City Limouzines Updates, Main conspirators in this fraud

Main Conspirator in this City Limouzines Fraud as per my personal research:

1. Manoj Vighe

2. Raviraj Desi

3. Kaiser Baig

4. Santosh Dayalkar

5. Naiyyer Razzaki

6. Amber Razzaki

7. Shehla Khan

8. Farhan Ahmed Khan

9. Vikas Patil

10. Anil D'Mello

11. Chirag Doshi

12. Chand Masood

13. Jabeen Masood

14. Amin Askari

15. Rajeev Loomba

16. Sneha Govekar

17. Rehan Alavi

18. Naeem Munawar Sayed

19. Ranjit Shetty

20. Aziz Khan

21ST MAY 2010

‘PRODUCER BROS DUPED INVESTORS’

Mumbai: The promoters of fly-by-night companies that vanish with public money love to hobnob with the entertainment industry. After S M Masood, chairman of the tainted investment company City Limouzines, dabbled in Bollywood producing some C-grade movies, two brothers known in the television industry have come under the scanner for duping investors.

Sandeep Shukla owner of Leo 1 Music, who funded the second season of realty show Dance India Dance, and his brother Manoj Shukla are currently being investigated for duping public by promising huge returns on their investments. “They are directors of Aurum Realty Ltd and are believed to have masterminded the fraud. We are trying to locate them,’’ a police officer said. Meanwhile the police have arrested two of the company’s directors—Jignesh Rathod and Shafiq Shaikh.

A Google search on Sandeep Shukla provided a detailed account of his birthday celebration last July at a five star hotel. Most of the attendees included lesser known television actors with the only exception of film actor Rajpal Yadav. It further says that his parents gifted him an Audi car. Sandeep has also produced a Marathi movie Anandi Ki Rohi.

The initial estimates by the police show that Aurum has duped 3,000 investors in Mumbai to the tune of Rs 40 crore. The company also had offices in Pune, Nashik and Aurangabad. In March, Amrish Patankar, a customs house clearing agent lodged a complaint with the economic offences wing (EOW). The company had floated two schemes at Kasara and Karjat and promised to construct dream houses there. The company promised the public very high returns on the amount they invested till the project came up. The firm even assured that the investors will be the tentative owners of the one-acre land at Karjat, a police officer said. “The company never owned any land,’’ a police officer said.

Investigators said the company floated the scheme in January 2009 and placed huge advertisements in newspapers. The advertisements read: ‘Change your life. Be Rich. Get wealthy by investing in land’. The company had two schemes: Nature Valley and Astra Hills. The investors were promised that their money will be doubled in a year. The company disbursed returns till March, after which it stopped.

According to the scheme, if a person invested Rs 51,000, he would get a monthly return of Rs 8,160 for one year. In its brochure, Aurum stated that the company was ISO certified.

One more held in City Limo scam

In the City Limouzines case, the EOW on Saturday arrested Kaiser Beg, tax consultant to the company. This is the first arrest of a non-employee in the case. Six persons including S M Masood and his wife Seema are presently in custody. The police believe that Beg was the brain behind the schemes floated by the company. When Masood was in hiding, Beg had transferred money into his accounts. 

TRUST UNDER SCANNER IN CITY LIMO CASE

 Mumbai: The economic offences wing (EOW) of the city police investigating the City Limouzines cheating case is examining whether a trust, who played the role of the company’s agent, can be booked for being party to the crime.

Dr Babasaheb Ambedkar Pratishthan, acted on behalf of City Limouzines and leased out vehicles purchased in the name of investors, has come under the scanner. These vehicles were part of

the scheme offered by City Limouzines while collecting money from the public. As part of the scheme, City Limouzines by way of loans and money collected from investors purchased vehicles and gave them on hire for a period of five years.

On completion of the fiveyear period, the vehicles were to be returned to the investors. The investors were also offered monthly returns which the company claimed came from leasing out the vehicles.

