Notices on 6 chit fund companies to refund money

Bhubaneswar: Justice MM Das Commission of Inquiry, probing the multi-crore rupee chit fund scam in Odisha, on Saturday served show cause notices on six chit fund companies to refund the money collected from small investors.

The Commission, in its show cause notices to Mall Bijay Kumar, managing director of Welfare Buildings and Estates Ltd, C Nayak, director of Utkal Financial and Consultancy Private Ltd, Lokeswar Dev Jain and Priyanka Saraswati Devi of Stock Guru India, Gurupada Das of Shine India, Prasant Kumar Das, director of Simanchal Multi-purpose Cooperative Ltd and Nabin Acharya of National Multi-purpose Self-help Cooperatives, has asked them to show cause by March 11 why they should not refund the money to the small investors who have deposited up to Rs 10,000 in their companies.

The Commission also heard the case on refund of deposit money of small investors by another chit fund company, Prayag Infotech.

In an affidavit filed during the hearing, officials of the Prayag Infotech informed the Commission that they have already refunded the principal deposits to over 700 investors while 150 investors have been refunded their principal deposits through cheque on Saturday.

They also informed the court that the company had taken steps to refund the deposits of the remaining investors.

Out of a total of 8.17 lakh affidavits verified by the Commission, scanning of 7.22 lakh affidavits has been completed. The commission has prepared a list of investors who had deposited less than Rs 10,000 in the chit fund companies.

The Commission has handed over the list to the representatives of the Seashore Group of Companies and the Artha Tatwa (AT) Group, the two chit fund companies, on whom it had served notices in the first phase.

It may be recalled that Justice Das, in a media briefing on October 18 last year, had said a field verification might be required so that the Commission, with the help of the state government, will constitute a committee which will have a spot verification to identify the genuine investors by examining their documents and affidavits.

“After this process is completed, the Commission, in its interim report, will recommend the government to start the process of payment to these small investors”, he had said.