Puppala Rajendra Prasad And 5 Others Vs Kapil Chit Funds Pvt. Ltd., Guntur
Case Details
 Case Type | AS |
 Filing Number | 1906/2015 |
 Registration Number | 111/2015 |
 Filing Date | 26-02-2015 |
 Registration Date | 05-06-2015 |
 First Hearing Date | 09th July 2015 |
 Decision Date | 06th December 2019 |
 Case Status | Case Disposed |
 Court Number and Judge | 1-Prl. District And Sessions Judge; |
 Nature of Disposal | Contested--Dismissed; |
Petitioners & Respondents
Petitioner Puppala Rajendra Prasad And Others, ;
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Petitioner AdvocateG.S.K.;
Respondent NameKapil Chit Funds Pvt. Ltd. Guntur;
Respondent AdvocateKvr;
Order Details
Order Details
Order not found.
Final Order Judgement
| Order Date | 06-12-2019  |
| IN THE COURT OF THE DISTRICT JUDGE: GUNTUR 1 Fair IN THE COURT OF THE PRINCIPAL DISTRICT JUDGE: GUNTUR. PRESENT: SRI. A. HARI HARANADHA SARMA PRINCIPAL DISTRICT JUDGE. Friday, the 6th day of December, 2019. A.S.No.111/2015. Between:- 1. Puppala Rajendra Prasad. 2. Sajja Sarath Babu. 3. Gulakaram Murali Krishna. 4. Bannaravuri Murali Krishna. 5. Mutluri Raju. 6. Bandi Venkateswara Rao. … Appellants/Defendants. And Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer. … Respondent/Plaintiff. Appeal against the Decree and Judgment passed in O.S.No.523/2012 dated 23-09-2014 on the file of II Addl. Junior Civil Judge, Guntur. Between: Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer. … Plaintiff. And 1. Puppala Rajendra Prasad. 2. Sajja Sarath Babu. 3. Gulakaram Murali Krishna. 4. Bannaravuri Murali Krishna. 5. Mutluri Raju. 6. Bandi Venkateswara Rao. … Defendants. This Appeal suit is coming on 27-11-2019 for hearing before me in the presence of Sri G. Santha Kumar, Advocate for the Appellants and of Sri K. Venkata Reddy, Advocate for the Respondents, and upon perusing the material available on record, and having stood over for consideration till this day, this Court delivered the following: 2 J U D G M E N T 1. This is an appeal directed against the Decree and Judgment dated 23- 09-2014 passed in O.S.No.523/2012 by the II Addl. Junior Civil Judge, Guntur. 2. The Appellants are the defendants before the Court below and suffered decree. Respondent herein is the Plaintiff. 3. For sake of convenience the parties will be herein after referred to as Plaintiff and Defendants as and how they are arrayed in the impugned proceedings. 4. The case of Plaintiff in brief is that: The Plaintiff is a company registered under Companies Act engaged in doing the chit fund business by framing certain rules and regulations for advantage of subscribers running chit business. The 1st defendant joined in the chit fund scheme of the Plaintiff with Series No.GTT03H. Ticket No.25 was allotted in his name. He has agreed to subscribe Rs.6,000/- per month for 50 months equally. The value of the chit was Rs.3,00,000/-. The 1st defendant participated in the auction and agreed to forego Rs.1,20,000/-, became successful bidder. Accordingly the amount was paid to him on execution of necessary documents including furnishing of guarantee by the defendants 2 to 6 in the form of executing necessary loan documents and agreement of guarantee etc. 1st Defendant in all paid Rs.60,000/- till the date of payment of prized amount. The Plaintiff issued cheque dated 17-07-2008 for Rs.1,71,582/- and Rs.8,418/- by way of adjustment on 17-07-2008. The total amount paid was Rs.1,80,000/- for which cash voucher was issued to him. Further the 1st defendant paid Rs.1,98,000/- till 33rd installment and thereafter committed default and his dues are at Rs.41,840/- apart from legal notice charges etc. Hence, the suit is filed for recovery of dues. 5. Written statement filed by 1st defendant was adopted by Defendants 2 to 6. The contest of the 1st defendant is that, the plaint allegations are false. The Plaintiff is put to strict proof. He is not liable to pay any amount. Dividends are not 3 properly calculated and paid. Bye-laws are not registered. Author of Plaint is not competent to sign the plaint. The agreement of chit is not in consonance with the A.P. Chit Fund Act. The Court has no jurisdiction to entertain the case under A.P. Chit Fund Act. One Shaik Rabbani the Recovery Manager and Ramesh Recovery Assistant of Plaintiff on 12-07-2012 received Rs.10,000/- and stated that entire dues are clear. The Account copy filed by Plaintiff is not reflecting correct dues. The suit is liable to be dismissed. 6. On the strength of pleadings the following issues were settled for trial by the Court below: 1. Whether the bye laws of the suit chit are registered according to law ? 2. Whether the 1st defendant is entitled for dividends ? 3. Whether the person who signed the Plaint on behalf of Plaintiff Company is competent to sign ? 4. Whether this Court has jurisdiction to entertain the suit ? 5. Whether there is no contractual liability between Plaintiff and defendants ? 6. Whether the account copy filed by the Plaintiff Company is true and valid ? 7. Whether the Plaintiff Company is entitled for recovery of suit amount as prayed for ? 8. To what relief ? 7. During trial on behalf of the Plaintiff, one Ch. Vijay Sri Harsha and P.W.2 R. Sai Kumar were examined and Exs.A.1 to A.15 documents were marked. On behalf of the defendants, D.W.1 was examined and Exs.B.1 to B.26 were marked. 8. The trial Court decreed the suit for Rs.31,840/- with interest at 6% on the principal sum of Rs.26,394/-. The findings of the Court below are that: 1. There is no convincing answer from the defendants as to non registration of bye laws and it was not even suggested to P.W.1. 4 2. As per the terms of the contract between the parties particularly the chit agreement Clause No.17 Prized subscriber if commits default not entitled for dividend. Therefore the claim of entitlement of defendants for dividends cannot be entertained. 