Section 88 of the Chit Funds Act, 1982 - Protection of Action Taken Under the Act
Section 88 of the Chit Funds Act, 1982 provides statutory protection in respect of specified actions done, or intended to be done, in good faith under the Act or the rules made under it. The provision applies to the State Government, the Registrar, other officers of the State Government, and the Reserve Bank of India and its officers while exercising powers or performing functions under the Act.
Text of Section 88 - Protection of Action Taken Under the Act
No suit, prosecution or other legal proceeding shall lie against the State Government, the Registrar or other officers of the State Government or of the Reserve Bank or any of its officers exercising any powers or discharging any functions under this Act in respect of anything which is in good faith done or intended to be done in pursuance of this Act or the rules made thereunder.
Meaning and Scope of Section 88
Section 88 is a statutory protection clause. Its purpose is to protect the authorities and officers identified in the provision from a suit, prosecution or other legal proceeding in respect of an act that falls within the conditions stated in the section.
The protection is linked to the exercise of powers or discharge of functions under the Chit Funds Act, 1982. An important requirement appearing expressly in the provision is that the relevant act must have been done, or intended to be done, in good faith in pursuance of the Act or the rules made under it.
Who Is Protected Under Section 88?
The provision expressly refers to the following authorities and officers:
- the State Government;
- the Registrar;
- other officers of the State Government;
- the Reserve Bank of India; and
- officers of the Reserve Bank exercising powers or discharging functions under the Act.
What Proceedings Are Covered?
The language of Section 88 refers to a suit, prosecution or other legal proceeding. The protection therefore is not expressed as being confined only to civil suits or only to criminal prosecutions. Its application, however, remains subject to the conditions contained in Section 88 itself.
Requirement of Good Faith
The words "in good faith" are central to Section 88. The section does not simply provide protection for every act of an authority or officer. The statutory protection concerns something done or intended to be done in good faith in pursuance of the Chit Funds Act, 1982 or the rules made under it.
Accordingly, when Section 88 becomes relevant in a particular dispute, the statutory language, the nature of the power exercised, the applicable rules, and the facts surrounding the particular action should be examined.
Connection With the Chit Funds Act, 1982
The Chit Funds Act, 1982 is Central Act No. 40 of 1982. It was enacted to provide for the regulation of chit funds and matters connected with them. Section 88 appears among the concluding provisions of the Act.
The immediately preceding Section 87 deals with the power to exempt, while Section 89 deals with the power of the State Government to make rules.
Official Text of the Chit Funds Act
For the authoritative statutory text, amendments, notifications and related legislative material, readers should verify the current law from the official India Code database maintained by the Government of India.
View the Chit Funds Act, 1982 on India Code
Download the official Chit Funds Act, 1982 PDF