Andhra Jyothi News: 1/9/2009Monday, August 31, 2009
Realtor Sahastra Estates India was held by the Consumer Court for deficiency in service
Eenadu News: 1/9/2009The Realtor by name Sahastra Estates India was held by the Hyderabad Consumer forum-3 for its deficiency in service to allot land.
The realtor after collecting money did not register the land to its customer and demanded more money to allot another land. On that the customer approached Hyderabad consumer forum. The forum has held that the realtor is liable to return back the money of the customer with 12% interest and further Rs.2,000/- towards expenses for the case.
Tax Evasion Case Against Amway by A.P. State Government
Dated: 26/8/2009The Commercial Tax Department of A.P. levelled a case against Amway for evasion of VAT Tax about Rs.90 lakh. The Hon'ble High Court of A.P. also rejected the plea of Amway to grant stay and ordered to pay 40% immediately.
- The Division Bench of the Hon'ble High Court of A.P. headed by Hon'ble Judges Goda Raghu Ram and Ramesh Ranganadhan refused to grant stay to Amway against the orders of the A.P. Commercial Taxes about the proceedings launched by the Department against the tax evasion by the Amway (W.P.No.17536 of 2009).
- Please refer Writ Petition No.17536 of 2009 on the website of Hon'ble High Court of A.P. High Court website link to know the status of the case:
http://hc.ap.nic.in/pls/lobis/caseno
Sunday, August 30, 2009
Huge collection of illegal Deposits under different names and cheating the public at large
Eenadu News - Vijayawada : 31/8/2008
One Anupama Finance company of the Vijayawada has collected crores of deposits from the public under different names and ultimately turned its board.
Public are requested not to fall prey to these money collection companies. Immediately report the information of collection of deposits even registered NBFCs and Financial companies to police and RBI officials so that they can check their credential at least to save the some of the public.
Another massive cheating by collection of huge money with fake details
Sakshi News Dated : 31/8/2008 :One Sujana company also cheated the public like as Satyam with fake details and documents.
Hon'ble Madras High Court Judge has commented that "law enforcing agencies will close the stable only after horse escaped".
Taking the lenient view of the RBI officials, SEBI and Police Officials, another dated to commit massive cheating. Public are requested to demand the Balance sheets of the company before investment and get it verify with your respective charted accountants and other known persons to know the real position of these companies.
A Public Interest Litigation (PIL) against PACL (pearls) in High Court of A.P.
- A Public Interest Litigation (PIL) was filed in the Hon'ble High Court of A.P. Against PACL India Ltd. for illegal mobilisation of deposits and promoting illegal Money Circulation Scheme in the guise of Real estate business without any land and layouts as well as records.
- The Division Bench of the Hon'ble High Court of A.P. has admitted the PIL and issued notices to the Police and PACL Company vide W.P.No.16712 of 2009.
- Please refer Writ Petition No.16712 of 2009 on the website of Hon'ble High Court of A.P. High Court website link to know the status of the case:
http://hc.ap.nic.in/pls/lobis/caseno
The Division Bench of High Court of A.P. held the scheme of Amway to be illegal Money Circulation Scheme
Reported vide 2007(4) ALT 808 DB. Para No.36 :"From the whole analysis of the scheme and the way in which it is structured it is quite apparent that once a person gets into this scheme he will find it difficult to come out of the web and it becomes a vicious circle for him. In any event the petitioners have not specifically denied the turnover they are achieving and the income they are earning towards the initial enrollment of the distributors, the renewal subscription fee and the minimum sales being achieved by the distributors as alleged in the counter affidavit. By no means can it be said that the money which the first petitioner is earning is not the quick/easy money. By promising payment of commission on the business turned out by the down-line members sponsored either directly or indirectly by the up-line members (which constitutes an event or contingency relative to enrollment of members), the first petitioner is earning quick/easy money from its distributors, apart from ensuring its distributor earn quick/easy money. Thus the two ingredients are satisfied in the case of promoter too. We are, therefore, of the considered view that the scheme run by the petitioners squarely attracts the definition of “Money Circulation Scheme” as provided in Section 2(c) of the Act..
Whole Judgement is available at: http://hc.ap.nic.in/orders/wp_20470_2006.html
What are the Money Circulations Schemes in India and its related law
The scheme which induces to give commissions / incentives based on enrolling or sponsoring new members into the scheme not only on the event of personal efforts of enrolling new members into the scheme but also on the contingency relatives or applicable to enrollment of new members by their downline members.Sec.2(c) of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 of India defines the Money Circulation Scheme.
- Sec.2(c) "money circulation scheme" means any scheme, by whatever name called, for the making of quick or easy money, or for the receipt of any money or valuable thing as the consideration for a promise to pay money, on any event or contingency relative or applicable to the enrolment of members into the scheme, whether or not such money or thing is derived from the entrance money of the members of such scheme or periodical subscriptions;
- Sec.3: Banning of Prize Chits and Money Circulation Scheme or enrolment as members or participation herein : - No person shll promote or conduct any prize Chit or Money Circulation scheme, or enroll as a member to any such chit or scheme or participate in it otherwise, or receive or remit any money in pursuance of such chit or scheme”
- Sec.10: Offences under this Act to be cognizable: - All offences punishable under this Act shall be cognizable”.
