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New Indian Express
26-05-2025
- Business
- New Indian Express
Amend TNPID Act, allow IOs attach properties in financial fraud cases: Madras High Court
MADURAI: Observing that District Revenue Officers (DROs), who are authorised to file attachment applications, are overburdened resulting in delay in attaching and selling properties of accused persons in financial fraud cases, the Madurai Bench of Madras High Court has directed the state government to take steps to amend the relevant provisions of the Tamil Nadu Protection of Interests of Depositors (TNPID) Act, 1997, delegating the power to investigating officers. Justice B Pugalendhi gave the direction while hearing a batch of petitions filed by some of the victims in a case registered by Economic Offences Wing, Madurai, against Apsal India Pvt Ltd and its sister concerns, which allegedly lured depositors promising high returns but cheated them. The petitioners alleged delay in the investigation and sought to speed up the same or transfer the probe to some other agency. The judge pointed out that in cases of the above nature, if the government is satisfied that a financial establishment is not likely to return the deposits, the designated officers under TNPID Act, namely the DROs, can pass an interim order of attachment attaching the money or other properties of such financial establishments and later file an application before the Special Court within 30 days to make the attachment order absolute. They can also seek a direction to sell the attached properties through public auction so that the amount could be returned to the victims. However, since DROs are already overburdened with other works, there is a delay in filing attachment applications, the judge noted and gave the above direction to enable the investigating officers to file the applications directly. Justice Pugalendhi further recalled that in 2020, the court had appointed a committee under a retired HC judge to ensure the deposits are returned to the victims. But the chairman of the committee recused himself from the post in 2023 citing non-cooperation by the company. While explaining the delay in investigation, the investigation officer (IO) contended that based on the court's direction, EOW had been only assisting the committee all these years and after the chairperson's recusal, they have sought a clarification from the court on further course of action. Rejecting this as a lame excuse, Justice Pugalendhi observed that the appointment of committee did not preclude the IO from investigating the case. Since the accused persons had obtained bail and anticipatory bail by undertaking to co-operate with the committee and later failed to do so, the judge advised the IO to move necessary applications to cancel their bail. Further noting that the case has been pending since 2017, the judge directed the IO to expedite the probe and file final report, preferably within six months.
Time of India
20-05-2025
- Business
- Time of India
Mere filing of FIR in financial fraud cases not sufficient: HC
1 2 Madurai: Mere registration of an FIR in financial fraud cases would not serve any purpose since the object of the Tamil Nadu Protection of Interests of Depositors (TNPID) Act, 1997, is to ensure that the victims got back their money, Madras high court has observed. The court was hearing the petition filed by Muthukumaran seeking a direction to the Economic Offences Wing (EOW) to attach the properties belonging to the Neomax company, which was involved in a financial fraud by collecting money from various people. Justice B Pugalendhi observed that the TNPID Act was enacted to regulate financial establishments that were exploiting depositors by promising high returns and subsequently defaulting on repayments, leading to widespread public distress. The judge observed that officials of the EOW are under the impression that they are supposed to act/prosecute only after a case is reported. They have to understand that they are also liable to prevent such offences. If any company is offering interest above the rate of interest prescribed by the Reserve Bank of India, it is the duty of the EOW to ascertain from the company whether they have any registration or authority to collect the deposits and whether they have the means to give such higher returns. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Gil Ramírez Dávalos: Descubre cómo Amazon CFD puede ayudarte a invertir como un pro Empezar ahora Subscríbete Undo Neither the govt nor the police are viewing this aspect, and people like the petitioners are lured by such companies. The judge observed that data, which is available as provided by the EOW, discloses that not even 10% of the amount has been disbursed to the victims. The govt has a moral responsibility to ensure that the victims got back their money. Hence, the judge directed the EOW to look into the allegations by the petitioner and take appropriate action. This apart, S Srisarankumar, who is the treasurer of the Theni District Neomax Investors' Protection Association, moved court seeking a direction to cancel the bail granted to the accused in the Neomax financial fraud case . However, justice Pugalendhi observed that on mere apprehension alone, the court is not inclined to entertain the petition, the judge observed and dismissed the petition.
