Sunday, May 25, 2014

SC: Where has depositors’ money gone?

Saradha report ‘sketchy’

New Delhi, March 4: The Supreme Court today expressed displeasure with the Saradha default probe details submitted by the Bengal government, saying it was “sketchy” and wondering where the money collected from depositors had gone.

The apex court granted 10 days’ time to the state government to file an additional affidavit on the investigation to examine whether it ought to order a CBI probe.

“What you have given is sketchy. Where has the money gone? Because as per the details given by the ED (Enforcement Directorate), they have attached 131 properties worth Rs 35 crore. As per your (state government’s) statement, you have attached some properties. Let us take it is worth another Rs 65 crore,” the bench of Justices T.S. Thakur and C. Nagappan told senior counsel C.S. Vaidyanathan, who is appearing for the government.

“So far, you have been able to account for only Rs 100 crore. But where has the rest of the money gone? We need to know where is the balance amount,” the court added.

“Most of the money, it seems, is collected in cash. (Saradha’s) bank accounts have very little money,” the bench said.

The extent of the deposit default scandal has not been conclusively established yet. During the hearing on February 25, the Supreme Court had said 18 lakh investors had been affected, a figure that appeared to have been based on the number of people who have registered themselves with the state government-appointed Shyamal Sen Commission. All the names are still to be vetted.

There is no consensus on the exact amount defaulted. While a petition has put the figure at Rs 30,000 crore, Vaidyanathan had estimated the amount to be Rs 1,700 crore.

Today, Vaidyanathan told the court that the Saradha Group had spent around Rs 820 crore to pay its agents. According to the senior counsel, 30 per cent of the total amount collected from investors had been spent on paying the agents.

Going through the 417-page report submitted by the government today, the court pointed out that according to it, Rs 50 crore had been spent to promote Saradha’s media business, particularly a TV channel.

“So, even for promoting a channel, you need Rs 50 crore?” the court asked. Senior counsel Harish Salve, who is also appearing for the Bengal government, said channels paid money for “dressing up” their shows and for “consultation fees”.

However, the court was not convinced with the state’s submission and directed it to file a detailed report on the probe. It posted the matter for further hearing on March 26.

Earlier, additional solicitor-general Sidharth Luthra told the bench that in July last year, the CBI had informed the Supreme Court that it was willing to investigate the case if the court so desired.

“If we are to investigate, we will now have to take a re-look at the various cases registered by the state government and plan our strategy. We do not have the manpower, but if the court wants, we are willing to carry out the task because we need to examine various angles and the inter-state ramifications, if any,” Luthra told the bench.

Luthra submitted to the court in sealed covers additional probe reports on behalf of the Serious Fraud Investigation Organisation (SFIO).

The apex court is hearing two PILs — one filed by advocates Pratim Kumar Singha Ray and Abu Abbasuddin, and the other by advocate Subrata Chattoraj — seeking a CBI probe into the Saradha default. The PILs allege that several Trinamul leaders are involved in the default. The Opposition in Bengal has also levelled a similar allegation.

On February 25, the Supreme Court had asked some tough questions to the Bengal government on why it was fighting shy of a CBI probe into the Saradha default scandal.

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