SEBI tightens the screws on PACL

Nirmal Singh Bhangoo, the founder of Pearl Agrotech Corporation Ltd (PACL) was earlier arrested by the CBI in Jan 2016, for one of the country’s biggest financial scandals. The arrest was announced nearly 17 months after SEBI’s order.

The case involved suspected collection of 450 billion rupees from nearly 55 investors across the country as a part of Ponzi scheme. The scheme assured return on investments in agricultural land. PACL had also argued that the selling of land was to the customers and not an investment scheme, and thereby did not fall in the arena of SEBI.

In February 2016, in the matter of PACL vs SEBI, Supreme Court had directed SEBI to conduct a committee for disposal of the land purchased by the Company (PACL) and repay the concerned investors out of the sale proceeds.

On June 24, 2016, SEBI,under the chairmanship of Justice (Retd.) R. M. Lodha, collected a large number of property documents. SEBI also appointed and agency for their safe custody, data creation and maintenance. It also engaged two agencies to carry out auction sale of the properties.

The committee under SEBI has requested the investors of PACL to cooperate and not to be guided by any rumours unless the committee gives any directions.