Type of Company

No, If you go through the definition of Chit fund co., the funds are sourced from within the members of the company not from outsiders and the services being rendered shall be for and within the members. But in this case, I am sure it does not amount to money laundering activity but i do think the shcme so adopted by the company is one of the activities concerned with the sale of products, nothing else. The point to ponder is they are not selling by force. Buyers should know the pros and cons of it.

Further, if it is incorporatated under sec. 3(1)(iii) of the companies act, 1956, then certainly it is a body corporate.