MUMBAI, April 21: Savings worth Rs 1 crore of nearly 100 small investors invested in the troubled Real Value Appliances (RVA) are locked up following the Mumbai High Court's orders to freeze the company's bank accounts.

The company, manufacturers of Ceasefire fire extinguishers and Vacuumizer cooking equipment, had channelised the funds through a single broker, Hiranand and Co. The hapless investors, including retired persons who stand to lose most of their savings, are knocking at the broker's door and the company to recover their money.

After waiting for months in vain, Kuldip Singh Sidana, former regional manager, Life Insurance Corporation of India who invested Rs 2 lakh with the company, has filed a suit to recover his dues. He had invested his money on the advice of Hiranand and Co. in February last year. The 15 per cent interest on the amount was paid to him at the time of investment.

In his petition Sidana stated that the company executed a promissory note in his favour for Rs 2 lakh, subsequently waived. In exchange a cheque for the said amount was issued in June 1996 which bounced when it was presented for payment. Later, Sidana and a representative of his broker held a meeting with the company officials who issued five post-dated cheques of Canara Bank for the months beginning February, 1997.

The company director Vinod Pandya had assured to pay a 21 per cent per annum interest from the date the debt was due. In return, the depositors agreed not to initiate any legal proceedings in respect of the cheques which bounced earlier.

However, the cheques for the five months of 1997 were returned by the petitioners' bank with the note `funds not arranged for' due to court order.

According to Girish Gangal, RVA General Manager (Taxation), the High Court had frozen its Canara Bank account temporarily due to the ongoing litigation.The company was asked by the court to open an account with UTI Bank with a proviso that funds be withdrawn only for the purpose of manufacturing and trading.

Suresh Nagpal, partner, Hiranand and Co., told Express Newsline that he is helping the investors in recovering their money. Over the past year, the broker has mediated settlements between the investors and the company.

Sidana said the broker and RVA's representatives had advised him to settle for Rs 60,000 or 30 per cent of his total investments, an offer he rejected.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.