A police officer said that the trust, which also runs a cooperative credit society, and City Limouzines operated from the same address at Kemps Corner. “City Limouzines’ chairman S M Masood is the vice chairman of the credit society,’’ the officer said. There are over 1,200 vehicles which have been leased out through the Pratishthan. “There was a proper agreeement entered into by the Pratishthan and the vehicle users. The pratishtan collected as high as Rs 5 lakh refundable deposits for a period ranging between three to five years. Besides this, they also collected money as fixed deposit with the credit society and offered around 9% interest,’’ a source said. According to the police, this clearly establishes a business link where the Pratishthan was aware of the activities of City Limouzines.

The credit society, according to the website, was established in 2003 and names several people as its trustees. The principal objective is “to provide medium term and long term project finances to Indian businesses while uplifting the lives of the underprivileged segment of the Indian society...’’ The credit society also floated schemes in collaboration with City Limouzines.

Meanwhile, after the company went into trouble there is a dispute as to whom the vehicles should go to. “The users claim that they have not got their deposits back and hence they are entitled to the vehicles. However, investors say that the vehicles are registered under their names and hence should be returned to them,’’ an officer said.

7TH MAY 2010.

CITY LIMO CASE: EOW FACES NEW HURDLE

Firm Registered Cars On Investors’ Names But Later Gave Them On Hire

Mumbai: The economic offences wing (EOW) of the city police, investigating the City Limouzines cheating case, is now facing a new hurdle where victims are fighting victims. The bone of contention is the vehicles promised to the investors by the company as part of the scheme.

The company had collected money from the public, gave monthly returns to the investors and promised vehicles at the end of the five-year period. The company registered the vehicles in the name of the investors and gave them on hire in the intervening period.

While the company ran into trouble, the investors and the people who had hired the vehicles are now fighting among themselves. While the investors claim that they are the rightful owners in the RTO records, the users refuse to hand over the vehicles until the company repays the refundable deposit collected from them.

The police claimed that the investors are the rightful owners, though they accept that the users are also victims. City Limouzines, through an agreement with Bharatratna Dr Babasaheb Ambedkar Pratishthan, gave around 1,200 vehicles—Skoda, Innova, Scorpio—on hire after a refundable deposit ranging between Rs 3.5 lakh to Rs 5 lakh was made. Those who took the vehicles on hire got to use a brand new vehicle for five years by paying a meagre monthly rent. The company, however, cheated several investors by not purchasing the vehicles at all.

Halfway through the scheme, the company collapsed, leaving the users and investors in the lurch. The police’s stand that the investors have the first right is now being challenged in court. In some cases, the investors moved the court for the return of vehicles where the police supported them. The investors thus got their vehicles back.

“The end users have done nothing illegal and took the vehicles on hire after entering into a proper agreement. It is not for the police to take a stand. The court should take a call on this,’’ said advocate Bhavesh Parmar, who moved the Bombay HC challenging the police action.

Interestingly, neither the investors nor the users objected when banks and financial institutions took away the vehicles when the investors defaulted on loans. “The firm took loans from various banks to buy vehicles. The monthly bank instalments were paid by investors from the returns given by the company,’’ a police official said.

‘‘When the company stopped making payments, the investors also defaulted in their dues to the banks. Some investors were lucky that the loans were obtained from City Cooperative Credit society, a sister concern of City Limouzines. The society also collapsed and hence there is no demand to repay the loans.’’

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6th May 2010.

It is correct that Layak Ali, who filed the FIR in HYD did not include Masood's name. I have attached a copy of his FIR. One of you need to convince Mr. Layak Ali, to add a supplementary complaint to the FIR and add names of Masood, Seema Razzaki, Geeta Razzaki, Umar Razzaki, Rajesh Choudhary and the entire list that was circulated on this group a few weeks ago. This needs to be done at the earliest. I suggest you folks in HYD call for an urgent meeting this sunday along with Mr. Ali and go to CSS and get the supplmentary FIR filed for all the names. Masood is anyways being taken to Mumbai today but the supplementary FIR will get his name added to the CSS chargesheet which will get filed with AP High Court. If you folks don't get this done, it will be a challenge in recovering funds for HYD investors, so you need to get this done on war footing!

