The court invoked Article 142 to ensure complete justice and constituted HPSC to auction assets and refund investors due to exceptional circumstances and complexities involved.

ORDER :

Surya Kant, J.

Petitioner Nos. 1 and 2 are husband and wife, whereas Petitioner No. 3 is their son. They have invoked the jurisdiction of this Court under Article 32 of the Constitution, seeking the following directions: -

"(a) To issue appropriate writ in the nature of mandamus or any direction or order directing the Respondent No. 1 to liquidate the attached assets within a period of 6 months and/or, in the alternative, allow the Petitioners to assist Respondent No. 1 in liquidating the attached assets;

(b) Direct Respondent No.1 to distribute the amount lying within it to genuine investors as early as possible;

(c) Direct Respondent No. 1 to allow the Petitioners to assist them in identifying genuine investors and also the amount deposited by them; and

(d) Pass other and further order(s) as this Hon'ble Court may deem fit in the facts and circumstances of the case."

2. The above-stated reliefs have been sought in light of the following set of events predicated in this factual background: -

(a) Petitioner Nos. 1 and 2 are the founder-Directors of one Sai Prasad Properties Ltd, incorporated under the provisions of the Companies Act, 1956. Petitioner No. 3 also joined the aforesaid company as a Director in 2008, allegedly when he was still studying in college, and is claimed to have thereafter resigned in the year 2014. The Petitioners also floated various other companies, known as the Sai Group of Companies, consisting of:

(i) M/s Sai Prasad Properties Ltd. (hereinafter, "SPPL");

(ii) M/s Sai Prasad Foods Ltd. (hereinafter, "SPFL");

(iii) M/s Sai Prasad Corporation Ltd. (hereinafter, "SPCL"); and

(iv) M/s Shree Sai Space Creations Ltd. (hereinafter, "SSSCL").

(b) The Security and Exchange Board of India (hereinafter, "SEBI") received a complaint dated 02.06.2010 alleging illegal mobilisation of funds by SPFL. After processing the said complaint and in furtherance of the orders passed by the High Court of Madhya Pradesh and the Department of Financial Services, Ministry of Finance, the Whole Time Member of SEBI (hereinafter, "WTM") issued an interim order-cum-show cause notice dated 17.07.2013, inter alia, directing SPFL and its Directors to refrain from collecting any more money from investors, under the existing schemes or any new schemes. SEBI, once again passed an order dated 14.01.2015 against SPFL and its Promotors/Directors, restraining them from collecting any money from the investors, launching or carrying out any Collective Investment Schemes, and from alienating/disposing/selling any of the assets of the Company, except for the purpose of refund to its investors.

(c) SEBI received a letter dated 17.08.2012 from the Registrar of Companies, Goa, Daman & Diu informing that upon inspection conducted under Section 209A of the Companies Act, 1956, it was found that SPPL had been accepting investments from their associates for a period of 4 to 9 years and had also been executing joint venture agreements. SEBI was then requested to take appropriate action against SPPL for violating Section 11AA of the SEBI Act, 1992.

(d) A preliminary enquiry was conducted, and after issuing an interim order-cum-show cause notice dated 17.07.2013, the WTM vide the final order dated 14.01.2015 issued directions against SPPL and its Promotors/Directors, identical to those passed against SPFL (mentioned in paragraph 2(b) above).

(e) In addition, SEBI received complaints on 23.09.2013 against SPCL and its sister concerns, alleging collection of money from the public, through the Collective Investment Schemes. While these complaints were under investigation, SEBI also received a reference from the Income Tax Department dated 03.03.2014 alleging the collection of money from the public by M/s Sai Prasad Group, to the tune of Rs. 290 crores. WTM once again issued an interim order on 22.07.2014, followed by a final order dated 01.02.2016, directing SPCL and its Directors not to collect any money from the investors or launch or carry out any Collective Inves