SAT rejects Rose Valley's plea for time to sell properties

The Securities and Appellate Tribunal (SAT) has rejected a plea by Rose Valley Real Estate and Construction seeking more time to sell the properties, for making refund to investors, belonging to Kolkata-based company and its directors.

The SAT, in December 2014, had passed an order directing the company and its directors to sell the properties belonging to them under the supervision of The Securities and Exchange Board of India (Sebi) within six months so that the sale proceeds received thereof are distributed to the investors from whom the money has been collected.

In this case, Rose Valley and its director had mobilised huge amount from investors through unauthorised Collective Investment Scheme (CIS) activities. Meanwhile, Rose Valley's counsel has approached Calcutta High Court in April this year.

Seeking more time to sell the properties for refund to investors, the company had submitted before SAT that its properties were being sold under the supervision of a committee constituted by the Calcutta High Court as the committee would take some time to sell the properties.

SAT, however, observed that the same counsel, Sudipto Sarkar, who had appeared before the Tribunal in December 2014 and agreed to sell the properties under Sebi's supervision, appeared before the High Court and submitted that an independent person should be appointed, under the supervision of the High Court, to sell the properties.

"When this Tribunal passed an order on December 15, 2014 directing that the properties be sold under the supervision of Sebi, it was not proper on part of Sarkar, to submit before the High Court that an independent person should be appointed to sell the properties," the Tribunal said in an order. SAT said that the “conduct of the appellants is highly deplorable.”

Dismissing the company's plea, SAT has directed Sebi to take appropriate steps in the matter so that interest of investors are properly secured.

“In any event, as on date, jurisdiction of Sebi to supervise sale of properties belonging to the appellants as ordered by this Tribunal stands divested pursuant to the order passed by the High Court.

“Since the High Court is seized of the matter relating to sale of the properties belonging to the appellants, question of our granting extension of time to them to sell their property does not arise,” SAT noted.

In 2011, Rose Valley Real Estates and Construction, a Rose Valley group firm, was barred by Sebi from raising funds from public on the charge that it did not have necessary regulatory approvals for running a CIS.