(1)
No foreman, other than a firm or other association of individuals or a company or co-operative society, shall commence or conduct chits, the aggregate chit amount of which at any time exceeds [rupees twenty-five thousand].*
(2)
Where the foreman is a firm or other association of individuals, the aggregate chit amount of the chits conducted by the firm or other association shall not at any time exceed,—
- where the number of partners of the firm or the individuals constituting the association is not less than four, a sum of rupees [one lakh]**;
- in any other case, a sum calculated on the basis of [twenty-five thousand rupees]* with respect to each such partner or individual.
(3)
Where the foreman is a company or co-operative society, the aggregate chit amount of the chits conducted by it shall not at any time exceed ten times the net-owned funds of the company or the co-operative society, as the case may be.
Explanation.—
For the purposes of this sub-section, “net-owned funds” shall mean the aggregate of the paid-up capital and free reserves as disclosed in the last audited balance-sheet of the company or co-operative society, as reduced by the amount of accumulated balance of loss, deferred revenue, expenditure and other intangible assets, if any, as disclosed in the said balance-sheet.
* The words in brackets shall stand substituted (date to be notified) to read as “rupees one lakh” by Act 10 of 2001, s. 3.
** The words in brackets shall stand substituted (date to be notified) to read as “six lakhs” by s. 3, ibid.