(4) If the estimated subscriber is to be determined at an auction rate and more than one person offers the maximum discount, the estimated subscriber shall be determined by random draw. (p) the names of the nominees of each subscriber, d.or the names of the persons to whom the benefits due to the subscriber in connection with the chat can be paid, if the subscriber is dead or if he is not otherwise able to conclude an agreement; (l) the consequences of the liability of an unsuremed subscriber or foreman or foreman in the event of a breach of any of the provisions of the Chit Agreement; (j) the name of the licensed bank to which the foreman is required to pay money in accordance with this Act; (k) where the foreman is an individual, the manner in which a sound is maintained, when that person dies or becomes of an unhealthy spirit or is unable to work; If a chit is estimated to a subscriber, you must pay him the chit amount after receiving the sufficient guarantee prescribed by the approved statutes of that Chit group. No guarantee from an estimated subscriber is required if they agree to pay all future installments to the package. Explanation. – For the purposes of this subsection, it is sufficient that the signature of each subscriber is collected in separate copies of the agreement. (2) The duration of a chit shall not exceed five years from its start date: provided that the Land Government may authorise the duration of a chit up to a period of ten years if it is satisfied that it is necessary, taking into account – (i) the rate at which the foreman is to receive the amount of the chit; (o) the data and time during which the foreman, subject to the provisions of Section 44, allows valuable unrated and unpaid subscribers access to the chit registers; (1) Any chit agreement must be signed in duplicate and signed by each of the subscribers or by each of them in writing and by the foreman, and attested by at least two witnesses and contain the following information: – Chit funds have been a popular method of saving and borrowing for impensal periods. The concept of the Chit Fund is based on the principle of reciprocity, in which a group of people participates in a system to contribute to fixed periodic amounts and distribute the amount thus collected to each of the participants in turn. The foreman, that is, the Chit Fund Company itself, implements this scheme of a Chit fund. Example: The operation of the Chit funds is best explained with the help of an example.
Take a typical chit fund with 25 members who contribute rs 100 per week. This fund lasts 25 weeks. In the first week, all members donate Rs 100. An auction meeting will be organized, through which the foreman of the Chit fund presided. The total amount is Rs 2500. The auction starts with this amount. Bidders begin to bid by disconseigning this amount (Reverse Bidding). Consider that the lowest offer of a person is Rs 2,150 (a discount of Rs 350).
This amount (Rs 2,150) is given to this successful bidder. The rest of the amount (Rs 350) is divided by 25, bringing the discount per person to Rs 14. This discount amount is refunded to each member. Sometimes a portion may be kept by the foreman as a service fee, usually in organized Chit funds. These (25) subscribers form a “Chit Group” and the Chit fund company can operate many such groups. For each group, the approval of the articles and the certificate of opening of the registrar`s office, Chit Funds, is a must. A subscriber`s share in a chit is also called a ticket. (d) the expected start date and duration of the chit; 3. The amount of the account referred to in point (f) of paragraph 1 may not exceed *[forty per cent] of the amount.
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