MUMBAI, June 8: The Investors' Grievances Forum (IGF), a Mumbai-based small investors' association, has filed a public interest litigation in the Mumbai High Court against 3,600 plantation companies which have collected a whopping sum of over Rs 25,000 crore.The respondents to the case are: the Securities and Exchange Board of India (SEBI), the Reserve bank of India, the Ministry of finance, the Central Bureau of Investigation, the Commissioner of Income tax, the Company Law Board, Department of Company Law Affairs, Registrar of Companies, Agriculture Finance Corporation, the Commissioner of Mumbai Police, Association of Agri Plantation Companies and the state of Maharashtra. The petition will come up for admission on June 11.Alarmed over the various plantation companies going under, the IGF said that despite various representations to all the above-mentioned government agencies, the latter failed to stop the plantation companies from looting small investors. Having lured investors and siphoned off theamount, plantation companies have now started disappearing from the scene, IGF said.Citing the example of the Chandigarh-based Golden Forest, the petition says that despite the Mumbai's High Court orders, the company has gone ahead with an advertisement in the newspapers either misquoting the orders passed by the court or selectively quoting certain parts of the order passed by the court. This has created an impression in the minds of the people that SEBI has not succeeded in the writ petition filed against them.However, the SEBI has failed to react to the public notice which would have prevented further investments into such plantations companies. "The petioners submit that such inaction on the part of the SEBI is highly derogative and speaks volumes of their misconduct," it said.It said another plantation company, Indo French Biotech Enterprises Ltd, had come out with several lucrative schemes in the market and also came out with a public issue. When it was found that the investigations wereinitiated against the said company, Indo French Biotech changed its name and floated another company named Indo Global Bye-tech Ambience Ltd. This new company wanted to come out with public issue, even though the promoters are same, the petition says.IGF said that the SEBI has restrained about 147 companies from taking deposits from the public. However, it has not taken cognizance of all 3,599 plantations companies. The rest of the companies continue to collect funds frm the public in one scheme or another. It has, therefore, prayed to the High Court to direct the SEBI to take action against all the companies.It said that Libra Plantations realised that it will not be possible for them to function and filed a winding up petition in the Mumbai High Court and got an official liquidator appointed. It said for two months the liquidator did not take possession of the assets and only after a court directive did so.Yet another company, Arrow Global Agro Tech issued post-dated cheques to the investors which,subsequently, started bouncing. It was only after a lot of persuasion, did the police arrest the company's directors. Only after this, the company started making payments to some investors.The petitioners said because of lack of co-ordination among the government agencies and authorities, such companies are still continuing, collecting funds in diverse, manipulative schemes, in blatant breach of the restrictions imposed by the SEBI. Though a committee, headed by S A Dave, has been set up to investigate the plantation companies no report has been submitted even after six months.The petition prayed that action should be initiated against all the inept officials of both Union and state government, the SEBI and the RBI for their inability to protect the small investors. It also prayed for setting up of a special court to expedite the cases filed.
