Shyam Divan to assist Supreme Court as Amicus Curiae in alleged Rs 7500 Cr scam case

The Supreme Court recently appointed Senior Counsel Shyam Divan as Amicus Curiae to assist the Court in a case involving an alleged scam worth Rs. 7500 crore..The order was passed by a Bench of Justices Rohinton Nariman and V Ramasubramanian. Divan who was counsel for one of the parties to the case agreed to give up his brief and take up the role of Amicus Curiae..The Court also acceded to the request made by Dhavan to have advocate Vipin Nair as Advocate-on-Record and advocate Vinayak Bhandari to assist him..The Court’s order states,.“Mr. Shyam Divan, learned Senior Advocate, has very kindly consented to give up his brief in the case and continue as the Court-appointed Amicus Curiae. He requests that Mr. Vipin Nair, be appointed as an Advocate on Record along with Mr. Vinayak Bhandari, learned counsel to assist him in this behalf. The said request is granted.”.The case before the Supreme Court concerns a Collective Investment Scheme floated by the company Royal Twinkle Star Club Ltd. and Citrus Check Inns Ltd. The Supreme Court, at this stage, is monitoring a phase-wise sale of the defaulting company in order to protect the interests of investors..In this instant case, an amount of roughly Rs. 7500 crore was raised through over 18 lakh investors in a ‘Ponzi’ scheme under the garb of holiday plans by the defaulting company. The company employed agents to sell the scheme, thereby making agents the face of the scheme before the investors. Upon non-repayment of the principal amount to the investors, the agents were sought to be made answerable to the investors. The investors and agents, however, formed a Trust under the Bombay Trusts Act..Proceedings against the company under the Insolvency and Bankruptcy Code (IBC) were initiated before the National Company Law Tribunal (NCLT), Mumbai. According to the investors, the IBC proceedings were initiated to jump the orders passed by the Securities and Exchange Board of India (SEBI), the Securities Appellate Tribunal (SAT), and the Supreme Court, which fixed a time-frame for the repayment of the monies by February 2018..The proceedings and orders of the SEBI, SAT, and Supreme Court were allegedly not brought to the notice of the NCLT, prompting some of the investors to move an application before the NCLT to point out the same. This application, however, was rejected by the Tribunal on technical grounds. The NCLAT was moved in appeal and eventually, the matter came before the Supreme Court, where the plea was admitted in January 2018..In an order passed in January last year, the Supreme Court had stayed the proceedings under the IBC before the NCLT. Thereafter, the Supreme Court, in May 2018, ordered for the attachment of properties of CCIL and RTSCL. It also directed the Directors of the company to declare their assets, both in India and overseas..[Read Order]