Tamil Nadu police starts probe into chit cheating case

THIRUVANANTHAPURAM: The Tamil Nadu police initiated a preliminary inquiry against Nirmal Krishna Nidhi Limited at Palukal on the Kerala-Tamil Nadu border area of Kanayakumari district after protests by investors turned violent on Friday. Hundreds of investors, both from Kerala and Tamil Nadu, have been gathering in front of the firm since Thursday. By Friday, the number of protesters increased and the investors blocked the road and pelted stones at the firm that was shut since Thursday.

The the firm which was several decades old, has about 6,000 investors. Many investors are from middle and low income groups. Kanyakumari SP Mr. M.Durai told DC that Thaucklay ASP was directed to conduct a preliminary inquiry into the whereabouts of the promoters. Details of an insolvency petition filed by one of the promoters in a local court in Thiruvananthapuram would also be collected. Subsequently a decision on registering a case would be made.

“At this stage we cannot say whether the company’s promoters were absconding or not. We have asked the protesters to lodge a petition with the police with details of their investments and the amount due to them,” he said. Local people alleged that the police was hand in glove with the chit fund promoters and hence were not registering a case or initiating steps to arrest the company’s promoters.

Meanwhile, there also were allegations that the main promoter Nirmal Krishnan (Nirmalan K) filed a personal insolvency petition at the court in order to save himself from the liabilities of the firm. The 16 respondents in the insolvency petition included several leading banks, financial institutions and four individuals. Some of the individuals were also alleged to be his benamis. However, legal sources said that the investors of the company could also produce their claims at the Thiruvananthapuram sub court. Nirmalan is residing in Jagathy in Thiruvananthapuram and hence the petition was filed here.

Pressing a police case and initiating civil procedures seem to be the options available for investors to get back their money. The firm might also be registered with the Reserve Bank of India for carrying out and receiving deposits and hence investors could also approach the RBI seeking relief, said a financial expert. The firm was alleged to be having investments from big shots, including some political leaders from Kerala, and many of those were settled in cash and land.