3. As per the evidence of P.W.1 coupled with Ex.A.13 the signatory to the pleadings has authority and as per the observations of Hon’ble Apex Court vide AIR 1971 SC 740 Para No.5 the Corporation is a legal person. The Secretary or Director or any Principal of the Corporation or Company can sign the pleadings. Therefore there is no procedural infirmity with regard to the authority of the person signing the plaint. 4. As per the provisions of A.P. Chit Fund Act, 1971 as on the date of registration of suit chit, the provisions of said Act is applicable. The Company and the defendants are residing at Guntur. Therefore, there is no bar to entertain the suit. 5. The evidence of Plaintiff is sufficient to believe that the documents are properly executed. Therefore, the liability in terms of document is established. 6. The Plaintiff Company in its notice Ex.A.6 stated that 1st defendant paid up to 43 installments and committed default of 7 installments. The legal notice was received by some of the defendants. From the dues of Rs.42,000/- (Rs.6,000/- x 7) due by 1st defendant the Plaintiff company deducted part payment of Rs.5606/- and shown the total amount due as Rs.36,394/-. However, the trial Court decreed the suit for Rs.31,840/-. 9. The grounds urged in the memorandum of grounds of appeal by the defendants disputing the propriety and sustainability of the Judgment are that: 1. The findings of trial Court on all issues are erroneous. 2. The trial Court failed to appreciate the case properly. 5 3. The trial Court failed to see that Plaintiff charged interest even after payment of installments. 4. The trial Court ignored the fact that the Plaintiff did not add dividend. 5. The trial Court went in wrong coming to the conclusion that the defendants are in default. 6. The trial court failed to see the Exs.B.1 to B.26 filed by the defendants. 7. The trial court went in wrong in deciding that the Defendants failed to show that he was regular in payment of installments. 8. The trial court is not justified in holding that the defendants are at default. 10. Heard both sides. Extensive arguments are submitted reiterating their respective contentions. 11. Perused the pleadings, issues, evidence of P.Ws.1 and P.W.2, D.W.1, recitals in Exs.A.1 to A.15, and Exs.B.1 to B.26, observations in the impugned judgment, grounds urged in the memorandum of grounds of appeal. Thoughtful consideration is given to the arguments advanced by both sides. 12. The points that arise for determination in this appeal are: 1. Whether the Civil Courts have got jurisdiction to decide the dispute in respect of the chit transactions in general particularly the dispute covered by the present legal proceedings ? 2. Whether the Plaintiff is able to prove its entitlement for the money decree for the amount prayed for ? 3. Whether the decree and Judgment of the court below are sustainable in law and on facts ? Or whether any interference is necessary ? If so, on what grounds and to which extent ? 4. What is the result of Appeal ? 6 13. POINT NO.1:- The findings of the trial Court on the jurisdiction covered by Issue No.4 are that; the provisions of A.P. Chit Fund Act,1971 would apply. One of the branches of the Plaintiff Company is situate at Guntur. 1st Defendant is also residing in Guntur. Therefore, there is no Bar to try the suit by the trial Court. 14. The suit transaction is pursuant to the chit with Series No.GTT03H25 and commencement of chit is 25-08-2007 and its termination is 25-09-2011 as per Ex.A.2 agreement. Even as per the evidence of P.W.1 Vijaya Sri Harsha there was auction on 26-05-2008. As per plaint the suit is verified on 1-5-2012 and its presentation was on 1-5-2012. As per the notification issued by the Central Government by exercising powers under Sub-section 3 of Section 1 of A.P. Chit Funds Act, 1982 (Act 40 of 1982) the Central Government appointed 15 th day of September, 2008 as the date on which the provisions of the Central Act applicable to Andhra Pradesh. In a similar situation in a case between Sri Visalam Chit Funds Ltd., Vs., A. Hussain and another, decided on 21st October, 2005, the Hon’ble High Court of Madras referred to the provisions of Chit Funds Act. The context in the case cited was that, chit was commenced prior to Chit Fund Act coming into force. Suit was filed after commencement of the Chit Funds Act, 1982 like one in the present case. In the said case the Hon’ble High Court of Madras has referred to Section 85 as well as Section 90 of the Act. Section 85 reads as follows: 85. Act not to apply to certain chits.—Nothing in this Act shall apply in respect of— (a) any chit started before the commencement of this Act; or (b) any chit the amount of which, or where two or more chits were started or conducted simultaneously by the same foreman, the aggregate amount of which does not exceed one hundred rupees. Section 90 reads as follows: “90. Repeal and saving.— (1) The Andhra Pradesh Chit Funds Act, 1971 (Andhra Pradesh Act 9 of 1971), the Kerala Chitties Act, 1975 (Kerala Act 23 of 1975), the Maharashtra Chit Funds Act, 1974 (Maharashtra Act LV of 1974), the Tamil Nadu Chit Funds Act, 1961 (Tamil Nadu Act 24 of 1961), as in force in the State of 7 Tamil Nadu and in the Union territories of Chandigarh and Delhi, the Uttar Pradesh Chit Funds Act, 1975 (Uttar Pradesh Act 53 of 1975), the Goa, Daman and Diu Chit Funds Act, 1973 (Goa, Daman and Diu Act 16 of 1973)and the Pondicherry Chit Funds Act, 1966 (Pondicherry Act 18 of 1966), are hereby repealed and the provisions of section 6 of the General Clauses Act, 1897 (10 of 1897), shall apply to such repeal as if each such Act so repealed were a Central Act. (2) Notwithstanding such repeal, the Acts mentioned in sub-section (1) shall continue to apply to chits in operation on the commencement of this Act, in the same manner as they applied to such chits before such commencement.” In the light of Section 85(a) and Section 90(2) of A.P. Chit Fund Act, 1982 since the chit in the present case commenced prior to the Chit Fund Act, 1982 coming into force in Andhra Pradesh the Jurisdiction contemplated under the said Act in terms of Section 64 approaching the Registrar of Chits does not arise and the earlier procedure approaching the Civil Courts in terms of A.P. Chit Fund Act, 1971 deemed to be tact. Therefore, the objection of the Appellants as to want of jurisdiction does not deserve any consideration. The point regarding jurisdiction is therefore answered against the appellants in respect of the dispute in the present case the Civil Courts have jurisdiction. 