Justice N. Jayasurya of the Andhra Pradesh High Court restrained the CID through an interim direction on Wednesday from conducting any inspections at the offices of Margadarsi Chit Fund Pvt. Ltd. (MCFPL) except in strict compliance with Section 46 of the Chit Funds Company Act and in compliance with a previous order passed by him on May 11, 2023.
He also ordered that the CID should not cause any hindrance to the company’s business activities, much less, by creating a panicky situation under the guise of inspection/searches. He said going by the material on record and for other stated reasons, MCFPL made out a prima facie case for granting interim protection, pending further consideration of the matter.
Further, Justice Jayasurya said it appeared that inspections by a team or some authorised persons were sought to be conducted at some branches of MCFPL even after working hours and the presence of CID /police was apparent. There was no satisfactory answer for it from the respondents, who are obligated to give an explanation by filing counter affidavits.