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4th May 2010

SC GETS TOUGH ON CHEQUE BOUNCE CASES

NEW DELHI: Delay in settling cheque bounce cases will now cost the defaulter dear, up to 20% of the cheque amount. The penalty for delayed settlement of the cheque amount, after conviction in the trial court, would rise steadily from 10% in district courts, 15% in high courts to a whopping 20% in the Supreme Court.

The SC on Monday took this radical step through a pioneering judgment which aims to curb the tendency among defaulters to sit over the amount tendered through a bounced cheque.

Saddled with 30 lakh cheque bounce cases, the SC accepted most of the suggestions offered by attorney general G E Vahanvati.

A Bench comprising Chief Justice K G Balakrishnan and Justices P Sathasivam and J M Panchal also laid down guidelines for early settlement in cheque dishonour cases under Section 138 of the Negotiable Instrument Act.

The judgment, authored by Chief Justice K G Balakrishnan, indicated that defaulters going for early settlement before the trial court would have to pay just the principal amount with applicable interest.

But if they approched the district court for settlement after being convicted by the trial court, they would have to pay 10% of the cheque amount to avoid going to jail. So if a chque amount is for Rs 1 lakh, then to compound the offence before the district court, the defaulter has to pay an additional Rs 10,000 to avoid going to jail.

Similarly, if the defaulter agrees for settlement and compounding of the offence at the HC stage, then he would have to pay 15% of the cheque amount. The amount so collected would be given to Legal Aid Authorities of the respective states which provide free legal assistance to poor litigants in various forums, the SC said.

This judgment will go a long way in reducing the pendency of over 30 lakh cheque bounce cases which have jammed the wheels of justice already slowed down by pendency of 2.7 crore cases. During the hearing of a Section 138 case between Damodar S Prabhu and Sayed Babalal, the Bench observed that there had been an enormous rush of cases after cheque bounce was made a penal offence in 1989, followed by the amendment in 2002 providing for summary trial for early resolution of the dispute.

3rd may 2010

The EOW Mumbai trial should start soon as the chargesheet was filed on March 30th.

30th Apr 2010.

ED ATTACHES NARIMAN POINT PROPERTY IN CITY LIMO CASE

(ED) has attached a prime property in Nariman Point belonging to tainted investment company City Limouzines. The attached premises comprise 5,000 sq ft of office space and another 2,000 sq ft of terrace on the 16th floor of Maker Chambers VI, considered one of the high-profile buildings. The property is valued at over Rs 15 crore. The attachment was made unde the Prevention of Money Laundering Act (PMLA). According to a source, the property was purchased in June 2009 by Kanu Realty, owned by City Limouzines’ chairman S M Masood’s first wife Chand and their daughter. “The amount collected from investors was used to buy it,’’ an official said.City Limouzines ran into trouble last August when cheques issued by the company as returns to the investors

bounced due to inadequate funds in the company’s bank accounts. In February, ED invoked the PMLA ,in the cheating case involving City Group companies, City Limouzines and City Realcom. ED officials had then attached two demand drafts of Rs 65 crore, which was to be credited in the company’s account, preventing diversion of funds. The money came after City Realcom surrendered a nearly 60-acre plot in Gurgaon, acquired from the government to set up a five-star hotel.

“The properties attached goes to the government. It is for the trial judge to decide whether the properties could be auctioned and money returned to the investors,’’ an official said. An attachment under PMLA overrides action under any other act.

The ED has been investigating the company for foreign exchange violations. At the same time, it could not invoke PMLA as one of the requirements was that a chargesheet under the IPC had to be filed against him or the company. The economic offences wing (EOW) investigating the cheating case against Masood had filed a chargesheet against the company and its directors Geeta Razzaki, his husband Umar and another director Rajesh Chaudhary.