Attachment of properties on default of return of deposits & power of special court regarding attachment.

(1) Where the competent authority is satisfied, (i) Upon complaints received from depositors or otherwise, that any financial establishment has fraudulently defaulted. (ii) That any financial establishment is acting in a calculated manner with an intention to defraud the depositors and such financial establishment is not likely to return the deposits, the competent authority may, in order to protect the interests of the depositors of such financial establishment, pass an ad-interim order attaching the money or other property alleged to have been procured either in the name of the financial establishment or in the name of any other person or establishment, or if it appears that such money or other property is not available for attachment or not sufficient for repayment of the deposits, such other property of the said financial establishment or the promoter, partner, director, manager or member of the said financial establishment, as the competent authority may think fit and publish the order in local newspaper of the area. (2) The competent authority shall apply within fifteen days from the date of the order to the special court for making the ad-interim order or attachment absolute. (3) The competent authority may also make an application to any special court or designated court or any other judicial forum established or constituted or entrusted with the powers by any other State Government for adjudicating any issue or subject pertaining to any money or assets of a financial establishment under any similar enactment in respect of money or property or assets belonging to or ostensibly belonging to a financial establishment or any person notified under the Act situated within the territorial jurisdiction of that special court or designated court or any other judicial forum as the case may be, for passing appropriate orders to give effect to the provisions of the Act. (4) Upon receipt of an application under subsection (2) of section (7), the special court shall issue show cause notice accompanied by copy of application filed by the competent authority to the financial establishment or any other person whose property is attached that why the order of attachment should not be made absolute. (5) Any person having any interest or claim in the property attached under sub-section (1) may apply to the special court within 45 days of the order of attachment for their claim. after receiving the application/objection the special court shall, after giving an opportunity of being heard to the applicants and the competent authority, may make such order as deem fit. (6) For hearing of application/objection provision of the Code of Civil Procedure, 1908, shall be applicable. (7) If no cause is shown and no objections are made on or before the specified date, the special court shall forwith pass an order making the ad-interim order of attachment absolute. (8) The special court may at the time of passing the final order pass an order of attachment absolute or in part. In making such order the special court shall not release such part of property so attached as is necessary for repayment to depositors. (9) The special court may, on application by the competent authority, pass such order or issue such direction as may necessary for sale of property attached and for distribution among the depositors of the money realised from such sale. (10) Where an application is made by any person duly authorised or specified by any other State Government under similar enactment empowering him to exercise control over any money or property or assets attached by that State Government, the special court shall exercise all its powers, as if such an application were made under the Act and pass appropriate order or direction on such application, so as to give effect to the provisions of such enactment.