Supreme Court constitutes high-powered committee to liquidate assets of Sai Prasad Group and refund investors
Justices Surya Kant & KV Viswanathan [15-07-2024]

Read Order: Balasaheb Keshawrao Bhapkar & Ors v. Securities and Exchange Board of India [SC- WRIT PETITION (CRL.) NO. 546 OF 2023]

LE Correspondent

New Delhi, July 16, 2024: The Supreme Court has invoked its powers under Article 142 of the Constitution to constitute a High-Powered Sale Committee (HPSC) to auction the immovable assets of the Sai Prasad Group of Companies. The move aims to refund the money to genuine investors who have been awaiting the return of their investments for over a decade.

The Sai Prasad Group, founded by Balasaheb Keshawrao Bhapkar and his wife, has been under scrutiny by the Securities and Exchange Board of India (SEBI) for illegal mobilization of funds through Collective Investment Schemes. SEBI had previously restrained the group and its directors from collecting money from investors and had attached their properties.

The Supreme Court has appointed Justice S. Ravindra Bhatt, a former Supreme Court judge, as the Chairperson of the HPSC. The committee also includes Dr. Justice Satish Chandra, a former Allahabad High Court judge, and a SEBI nominee as members.

The HPSC has been tasked with obtaining property documents, creating a database, and ensuring the safe storage and digitalization of records. It will appoint certified valuers to evaluate the company's assets and engage e-auction service providers for the sale process. The sale proceeds will be deposited in a separate SEBI-monitored account.

The top court has also outlined a detailed refund process for investors, which includes identifying genuine investors, determining the refund amounts, and setting a threshold recovery limit. The HPSC will invite investor claims through public notices and decide on the mode of refund. The Sai Prasad Group and its promoters have been directed to submit asset details to the HPSC and execute necessary sale deeds. The court has also ordered the enlargement of Balasaheb Bhapkar and his wife on interim bail to facilitate the sale and disbursement process.

The states of Chhattisgarh, Maharashtra, Madhya Pradesh, Rajasthan, Uttar Pradesh and Haryana have been directed to appoint one of their officers of the Revenue Department, not below the rank of Collector, to assist the HPSC in relation to the properties situated within that State. The Collector shall be obligated to provide the requisite information, in writing, and shall sign the proceedings as State Representative, the top court said.