Details of additional features to be incorporated in a chitty software in the light of new Chit Act

Highlights

No need for branch accounting. Only Kuri and head office accounting is required.
Besides company auditing reports, additional statutory reports should be generated for chit registrar Ticket transfer renamed as Substitution of Subscriber Forfeitures renamed as Removal of Subscriber

CSD can not be collected but FD lean note is possible

Highlights

cont

Every transactions relating to chit will be recorded with a common serial number

Late fee cannot be more than 12% per annum

Pass book loan can be provided on the amount paid by the nonprized subscriber

Chit security details will be maintained

Accounting

Accounting difference between old and new pattern

Old pattern of Kuri accounting

New pattern of Kuri accounting

Kuri Books Branch Books Head Office Books

Kuri Books Head Office Books

Note: In case of multiple operational branches, branch accounting may require

NOF Calculation
Example

Paid up capital = + Reserve (Minimum 10 % of last year net profit) + Profit ( Loss) + General Reserve Total NOF

10,00,000

=
= =

50,000
3,00,000 2,00,000

15,50,000

Now aggregate sala will be

Suppose, Total sala of all commenced chits under new act is Eligibility for starting new chit amounted to

Rs. 1,55,00,000
Rs.
Rs.

1,00,00,000
55.00.0000

Important fees & levies

Stamp duty for chit registration
Fees 1. Inspection of immovable property (section 20) 2. Application for previous sanction (2 of section 4) 3. Filing a chit agreement (1 of section 7) 4. Filing copy of the minutes of proceedings (section 17) 4. Certificate of commencement (2 of section 9) as per the table below
Chit Amt From Chit Amt To Fee (Rs.)

- 2.5% of sala.
- Rs. 25.00 - Rs. 25.00 - Rs. 10.00

-Rs. 2.00

Up to 5001 10001 15001 20001 25001

5000 10000 15000 20000 25000 1,00,000

10.00 25.00 50.00 100.00 150.00 250.00

Above

1,00,000

750.00

Important fees & levies

5. Various fees for chit audit and inspection by registrar (under section 24 and 46)

cont

Chit Amt From

Up to 5,001 15,001 25,001 50,001 Above

Chit Amt To
5,000 15,000 25,000 50,000 1,00,000 1,00,000

Fee (Rs.)
25.00 60.00 120.00 200.00 500.00 1000.00

Authorities concerned

Registrar of Chits Central Excise IT Department

Regulating and monitoring authority

Collection of Service Tax on income Collection of TDS on payment

Taxes to be managed
Service Tax
Taxable income : Foreman commission Interest Late fee * : 70 % : 12.48 (S T 12%, Edu. Cess 2% & H. Edu. Cess 2%) : 10,00,000

Taxable portion Rate of Tax Primary exemption

TDS
Taxable Expenses : Canvassing commission Collection commission Sitting Fees : Payment exceeding 5000 at a time or 20,000 in a financial year to a party Rate of Tax : 10 %

Taxable Amount

* Please take clarification from your chartered accountant

Bank accounts operation

It is suggested that, separate bank accounts may be maintained for the following transactions.

To deposit/payment of chit amount collected from subscribers To release chit amount to prized subscribers (optional)

To transfer and payment of removed ticket amount To transfer and payment of chit amount that not paid on due date To maintain company transaction other than chit.

Model of bank operation

Transfer

Account No 2 Account No 3 (Optional) Account No 4

Manage other Receipt and payment

Deposit all chit receipts/payment

Payment of chit Amt.

Account No1
Payment of chit Removed ticket Amt.

Account No 4

Payment/receipt adjustment of chit amt. payable after due date

Process and preparation of forms and details required for chit registration and other relevant activities with registrar of chit.

Sample screenshots taken from Integra Chit Plus Software

Primary Setup
To incorporate primary details of foreman, registrar and directors of the company

Step 1

Chit Designing
Design your chit as per the Central Chit Act.

Step 2

Create Security

Step 3

50% as cash deposit and 50% as bank guarantee Or Govt. securities amounted not less than 1.5 times of chit sala Or Immovable property valued not less than 2 times of chit sala

In case of multiple division, deposit amount will be multiplied by division Example:Chit sala Total division Total security required = 5,00,000 =3 = 5,00,000

X 3 = 15,00,000

Enter Security Details

Step 4

Take Print out of Form No X

(Application for certificate of sufficiency of security for conducting a chit)

Step 5

Preparation of Form I
(Application by a Foreman for obtaining previous sanction to commence or conduct a chit)

Step 6

Printout of application Form I

Step 7

Preparation of Annexure

Step 8

Printout of Annexure

Step 9

Submit Application
Submit application to Deputy Registrar of Chit, Through Assistant Registrar of chits along with following attachments and details. 1. Application form No I & Annexure 2. Security sufficiency Certificate 3. Details of NOF 4. Copies of the chit agreements- draft

Step 10

5. Copies of audited balance sheet of last financial year

6. Auditors report on accounts for remaining period 7. Copy of incorporation certificate 8. Copy of memorandum and article of association 9. Board resolution to start chitty 10. Fee Rs. 25.00

Enter Previous Sanction

Step 11

GET your previous sanction and enter details in to software

Step 12

Announce chit and subscribe tickets

Chitty Registration
Preparation and submission of Form No II & Form No VIII for Chitty Registration

Step 13

Printout of Form No II

Step 14

Preparation of Form No VIII (Chit agreement)

Step 15

Take printout of Form No VIII

Step 16

Declaration by Foreman RECEIVE Chitty

Step 17

Registration and prepare form No V (Declaration by Foreman)

Commencement of chits
Enter details of commencement

Step 18

Step 19

Now
Chitty Commenced

Registers and books to be maintained

A register of subscribers will be generated in Form XIII. A ticket (subscriber) ledger will be generated in Form XIV. A day book will be generated in Form XV. A receipt will be provided in duplicate in Form XVI A book containing details of notices issued to the subscribers. A book containing the minutes of the proceedings of each draw

Files to be maintained

A file containing true copies of notice issued to the subscribers. A file containing chit application by the subscribers. A file containing authorization for participating in the auction of the chit subscriber A file containing the vouchers for payment made by the foreman. A file containing documents relating to securities offered by the prized subscribers.

Filing reports and statement with Registrar

Balance sheet: Time for submission Within a period of three months from the expiry of financial year Form XXVIII:- Receipts and Expenditure account and statement showing the assets and liabilities of the individual chit group. Time for submission For those chits, the duration does not exceed one year - Within two months from the termination of the

chit

If the duration of chit exceeds one year - on expiry of every period of twelve months and also on the termination of the chit.

Wish You All The Best Thank You

Team Integra

0487 2322006 9846290789

integraaims@gmail.com integrachitplus@gmail.com