Delhi HC allows revival of CRB Capital Markets

The Delhi High Court on Tuesday allowed the revival of CRB Capital Markets Ltd which had duped 1.34 lakh small investors and many financial institutions including 36 cooperative banks of more than Rs 1,200 crore in 1990s.

While disposing of the petition, Justice Mukul Mudgal directed RBI to defreeze all the frozen accounts of the company, its group companies and its ex-directors, besides asked it to consider its application for re-registration as non-banking financial company and restoration of licenses to act as authorised dealer in forex in accordance with law.

However, it dismissed CRB's plea seeking restoration of its suspension order by the RBI against setting up CRB Global Bank Ltd.

"I cannot lose sight of the fact that secured and unsecured creditors as well as the shareholders who are the real stake holders in the company have overwhelmingly voted in support of the scheme...," he said.

Coming to the rescue of weaker sections comprising widows, disabled and senior citizens the court directed that they would get their entire deposit without any limit within one year of the sanctioning of the scheme.

As per the modified scheme, the small depositors up to Rs 5,000 would also get their entire deposit repaid within nine months while weaker sections.

Unsecured creditors, deposit holders and the bond holders above Rs 5,000 will get cash payment equivalent to 50 per cent of the principle amount in four yearly equal installments and balance 50 per cent of the principle amount is to be discharged through allotment of the CRB shares.

In case of the banks, cooperative Banks and financial institutions, 25 per cent of the principle amount will be paid within three months from the date of sanction of the scheme and the balance 75 per cent in 16 equal quarterly installments commencing from the month following the expiry of six months from the date of sanction of the scheme.