I would like to refer to the media reports on companies which have been defaulting payments due to fixed deposit investors. As per reports published in a renowned newspaper well known pharmaceutical company which despite Supreme Court order, has failed to produce refund proposal, putting its fixed deposit holders in a fix. The FD holders of this company cry foul over their lost monies. For instance, an FD holder says he had saved the money for his daughter’s wedding and fears he might not get it back. The investors feel the said company has swindled money. (Even the employees of this company have not been paid salaries for last several months and the firm has not even paid the statutory provident fund and TDS since March-2015). As the organisation has been unable to meet its financial commitments, over 20 winding up petitions have been filed by its vendors and distributors. So, it’s now the sad and pitiable cases of yet another category of “affected investors”: the fixed deposit investors that have come to light, of late!
In the Vijay Mallya case it was only the default on huge bank loans which was most focused, highlighted and debated upon. And yes, parallelly, the case of employees who were not paid their salaries for years, the Provident Fund remittance status and other pending taxes, were also highlighted. But….now we see yet another section of investors being literally deprived of their hard earned monies in investments i.e. the investors of “fixed deposit” amounts in various companies!
Gone are the days when we used to invest in Companies’ Fixed Deposits as the return was considered safe and good to meet any emergency (The post-dated cheques issued by the companies towards interest etc were duly honoured then) But…..today, it’s sad to note that several companies accept “fixed deposits” from many investor but fail to pay the “quarterly interest” amounts for months and years. Less said, about the principal amount which again remains unpaid for years the better!
I have known many investors who have been filing complaints to these companies. Many of them have even referred the case of “defaulting firms to Registrar of Companies (ROC) concerned Ministries, officials etc. However, no concrete action is being taken by these officials/departments against the defaulting companies. The investors are, by and large, retired persons, who have invested their hard earned money in these companies with the faith that the interest and the principal amount will come handy during emergencies. There are companies which do not even have the humanitarian approach towards these investors.
The worst part is that most of these companies do not have the communication culture and the redressal forum” to assure the investors of their money. The investors are thus left in the lurch to follow up repeatedly. I think it’s high time, the Finance Ministry and other departments like the Registrar of Companies, Company Law Board, Enforcement Directorate, Income Tax and so on must ask for due report of the companies who have been repeatedly defaulting in the payments of interest /principal amount and take stock of the money legitimately due to the investors. Else, the small time and poor investors will never get their lifetime savings, back.
(The views expressed by the author in the article are his/her own.)