TaxTMI 
TaxTMI 
2024 (7) TMI 935
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....t may deem fit in the facts and circumstances of the case." 2. The above-stated reliefs have been sought in light of the following set of events predicated in this factual background: - (a) Petitioner Nos. 1 and 2 are the founder-Directors of one Sai Prasad Properties Ltd, incorporated under the provisions of the Companies Act, 1956. Petitioner No. 3 also joined the aforesaid company as a Director in 2008, allegedly when he was still studying in college, and is claimed to have thereafter resigned in the year 2014. The Petitioners also floated various other companies, known as the Sai Group of Companies, consisting of: (i) M/s Sai Prasad Properties Ltd. (hereinafter, "SPPL"); (ii) M/s Sai Prasad Foods Ltd. (hereinafter, "SPFL"); (iii) M/s Sai Prasad Corporation Ltd. (hereinafter, "SPCL"); and (iv) M/s Shree Sai Space Creations Ltd. (hereinafter, "SSSCL"). (b) The Security and Exchange Board of India (hereinafter, "SEBI") received a complaint dated 02.06.2010 alleging illegal mobilisation of funds by SPFL. After processing the said complaint and in furtherance of the orders passed by the High Court of Madhya Pradesh and the Dep....
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.... mobilisation of funds through a joint venture participation project, which was in the nature of Collective Investment Schemes. Upon investigation, SEBI found a prima facie violation of Section 11AA (2) of the SEBI Act. Consequently, an interim order-cum-show cause notice was issued on 23.01.2014, directing SSSCL and its Directors to abstain from collecting any money from the investors and from launching or carrying out any Collective Investment Schemes. WTM further directed SSSCL to wind up the existing Collective Investment Schemes, refund the monies collected by it under such schemes and submit a compliance report including the trail of funds claimed to be refunded, bank account statements indicating the refunds to investors, and replies from the investors acknowledging such refunds. In addition, proceedings under Chapter VI-A of the SEBI Act, 1992 were also initiated, and an Adjudicating Officer was appointed to inquire into the violations. (g) It may not be necessary to refer to the subsequent events in relation to the four companies referred to above, except to say that: (i) Penalties were imposed; (ii) Recovery proceedings for a sum of Rs. 30,561,0....
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....rs that he was, however, released on bail by the Chhattisgarh High Court on 10.04.2023 in MCRC No. 724 / 2023. Thereafter, vide the order dated 15.03.2024 passed in SLP (Crl.) D. No. 43363/2023, it has been directed that Petitioner No. 3 shall not be arrested in any fresh case registered against the Petitioners on the same or related issues. On 29.04.2024, it was further directed that Petitioner No.3 shall not be arrested in any of the cases registered against him until further orders. 3. Having understood the facts, we shall now advert to the Petitioners' prayer seeking a direction to SEBI to liquidate the attached assets in a time-bound manner and disburse the sale proceeds to genuine investors as early as possible. In this regard, SEBI noted that the Forensic Audit conducted by the Economic Offence Wing (hereinafter, "EOW") revealed that the Companies floated by the Petitioners were liable to refund Rs. 4700 crores, though as per the order passed by the WTM the refund amount was initially Rs. 3049 crores only. It is also not in dispute that there are 498+13 immovable properties owned by the companies; the details whereof have been furnished before the MPID Court, Mumbai. The ....
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....nd 2 are languishing in jail as undertrials for over 8 years; (b) Innocent investors have been eagerly awaiting the refund of their hard-earned money for more than a decade; (c) Despite its best intentions and commitment, SEBI is facing an uphill task in conducting public auctions in a timebound manner; (d) SEBI or MPID Court, Mumbai do not have the readily available infrastructural and strategical facilities to identify each property, to have fair assessment of their market value, and then to auction them to fetch the true market value; (e) The conclusion of trials in the pending criminal cases is marred by uncertainty; and (f) The Petitioners have shown their bona fide towards refunding the investors' amounts, and any further delay in this regard, will be prejudicial to one and all. 7. Keeping these exceptional and peculiar circumstances in view, we deem it fit to invoke our powers under Article 142 of the Constitution of India, so as to do complete justice between the parties and hence, constitute the HPSC comprising of the following: (a) Hon'ble Mr. Justice S. Ravindra Bhatt, Former Judge, Supreme Court of India - Cha....
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....bered in its favour in the State Government land records; (j) The HPSC shall appoint a pool of Certified Valuers to evaluate the Company's assets in each State; (k) We hereby confer and vest all the powers of a Civil Court in the HPSC for taking necessary actions to speed up the liquidation of the Companies' properties; (l) The HPSC, with the help of experts, will prepare a list of properties already sold under the supervision of the MPID Court, Mumbai, as well as a separate list of the properties that are yet to be sold; (m) The HPSC will engage/appoint e-auction service providers for auctioning of the assets; (n) Similarly, expert agencies may be empanelled for the valuation of the assets for initiating the public auction process and its advertisement; (o) The final decision regarding the disposal of the assets shall be at the complete discretion of the HPSC and once the sale is made the property shall vest in the buyer, free from all encumbrances. (p) The Petitioners or their nominees will be at liberty to join the auction proceedings and bring prospective buyers. They may submit their suggestions to the HPSC....
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....by the Petitioners and their companies, the following may be done: (i) The Petitioners and their Companies shall forthwith submit details of all the immovable assets/jewellery items to the HPSC and shall also handover original title deeds or other relevant documents as may be in their possession; (ii) The Petitioners and their Companies shall execute the necessary sale deeds within the time frame and as per the instructions of the HPSC after the sale is confirmed and the full consideration is received in the bank account to be operated by HPSC; and (iii) In the event of any pending title dispute, the HPSC shall determine the rights of the Sai Prasad Group of Companies in such properties for the limited purpose of auctioning them. Except for when there are legal impediments, such property shall be auctioned without any delay, and the Petitioners or the authorised representatives of their Companies will execute the necessary documents, including sale deeds, in such cases also. Secretarial cum Administrative requirements 10. With respect to the administrative or secretarial assistance that is necessitated in the course of dealing with these directions,....
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.... depositors of the Sahara Group of Cooperative Societies. In that case, an honorarium of Rs. 15 lakhs per month was ordered to be paid to the learned former Judge of this Court, besides Rs. 5 lakhs per month to the learned amicus curiae. 12. Having bestowed our thoughtful consideration on these two orders and after taking note of the fact that the entire process in the case in hand might take more than a year, it seems to us that fixation of monthly honorarium may not be desirable. Similarly, we do not want to leave it for the learned Chairperson or members of the HPSC to fix their own honorarium as it is likely to cause embarrassment to them. Considering all these aspects in view, we issue the following directions:- (i) The Chairperson of the HPSC shall be entitled to an honorarium of Rs. 2 lakhs per sitting day, when effective proceedings are held. This will be in addition to travelling, boarding and other miscellaneous expenses as may be incurred in discharging the assigned responsibilities; (ii) The learned Member, who is a former Judge of the High Court shall be entitled to an honorarium of Rs. 1.50 lakhs per sitting day, when effective proceedings are hel....