The Securities and Exchange Board of India (Sebi) on Thursday approached the Supreme Court seeking transfer of a fresh plea filed by PACL from the Rajasthan High Court to the apex court.
Sebi has alleged that while PACL and its promoters had moved the Supreme Court against SAT’s August 12 order that directed it to refund close to over Rs 44,376 crore that it collected from around 58.5 million customers and winding up of its collective investment schemes (CIS), the real estate firm on October 12 again moved the Rajasthan HC seeking a direction to Sebi to register its CIS and for release of its sale deeds to enable it sell properties to raise money.
According to the market watchdog, the petition filed by PACL before the HC last month “is yet another attempt by it to continue its CIS, which have been found to be contrary to and unsustainable in law”.
It is another attempt on PACL’s part to delay and stall the implementation of Sebi orders that directed the company to wind up its CIS, the transfer petition filed by Sebi through counsel Pratap Venugopal stated. He further added that the petition pending before the HC should be transferrred to the SC “to avoid conflicting judgments that will adversely affect and jeopardise the interest of investors”.
According to Sebi, the purpose of regulating entities running CIS is to protect the interest of gullible investors who have lost or are likely to lose their life savings by the misdeeds of unscrupulous elements and fly-by-night operators.
“However, instead of complying with the statutory obligations, PACL has rushed to the HC… seeking at this point of time registration of its collective investment schemes under the CIS Regulations, which is impermissible and contrary to the said regulations,” Sebi said. The money was allegedly collected by Nirmal Singh Bhangoo-managed group via its two companies — PACL and Pearls Golden Forest — in ponzi schemes under the garb of sale and development of farm land.
On August 22 last year, Sebi had asked PACL to wind up its schemes and refund the money collected from investors as the CIS run by it was in violation of the Securities and Exchange Board of India Collective Investment Scheme Regulations, 1999 (CIS Regulations). This was challenged by the company before the SAT, which upheld the Sebi order.
The apex court had earlier appointed a special committee to probe other companies of the Pearl Group and had also cleared the decks for sale of more than 10,000 properties of the group’s companies spread across states like Punjab, Haryana, Rajasthan and Delhi.