Mr. Justice E.J. Bellie, President—The opposite party against whom a decree has been passed by the District Forum, is the Appellant. The transaction alleged by the complainant in respect of which according to him the opposite party has committed deficiency in service is a chit transaction. The complainant was a subscriber to a chit conducted by the opposite party. According to him, he had paid the entire subscription and at the end of the chit he was entitled to Rs. 40,000/- and when he demanded payment of this amount the opposite party evaded. On these grounds the complaint has been filed for payment of Rs. 40,000/- and compensation.

2. The opposite party contended that the complainant had obtained a loan of Rs. 80,000/- from him, and the chit amount of Rs. 40,000/- has been adjusted towards this loan amount as per the letter written by the complainant, and there is still a balance of Rs. 10,000/- due from the complainant to the opposite party, and therefore there is no deficiency in service on its part as alleged by the complainant.

3. The District Forum rejected the case of the opposite party and, holding that there was deficiency in service on the part of the opposite party, gave an award.

4. Now in the appeal, the learned Counsel appearing for the appellant/opposite party raises a legal plea viz. in view of Section 64 of the Chit Funds Act, the District Forum had no jurisdiction to try the complaint and, therefore, the order passed by it is unsustainable. After hearing both sides, we find there is much force in this contention of the learned Counsel. Section 64 of the Chit Funds Act 1982 (Act 40 of 1982) is in the following terms :—

“64. Disputes relating to chit business.—

(1) Notwithstanding anything contained in any other law for the time being in force, 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 of each party thereto is one or the other of the following, namely :

(a) a foreman, a prized subscriber or ,a non-prized subscriber, including a defaulting subscriber, past subscriber or a person claiming through a subscriber, or a deceased subscriber to a chit;

(b) a surety of a subscriber, past subscriber, or a deceased subscriber.

Explanation :—For the purpose of this subsection, a dispute touching the management of a chit business shall include —

(i) a claim by or against a foreman for any debt or demand due to him from a subscriber or due from him to a subscriber, past subscriber or the nominee, heir or legal representative of a deceased subscriber whether such debt or demand is admitted or not;

(ii) a claim by a surety for any sum or demand due to him from the principal borrower in respect of a long by a foreman and recovered from the surety owing to the default of the principal borrower, whether such sum or demand is admitted or not; and

(iii) a refusal or failure by a subscriber, past subscriber or the nominee, heir or legal representative of a deceased subscriber to deliver possession to a foreman of land or any other asset resumed by him for breach of conditions of the assignment.

(2) Where any question arises as to whether any matter referred to for the award of the Registrar is a dispute or not for the purpose of Sub-section (1), the same shall be decided by the Registrar whose decision thereon shall be final.

(3) No Civil Court shall have jurisdiction to entertain suit or other proceedings in respect of any dispute referred to in Subsection (1).”

It is clear from Clause (i) under the explanation given in the section that a dispute regarding a claim by a subscriber against the foreman is a matter which shall be referred to the Registrar for an arbitration as required under Sub-section (1). As per Sub-section (3) Section 64, no Civil Court shall have jurisdiction to entertain suit or other proceedings referred to in Sub-section (1). From this it is plain that a dispute, as the one in the present case, has to be refe