Lok Sabha Question No. 1366 (UNSTARRED), answered on 2018-02-09
Subject: Refund to Investors
Ministry: FINANCE
Asked by: B. SREERAMULU, ANJU BALA

## GOVERNMENT OF NNDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMC AFFAIRS

## LOK SABHA

## UNSTARRED QUESTION NO. 1366 TO BE ANSWERED ON FRIDAY, 9TH FEBRUARY, 2018/ MAGHA 20,1939 (SAKA)

## REFUND TO INVESTORS

## QUESTION

## 1366. SHRI B SRIRAMULU: SHRIMATI ANJU BALA:

Will the Minister of Finance be pleased to state:

- (a) whether  the Government has completed the auction   process   of Ambey  Valley township and other unlawfully under Sahara India Real Estate and Sahara Housing Investment thereof; Corp Corp
- (b) whether the Securities and Exchange Board of India (SEBD) has completed the refund process of Sahara" Group: investors and if $0, the details thereof and if not, the reasons therefor along with the extent: of financial liabilities that remain with the SEBI; and
- (c) the steps taken by the Government to preventlavoid such type of financial frauds in future in the country? being

## ANSWER

## (SHRI PON. RADHAKRISHNAN)

- Bombay High Court to conduct the auction for sale ofthe Aamby Valley City, under the guidance of two Judges of the Hon'ble Bombay High Court   Accordingly, the Official Liquidator of the Bombay High Court is taking steps in this regard, Securities and Exchange Board of India (SEBD) has informed that the auction process is not completed and it is ongoing under the aegis of the Judicial Mechanism

(b): SEBI has not completed the refund process of SAHARA Group investors; SEBI has been making refund to investors of Optionally Fully Convertible Debentures (QFCDs) in (a) Sahara India Real Estate Corporation Ltd\_ [SIRECL] and (6) Sahara   Housing Investment Corporation Ltd. [SHICL]; who are lodging their claims/complaints after verification.

Hon ble Supreme Court; vide its Order dated 08.05.2013 permitted SEBI to make refunds to those investors of aforesaid two companies, who lodge their complaints with SEBI: SEBI initiated the process of refunding the moneys and released a Press Release o 28.05.2013 to that effect SEBI also released Press Advertisements investors  at to make necessary application to SEBI for refund of their moneys invested in the OFCDs of the two Companies SIRECL and SHICL. during large viz ,

SEBI has also made available the format of Application for Refund in its website (WWw sebigov.in) to enable the investors to make the application;

However; SEBI has so far received claims from investors in respect of 43,547 deposit accounts only:  SEBI bas made refunds in respect of 719 deposit accounts for & total value of Rs.91.52 Crore including interest (Principal Rs.50.08 Crore; Interest Rs.41.44 Crore): 32,

(c): Several complaints are received from complainants alleging raising of funds by companies from public through issuance of shares convertible securities without complying with the statutory regulatory requirements specified for a public issue. SEBI has been examining such complaints and passing orders promoters to refund the amount collected from investors along with interest @15% pa. Further; companiesl directors promoters involved in such cases have been debarred from accessing securities market for specified period. being

In order to protect the interest of small investors and depositors against illicit schemes, 24 States and 3 Union Territories (UTs) have enacted special laws called the Protection of Interest of Depositors' (In Financial Establishments) Acts, where by States/ UTs are empowered to take action.

Further, State Level  Coordination  Committee (SLCC) is the joint forum formed in all States to facilitate information sharing among the Regulators and Enforcement Agencies of the State with the objective to control incidents of unauthorized acceptance of deposits by unscrupulous entities, SLCCs were reconstituted in 2014 with renewed focus On unauthorized collection of money by unscrupulous entities May,

Apart ftom the above; the interests of participants in Chit Funds are protected under the Chit Funds Act 1982, Prize-Chitsl money circulation schemesl Ponzi schemes are banned under   the Prize Chits   and  Money Circulation Schemes (Banning) Act, 1978, under which investigations are to be carried out by the State Police authorities.

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