Raj Kumar K
in Bankruptcy Criminal Law
Asked October 05, 2017

How to recover money from bank shut due to insolvency

  • 1 Answer

I am a serving Army Soldier at Delhi. From 18 years of hardly earned money from high altitude and tough terrain areas of country for sum of Rs 2400000/- have been deposited to Nirmal Krishna Chits Pvt Ltd , Palukal, Kanyakumari for the construction of home. On 07th SEPT., I heard that, the said bank was shut down permanently with court notice as insolvency 3/2017. I contacted the lawyer (Advocate of said firm) by telephone told me that my amount is safe and it should be credited by the court or take a legal action . What type action I should take to collect the amount? Please help me.

Answer 1

S. 43 of the Chit Funds Act, 1982 lays down that any amount due to the subscriber from a foreman in relation to the chit business shall be a first charge on the chit assets. You may thus approach the Registrar for recovery of your dues. 

S. 71 of the Act equips the Registrar with the same powers as that of a civil court and lays down that every order passed by the Registrar under section 68 or section 69 and every order passed by the State Government in appeal under section 70 for payment of any money shall, if not carried out, on a certificate issued by the Registrar, be deemed to be a decree of a civil court, and shall be executed in the same manner as a decree of such court.

Hence, firstly you can file an application to the Registrar for recovery of your money whereby if the co. does not have sufficient funds then it may be directed to charge the amount against its assets.  You can also proceed against the foreman personally for the balance, if any, of the amount due to him after the declaration of the final dividend in the proceedings for the winding up of the chit. Secondly, if an order is passed by the Registrar and the co. or the foreman, as the case may be, does not adhere to the directions therein, then you may approach the Registrar for ensuring execution of the said order or direction.

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