15. POINT NO.2:- The defendants are not disputing the Chit Fund transaction with Plaintiff. They have taken the plea of discharge. All other objections as to entitlement of defendants for dividends are properly answered by the Court below that defaulter is not entitled for dividend. With regard to authority of the person verifying the plaint that the signatory is qualified, in view of the admission of entering into agreement there is contractual liability. In view of the evidence of P.W.1 and person concern with the Plaintiff Company the accounts are true and valid. The peculiar context of the present case is that, the defendants have taken the defence of discharge. Then substantial burden to prove the discharge lies on the defendants. To show that they have discharged their liability the Defendants stated that they have paid the amount by placing Exs.B.1 to B.26. The receipts relied on by the defendants Exs.B.1 to B.26 and the amount paid by them as per the receipts placed are as follows: 8 Sl.No. Receipt Number Receipt_Date Amount paid 1. CR No.1507/2008 26-05-2008 RS.44,601-00 2. CR No.0968/2008 17-07-2008 RS.07,960-00 3. CR No.0160/2008 17-07-2008 RS.00,450-00 4. CR No.21952 29.12.2008 RS.03,000-00 5. CR No.21953 29.12.2008 RS.01,600-00 6. CR No.24034 30-03-2009 RS.09,000-00 7. CR No.24748 29-04-2009 RS.04,000-00 8. CR No.24754 01-05-2009 RS.03,000-00 9. CR No.26317 24-06-2009 RS.04,300-00 10. CR No.1321 22-09-2009 RS.29,500-00 11. CR No.30522 30-12-2009 RS.05,300-00 12. CR No.33476 09-04-2010 RS.09,000-00 13. CR No.34248 08-05-2010 RS.05,000-00 14. CR No.2204/2010 06-07-2010 RS.00,560-00 15. CR No.2300 13-09-2010 RS.10,000-00 16. CR No.3301 16-09-2010 RS.05,000-00 17. CR No.3308 28-09-2010 RS.04,000-00 18. CR No.6444 28-06-2010 RS.10,210-00 19. CR No.3128 17-12-2010 RS.10,000-00 20. CR No.2753 07-01-2011 RS.10,000-00 21. CR No.3704 01-02-2011 RS.18,000-00 22. CR No.3757 20-05-2011 RS.10,000-00 23. CR No.4155 20-07-2011 RS.10,000-00 24. CR No.4168 30-07-2011 RS.09,000-00 25. CR No.3855 28-09-2011 RS.08,500-00 26. CR No.5162 12-07-2012 RS.10,000-00 T O T A L Rs.2,41,981-00 16. Whether the liability of the defendants in total is Rs.2,41,981/- or more is one question. Whether the Plaintiff is able to substantiate the liability of the defendant is for more than Rs.2,48,981/- is another question. Whether the payments made are reflected in the Account extract is another question. Periodically the amounts paid are adjusted. It appears that the adjustments are made suitable and matching with he balances time to time, but not at the quantum specified by the defendants. The defendants have shown the payments at lump sum and the adjustments in the account extract are shown at different quantums. Dividends are also added on some months. It appears that the account abstract is maintained with reference to the formula fixed and feeded in the system. In the light of the written statement and the defence it can be understood that the dispute is solely touching the quantification of dues. The Defendants pleaded that on 12-07-2012 also Rs.10,000/- was lastly paid and an assurance was given that that 9 shall be the last payment and the total dues are cleared. When that is the case, when the said amount covered by Ex.B.26 was paid, why they need not obtain no dues certificate from Plaintiff is a serious question. Now it is necessary to consider the oral evidence of the parties also to some extent in this regard. 17. P.W.1 stated that total amount paid is Rs.2,58,000/- and cash vouchers are issued for all the payments. Amount due is Rs.42,000/-. Evidence affidavits of one Sai Kumar and Vijaya Sri Harsha both are filed indicating them as evidence affidavit of P.W.1. Sri Harsha’s evidence affidavit was taken on record on 20-2-2014, whereas the evidence affidavit of Sai Kumar is taken on 2/4/2014. Through Sai Kumar Ex.A.15 is marked. As per the observations on the docket proceedings on 22-09-2014 and 23-09-2014 of the Court at the stage of judgment, evidence affidavit of Vijaya Sri Harsha was accepted as P.w.1 and evidence affidavit of Sai Kumar was accepted as P.w.2. But there is no cross-examination of Vijaya Sri Harsha and it can be seen that only P.W.2 is cross examined. Both P.Ws.1 and P.W.2 referred as working as Law Officers. The Evidence Affidavits of both of them the verbatim same including the documents sought to be marked. From 2-12-2013 the matter was posted for cross-examination of P.W.1 several times and at last on 2-4-2014 P.W.1 was cross examined and the witness cross examined on 2-4-2014 is P.W.2. 18. The evidence affidavit of P.W.1 Vijaya Sri Harsha is relating to Exs.A.1 to A.14. The evidence of P.W.2 Sai Kumar is relating to Ex.A.15 in chief. Whereas the cross-examination is on P.W.2 alone. The main grievance of the defendants appears to be is that, the total amount paid by them is not accounted. P.W.2 admitted that defendants paid Rs.10,000/- on 12-07-2012. It is also admitted by P.W.2 that the said payment is not reflected in the plaint. 