Sebi to auction asset of Tower Infotech

Markets regulator Sebi will this month conduct the auction of the property of West Bengal-based Tower Infotech Ltd, which had garnered funds through illegal money pooling schemes, to repay investors. The Securities and Exchange Board of India (Sebi) has initiated the process for sale of assets of Tower Infotech Ltd, as per an order from Calcutta High Court, under which the auction would be conducted for sale of the company's land. The High Court has directed Sebi to sell certain assets of Tower Infotech and distribute the proceeds among duped depositors and debenture holders.

In a public notice, the capital markets watchdog said that the sale of Tower Infotech's property will be conducted on November 18 before the High Court. "The sale shall be conducted through physical auction and ...property will be sold in a single lot and shall not be sold below the reserve price fixed," it added. The property listed for sale includes a land parcel in Calcutta with a reserve price of Rs 6 crore.

Prospective buyers have been asked to send applications along with a payment for an amount equivalent to 10 per cent of the reserve price as earnest money by November 9. Last year, Sebi had conducted the e-auction of the four properties of Tower Infotech. In addition, the markets regulator had asked investors and depositors of Tower Infotech to submit their claims for refund of money invested in the company's 'chit-fund' schemes.

The unauthorised money-collection schemes are widely known as 'chit funds' in West Bengal and other Eastern and North-Eastern states, although their operators are not registered as 'chit fund' companies in most cases.