Chit Fund Department
Government of NCT of Delhi

The Madras Chit Funds Act, 1961    

Chapter VI

TRANSFER

23. Prized subscriber to give security - Before receiving the prize amount without deducting all future subscriptions, every prized subscriber shall furnish and the foreman shall take sufficient security for the due payment of future subscriptions and if the foreman is the prized subscriber, he shall give security for the due payment of future subscriptions to the satisfaction of the Registrar.

24. Prized subscriber to pay the subscription - Every prized subscriber shall pay his subscriptions regularly at the time and place and on the date mentioned in the chit agreement and on his failure to do so, he shall be liable to make a consolidated payment of all the future subscriptions at once.

25. Foreman to demand future subscription by written notice:-

1.  A foreman shall not be entitled to claim consolidated payment of all the future subscriptions from a defaulting prized subscriber unless he shall have demanded the same in writing.
2. If in a suit by a foreman for consolidated payment of future subscription from a defaulting prized subscriber, the defendant pays into court on or before the date to which the suit is posted for hearing the arrears of subscriptions till that date together with interest thereon at the rate provided for in the chit agreement or at twelve per cent per annum simple interest which ever is lower, and the costs of the suit for payment to the plaintiff, then, notwithstanding any contract to the contrary, the court shall pass a decree directing that the defendant shall deposit in court for payment to the plaintiff , the future subscriptions on or before the dates on which full due and that , in default of payment by the defendant of any future subscription on or before the due date the plaintiff shall be at liberty to realize in execution all the future subscriptions and interest thereon, less the amount,if any already deposited by the defendant.
   Provided that if any such suit is upon a Promissory note no decree shall be passed under this sub-section unless such promissory note expressly state that the amount due under the promissory note is towards payment of subscriptions to the chit.
3.  Any person who holds an interest in the property furnished as security or any part thereof shall be entitled to make payment under sub-section (2).
4. All consolidated payments of future subscriptions realized by a foreman shall be deposited in an approved bank before the date of the next succeeding instalment. The amount so deposited may be withdrawn only for payment of future subscriptions. When any property is acquired in lieu of the consolidated payment, it shall remain as security for the due payment of future subscriptions.