Home BIG STORY Odisha issues guidelines for auctioning assets of chit fund Cos

Odisha issues guidelines for auctioning assets of chit fund Cos

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Odisha Sun Times Bureau
Bhubaneswar, Oct 29:

The Odisha government’s Finance department has issued new guidelines for auctioning of confiscated properties of chit fund companies to make payments to depositors from the realized amount, who had lost their hard earned money to these fraud companies.

A rally in Bhubaneswar by investors who lost money in the chit fund scam (File Pic)
A rally in Bhubaneswar by investors who lost money in the chit fund scam
(File Pic)

The state government has entered into an agreement with public sector undertaking MSTC Ltd for auctioning of the confiscated properties, revealed official sources.

According to the new guideline, the collector of the district where the confiscated lies will form a committee to determine the upset price (minimum reserve price) of the confiscated property. The committee will be chaired by the sub-collector. Later additional district magistrate (ADM) or competent authority will upload the details of the confiscated property on the website of MSTC Ltd. The date of the auction of the said property will be publicized in national and local newspapers. After the auction is complete MSTC Ltd will remit the realized amount to the bank account of the concerned ADM. Later concerned ADM with the designated court’s permission remit the amount to the bank accounts of the depositors.

“After the auction, the sale proceeds will be deposited in the account of the ADM or competent authority in a scheduled commercial bank. The sale proceeds of the confiscated property will be distributed to the identified affected depositors in accordance with court’s orders on who is to be paid and how much to be paid,” said Tapan Kumar Pradhan, director Institutional Finance of the state government briefing reporters here today.

Meanwhile, court orders on confiscated properties of chit fund companies Rose Valley, Safex India and Astha International have been received. The combined asset value of the confiscated properties of these three companies is about Rs 127 crore.

Notably, till date in the chit fund scam there are 19 cases against 17 chit fund companies pending in the courts which include Saradha, Artha Tatwa, Seashore and Sastra. Cases pertaining to 12 firms are lying pending in the courts for over six months. Money amounting to Rs 144 crore and more than 160 acres of land belonging to these 17 companies has been seized.