SC Orders Attachment Of All Properties, Assets Of CCIL, RTSCL In Rs.7,500-Cr Scam Involving 18 Lakh Investors [Read Order]

SC Orders Attachment Of All Properties, Assets Of CCIL, RTSCL In Rs.7,500-Cr Scam Involving 18 Lakh Investors [Read Order]

The Supreme Court on Thursday attached all the properties and assets of two Mumbai-based firms, Royal Twinkle Star Club Ltd (RTSCL) and Citrus Check Inns Ltd (CCIL), in order to recover Rs.7,500 crores in savings lost by some 18 lakh investors.

A bench of Justice Rohinton Nariman and Justice Abhay Sapre directed that a sale-cum-monitoring committee be set up, comprising of the resolution professional, one SEBI representative, one investor representative and one representative of CCIL and RTSCL and their associates/sister concerns.

This four-member committee will then appoint registered valuers to value the properties that have been unearthed during the insolvency process of CCIL and RTSCL, which will include assets of their sister concerns as well. The total number of such associates/sister concerns is 88.

Senior advocate Shyam Divan and Kapil Joshi were the counsels appearing on behalf of the investors in the matter along with Amir Karkhanis and Rahul Gaikwad of Gravitas Legal.

The bench also appointed Deloitte as the special auditor to carry out the forensic audit CCIL, RTSCL, and their entire sister concerns.

Previously, a different bench headed by Justice Nariman had stayed insolvency proceedings before the National Company Law Tribunal (NCLT) suspecting a prima facie case of collusion between the promoters and petitioners of the case. The petitioners, in this case, were actually investors of CCIL and RTSCL.

In 2016, the SEBI had directed the four directors of Royal Twinkle Star Club Ltd (RTSCL) to refund investors’ money within three months but the orders were not complied with. The money was collected under various holiday plans, which promised cashbacks if the investors did not utilize them.

SEBI asked RTSCL and its directors to refrain from garnering money under the Collective Investment Scheme (CIS), and barred them from accessing markets for four years in 2016. SAT had upheld SEBI’s ruling and banned the scheme.

The apex court has now made it clear that once valuation of all the properties and assets of these companies is concluded, their sale will be carried out under the aegis of NCLT.

Read the Order Here