Sebi rejects PACL group firm's plea to defreeze accounts

Sebi has ruled that curbs imposed on Pearls Infrastructure Projects, majority owned by PACL, will continue as it has rejected the plea to defreeze bank accounts on grounds that proceedings to recover over Rs 60,000 crore from the parent entity is going on.

Besides bank accounts, the regulator has refused to defreeze Pearls Infrastructure Projects Ltd's (PIPL) demat account and mutual fund holdings.

The move comes after the Securities and Appellate Tribunal (SAT) directed Sebi to pass fresh directions in the matter.

In a fresh order passed yesterday, the regulator said, "it has set aside the contentions of the appellant and direct that the directions as passed on September 2016 that no debit shall made in any bank accounts, lockers, demat accounts and mutual fund folios etc of PIPL shall remain in force".

According to Sebi, PACL holds 94.82 per cent shareholding of PIPL directly and indirectly through its associate or subsidiary companies.

Sebi had initiated recovery proceedings against PACL, its promoters and associate firms, including PIPL, to recover investors' money on September 7, 2016. It had ordered freezing of bank accounts as well as demat and mutual fund holdings of as many as 640 group entities.

In a directive to various banks, depositories and mutual funds, Sebi had asked them to ensure that "no debit" is made with immediate effect in any of the bank accounts, lockers, demat accounts and mutual funds of these entities, to which the PACL Group is suspected to have transferred money, including for purchase of properties.

The regulator found that the group, which had raised money from the public in the name of agriculture and real estate businesses, had collected these funds through illegal collective investment schemes over a period of 18 years.