Chennai: The Madras high court has appointed a nine-member committee to settle more than Rs761 crore dues of about 900,000 investors who had deposited money with Tamil Nadu-based Disc Assets Lead India Ltd for purchase of plots over 10 years ago.
The first bench comprising Chief Justice Indira Banerjee and justice M. Sundar appointed retired Jammu and Kashmir high court Chief Justice N. Paul Vasanthakumar as the head of the committee which shall function as the administrator of the company, facing action by the Securities and Exchange Board of India (Sebi) for some violation. The order was passed on a batch of petitions seeking the court’s intervention to settle the dues of the investors.
The bench set up the committee after perusing the report of retired high court judge G.M. Akber Ali, earlier appointed as the court commissioner to look into the grievances of the investors, and suggestions of senior counsels B. Kumar and M.S. Krishnan, appointed amicus curiae to assist the court. The committee shall comprise among others the amicus curiae, representatives of the state government and state police.
The company had in 2006 floated schemes for purchase, development and maintenance of agricultural land by way of instalment payment and cash down plans. A total of over 1.2 million customers had invested about Rs1,200 crore in the schemes, but they were neither alloted the plots nor refunded the deposit money.
Sebi had initiated action against the company as it had not obtained a certificate of registration as required under the SEBI Act and directed it not to collect deposits under the scheme. Sebi had also barred its directors from floating any new schemes, disposing of the properties and diverting the funds of investors.
The Economic Offences wing police had also registered a case against the company on a complaint from an investor. Justice Ali in his report said a total of about Rs1,137 crore was collected from 12,27,274 depositors. From this, an amount of Rs761.97 crore was due to 9,05,765 investors. The court directed the depositors to approach the committee for their claims by submitting an application with details of their investments and supporting documents.
The committee was ordered to identify the properties of the company and its sister concerns, directors and transferees and arrange to sell them. The bench also restrained the company, its directors and sister concerns from transferring or alienating any of their properties and assets, except through the committee.