Paving the way for auction of property worth Rs 200 crore of MD of chit fund company, investors will get their money

New Delhi : The Supreme Court has allowed the Enforcement Directorate (ED) to auction two properties worth Rs 200 crore of the director general of a chit fund company. These properties belong to Nowhera Shaikh, Managing Director of Heera Gold Exim Private Limited, who is accused of defrauding investors through a Ponzi scheme.

A bench of Justices JB Pardiwala and R Mahadevan gave this order. ED has welcomed this decision and has started the process of getting the properties returned to the victims. ED says that it wants to provide justice to the investors trapped in this fraud.

Sheikh had proposed to sell his/her properties, after which the Supreme Court allowed the auction. he/she had listed three properties – Naina Towers located in Banjara Hills, Hyderabad with a market value of Rs 90 crore, Heera Foodex with a market value of Rs 120 crore, and Heera Retail (Hyderabad) Pvt Ltd with a market value of Rs 753 crore. However, the court allowed the sale of only the first two properties as some documents of the third property were missing.

The bench said, ‘We direct the ED to auction both the properties in accordance with law… We permit the ED to issue auction notices in accordance with law after fixing an offset price. The offset value will be decided after receiving the report from the government approved valuer.

The court gave Shaikh three more months to surrender in the case and directed him/her to deposit Rs 25 crore with the agency. Earlier the court had canceled his/her bail.

The court has also directed Sheikh to give complete and true details of all his/her untainted properties, which will be auctioned to return the money to the investors. Sheikh has been asked to submit details within two weeks.

The Supreme Court said, ‘Once the ED gets information about other untainted properties, it will also move those properties for auction as soon as possible and try to recover the maximum amount.’

ED says that it wants to provide justice to the investors trapped in this fraud. In this case, Nowhera Shaikh is accused of cheating investors through a Ponzi scheme. Ponzi scheme is a type of fraud in which returns are given to old investors from the money received from new investors.