Amway was held by the District Consumer Forum, Vijayawada
It was held that Amway India had adopted unfair trade practice in publishing and selling their products. The District Forum directed the Amway India to remove the adulterated and misbranded products from the market and not to indulge in such unfair trade practices in future. It was further directed to issue a corrective advertisement regarding the products, which are misbranded and misstated. Exemplary damages of Rupees 1,00,000/- was imposed on them to be deposited in the Consumer Welfare Fund and Rs. 2,000/- as cost to be paid to the Consumer Education Society.Consumer Guidance Society v. Amway India Enterprises, C.C. 140 of 2007, decided on 16th day of October, 2007.
Saturday, August 29, 2009
RBI Cautions against the illegal Money Circulation Schemes in different forms
RBI Circular about "illegal Money Circulation Schemes"."As you may be aware, fictitious lottery and money circulation schemes aimed at
defrauding members of the public have come to light from time to time. It is clarified that remittances in any form towards participation in lottery schemes is prohibited under Foreign Exchange Management Act, 1999. Further, these restrictions are also applicable to remittances for participation in lottery-like schemes functioning under different names, such as money circulation scheme or remittances for the purpose of securing prize money/awards etc. We invite a reference in this connection to a Press Release on the subject dated December 7, 2007 issued by the Reserve Bank of India (copy enclosed). You are advised to bring the contents of the press release to the notice of your customers".
Full Text : http://www.rbi.org.in/Commonman/English/scripts/Notification.aspx?Id=372
Consumer success against Courier company for deficiency in delivery of goods
The Rayachur district consumer forum of Karnataka State has held against the Professional couriers for its deficiency in service of delivery of articles. The forum fined the courier company Rs.50,000/- for its deficiency. Kindly go through the article in Telugu.
You can visit the same on line at : http://epaper.eenadu.net/svww_zoomart.php?Artname=20090830a_008101009&ileft=745&itop=579&zoomRatio=130&AN=20090830a_008101009
Friday, August 14, 2009
Recent Judgement of Supreme court against Money Circulation Schemes
Recently the Hon’ble Supreme Court of India has held in KURIACHAN CHACKO AND OTHERS .Versus STATE OF KERALA which was reported vide (2008)8 SCC 708 about the Money Circulation Schemes as explained U/s.2(c) of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, the extracts of the relevant paragraphs of the judgment is as follows- Para No.36. In our opinion, the requirement of law is "an event or contingency relative or applicable to the enrolment of members into the scheme" and nothing more. The plain language of the section does not insist that such enrolment of members must be by the members already enrolled. It is impossible to read into the statutory provision such requirement which is not stipulated by Parliament. Upholding of the argument of the learned counsel would result in rewriting of the section, which is certainly not permissible in our constitutional system.
- Para No.37. The event or contingency on the happening of which the amount would become payable must be relative or applicable to the enrolment of the members into the Scheme. It is immaterial by whom such members are enrolled. It may be by members, by promoters or their agents or by gullible sections of the society suo motu (by themselves). The sole consideration is that payment of money must be dependent on an event or contingency relative or applicable to the enrolment of more persons into the Scheme, nothing more, though nothing less. In the present case, the second ingredient is very much present.
- Para No.41. The High Court also upheld the argument of the prosecution that the Scheme was a '"mathematical impossibility". The promoters of the Scheme very well knew that it is certain that the Scheme was impracticable and unworkable making tall promises which the makers of the promises knew truly well that it could not work successfully. It could work for some time in that "Paul can be robbed to pay Peter" but ultimately when there is a large mass of Peters, they will be left in the lurch without any remedy as they would by then have been deceived and deprived of their money.
Full Judgement is available on the website of Supreme Court of India :
Public Interest Litigation Against Amway and its camouflaged advertisements
An N.G.O. by name 'Corporate Frauds Watch Society' has filed a Public Interest Litigation against the Amway and its camouflaged advertisement in the Hon'ble High Court of A.P. vide WP No.11381 of 2009 with a request to stop campaigning its camouflaged advertisements till the disposal of a criminal case pending in the Nampalli Criminal Courts vide CC No.125 of 2008 in Cr.No.10/2006 U/s.420,385 IPC and Sec.4,5 and 6 r/w 2(c), 3 of The Prize Chits and Money Circulation Schemes (Banning) Act, 1978 of C.I.D. P.S., Hyderabad, A.P.High Court of AP website for case status:http://hc.ap.nic.in/pls/lobis/caseno
Indian Express : 03/07/2009
A division bench comprising Chief Justice Anil RDave and Justice Ramesh Ranganathan of the High Court on Thursday refused to issue notices to media houses for carrying advertisements of AmwayThe bench was dealing with a petition filed by a voluntary organisation, Corporate Frauds WatchThe petitioner asked the court to direct the government to stop Amway from doing its business which it alleged was “illegal” in nature. The court issued notices to the CID and Amway asking them to explain their behaviourThe petitioner told the court that Amway was releasing several advertisements in both print and electronic media despite a clear judgement from the AP High Court and later from the Supreme Court to ban its business.
Link: http://www.dc-epaper.com/DC/DCH/2009/07/03/ArticleHtmls/03_07_2009_004_009.shtml
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