Kanakadurga Chit Funds Pvt. Ltd v. State of Telangana

Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an order, direction or Writ more particularly one in the nature ol Writ of Mandamus or any other appropriate writ a) To declare the action of the Respondents in failing to release the security deposit made in terms of Chapter lll of the Chit Fund Rules, 2008, upon termination of the chit groups, as illegal, arbitrary, and a dereliction of statutory duties under the Chit Funds Act, 1982, and as being in violation of A(icle 19(1) (g) of the Constitution of lndia, and -*1-?Af .]- .,; *d... Fl b) To direct the Respondents to forthwith approve the pending auction minutes uploaded on the T-Chits portal, as per statutory requiremenls, and c) To direct the Respondents to forthwith release the secur ty deposit amounting to Rs. 21,00,000 (Rupees Twenty one lakhs only), duly deposited by the Petitioner upon termination of the chit groups, together ,1/ith rnterest accrued thereon. lA NO: 1 OF 2025 Petition under Section '151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Corrrt may be pleased to direct the Respondents to approve the auction minutes an j release the security deposits amounting to Rs. 21,00,000 (Rupees Twenty one lakhs only), in terms of the section 20 of the Act, '1982, in the light of the representations dated 16.1O.2024, submitted by the Petitioner. Counsel for the Petitioner: SRI B.VARA PRASADA RAO Counsel for the Respondents: AGP FOR STAMPS & REG|:STRATION The Court made the following: ORDER THE HON'BLE SRI JUSTICE K.SARATH WRIT PETITION No.13O59 of2o25 ORDER: Heard iearned counsel for the petitioner and learned Assistant Government pleader for Stamps and Registration appearing for the respondents. With their consent, this Writ Petition is disposed of at the stage of admission itself.

2. This writ petition is filed praying to: a) "...To declare the action of the Rcspondcnts in lailing to release the security deposit made in terms of Chapter III of the Chit Fund Rules 20O8, upon termination of the chit groups, as illegal, arbitrary, and a dereliction ol statutory duties under the Chit Funds Act, 1982, and as being in violation of Article 19(1) (g) of rhe Constitution of India, and b) To direct the Respondents to forthwith approvc the pending auction minutes uploaded on the T-Chits portal, as per statutory requirements, and c) To direct the Respondents to forthwith release the security deposit amounting to Rs.21,O0,OOO/- (Rupees Twenty One Lakhs only), duly deposited by the Petitioner upon termination of the chit groups, together with interest accrued thereon..."

3. Brief facts rising to file this writ petition are that petitioner is a registered Chit fund Company incorporated SK' J w.P.No.13059 of 2025 under the Companies Act, 2013 represented by its Director' Sri Kondam Kama'lakar and carrying on chit fund business in the name of Kanakadurga Chit Funds Private Limited' The petitioner further submits that he has called for subscription and has diligently complied rr rth all statutory obligation under the Clhit Funds Act' 1932 and relevant rules there under including d,epositing tlf Fixed Deposit Receipts (FDRs) as security for registered chit groups with the Assistant Registrar of Chits, Mahabub ragar in terms of Chapter III of A.P. Chit Fund Rules 2O0B' The petitioner further submits that said chits have be r:n depositing in terms of Section 20 of the Chit Fund A:l' 1982 and the Rules 22 of the Rules 2OO8 is for release oi security deposit made under Section 20 of the Act' On ttrrmination of the chits, the petitioner made application un ler Rule 22 of the Rules 2OO8 and the Registrar has to follow the procedure as specified of Rule 24 of Rules 2008 by ,tisplaying a notice inviti.ng objection from the subscribers to the specified chits and thereafter release the security togethcr interest accrued therein.

4. ) ) Learned Counsel for the petitioner would further 3 sK, ., u/.P.No.13059 of 2025 submit that petitioner has deposited a sum of Rs.21,00,000/- for several chit groups during the period April 2019 to Januar5r 202 1 and the said chits were terminated. Upon termination of each chit, the petitioner has submitted an application to the registrar for release of security deposit along with the declaration statement that the petitioner has cieared a,11 dues to its subscribers. Subsequently, petitioner made application dated

16.10.2024 seeking for release of security deposit, but till date the respondent No.4 has not considered the petitioner's representation. Aggrieved by the same, this writ petition is filed.

5. Learned Counsei for the petitioner would submit that the limited grievance of the petitioner is that the respondent No.4 has not considered the petitioner,s I I representation dated 16.10.2024 till date, hence pray this Court to direct the respondent authorities to consider the said representation and pass appropriate orders in a time bound period.

6. Learned Assistant Government pleader appearing for respondents submits that if the said petitioner,s 1 I i 4 sk, J c/.P.No.13059 of 2025 representation is stiil pending for con sideration . the respondent authorities may be directed to dispose of the said representation dated 16. 10.2024 and pass appropriate orders in accordalce with law. 7 In view of the submission made by lsarned counsel appearlng on either side and without expressmg any oplnlon on the merits of the case, this v,rit petition is disposed of, directing the respondent author ties to dispose of the petitioner's representation dated r(t.ro.2024 and pass appropriate orders in strictly in accordance with law, as expeditiously as possible, preferably within a period of four (4) weeks from the date of receipt of copy of this order and communicate the same to the petitioner. 8. Miscellaneous petitions, pending, if an-y, in this writ petition shaU s,tand closed. No order as to costs. To, A. SI //rRUE coPY// SSI l\ IEENIVASA REDDY iTANT REGISTRA SECTION OFFICER The Principal Secretary to Government, R"r"nr" (!t.., secretariat, Hyderabad, Telangana State. Registration. M.J. Road, Hydbrabad. felangina] -'-'

2. The Commissioner and lnspector General/Registrar of Chits, Stamps and is and Registration),

3. The Deoutv Reoistrar of chits (District Registrar), Mahab.tbnagar at Registrar Office, Mahabu6nagar, Terangana.

4. The Assistant Reoistrar,of Chits, Mahabubnagar at Registration Office, Mahabubnagar, Telangana.

5. One CC to SRt B.VARA PRASADA RAO, Advocate [OpUl] O lw9 Clg to GP FOR STAMPS 4ND REG|STRAT|ON, High Court for the State of Telangana at Hyderabad toull -- - '-" -

7. Two CD Copies BSR TJ :!..-_-'-'.'1'-a--*'.- it' I HIGH COURT DATED:0210512025 1 ORDER WP.No.13059 of 2025 1r1t i14 16: '/ JF J o t 01 JIL 2t6 P,r CH E:) t '\ r , c) DISPOSING OF THE WRIT PETITION, WITHOUT COSTS \6t6 leK