K.A. SWAMI C. J.

In these writ petitions and also the writ appeals, the validity of several provisions of the Chit Funds Act, 1982 (hereinafter referred to as "the Act"), is challenged. In the meanwhile, the Supreme Court has considered the validity of the provisions contained in the very Act in Shriram Chits and Investments (P.) Ltd. v. Union of India, and held that all the provisions of the Act are valid. Therefore, these writ petitions and the writ appeals are liable to be dismissed in the light of the pronouncement made by the Supreme Court. However, an argument is advanced before us that the validity of section 6(3) of the Act has not been specifically considered and, therefore, the same be considered in these cases. We may only refer to paragraphs 29 and 30 of the judgment of the Supreme Court in Shriram Chits and Investments (P.) Ltd.s case to meet this contention. Paragraphs 29 and 30 of the judgment of the Supreme Court read as follows : "Section 6(3) of the Act reads thus :

6(3). The amount of discount referred to in clause (f) of sub-section (1) shall not exceed thirty per cent. of the chit amount.

It was submitted that the ceiling of the discount is highly arbitrary and imposes unreasonable restrictions on the business of the petitioners. It appears to us that the ceiling of discount is on the higher side and the subscribers, who are in need of money, per force, have to give the discount to that extent and cannot be expected to take care of their own interest when they bid at the time of chit auction. This restriction is neither arbitrary nor unreasonable."*

Thus, it is clear that the Supreme Court has specifically considered the validity of section 6(3) of the Act and held that the said provision of the Act is valid.In addition to this, learned counsel appearing on behalf of the petitioners/appellants also contended that rules 16, 28(1), 28(2), 31(1) and 31(2) of the Tamil Nadu Chit Funds Rules, 1984 (hereinafter referred to as "the Rules"), are ultra vires the provisions of the Act, powers of the rule making authority and some of them are unconstitutional. No doubt, in the aforesaid judgment of the Supreme Court, the validity of these rules are not considered. Therefore, we have heard both sides on the validity of the aforesaid rules. We now proceed to consider the validity of these rules. Rule 16 of the Rules reads thus :

"Form of notice to chit subscriber".--Every notice to be given by a foreman to the subscribers in a chit under section 16 shall be in Form IX. It shall be sent to each subscriber under certificate of posting and shall also be exhibited on the notice board of the office of the foreman ".

We have not been able to see any infirmity or invalidity in this rule as the said rule only prescribes the form of the notice and the mode in which the notice has to be sent. Section 16 of the Act specifically provides that every draw in a chit shall be held on the date, at the time and place mentioned in the chit agreement and a notice, therefore, in such form and in such manner as may be prescribed shall be issued by the foreman to all the subscribers. It is pursuant to this provision that rule 16 has been framed prescribing the form of the notice and the mode in which the notice shall be sent. However, it is contended that the rule in so far as it directs that the notice shall be sent under certificate of posting is invalid inasmuch as it casts a financial burden upon the foreman which he cannot meet out of the five per cent. commission he gets. It is necessary to ensure that a notice is issued to a subscriber. Sending of notice under certificate of posting is one of the cheapest modes which the rule provides. The fact that the foreman maintains a register for having sent the notice by itself will not be sufficient because there will be no other records to cross-check it. If it is made compulsory to send the notice under certificate of posting, there will be a record to cross-check and ascertain