19. The trial Court in the Judgment came to conclusion that the dues are Rs.31,840/- as against the dues claimed at Rs.41,840/-. Probably it appears that the trial Court has given credit to Rs.10,000/- admittedly paid. Then it is not clear 10 how the trial Court came to conclusion that the principal amount is Rs.27,394/-. The dues are shown by the Plaintiff at Rs.42,000/- and interest component and miscellaneous charges component is considered at Rs.6,390/-. If the same is excluded the dues may come to Rs.35,610/-. The dues arrived by the trial Court particularly the principal amount at Rs.26,394/- appears to have been arrived after deducting part payments shown at Rs.5,666/-. The cross-examination done on P.W.2 is that the amount of Rs.10,000/- paid is not reflected in the pleadings and that the defendants are not liable to pay Rs.41,840/- to Plaintiff Company and the clear stand of the defendants is that no further dues are there after payment of Rs.10,000/- on 12-07-2012. D.W.1 during cross-examination stated that he studied up to Degree. He has to pay 50 installments at the rate of Rs.6,000/- per month. Exs.B.4 to B.26 are temporary receipts and it is also mentioned in Exs.B.4 to B.26 that official receipts will be issued, but no official receipts are issued. He has stated that out of the total amount of Rs.3,00,000/- he has paid Rs.2,41,000/- and the Plaintiff filed the suit for Rs.36,395/-. The entitlement of defendants for dividends despite default is one aspect. However the account extract shows that dividend is also deducted while calculating the dues. Further it can be seen that some interest is added in respect of delayed payments. According to the admission of D.W.1 he has paid Rs.2,41,981/- as against the total dues. The delayed payments and interest component etc., are also the aspects required consideration. The receipts relied on by the defendants are admittedly temporary receipts and issuing of official receipts is contemplated and the defendants did not collect the official receipts. The defendants failed to prove their stand. 20. Upon considering the entire evidence on record, this Court is of the view that the entitlement of the Plaintiff arrived by the trial Court does not require any interference and fit for confirmation on any aspects and there are no serious grounds to interfere either on legal or factual base. Point No.2 framed is answered accordingly against the Appellants. 11 21. POINT NO.3:- In the light of the discussion made on Point Nos. 1 and 2, this Court finds that the decree and Judgment, dated 23-09-2014 passed in OS.No.523/2012 by II Addl. Junior Civil Judge, Guntur are sustainable in law and on facts and fit for confirmation and there are no grounds to interfere. Point No.3 is answered accordingly. 22. POINT NO.4:- In the result, the appeal is dismissed confirming the Judgment and decree passed in OS.No.523/2012, dated 23-09-2014 by the II Addl. Junior Civil Judge, Guntur. However, considering the facts and circumstances of the case, both parties are directed to bear their own costs. Dictated to Stenographer Grade-I, transcribed by him, corrected and pronounced by me in the open court, this the 6th day of December, 2019. PRINCIPAL DISTRICT JUDGE GUNTUR. Copy to: The II Addl. Junior Civil Judge, Guntur. 12 Fair IN THE COURT OF THE PRINCIPAL DISTRICT JUDGE: GUNTUR. PRESENT: SRI. A. HARI HARANADHA SARMA PRINCIPAL DISTRICT JUDGE. Friday, the 6th day of December, 2019. A.S.No.111/2015. Between:- 1. Puppala Rajendra Prasad, S/o Koteswara Rao, Hindu, 49 years, R/o 26-38-113, Jyothi Nilayam, A.T. Agraharam, Guntur. 2. Sajja Sarath Babu, S/o Veera Raghavaiah, 60 years, 11-36-1, Vemuru Post and Mandal, Guntur Dt. 3. Gulakaram Murali Krishna, S/o Adiseshagiri, 50 years, R/o Nizampatnam Post and Mandal, Guntur Dt. 4. Bannaravuri Murali Krishna, S/o Gurunadham, 42 years, R/o 11-261, Bhattiprolu Mandal and Post, Guntur Dt. 5. Mutluri Raju, S/o Adam, 45 years, R/o 26-36-13, Ankamma Nagar, 4th line, Guntur. 6. Bandi Venkateswara Rao, S/o Rammohan Rao, 43 years, R/o 2-75, Nagaram Post and Mandal, Guntur Dt. … Appellants/Defendants. And Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer Ch. Vijay Sri Harsha, S/o Prasada Rao, Guntur. … Respondent/Plaintiff. Appeal against the Decree and Judgment passed in O.S.No.523/2012 dated 23-09-2014 on the file of II Addl. Junior Civil Judge, Guntur. Between: Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer. … Plaintiff. And 1. Puppala Rajendra Prasad. 2. Sajja Sarath Babu. 3. Gulakaram Murali Krishna. 4. Bannaravuri Murali Krishna. 5. Mutluri Raju. 6. Bandi Venkateswara Rao. … Defendants. This is an appeal directed against the Decree and Judgment dated 23-09-2014 passed in O.S.No.523/2012 by the II Addl. Junior Civil Judge, Guntur. 13 Appeal presented on : 26-02-2015 Appeal filed on : 05-06-2015 VALUATION: This Appeal suit is filed for recovery of Rs.41,840/- on which a court fee of Rs.2,146/- is paid under Section 20 r/w 49 of APCF & SV Act. This Appeal suit is coming on 27-11-2019 for hearing before me in the presence of Sri G. Santha Kumar, Advocate for the Appellants and of Sri K. Venkata Reddy, Advocate for the Respondents, and upon perusing the material available on record, and having stood over for consideration till this day, this Court DOTH ORDER AND DECREE as follows: (1) That the appeal be and the same is hereby dismissed confirming the Judgment and Decree passed in O.S.No.523/2012 dated 23-09-2014 by the II Addl. Junior Civil Judge, Guntur. (2) That the Appellants do bear their own institutional costs of Rs.2,148/- and the Respondent do bear its own costs of Rs.Nil. (CM & FC not filed by both parties). Given under my hand and the seal of the court, this the 6th day of December, 2019. PRINCIPAL DISTRICT JUDGE, GUNTUR. TABLE OF COSTS For Appellants For Respondent Vakalath 2.00 -- Court fee paid 2,146.00 -- Total 2,148-00 Nil PRINCIPAL DISTRICT JUDGE, GUNTUR. J U D G M E N T TABLE OF COSTS |
