The Hindu Business Line : Economic offences wing asks for a fast track court

Chennai, Feb. 24 The Economic Offences Wing (EOW), which is a part of the Tamil Nadu Police Department, has written to the State Government asking for an “exclusive fast track court” to handle cases relating to economic offences, Mr Uma Ganapathy Sastry, Inspector General of Police, EOW-II, told Business Line recently.

Most of the offences are non-return of public deposits by non-banking finance companies. These cases come under the purview of the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) Act, 1997, better known as the TNPID Act.

At present, there is only one court in Chennai that handles TNPID cases.

As of December-end 2007, the EOW-II, which deals with cases of defaults by financial institutions, had registered 1,285 criminal cases, of which 115 are under investigation and 366 cases are pending trial. These involve about Rs 670 crore.

A few months ago, the State government had approved the setting up of two courts, in Madurai and Coimbatore, to take up the TNPID cases. “Hopefully, by April, these courts should start functioning,” Mr Sastry said. When that happens, the workload on the Chennai court will be considerably reduced.

Further, those cases that do not come under the TNPID Act get referred to the court of the Chief Metropolitan Magistrate in Chennai, whose workload is already heavy. It is against this backdrop that the EOW has requested for a fast-track court.

Things have improved a lot over the last one-and-a-half-years, says Mr Sastry.

Positive developments

Mr Sastry observed that over the last 18 months, a number of positive developments have taken place, including the order enabling the establishment of special courts at Madurai and Coimbatore. For example, the District Revenue Officers have been given the powers to attach property.

Refunds have been on the rise, thanks perhaps to the rising property prices because of which borrowers are coming forward to settle dues. Refunds in 2005 were Rs 45 crore, which more than doubled to Rs 96 crore in the next year. In 2007, Rs 118 crore was refunded to the public, Mr Sastry said.

Biggest of them all

RBF Nidhi is one that involves the highest amount of all the cases handled by EOW — Rs 454 crore. Initially, EOW identified 205 pieces of property worth Rs 415 crore, to be auctioned and sold off. However, properties worth Rs 390 crore belonged to Mr Srinivasalu Reddy, who has since been acquitted.

Mr Reddy was the Chairman of the Balaji group of companies and is a sitting Member of Parliament.

RBF Nidhi has three pieces of property worth Rs 36 crore. These are now with the Official Liquidator. According to Mr Sastry, the auctions did not fetch acceptable prices. Mr Sastry wants the OL to examine if it is possible in law to put the properties on e-auction, for a broader base of potential bidders.

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