Repayment issue of unregistered chit/committee

deepak yadav (Querist) 18 September 2024 This query is : Resolved
Sir I was the operator of a unregister chit in which I suffered a loss. I have nothing with which I can compensate the loss.Customers are threatening a lot to get their money back And they are threats of sending me to jail.They are threatening my family too.How do I protect myself and my family in this situation?please help 🙏I had done this work with complete honesty for the last 12 years.I suffered a lot of loss during the Corona period, to compensate for which I sold everything I owned. I have enough proof of transactions with all the customers as I used to pay the amount through UPI. Will it be right to surrender?

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An operator of an unregistered chit fund is facing severe threats from customers due to losses incurred, with concerns for their family's safety and potential jail time. While the operator has transaction proof, they are unsure about surrendering to authorities or seeking legal recourse. Advice suggests that running unregistered chits is illegal and that amicable settlement with subscribers is the best course of action to avoid further legal complications, even though the operator's lawyer has suggested surrendering and confessing.

T. Kalaiselvan, Advocate (Expert) 18 September 2024
You can ask time to settle the due amount to the customers.
The question is that you are liable to pay them, yo cannot say that you will not pay them, it would be better that if they go to court so that you will have breathing time to accumulate money to pay them periodically or as a one time settlement

kavksatyanarayana Online

(Expert) 18 September 2024
Running of unauthorized chits is a crime as per the Chit Fund Act, of 1982 (some states made some amendments to the rules in 20085/2009). You are a lucky person as no one complained about you. Now you amicably settle their amounts to the subscribers to avoid legal complications.

Dr. J C Vashista (Expert) 19 September 2024
Chit fund running is illegal and unathorised.
It is better to discuss and sort out the issues amicably.

deepak yadav (Querist) 19 September 2024
Thanks for your valuable reply. My lawyer advised me that the customer is equally guilty in this crime. And these are not legally dues
. So you should surrender. Is this the right advice?

T. Kalaiselvan, Advocate (Expert) 19 September 2024
If you resort to legal action against the customers then you also would be in trouble hence the next option is either to arrange settlement by compromising or follow the advice of your lawyer

deepak yadav (Querist) 19 September 2024
The lawyers are asking me to confess my crime and surrender, not to take action against the clients. Would this be appropriate?

T. Kalaiselvan, Advocate (Expert) 19 September 2024
Yes it is you who have not paid the customers and not kept up your commitment therefore you will be held liable for the offence of cheating and fraud.
If some of your customers have not paid the amount properly then you can very well take action agaisnt them as per law instead of making a complaint agaisnt them in this forum.

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