Section 80 of the Chit Funds Act, 1982 - Cognizance of Offences

Section 80 of the Chit Funds Act, 1982 deals with the cognizable nature of offences under Section 11 and specifies the minimum level of criminal court competent to try offences punishable under the Act.

Updated: 16 September 2026

Text of Section 80 - Cognizance of offences

What Section 80 means

Section 80 contains two procedural rules. First, an offence under Section 11 of the Chit Funds Act, 1982 is expressly made cognizable. Second, an offence punishable under the Act cannot be tried by a court below the level specified in Section 80(2).

Meaning of a cognizable offence

For current criminal procedure, Section 2(1)(g) of the Bharatiya Nagarik Suraksha Sanhita, 2023 defines a "cognizable offence" as an offence for which a police officer may, in accordance with the First Schedule or any other law for the time being in force, arrest without warrant. The BNSS came into force on 1 July 2024, subject to its statutory provisions and savings.

Important: Section 80 does not make every offence under the Chit Funds Act cognizable. Its express declaration in sub-section (1) is confined to offences under Section 11.

Connection with Section 11 of the Chit Funds Act

Section 11 regulates the use of specified expressions connected with chit business. The Chit Funds (Amendment) Act, 2019 expanded the terminology in the principal Act, including references to "fraternity fund" and "Rotating Savings and Credit Institution". Accordingly, Section 80 should be read together with the current text of Section 11.

Which court can try an offence under the Act?

Under Section 80(2), no court inferior to a Metropolitan Magistrate or a Judicial Magistrate of the first class may try an offence punishable under the Chit Funds Act. The provision therefore fixes a statutory minimum level of trial court for offences under the Act.

The Bharatiya Nagarik Suraksha Sanhita, 2023 now governs criminal procedure generally from 1 July 2024. Section 3 of the BNSS deals with construction of references to Magistrates, while Section 5 preserves the operation of special or local laws and special procedure unless a contrary provision applies. The Chit Funds Act remains the special enactment governing the matters covered by Section 80.

Practical points

Related provisions

For the surrounding statutory scheme, readers may also refer to Section 79 - Offences by companies and the succeeding provision on compounding of offences under Section 81 of the Chit Funds Act, 1982.

Legal note

This page provides general information on the statutory provision. Application of Section 80 to a particular complaint, investigation, prosecution, territorial jurisdiction, or pending proceeding depends on the facts, applicable State rules and notifications, and the procedural law governing the proceeding.