“chit”

The Chit Funds Act, 1982 · s. 2

(b) "chit" means a transaction whether called chit, chit fund, chitty, kuri[1] [, fraternity fund, Rotating Savings and Credit Institution] or by any other name by or under which a person enters into an agreement with a specified number of persons that every one of them shall subscribe a certain sum of money (or a certain quantity of grain instead) by way of periodical instalments over a definite period and that each such subscriber shall, in his turn, as determined by lot or by auction of by tender or in such other manner as may be specified in the chit agreement, be entitled to the[2] [net chit amount]. Explanation. —A transaction is not a chit within the meaning of this clause, if in such transaction,—