Chit Fund Payment default

Dear Client,
Chit Funds are registered by State Governments under the Chit Funds Act, 1982 administered by the Ministry of Finance but with responsibilities of implementation resting with the States. Unless a chit-fund business is registered following the provision of the Chit Funds Act, 1982 and the Companies Act, 2013 and the rules made thereunder, one can not start or run a business of chit-fund. Borrower is personally held liable for repayment of the debt. You can make a prayer to the Chit Fund Company for some more time to settle the dues but cannot escape yourself from your liability of repayment of loans. Moreover, legal actions may also be taken against a defaulted borrower including filing a civil suit in court or initiating criminal proceedings against him/her. The chit fund company may also make use of debt recovery tribunals to recover the dues they are owed from the defaulter borrower by attaching their property or guarantor's property. So, to address harassment from the recovery agents of the chit fund company, you can file a complaint against them at the local Police Station endorsing a copy of the said police complaint to the chit fund company. As per Section 64(1) of the Chit Funds Act, 1982, any dispute touching the management of a chit business shall be referred by any of the parties to the dispute, to the Registrar for arbitration if each party thereto is one or the other. Under Sec.66(1) of the Act, if the Registrar is satisfied that any matter referred to him or brought to his notice is a dispute within the meaning of section 64, he shall, subject to such rules as may be prescribed, settle the dispute himself, or refer it for disposal to a person appointed by him. The Registrar hearing a dispute under section 66, shall, in addition to the powers conferred on him under that section, have the same powers as are vested in a Civil Court while trying a suit under the Code of Civil Procedure, 1908. It is recommended to consult with an Advocate to explore the remedies and grounds to challenge the legal action, if initiated by the Chit Fund Company for recovery of loan or debt.