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2010 Supreme(Kar) 675

2010(6) Kar. L.J. 317
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
ARAU NAGARAJ, J.
Smt. KAMAKSHI
Versus
STATE OF KARNATAKA
Criminal Revision Petition No. 1663 of 2006.
Decided on : 23rd June, 2010

Advocates Appeared:
Sri Amaresh A. Angadi, Advocate for Petitioner;
Sri Vijayakumar Majage, High Court Government Pleader for Respondent.

Headnote:PRIZE CHITS AND MONEY CIRCULATION SCHEMES (BANNING) ACT, 1978 - Sections 2(e) & 4: [Arali Nagaraj, J] ’Prize Chit’ - Accused is not alleged to have entered into any agreement with members of two groups that amount so collected would because for giving or awarding periodical prizes or gifts, either in cash or in kind or that it would be used for re-funding to subscribers or such of them as have not won any prize or gift - Held, Contents of said charge do not attract definition of ’Prize Chit’ which has been banned under Section 3 of Act. Conviction of accused under the Act is illegal.

ORDER

The accused in C.C. No. 22406 of 1997 on the file of the learned X ACMM, Bangalore City, Bangalore which subsequently came to be renumbered as C.C. No. 14544 of 1999 on the file of the learned Metropolitan Magistrate, I Traffic Court, Bangalore City, Bangalore (hereinafter referred to as "Trial Court" for short) has challenged in this revision the legality and correctness of the judgment and order of conviction and sentence dated 28-7-2000 passed in the said case convicting her for the offence under Section 4 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 (hereinafter referred to as "Prize Chits Act" for short). She has also challenged in this revision the correctness of the judgment and order dated 20-7-2006 passed in Cri.A. No. 15096 of 2000 on the file of the learned XIII Additional Sessions Judge, Mayohall Unit, Bangalore (hereinafter referred to as "Appellate Court" for short) confirming the judgment and order of conviction passed by the Trial Court.

2. Heard the arguments of Sri Amaresh A. Angadi, the learned Counsel for the revision petitioner-accused and Sri Vijayakumar Majage, the learned High Court Government Pleader. Perused both the impugned judgments and orders and also the entire material found in the original records obtained from the Trial Court.

3. Sri Amaresh A. Angadi, the learned Counsel for the revision petitioner-accused strongly contends that the charge framed against the revision petitioner-accused in the Trial Court for the offence under Section 4 of Prize Chits Act do not attract the definition of "Prize Chit" as defined under Section 2(e) of the said Act and therefore, conviction of the revision petitioner-accused under Section 4 of the said Act for contravention of Section 3 of the said Act which bans Prize Chit and Money Circulation Schemes cannot be sustained in law.

4. Per contra, Sri Vijayakumar Majage, the learned High Court Government Pleader contends that both the Trial Court as well as the Appellate Court have concurrently found that the revision petitioner accused committed the offence punishable under Section 4 of the Prize Chits Act and therefore, both the judgments do not call for any interference in this revision.

5. The charge framed by the Trial Court against the revision petitioner-accused reads as under:

"That you on 12th June, 1993 at your house at Mottappanapallya, Indiranagar, told the neighbours that you are going to start a Chit of Rs. 15,000/- p.m. and that it consists of 50 members and each has to pay Rs. 300/- p.m. and by giving false benefit information to members dishonestly induced 50 members to give Rs. 300/-. And further on 10th November, 1993 again told the neighbours that you are going to start another chit for Rs. 13,000/- consisting of 52 members each has to Rs. 250/- every month, and further dishonestly induced 52 members to pay Rs.250/- and thus collected the whole amount and cheated the members without giving the money back and further you were running the said chit without any valid licence from the Government and you thereby committed the offences punishable under Sections 3 and 4 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 and within my cognizance".

6. Section 2(e) of the Prize Chits Act defines Prize Chit as under:

""Prize chit" includes any transaction or arrangement by whatever name called under which a person collects whether as a promoter, foreman, agent or in any other capacity, monies in one lump sum or in instalments by way of contributions or subscriptions or by sale of units, certificates or other instruments or in any other manner or as membership fees or admission fees or service charges to or in respect of any savings, mutual benefit, thrift, or any other scheme or arrangement by whatever name called, and utilises the monies so collected or any part thereof or the income accruing from investment or other use of such monies for all or any of the following purposes, namely.-

(i) giving or awarding periodic


















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