Chandigarh: The Punjab government has initiated the process to seize properties of the Pearl Group, Chief Minister Bhagwant Mann said Thursday, reiterating his promise to return the money investors had infused into the ponzi scam allegedly run by the company.
In a tweet in Hindi, Mann said a decision has been made to “auction” the properties and use the proceeds to return investors’ money once legal action is complete.
चिट फंड कंपनी “परल” की पंजाब में मौजूद सभी Property’s को सरकार ने अपने क़ब्ज़े में लेने की प्रक्रिया शुरू कर दी है.. जल्दी ही क़ानूनी कार्रवाई पूरी करके निलामी करके लोगों को उनके पैसे वापस करने का सिलसिला शुरू करने का फ़ैसला लिया गया है..
— Bhagwant Mann (@BhagwantMann) June 29, 2023
In 2013, the Central Bureau of Investigation (CBI) filed an FIR against the Pearl Group and its various directors at the direction of the Supreme Court for allegedly operating investment schemes without any statutory approval. Nirmal Singh Bhangoo, the group’s chairman and managing director (CMD), was among 12 individuals subsequently arrested by the agency in connection with the case. The trial in this case is still underway.
The Pearl Group comprises several companies operating under a common management with business interests in agricultural research, real estate and afforestation.
Throughout the course of its investigation into the CBI alleged that investors were wrongfully promised huge returns from the development of agricultural land, besides tax-free income from interest on their investments. The ponzi scheme allegedly run by the Pearl Group attracted a large number of investors from Punjab, among other states.
In December 2015, the Securities and Exchange Board of India (SEBI) initiated recovery proceedings against the Pearl Group and its directors for their “failure to refund an amount of Rs 49,100 crore” to investors. The following year, the Supreme Court formed a committee headed by former Chief Justice of India R.M. Lodha to auction the properties of the Pearl Group and use the proceeds to refund investors. According to SEBI, the committee has refunded Rs 919 crore to over 19.6 lakh investors to date.
In a report submitted to the apex court in February 2016, the committee said the Pearl Group owed Rs 57,000 crore to six crore investors, who had invested with two firms operating under it — Pearls Agrotech Corporation Ltd and Pearls Golden Forest Ltd. It added that while the group’s total liability was over Rs 80,000 crore, the value of assets disclosed by it till that time only amounted to Rs 7,600 crore.
In January last year, the CBI had filed a supplementary chargesheet in connection with the ponzi scam allegedly run by the Pearl Group.
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Vigilance Bureau probe into Pearl Group
In May this year, the Bhagwant Mann-led AAP government directed the state Vigilance Bureau to take over the probe into related aspects of the alleged fraud from the state police. Accordingly, two FIRs registered in Ferozepur district — the first in 2020 and the second in January 2023 — were transferred to the Vigilance Bureau, according to a government note dated 23 May, 2023.
The FIRs pertained to alleged illegal and fraudulent alienation of properties linked to the Pearl Group in violation of orders passed by the Supreme Court in July 2016. Thirteen named as accused in the 2020 FIR filed in Zira are on bail and have since joined the probe.
On its part, the Vigilance Bureau formed a seven-member Special Investigation Team (SIT) to probe the two FIRs and assess the status of other properties owned by the Bhangoo-led Pearl Group. On 15 June, the Vigilance Bureau directed all deputy commissioners to verify land record entries of the 2,239 Pearl Group-owned properties spread across the state to check for misappropriation, resale or illegal encroachment.
These 2,239 properties identified by the CBI during the course of its eight-year investigation were also included in a list shared by SEBI with the Lodha committee.
However, according to the Vigilance Bureau, many of these properties have been misappropriated. While 31 have been alienated (transferred without any justification), another 16 are under scrutiny for alleged encroachments.
The Vigilance Bureau has now directed the senior superintendents of police (SSPs) of various districts to ascertain if government officials played any role in the misappropriation of the properties linked to the Pearl Group.
In a meeting he chaired of deputy commissioners and SSPs in February, CM Mann had directed them to identify properties of the Pearl Group and prohibit their sale or purchase. The chief minister had said at the time that a state-level list would be compiled in consonance with the directions of the Supreme Court and Justice Lodha committee.
(Edited by Amrtansh Arora)
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