Arguments in Margadarsi chitfund case completed in Andhra Pradesh High Court; decision on interim orders postponed

Senior advocates Nagamuthu and Dammalapati Srinivas while appearing for the Margadarsi said that the Assistant Registrar held inspections and the Deputy Registrar invited objections against the retention of chit groups is not valid.

Amaravati: The arguments in the Margadarsi Chitfund case in the Andhra Pradesh High Court were completed on Wednesday with the Margadarsi lawyers challenging the public notice issued by the Registrar/Deputy Registrar of Chits in the case, sources said. It is learnt that the arguments were held in the High Court on the lawsuits filed on July 30 this year.

Arguments on supplementary petitions in two lawsuits filed regarding chit groups of Guntur and Krishna districts have been completed in the case. The hearing on another lawsuit filed regarding Chit Groups of Prakasam district was postponed till Thursday. The bench of Justice N. Jayasuriya announced that he was deferring judgment on the issue of interim orders for now. In the hearing held on Wednesday, Advocate General (AG) Sriram presented arguments on behalf of the government.

In his submission before the court, the AG said that no unilateral decision was taken to stop chit-groups. “As the violations continue, we have issued a public notice inviting objections regarding the retention of chit groups. Chit registrars are empowered to initiate proceedings suo moto,” added the AG. He said that as per GO issued in 2008, powers have been assigned to Assistant and Deputy Registrars even as under Section 48(h) of the Chitfund Act, the Deputy Registrar has suo moto power to take action for the retention of groups.

“A show cause notice cannot be challenged. Do not issue an interim order,'' said the AG. Arguing on behalf of Margadarsi Chitfund Company, senior advocates Nagamuthu and Dammalapati Srinivas argued that assistant registrars and deputy registrars should perform different legal duties. “The Assistant Registrar held inspections and the Deputy Registrar invited objections against the retention of chit groups is not valid,” they argued.

“The action of the authorities was like one judge heard the arguments and another judge gave the verdict,” the lawyers said. They said that the Margadarsi chit company is not accused of not paying the money. “In that case, actions cannot be taken suo motu to stop the chit groups. Because the deadline for submitting objections is ending on the 14th of this month, the action through the 'Public Notice' issued by the government has been requested to be suspended,” added the Margadarsi lawyers.

They requested the court for an interim order restraining the authorities from taking further action based on that notice.