| Order Date | 06-12-2019 |
| IN THE COURT OF THE DISTRICT JUDGE: GUNTUR 1 Fair IN THE COURT OF THE PRINCIPAL DISTRICT JUDGE: GUNTUR. PRESENT: SRI. A. HARI HARANADHA SARMA PRINCIPAL DISTRICT JUDGE. Friday, the 6th day of December, 2019. A.S.No.111/2015. Between:- 1. Puppala Rajendra Prasad. 2. Sajja Sarath Babu. 3. Gulakaram Murali Krishna. 4. Bannaravuri Murali Krishna. 5. Mutluri Raju. 6. Bandi Venkateswara Rao. … Appellants/Defendants. And Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer. … Respondent/Plaintiff. Appeal against the Decree and Judgment passed in O.S.No.523/2012 dated 23-09-2014 on the file of II Addl. Junior Civil Judge, Guntur. Between: Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer. … Plaintiff. And 1. Puppala Rajendra Prasad. 2. Sajja Sarath Babu. 3. Gulakaram Murali Krishna. 4. Bannaravuri Murali Krishna. 5. Mutluri Raju. 6. Bandi Venkateswara Rao. … Defendants. This Appeal suit is coming on 27-11-2019 for hearing before me in the presence of Sri G. Santha Kumar, Advocate for the Appellants and of Sri K. Venkata Reddy, Advocate for the Respondents, and upon perusing the material available on record, and having stood over for consideration till this day, this Court delivered the following: 2 J U D G M E N T 1. This is an appeal directed against the Decree and Judgment dated 23- 09-2014 passed in O.S.No.523/2012 by the II Addl. Junior Civil Judge, Guntur. 2. The Appellants are the defendants before the Court below and suffered decree. Respondent herein is the Plaintiff. 3. For sake of convenience the parties will be herein after referred to as Plaintiff and Defendants as and how they are arrayed in the impugned proceedings. 4. The case of Plaintiff in brief is that: The Plaintiff is a company registered under Companies Act engaged in doing the chit fund business by framing certain rules and regulations for advantage of subscribers running chit business. The 1st defendant joined in the chit fund scheme of the Plaintiff with Series No.GTT03H. Ticket No.25 was allotted in his name. He has agreed to subscribe Rs.6,000/- per month for 50 months equally. The value of the chit was Rs.3,00,000/-. The 1st defendant participated in the auction and agreed to forego Rs.1,20,000/-, became successful bidder. Accordingly the amount was paid to him on execution of necessary documents including furnishing of guarantee by the defendants 2 to 6 in the form of executing necessary loan documents and agreement of guarantee etc. 1st Defendant in all paid Rs.60,000/- till the date of payment of prized amount. The Plaintiff issued cheque dated 17-07-2008 for Rs.1,71,582/- and Rs.8,418/- by way of adjustment on 17-07-2008. The total amount paid was Rs.1,80,000/- for which cash voucher was issued to him. Further the 1st defendant paid Rs.1,98,000/- till 33rd installment and thereafter committed default and his dues are at Rs.41,840/- apart from legal notice charges etc. Hence, the suit is filed for recovery of dues. 5. Written statement filed by 1st defendant was adopted by Defendants 2 to 6. The contest of the 1st defendant is that, the plaint allegations are false. The Plaintiff is put to strict proof. He is not liable to pay any amount. Dividends are not 3 properly calculated and paid. Bye-laws are not registered. Author of Plaint is not competent to sign the plaint. The agreement of chit is not in consonance with the A.P. Chit Fund Act. The Court has no jurisdiction to entertain the case under A.P. Chit Fund Act. One Shaik Rabbani the Recovery Manager and Ramesh Recovery Assistant of Plaintiff on 12-07-2012 received Rs.10,000/- and stated that entire dues are clear. The Account copy filed by Plaintiff is not reflecting correct dues. The suit is liable to be dismissed. 6. On the strength of pleadings the following issues were settled for trial by the Court below: 1. Whether the bye laws of the suit chit are registered according to law ? 2. Whether the 1st defendant is entitled for dividends ? 3. Whether the person who signed the Plaint on behalf of Plaintiff Company is competent to sign ? 4. Whether this Court has jurisdiction to entertain the suit ? 5. Whether there is no contractual liability between Plaintiff and defendants ? 6. Whether the account copy filed by the Plaintiff Company is true and valid ? 7. Whether the Plaintiff Company is entitled for recovery of suit amount as prayed for ? 8. To what relief ? 7. During trial on behalf of the Plaintiff, one Ch. Vijay Sri Harsha and P.W.2 R. Sai Kumar were examined and Exs.A.1 to A.15 documents were marked. On behalf of the defendants, D.W.1 was examined and Exs.B.1 to B.26 were marked. 8. The trial Court decreed the suit for Rs.31,840/- with interest at 6% on the principal sum of Rs.26,394/-. The findings of the Court below are that: 1. There is no convincing answer from the defendants as to non registration of bye laws and it was not even suggested to P.W.1. 4 2. As per the terms of the contract between the parties particularly the chit agreement Clause No.17 Prized subscriber if commits default not entitled for dividend. Therefore the claim of entitlement of defendants for dividends cannot be entertained. 3. As per the evidence of P.W.1 coupled with Ex.A.13 the signatory to the pleadings has authority and as per the observations of Hon’ble Apex Court vide AIR 1971 SC 740 Para No.5 the Corporation is a legal person. The Secretary or Director or any Principal of the Corporation or Company can sign the pleadings. Therefore there is no procedural infirmity with regard to the authority of the person signing the plaint. 4. As per the provisions of A.P. Chit Fund Act, 1971 as on the date of registration of suit chit, the provisions of said Act is applicable. The Company and the defendants are residing at Guntur. Therefore, there is no bar to entertain the suit. 5. The evidence of Plaintiff is sufficient to believe that the documents are properly executed. Therefore, the liability in terms of document is established. 