SEBI plans to auction 61 properties owned by the Saradha Group on July 17 to recover funds acquired through illicit schemes. The auction, with a reserve price of over Rs 26 crore, includes land parcels in West Bengal. Quikr Realty and C1 India will assist in the sale. The Calcutta High Court's order directs SEBI to complete the auction within three months. Saradha Group, accused of chit-fund operations, raised Rs 4,000 crore before collapsing in 2013. Potential bidders must conduct thorough investigations into property liabilities. The successful bidder bears transfer costs and taxes.
SEBI, the capital markets regulator, intends to recoup funds by conducting an auction of 61 properties owned by the Saradha Group. These properties, alleged to have been acquired through illicit schemes that defrauded the public, will go under the hammer on July 17. The reserve price for the auction is set at over Rs 26 crore. These properties, including land parcels in West Bengal, will be auctioned between 11 a.m. and 1 p.m. on the specified date, with a total reserve price of Rs 26.22 crore.
To oversee the sale of these properties, SEBI has enlisted the assistance of Quikr Realty, while C1 India has been appointed as the e-auction provider. The decision to proceed with the auction follows a directive from the Calcutta High Court in June 2022, mandating SEBI to complete the auction process within a span of three months.
The Saradha Group, a consortium comprising more than 239 private companies, stands accused of engaging in chit-fund operations in West Bengal, Assam, and Odisha. Prior to its collapse in April 2013, the group reportedly amassed approximately Rs 4,000 crore from 1.7 million depositors.
SEBI's notice directs potential bidders to personally conduct thorough investigations into any encumbrances, legal disputes, attachments, or liabilities associated with the properties before placing their bids. The auction requires participants to partake solely on their own behalf, with no third-party intervention allowed.
The successful bidder will be responsible for the costs and fees associated with transferring the property into their name. Additionally, all taxes related to the properties will be the responsibility of the purchaser. It is worth noting that in March, SEBI announced the auctioning of 66 properties owned by the Saradha Group with a combined reserve price of Rs 32 crore, initially scheduled for April 11.
By undertaking this auction, SEBI aims to recover the funds raised by the Saradha Group through illicit means, ensuring justice for the public who fell victim to their fraudulent schemes. The auctioning of these properties serves as a significant step towards restoring financial stability and discouraging such fraudulent activities in the future.
Established in 1992 by the Indian government, SEBI is a regulatory authority dedicated to protecting the interests of securities investors and overseeing the operations of the securities market. SEBI has demonstrated success in implementing significant reforms, such as transitioning the market to electronic and paperless systems. They introduced shorter settlement cycles, moving from T+5 to T+3 and eventually to T+2. SEBI eliminated physical certificates, reducing the risk of theft and forgery. During times of crisis, SEBI has taken prompt actions to address issues and enhance disclosure requirements for corporate promoters. They have also relaxed takeover regulations to encourage investments.
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