SEBI initiates auction process for PACL assets
The Dollar Business Bureau
Market regulator Securities and Exchange Board of India (SEBI) has initiated a sale process for the attached assets of the PACL group. It has also announced that an e-auction will be held for some of its properties on July 5.
The sale has been initiated with an aim to recover funds totaling around Rs.60,000 crore in the PACL case.
Two properties of PACL, a residential plot in Nangloi and an office property in the central Connaught Place will be put on e-auction on July 5, at reserve prices of Rs.90 lakh and Rs.29.59 crore respectively.
The bidders, who are interested, can inspect the property on June 9. They will have to deposit 10% of the reserve price for confirming the contract by June 27.
PACL has been raising money from the public through agriculture and real estate business. However, SEBI has found out that the money has been illegally collected by the company through various investment schemes for over a period of 18 years.
Following the order of the Supreme Court, the market regulator has set up a committee to ensure that the money is refunded to the investors after the sale of the company’s assets. For the auction, SEBI has also brought in HDFC realty.
The panel is being chaired by RM Lodha the former Chief Justice of India. The panel will oversee the whole auction process, and after verifying the genuineness of the investors, will ensure that the money is refunded to them.
SEBI ordered the attachment of all PACL group assets and also the assets of its nine directors and promoters in December, after they failed to refund more than Rs.60,000 crores to its investors.
According to SEBI, the PACL group raised Rs.49,100 crores from five crore investors. The group had promised assured returns, interest payout and other charges, which incidentally went over Rs.55,000 crores.
Besides that, PGFL, one of the group firms of PACL, has illegally mobilised more than Rs.5000 crores. It has failed to refund this amount even after orders from SEBI and SAT (Securities Appellate Tribunal) were sent to it.
On August 22, 2014, SEBI had issued an order to refund the money. The defaulters were asked to close the schemes and refund the money within three months from the date of the order.