Chit Fund Act 1982 | Sunitha Chit Funds Pvt. Ltd.

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Our Commitment to Full Compliance

Sunitha Chit Funds Pvt. Ltd. is registered with the Karnataka State Chit Fund Registrar and operates in strict compliance with The Chit Funds Act, 1982. Every chit group we operate is conducted as per the provisions of this Act, ensuring complete protection for all our members.

📖 What is the Chit Fund Act 1982?

The Chit Funds Act, 1982 is a central legislation enacted by the Parliament of India to regulate chit fund businesses across the country. It replaced the earlier state-level laws and brought uniformity to the regulation of chit funds throughout India.

The Act defines a chit fund as a transaction where a person enters into an agreement with a specified number of persons that every one of them shall subscribe a certain sum of money by way of periodical instalments over a definite period, and each subscriber shall in turn be entitled to the prize amount determined by lot or by auction or by tender.

The Act is administered by state governments through appointed Registrars. In Karnataka, this is the Karnataka State Chit Fund Registrar, with whom Sunitha Chit Funds Pvt. Ltd. is duly registered.

📝 Key Definitions Under the Act

The following terms are defined under Section 2 of the Chit Funds Act, 1982:

Chit

A transaction where subscribers contribute periodically and take turns receiving the prize amount through auction or draw.

Chit Amount

The total sum payable to the prize winner in any installment, equal to the aggregate of all subscriptions payable for that installment.

Foreman

The person responsible for conducting the chit — in this case, Sunitha Chit Funds Pvt. Ltd.

Subscriber

Any member who has agreed to contribute their monthly installment and participate in the chit group.

Discount

The amount by which the chit amount is reduced in an auction — i.e., the bid amount agreed to by a prized subscriber.

Dividend

Each subscriber's share in the discount, which reduces their effective monthly contribution.

⚖️ Key Provisions Affecting Members

Section 5 — Registration

No person shall conduct any chit without obtaining the previous sanction of the State Government, and no chit shall commence unless a certificate of commencement of chit is obtained from the Registrar. Sunitha Chit Funds holds all required registrations.

Section 8 — Chit Agreement

Every chit shall be conducted in accordance with a written agreement — the chit agreement — which must contain specified details including chit amount, number of subscribers, duration, and rules for auction.

Section 18 — Auction Process

The chit amount shall be paid to the subscriber who offers to receive the lowest amount (highest discount). The maximum permissible discount shall not exceed 25-35% of the chit amount as specified by the State Government.

Section 19 — Foreman's Commission

The foreman is entitled to receive, as commission, a sum not exceeding 5% of the chit amount in each installment. This commission is deducted from the discount before distribution to subscribers.

Section 34 — Books & Accounts

Every foreman shall maintain proper books of accounts, minutes books of draws/auctions, and shall make these available for inspection by subscribers and the Registrar.

Section 45 — Protection of Subscribers

Subscribers have the right to inspect chit accounts, receive receipts for all payments made, and receive a copy of the chit agreement. The Act provides strong protections for subscriber rights.

✅ How Sunitha Chits Complies

We take our regulatory obligations seriously. Here is how we comply with every major requirement of the Chit Fund Act 1982:

✓ State Registration

Registered with the Karnataka State Chit Fund Registrar. Certificate of Registration obtained prior to commencing operations.

✓ Written Chit Agreements

Every member signs a comprehensive chit agreement containing all mandatory details as specified under the Act.

✓ Commission Cap (5%)

Our management commission is exactly 5% of the chit amount per month — within the statutory maximum permitted.

✓ Maximum Discount (35%)

Auctions are capped at 35% discount as permitted under Karnataka State Government notifications under the Act.

✓ Transparent Auctions

All auctions are conducted openly. Members are invited to attend and observe. Minutes are maintained for every auction.

✓ Proper Accounts

Complete books of accounts, payment receipts, and member registers are maintained and available for inspection.

🛡️ Your Rights as a Subscriber

The Chit Funds Act 1982 guarantees you the following rights as a member of any chit group:

Right to receive a signed copy of the chit agreement
Right to receive a receipt for every payment made
Right to attend and participate in monthly auctions
Right to inspect the chit accounts and records
Right to approach the Registrar if your rights are violated
Right to receive prize money within the timeframe specified in the Act
Right to receive your share of dividends after each auction
Right to a termination of chit if the foreman fails to conduct it properly

📞 Registrar Information

For matters related to the Chit Fund Act 1982, you may contact the Karnataka State Chit Fund Registrar:

Karnataka State Chit Fund Registrar
Department of Cooperation, Government of Karnataka
Members may file grievances against any registered chit fund operator with the Registrar's office.
Website: cooperationdept.karnataka.gov.in

Questions About Regulatory Compliance?

We are happy to share our registration details, chit agreements, and compliance records.

📞 +91-8884536333 | ✉️ sunithachits@gmail.com

1st Floor, Spoorthi Complex, Sindhanur, Karnataka – 584128