All Amway apologists are liable to be punished

We have gone through the Section 2 (c) of the Prize Chits & Money Circulation Schemes (Banning) Act, 1978 which defined money circulation schemes. Let us now look at the Section 3 which states, "No persons shall promote or conduct any prize chit or money circulation scheme, or enroll as a member to any such chit or scheme, or participate in it otherwise, or receive or remit any money in pursuance of such chit or scheme."

In other words, joining or making others join such schemes is completely banned under this section.

Likewise, the Section 4 states that "Whoever contravenes the provisions of Section3 shall be punishable with imprisonment for a term which may extend to three years or with fine which may extend to five thousand rupees or with both; Provided that in the absence of special and adequate reasons to the contrary to be mentioned in the judgement of the court, the imprisonment shall not be less than one year and the fine shall not be less than one thousand rupees.

Section 5 states, "Whoever, with a view to the promotion or conduct of any prize chit or money circulation scheme in contravention of the provisions of this Act or in connection with any chit or scheme promoted or conducted as aforesaid,-

(a) prints or publishes any ticket, coupon or other document for use in the prize chit or money circulation scheme; or

( b ) sells or distributes or offers or advertises for sale or distribution, or has in his possession for the purpose of sale or distribution any ticket, coupon or other document for use in the prize chit or money circulation scheme ; or

( c ) prints, publishes or distributes, or has in his possession for the purpose of publication or distribution-

(i) any advertisement of the prize chit or money circulation scheme; or

(ii) any list, whether complete or not, of members in the prize chit or money circulation scheme ; or

(iii) any such matter descriptive of, or otherwise relating to the prize chit or money circulation scheme, as is calculated to act as an inducement to persons to participate in that prize chit or money circulation scheme or any other prize chit or money circulation scheme; or

(d) brings, or invites any person to send, for the purpose of sale of distribution, any ticket coupon or other document for use in a prize chit or money circulation scheme or any advertisement of such prize chit or money circulation scheme; or

(e) uses any premises, or causes or knowingly permits any premises to be used, for purposes connected with the promotion or conduct of the prize chit or money circulation scheme; or

(f) causes or procures or attempts to procure any person to do any of the above-mentioned acts, shall be punishable with imprisonment for a term which may extend to two years, or with fine which may extend to three thousand rupees, or with both:

Provided that in the absence of special and adequate reasons to the contrary to be mentioned in the judgment of the court, the imprisonment shall not be less than one year and the fine shall not be less than one thousand rupees."

In essence, all apologists of such schemes should be brought to book.

Section 6 deals with the offences by companies. It states who should be punished if companies committed such offences. "Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceed against and punished accordingly : Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

(2) Not withstanding anything contained in sub-section (1),where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly .

Explanation ;_-For the purposes of this section –

(a) “company” means any body corporate and includes a firm or other association of individuals ; and

(b) “director”, in relation to a firm, means a partner in the firm.

So, all the office-bearers of such companies which indulged in conducting money circulation schemes or prize chits are liable to be punished.

We shall look into other provisions later.