All India PACL (Pearls) Investors Association (AIPIA) has decided to take out a massive morcha of around one lakh investors to market regulator Securities and Exchange Board of India (SEBI) and hand out claims of investors to the market regulator.
In a release, Vishwas Utagi, Convener of AIPIA, said, "We want SEBI to create an infrastructure in all the cities and districts in India to receive such claims or complaints with a view to refund the money of claimants and investors."
The Association is also requesting investors to submit filled forms for claims at its offices. Here is the address of its Mumbai office...
All India PACL (Pearls) Investors Association
C/O Maharashtra State Bank Employees Federation,
Dadyseth House, 1st Floor, (Rear), Nanabhai Lane,
Fort, Mumbai- 400 023
PACL (earlier Pearls) is a Delhi-based company, proclaiming itself as a real estate company which has collected huge money for the last 13 years from almost six crore people from all the states in India. "Out of six crore investors in the country more than one crore are from Maharashtra! What is shocking is that on one side, poor peasantry is committing suicide in Vidharbha and Marathwada and on other side, the situation is that poor and middle class people in this area have lost money in PACL. Their number is about five lakh in Marathwada alone," Mr Utagi added.
On 15th December, the Association has organised a full day meeting of investors duped by PACL. During the meeting it was decided to ask SEBI to take control of all bank accounts, properties, assets of PACL and refund depositors' money.
Earlier, SEBI, as part of its recovery proceedings, attached all bank and demat accounts, mutual fund portfolios of PACL and it eight directors and promoters. In a release, SEBI said, the recovery proceedings have been initiated for their failure to comply with its order issued on 22 August 2014 directing, PACL and its directors and promoters to wind up the schemes, and refund Rs49,100 crore to the investors within three months from the date of the order. This amount is excluding further interest and all costs, charges and expenses incurred in the recovery proceedings.
According to SEBI, the amount due to investors of PACL would be over Rs55,000 crore. This includes promised returns, further interest, all costs, charges and expenses incurred in respect of all the proceedings taken for recovery of Rs49,100 crore from PACL.
The mobilisation of funds by PACL traces back prior to 1997. Upon receipt of a complaint, SEBI on 30 November 1999 and 10 December 1999 issued letters asking PACL to comply with the provisions of the collective investment scheme (CIS) Regulations.
PACL challenged these letters before the High Court of Rajasthan in December 1999, claiming that its scheme does not fall under the definition of CIS as defined under the CIS Regulation and SEBI Act. PACL also challenged the constitutional validity of the CIS Regulations.
The Rajasthan High Court on 28 November 2003, held that PACL's schemes were not CIS as defined under Section 11AA of the SEBI Act. The HC also quashed SEBI's letters issued to PACL.
SEBI filed an appeal before the Supreme Court against the order of Rajasthan HC. The SC on 25 February 2013, while allowing the appeal upheld the constitutional validity of CIS Regulations, and directed SEBI to investigate the matter and take appropriate actions.
After conducting an inquiry, SEBI on 22 August 2014, issued an order directing PACL, its promoters and directors to wind up all the existing CIS and refund the monies collected by the company to investors as per the terms of offer within a period of three months from the date of the Order.
PACL filed an appeal before the Securities Appellate Tribunal (SAT), which was dismissed on 12 August 2015. The SAT directed PACL and its promoters-directors to refund the money within three months. Since the company and its promoters-directors failed to refund the money to the investors as per the directions of SEBI and SAT, the market regulator said it has initiated the recovery proceedings.