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Report No. 143

2.3. Companies addressed.-

The Commission forwarded all the complaints of the depositors to the concerned companies along with the request to repay the concerned depositors at the earliest. These companies were also asked to furnish the following information from their records:-

(i) Concrete factual information pertaining to the complaint of the said person and cause of delay;

(ii) Number of depositors and the total amount involved where the deposits have remained unrefunded for a period exceeding 90 days commencing from the date of maturity separately in respect of (a) deposits of less than Rs. 11,000, and (b) deposits of more than Rs. 11,000;

(iii) Reasons for the deposits remaining unrefunded; and

(iv) Number of cases pending in Courts/Company Law Board for refund of the amount and the total amount involved in such cases.

The Commission pointedly impressed upon the defaulting companies to repay the small depositors particularly those whose deposits were in the range of Rs. 5,000 or less as these small depositors cannot afford to approach the competent authority, such as the Company Law Board (CLB) or Civil Court exercising summary jurisdiction on account of the time-cost and money-cost, both of which would be beyond their reach by reason of their lack of resources in the context of the smallness of amount.

Companies were also applied that in case these small depositors were obliged to initiate legal proceedings these companies will also have to incur time-cost and money-cost which would possibly exceed the expenditure of the claim made by the small depositors companies. The letter addressed to various companies is shown as per Appendix 'A'.



Legislative Safeguards for protecting the Small Depositors from Exploitation Back




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