected person to furnish adequate security within a specified period. |
| Third-party rights | Rights of non-parties subsisting before attachment are expressly preserved. |
| Other interim relief | The Registrar or nominee may make just and convenient interlocutory orders to prevent the ends of justice being defeated. |
Conditional attachment and security
Under sub-section (1), the initial remedy is a conditional attachment. The statutory text expressly recognizes adequate security as an alternative. Under sub-section (2), once attachment is directed, the Registrar or nominee must issue notice requiring the person whose property is attached to furnish security considered adequate within the specified period.
If adequate security is not furnished, the attachment may be confirmed. After the dispute is decided, the attached property may be directed to be disposed of towards the claim, if a claim is awarded.
Protection of third-party and decree-holder rights
Sub-section (3) preserves rights in the property that existed before attachment where those rights belong to persons who are not parties to the dispute. It also states that a decree-holder is not barred from applying for sale of the property under attachment of the decree.
Interlocutory orders under sub-section (4)
Apart from attachment, sub-section (4) authorizes the Registrar or nominee to make interlocutory orders pending the award where such orders appear just and convenient to prevent the ends of justice from being defeated. This power operates within the pending dispute contemplated by Section 68.
Related provisions
Section 68 should be read with the surrounding dispute-resolution provisions. Section 64 identifies disputes relating to chit business that are referable to the Registrar; Section 66 deals with settlement of disputes; Section 67 deals with procedure and specified powers of the Registrar or nominee; and Section 69 concerns the decision of the Registrar or nominee.
Official statutory source
The Chit Funds Act, 1982 is Central Act No. 40 of 1982. For the official consolidated text and associated legislative material, refer to India Code - The Chit Funds Act, 1982. Users should verify the current statutory text, applicable State rules and notifications relevant to the particular chit and proceeding.
Page reviewed and updated: 16 September 2026.