Kolkata: The Calcutta High Court on Friday ordered a forensic audit by the Securities and Exchange Board of India (SEBI) into alleged financial irregularities by the Rose Valley Assets Disposal Committee, which was constituted in 2015 under retired judge Dilip Seth to refund investors through the sale of the
group’s properties.
A division bench of Justice Rajarshi Bharadwaj and Justice Md Shabbar Rashidi observed that the committee had failed to make any substantial progress in the past year, despite Rs 500 crore lying in bank accounts earmarked for repayment to depositors. The judges directed SEBI to scrutinise the sale of 10 Rose Valley properties and determine whether the transactions were carried out at fair market value.
The regulator was also tasked with verifying whether the committee’s book-keeping and accounts were in proper order. In addition, SEBI must clarify whether it was
legitimate for the committee to accept funds from an entity called the Chocolate Group, which was allegedly permitted to run Rose Valley’s chain of hotels despite not being part of the liquidation mandate.
The bench noted with concern that no audit of the committee’s functioning had been carried out in the past decade. Earlier, it had criticised the panel for allowing a “non-existent” Chocolate Group to manage Rose Valley assets instead of auctioning them.
Rejecting opposition from the committee’s counsel, the court directed SEBI to file its forensic audit report before the next hearing on September 26.