DS Kulkarni Group case referred to SFIO

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The Serious Frauds Investigation Office (SFIO) will probe Pune-based realty firm DS Kulkarni Group, which defaulted on payments to depositors, sources told Moneycontrol.

Till now, the nearly Rs 200-crore case was being investigated by  Pune's Economic Offences Wing, and market regulator Securities and Exchanges Board of India. These investigations will also continue. The decision to get SFIO into the case was taken by the Ministry of Corporate Affairs.

A source told Moneycontrol, “The DS Kulkarni case has been transferred to SFIO to check if the promoters siphoned off money from the company's books”.

SEBI is also looking into this matter following media reports of DS Kulkarni after media reports of the company defaulting on its obligations to investors who had loaned money to the company in the form of fixed deposits. The market regulator had issued a notice in October last year and  had asked the company about complaints registered at Pune's EOW.

“With both SFIO and SEBI investigating, there could be a faster relief to more than 8,000 depositors of the company,” said sources.

DS Kulkarni ran deposit schemes offering interest rates ranging from 11 percent to 12 percent per annum.

A posting on the company’s website says depositors will get "post-dated cheques for interest as well as for principal amount and highest effective rate of interest of 14.89 percent”.

However, from last February, investors allege that company cheques started bouncing, creating panic. On a complaint from an investor, Pune's EOW started an investigation and raided houses and offices of promoter DS Kulkarni.

Kulkarni, known as DSK, and his wife on Tuesday got an interim relief from arrest from the Bombay High Court, which gave them time till 13^th February. The high court has instructed DSK to be present before the EOW's investigating officer every day for four hours from 7^th February.