6. The Plaintiff Company in its notice Ex.A.6 stated that 1st defendant paid up to 43 installments and committed default of 7 installments. The legal notice was received by some of the defendants. From the dues of Rs.42,000/- (Rs.6,000/- x 7) due by 1st defendant the Plaintiff company deducted part payment of Rs.5606/- and shown the total amount due as Rs.36,394/-. However, the trial Court decreed the suit for Rs.31,840/-. 9. The grounds urged in the memorandum of grounds of appeal by the defendants disputing the propriety and sustainability of the Judgment are that: 1. The findings of trial Court on all issues are erroneous. 2. The trial Court failed to appreciate the case properly. 5 3. The trial Court failed to see that Plaintiff charged interest even after payment of installments. 4. The trial Court ignored the fact that the Plaintiff did not add dividend. 5. The trial Court went in wrong coming to the conclusion that the defendants are in default. 6. The trial court failed to see the Exs.B.1 to B.26 filed by the defendants. 7. The trial court went in wrong in deciding that the Defendants failed to show that he was regular in payment of installments. 8. The trial court is not justified in holding that the defendants are at default. 10. Heard both sides. Extensive arguments are submitted reiterating their respective contentions. 11. Perused the pleadings, issues, evidence of P.Ws.1 and P.W.2, D.W.1, recitals in Exs.A.1 to A.15, and Exs.B.1 to B.26, observations in the impugned judgment, grounds urged in the memorandum of grounds of appeal. Thoughtful consideration is given to the arguments advanced by both sides. 12. The points that arise for determination in this appeal are: 1. Whether the Civil Courts have got jurisdiction to decide the dispute in respect of the chit transactions in general particularly the dispute covered by the present legal proceedings ? 2. Whether the Plaintiff is able to prove its entitlement for the money decree for the amount prayed for ? 3. Whether the decree and Judgment of the court below are sustainable in law and on facts ? Or whether any interference is necessary ? If so, on what grounds and to which extent ? 4. What is the result of Appeal ? 6 13. POINT NO.1:- The findings of the trial Court on the jurisdiction covered by Issue No.4 are that; the provisions of A.P. Chit Fund Act,1971 would apply. One of the branches of the Plaintiff Company is situate at Guntur. 1st Defendant is also residing in Guntur. Therefore, there is no Bar to try the suit by the trial Court. 14. The suit transaction is pursuant to the chit with Series No.GTT03H25 and commencement of chit is 25-08-2007 and its termination is 25-09-2011 as per Ex.A.2 agreement. Even as per the evidence of P.W.1 Vijaya Sri Harsha there was auction on 26-05-2008. As per plaint the suit is verified on 1-5-2012 and its presentation was on 1-5-2012. As per the notification issued by the Central Government by exercising powers under Sub-section 3 of Section 1 of A.P. Chit Funds Act, 1982 (Act 40 of 1982) the Central Government appointed 15 th day of September, 2008 as the date on which the provisions of the Central Act applicable to Andhra Pradesh. In a similar situation in a case between Sri Visalam Chit Funds Ltd., Vs., A. Hussain and another, decided on 21st October, 2005, the Hon’ble High Court of Madras referred to the provisions of Chit Funds Act. The context in the case cited was that, chit was commenced prior to Chit Fund Act coming into force. Suit was filed after commencement of the Chit Funds Act, 1982 like one in the present case. In the said case the Hon’ble High Court of Madras has referred to Section 85 as well as Section 90 of the Act. Section 85 reads as follows: 85. Act not to apply to certain chits.—Nothing in this Act shall apply in respect of— (a) any chit started before the commencement of this Act; or (b) any chit the amount of which, or where two or more chits were started or conducted simultaneously by the same foreman, the aggregate amount of which does not exceed one hundred rupees. Section 90 reads as follows: “90. Repeal and saving.— (1) The Andhra Pradesh Chit Funds Act, 1971 (Andhra Pradesh Act 9 of 1971), the Kerala Chitties Act, 1975 (Kerala Act 23 of 1975), the Maharashtra Chit Funds Act, 1974 (Maharashtra Act LV of 1974), the Tamil Nadu Chit Funds Act, 1961 (Tamil Nadu Act 24 of 1961), as in force in the State of 7 Tamil Nadu and in the Union territories of Chandigarh and Delhi, the Uttar Pradesh Chit Funds Act, 1975 (Uttar Pradesh Act 53 of 1975), the Goa, Daman and Diu Chit Funds Act, 1973 (Goa, Daman and Diu Act 16 of 1973)and the Pondicherry Chit Funds Act, 1966 (Pondicherry Act 18 of 1966), are hereby repealed and the provisions of section 6 of the General Clauses Act, 1897 (10 of 1897), shall apply to such repeal as if each such Act so repealed were a Central Act. (2) Notwithstanding such repeal, the Acts mentioned in sub-section (1) shall continue to apply to chits in operation on the commencement of this Act, in the same manner as they applied to such chits before such commencement.” In the light of Section 85(a) and Section 90(2) of A.P. Chit Fund Act, 1982 since the chit in the present case commenced prior to the Chit Fund Act, 1982 coming into force in Andhra Pradesh the Jurisdiction contemplated under the said Act in terms of Section 64 approaching the Registrar of Chits does not arise and the earlier procedure approaching the Civil Courts in terms of A.P. Chit Fund Act, 1971 deemed to be tact. Therefore, the objection of the Appellants as to want of jurisdiction does not deserve any consideration. The point regarding jurisdiction is therefore answered against the appellants in respect of the dispute in the present case the Civil Courts have jurisdiction. 