HC mulling committee to sell property owned by ponzi companies

The Calcutta High Court today said it was contemplating formation of a committee for selling properties owned by chit fund companies so as to pay back investors, while hearing cases related to such companies by investors seeking return of their deposits.
A division bench, comprising Chief Justice Manjula Chellur and Justice Joymalyo Bagchi, said that it was thinking of forming a committee to take over, sell the properties and pay back depositors.
The bench said that such a committee comprising experts in the field would be able to act fast and thus help depositors get their money back.
Appearing for the depositors of several ponzi fund companies, including those of MPS Group and Tower Group, senior counsel Bikash Bhattacharya submitted that formation of such committee would auger well for the depositors.

These cases do not include those of Saradha Group or Rose Valley Group.
No decision was, however, taken in this regard.

The matter would come up for hearing again on August 28.
West Bengal government had formed a one-man commission of Justice (retd) Shyamal Sen to pay back investors by seizing and selling ponzi company-owned properties and also formed a corpus in this regard.
Enforcement Directorate had later challenged the formation of the Commission by the state government stating that only ED could seize properties and sell such properties under Prevention of Money Laundering Act (PMLA).
Justice Sen Commission, appointed in August, 2013 following unearthing of the multi-crore rupee Saradha chit fund scam followed by those of other ponzi companies, was wound up in October, 2014 by the state government.

The bench also directed the state government to file a report by the Inspector General of Registration (IGR) identifying properties owned by the MPS Group, which had diversifed into hospitality and real estate business allegedly using ponzi funds.
The court directed Enforcement Directorate and state police to assist the IGR in the process. The bench directed the IGR to be present on August 28 during the next hearing when he would have to submit the report.