NEW DELHI: Almost two decades after being duped by a non-banking financial company and fighting a protracted legal battle, 14 lakh investors will finally getting their money back thanks to the intervention of the Supreme Court.

Fourteen years after the apex court had directed attachment of all properties of the Golden Forest India Ltd (GFIL) and appointed a committee headed by a former Punjab and Haryana High Court judge RN Agrawal to protect the interest of investors, the court has now given the green signal for reimbursement of Rs 700 crore to investors and asked the committee to complete the task within three months. The amount was raised by the committee by selling various assets of the company.

Chandigarh-based GFIL commenced its business of developing agricultural land and floated a collective investment scheme in 1987 for development of land and social forestry. Under the scheme, the investors deposited money and the company purchased land on their behalf. The scheme attracted large number of investors, particularly from middle class families, as the minimum investment was as low as Rs 1,000 and the company promised returns as high as 20 per cent.

In a short span of ten years, it had raised more than Rs 1,000 crore from investors and purchased large parcel of land in different parts of the country. Around 14 lakh people had invested in the scheme and they were promised a hefty amount at the time of maturity. The company, however, went bust, leaving the investors high and dry and they had to fight a long legal battle for reimbursement. The SC intervened in 2004 and had since then been monitoring the sale of the company’s assets to raise the money.

The SC-appointed committee told a bench of Justices Arun Mishra and A Abdul Nazeer that it had so far raised Rs 700 crore and assets worth of Rs 100 cr remained attached with the Income Tax department. Senior advocate Narender Hooda, appearing for the investors pleaded the court that at least the principal amount should be reimbursed to investors who had been waiting for the last two decades.

Accepting Hooda’s plea, the bench directed that the committee to reimburse 70 percent of investment of each investors and the rest and interest on their investment would be refunded after auctioning the immovable assets of the company.

“As per number of claims received by the committee, approximately 900 crore is the principal amount; first, we take care of the principal amount to be distributed amongst the investors. Amount of payment of interest/maturity value as assured shall be considered later after property is sold. In the circumstances, we direct that 70% of the principal amount be distributed out of the amount of Rs 700 cr to each of the investors,” the bench said.

It asked the committee to take the services of investment banking firm Karvey Investors Services Limited in refunding the money to investors. The court also decided to auction the immovable assets of the company as the committee told that total saleable land of GFIL is around 8700 acre. The bench, thereafter, appointed a three- member panel of income tax commissioners to find out the valuation of the properties and file a report before the court.

“For identifying the particular property, the collector shall nominate the revenue officer of the rank of sub-divisional officer or tehsildar, of the district concerned and the valuation report shall be submitted to this court. Let this exercise be completed and the plot numbers etc shall also be furnished to this court,” the bench said.