15. POINT NO.2:- The defendants are not disputing the Chit Fund transaction with Plaintiff. They have taken the plea of discharge. All other objections as to entitlement of defendants for dividends are properly answered by the Court below that defaulter is not entitled for dividend. With regard to authority of the person verifying the plaint that the signatory is qualified, in view of the admission of entering into agreement there is contractual liability. In view of the evidence of P.W.1 and person concern with the Plaintiff Company the accounts are true and valid. The peculiar context of the present case is that, the defendants have taken the defence of discharge. Then substantial burden to prove the discharge lies on the defendants. To show that they have discharged their liability the Defendants stated that they have paid the amount by placing Exs.B.1 to B.26. The receipts relied on by the defendants Exs.B.1 to B.26 and the amount paid by them as per the receipts placed are as follows: 8 Sl.No. Receipt Number Receipt_Date Amount paid 1. CR No.1507/2008 26-05-2008 RS.44,601-00 2. CR No.0968/2008 17-07-2008 RS.07,960-00 3. CR No.0160/2008 17-07-2008 RS.00,450-00 4. CR No.21952 29.12.2008 RS.03,000-00 5. CR No.21953 29.12.2008 RS.01,600-00 6. CR No.24034 30-03-2009 RS.09,000-00 7. CR No.24748 29-04-2009 RS.04,000-00 8. CR No.24754 01-05-2009 RS.03,000-00 9. CR No.26317 24-06-2009 RS.04,300-00 10. CR No.1321 22-09-2009 RS.29,500-00 11. CR No.30522 30-12-2009 RS.05,300-00 12. CR No.33476 09-04-2010 RS.09,000-00 13. CR No.34248 08-05-2010 RS.05,000-00 14. CR No.2204/2010 06-07-2010 RS.00,560-00 15. CR No.2300 13-09-2010 RS.10,000-00 16. CR No.3301 16-09-2010 RS.05,000-00 17. CR No.3308 28-09-2010 RS.04,000-00 18. CR No.6444 28-06-2010 RS.10,210-00 19. CR No.3128 17-12-2010 RS.10,000-00 20. CR No.2753 07-01-2011 RS.10,000-00 21. CR No.3704 01-02-2011 RS.18,000-00 22. CR No.3757 20-05-2011 RS.10,000-00 23. CR No.4155 20-07-2011 RS.10,000-00 24. CR No.4168 30-07-2011 RS.09,000-00 25. CR No.3855 28-09-2011 RS.08,500-00 26. CR No.5162 12-07-2012 RS.10,000-00 T O T A L Rs.2,41,981-00 16. Whether the liability of the defendants in total is Rs.2,41,981/- or more is one question. Whether the Plaintiff is able to substantiate the liability of the defendant is for more than Rs.2,48,981/- is another question. Whether the payments made are reflected in the Account extract is another question. Periodically the amounts paid are adjusted. It appears that the adjustments are made suitable and matching with he balances time to time, but not at the quantum specified by the defendants. The defendants have shown the payments at lump sum and the adjustments in the account extract are shown at different quantums. Dividends are also added on some months. It appears that the account abstract is maintained with reference to the formula fixed and feeded in the system. In the light of the written statement and the defence it can be understood that the dispute is solely touching the quantification of dues. The Defendants pleaded that on 12-07-2012 also Rs.10,000/- was lastly paid and an assurance was given that that 9 shall be the last payment and the total dues are cleared. When that is the case, when the said amount covered by Ex.B.26 was paid, why they need not obtain no dues certificate from Plaintiff is a serious question. Now it is necessary to consider the oral evidence of the parties also to some extent in this regard. 17. P.W.1 stated that total amount paid is Rs.2,58,000/- and cash vouchers are issued for all the payments. Amount due is Rs.42,000/-. Evidence affidavits of one Sai Kumar and Vijaya Sri Harsha both are filed indicating them as evidence affidavit of P.W.1. Sri Harsha’s evidence affidavit was taken on record on 20-2-2014, whereas the evidence affidavit of Sai Kumar is taken on 2/4/2014. Through Sai Kumar Ex.A.15 is marked. As per the observations on the docket proceedings on 22-09-2014 and 23-09-2014 of the Court at the stage of judgment, evidence affidavit of Vijaya Sri Harsha was accepted as P.w.1 and evidence affidavit of Sai Kumar was accepted as P.w.2. But there is no cross-examination of Vijaya Sri Harsha and it can be seen that only P.W.2 is cross examined. Both P.Ws.1 and P.W.2 referred as working as Law Officers. The Evidence Affidavits of both of them the verbatim same including the documents sought to be marked. From 2-12-2013 the matter was posted for cross-examination of P.W.1 several times and at last on 2-4-2014 P.W.1 was cross examined and the witness cross examined on 2-4-2014 is P.W.2. 18. The evidence affidavit of P.W.1 Vijaya Sri Harsha is relating to Exs.A.1 to A.14. The evidence of P.W.2 Sai Kumar is relating to Ex.A.15 in chief. Whereas the cross-examination is on P.W.2 alone. The main grievance of the defendants appears to be is that, the total amount paid by them is not accounted. P.W.2 admitted that defendants paid Rs.10,000/- on 12-07-2012. It is also admitted by P.W.2 that the said payment is not reflected in the plaint. 