SC To Examine Andhra Govt's Transfer Plea For Margadarsi Chit Fund Case Petitions

A vacation bench has issued a notice to the chit fund company, Margadarsi Chit Fund Private Ltd. (MCFPL), and scheduled the matter for hearing on July 18.

The Supreme Court has agreed to examine a plea by the Andhra Pradesh government seeking the transfer of a bunch of pleas in the Margadarsi Chit Fund case. Margadarsi Chit Fund Private Ltd (MCFPL) and others had filed the pleas, challenging the criminal and other investigations initiated against them, news agency IANS reported. A vacation bench, comprising Justices Aniruddha Bose and Rajesh Bindal, issued a notice to MCFPL, and scheduled the matter for hearing on July 18.

Senior advocate Harish Salve, representing Margadarsi Chit Fund Private Ltd (MCFPL), opposed the plea and contended this kind of politics should be avoided. He stated that the issues related to the case were already being addressed by the Telangana High Court, and instead of filing an appeal, the state government was seeking a transfer of the matter. It was further informed by the Supreme Court that the high court had already scheduled the matter for June 26.

The state government sought transfer of the matters from Telangana to the Andhra Pradesh High Court.

According to the plea filed by the state government, it argued that the First Information Reports (FIRs) were registered by the Andhra Pradesh Criminal Investigation Department (CID) police station in Guntur against Margadarsi Chit Fund Private Ltd. (MCFPL). The allegations include offences committed in Andhra Pradesh under the Chit Fund Act, the Andhra Pradesh Protection of Depositors in Financial Establishments Act, 1999, and the Indian Penal Code (IPC).

The Andhra Pradesh government emphasised that the offences were committed within its territory, and therefore, the state police had conducted the investigation.

"Instead of availing of their remedies available under law, the Respondents herein chose to approach the Hon'ble High Court of Telangana, invoking its writ jurisdiction, where none existed. Shockingly, not only were such writ petitions entertained, but interim orders were also passed restraining the petitioner from taking any coercive steps against MCFPL, its management, employees, or affiliates," said the plea, as reported by IANS.

According to the plea filed by the state government, it stated that a significant number of subscribers to the chit funds offered by Margadarsi Chit Fund Private Ltd. (MCFPL) are located in Andhra Pradesh. The plea also mentioned that the majority of the branch offices of MCFPL are situated in Andhra Pradesh. 

"Therefore, the cause of action arises or the situs [place/jurisdiction] of the offences is in Andhra Pradesh, and thus, it is only the honourable high court of Andhra Pradesh that will have jurisdiction over these matters and no other high court, including the honourable Telangana High Court," said the plea.