Vijayawada: The Andhra Pradesh High Court has suggested to the state government not to inspect branches and verify records of the Margadarsi Chit Fund with regard to the chit fund scam until it issued an interim order in the case.
A single judge bench headed by Justice N. Jayasurya heard on Monday a petition filed by Margadarsi’s authorised signatory, P. Rajaji, challenging the AP government’s present inspection at all its 37 branches. The inspection involved officials from CID, the stamps and regulations etc.
Petitioner Margadarsi’s counsels Nagamuthu and Menakshi Arora argued that, in the name of inspections, the officials were causing hurdles to the Margadarsi employees in the discharge of their duty. Only the registrar, deputy registrar and assistant registrar were authorised to inspect the branches and verify records. But, even clerical staff were engaged to do so, they complained.
Government pleader C. Suman submitted that under Section 46 (A) of the Chit Fund Act, the registrar was having the power to inspect the records and ruled out any truth in the allegations of disruption of work at Margadarsi branches by way of inspection by the officials.
He said that they did not follow the directions issued by the high courts in both AP and TS.
AP CID counsel Sivakalpana Reddy submitted that seven cases were booked against Margadarsi, in which chargesheets were filed in two cases. “In the searches made in March, we noticed that the chit group amounts that belonged to Narasaraopet were transferred to the Rajahmundry chit group. The officials are verifying the details,” he said.
The court asked whether the branches were being given any prior information about the inspection and whether the inspection continued beyond the work hours.
After hearing both the parties, the court announced to reserve its verdict and gave oral instructions to the government pleader to suggest to the officials not to inspect branches and verify records until interim orders were issued.