19. The trial Court in the Judgment came to conclusion that the dues are Rs.31,840/- as against the dues claimed at Rs.41,840/-. Probably it appears that the trial Court has given credit to Rs.10,000/- admittedly paid. Then it is not clear 10 how the trial Court came to conclusion that the principal amount is Rs.27,394/-. The dues are shown by the Plaintiff at Rs.42,000/- and interest component and miscellaneous charges component is considered at Rs.6,390/-. If the same is excluded the dues may come to Rs.35,610/-. The dues arrived by the trial Court particularly the principal amount at Rs.26,394/- appears to have been arrived after deducting part payments shown at Rs.5,666/-. The cross-examination done on P.W.2 is that the amount of Rs.10,000/- paid is not reflected in the pleadings and that the defendants are not liable to pay Rs.41,840/- to Plaintiff Company and the clear stand of the defendants is that no further dues are there after payment of Rs.10,000/- on 12-07-2012. D.W.1 during cross-examination stated that he studied up to Degree. He has to pay 50 installments at the rate of Rs.6,000/- per month. Exs.B.4 to B.26 are temporary receipts and it is also mentioned in Exs.B.4 to B.26 that official receipts will be issued, but no official receipts are issued. He has stated that out of the total amount of Rs.3,00,000/- he has paid Rs.2,41,000/- and the Plaintiff filed the suit for Rs.36,395/-. The entitlement of defendants for dividends despite default is one aspect. However the account extract shows that dividend is also deducted while calculating the dues. Further it can be seen that some interest is added in respect of delayed payments. According to the admission of D.W.1 he has paid Rs.2,41,981/- as against the total dues. The delayed payments and interest component etc., are also the aspects required consideration. The receipts relied on by the defendants are admittedly temporary receipts and issuing of official receipts is contemplated and the defendants did not collect the official receipts. The defendants failed to prove their stand. 20. Upon considering the entire evidence on record, this Court is of the view that the entitlement of the Plaintiff arrived by the trial Court does not require any interference and fit for confirmation on any aspects and there are no serious grounds to interfere either on legal or factual base. Point No.2 framed is answered accordingly against the Appellants. 11 21. POINT NO.3:- In the light of the discussion made on Point Nos. 1 and 2, this Court finds that the decree and Judgment, dated 23-09-2014 passed in OS.No.523/2012 by II Addl. Junior Civil Judge, Guntur are sustainable in law and on facts and fit for confirmation and there are no grounds to interfere. Point No.3 is answered accordingly. 22. POINT NO.4:- In the result, the appeal is dismissed confirming the Judgment and decree passed in OS.No.523/2012, dated 23-09-2014 by the II Addl. Junior Civil Judge, Guntur. However, considering the facts and circumstances of the case, both parties are directed to bear their own costs. Dictated to Stenographer Grade-I, transcribed by him, corrected and pronounced by me in the open court, this the 6th day of December, 2019. PRINCIPAL DISTRICT JUDGE GUNTUR. Copy to: The II Addl. Junior Civil Judge, Guntur. 12 Fair IN THE COURT OF THE PRINCIPAL DISTRICT JUDGE: GUNTUR. PRESENT: SRI. A. HARI HARANADHA SARMA PRINCIPAL DISTRICT JUDGE. Friday, the 6th day of December, 2019. A.S.No.111/2015. Between:- 1. Puppala Rajendra Prasad, S/o Koteswara Rao, Hindu, 49 years, R/o 26-38-113, Jyothi Nilayam, A.T. Agraharam, Guntur. 2. Sajja Sarath Babu, S/o Veera Raghavaiah, 60 years, 11-36-1, Vemuru Post and Mandal, Guntur Dt. 3. Gulakaram Murali Krishna, S/o Adiseshagiri, 50 years, R/o Nizampatnam Post and Mandal, Guntur Dt. 4. Bannaravuri Murali Krishna, S/o Gurunadham, 42 years, R/o 11-261, Bhattiprolu Mandal and Post, Guntur Dt. 5. Mutluri Raju, S/o Adam, 45 years, R/o 26-36-13, Ankamma Nagar, 4th line, Guntur. 6. Bandi Venkateswara Rao, S/o Rammohan Rao, 43 years, R/o 2-75, Nagaram Post and Mandal, Guntur Dt. … Appellants/Defendants. And Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer Ch. Vijay Sri Harsha, S/o Prasada Rao, Guntur. … Respondent/Plaintiff. Appeal against the Decree and Judgment passed in O.S.No.523/2012 dated 23-09-2014 on the file of II Addl. Junior Civil Judge, Guntur. Between: Kapil Chit Funds Private Limited, Guntur. Rep., by its Legal Officer. … Plaintiff. And 1. Puppala Rajendra Prasad. 2. Sajja Sarath Babu. 3. Gulakaram Murali Krishna. 4. Bannaravuri Murali Krishna. 5. Mutluri Raju. 6. Bandi Venkateswara Rao. … Defendants. This is an appeal directed against the Decree and Judgment dated 23-09-2014 passed in O.S.No.523/2012 by the II Addl. Junior Civil Judge, Guntur. 13 Appeal presented on : 26-02-2015 Appeal filed on : 05-06-2015 VALUATION: This Appeal suit is filed for recovery of Rs.41,840/- on which a court fee of Rs.2,146/- is paid under Section 20 r/w 49 of APCF & SV Act. This Appeal suit is coming on 27-11-2019 for hearing before me in the presence of Sri G. Santha Kumar, Advocate for the Appellants and of Sri K. Venkata Reddy, Advocate for the Respondents, and upon perusing the material available on record, and having stood over for consideration till this day, this Court DOTH ORDER AND DECREE as follows: (1) That the appeal be and the same is hereby dismissed confirming the Judgment and Decree passed in O.S.No.523/2012 dated 23-09-2014 by the II Addl. Junior Civil Judge, Guntur. (2) That the Appellants do bear their own institutional costs of Rs.2,148/- and the Respondent do bear its own costs of Rs.Nil. (CM & FC not filed by both parties). Given under my hand and the seal of the court, this the 6th day of December, 2019. PRINCIPAL DISTRICT JUDGE, GUNTUR. TABLE OF COSTS For Appellants For Respondent Vakalath 2.00 -- Court fee paid 2,146.00 -- Total 2,148-00 Nil PRINCIPAL DISTRICT JUDGE, GUNTUR. J U D G M E N T TABLE OF COSTS |
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Frequently Asked Questions
The Petitioner in case Puppala Rajendra Prasad And 5 Others vs Kapil Chit Funds Pvt. Ltd., Guntur is Puppala Rajendra Prasad And 5 Others.
The Respondent in case Puppala Rajendra Prasad And 5 Others vs Kapil Chit Funds Pvt. Ltd., Guntur is Kapil Chit Funds Pvt. Ltd., Guntur.
The case against Kapil Chit Funds Pvt. Ltd., Gunturwas filed on 26-02-2015 by Puppala Rajendra Prasad And 5 Others.
The status of case Puppala Rajendra Prasad And 5 Others against Kapil Chit Funds Pvt. Ltd., Guntur is Case Disposed.