Heera Group gold case: HC dismisses writ; auction to proceed

Hyderabad: The Telangana High Court on Friday dealt a significant setback to M/s Heera Group of companies Pvt Ltd and its founder-director Nowhera Shaik, in connection with the proceedings arising out of the gGroup case. A review application filed by the company and its director seeking to set aside the exemplary costs imposed by the court was taken up by Justice Nagesh Bheemapaka, who heard the interim plea and adjourned the case for orders.

On Thursday the court had dismissed a last-minute writ filed by the group and Shaik challenging the proposed auction of attached properties and imposed costs of Rs 5 crore, taking a stern view of the litigation.

The court found the attempt to stall the liquidation proceedings lacked merit and was aimed at obstructing the recovery process initiated for the benefit of investors allegedly defrauded in the multi-crore Heera Gold scam.

The petition was mentioned through a lunch motion seeking to stop the auction of 59 immovable properties scheduled to be conducted on December 26. The petitioner questioned the legality of the auction proceedings initiated by the Enforcement Directorate and conducted through Metal Scrap Trade Corporation Ltd, contending that the process was arbitrary, violated principles of natural justice and undervalued the properties. The writ alleged that the auction was contrary to the SC directions of March 5, 2025.

Appearing for the petitioner, counsel Samala Ravendar argued that the auction catalogue deserved to be cancelled as the reserve prices fixed were far below the prevailing market value of the properties.

The writ arrayed as respondents senior ED officials, Hyderabad, including the director, joint director and deputy director, along with MSTC Ltd, a public sector enterprise functioning under the administrative control of the Steel Ministry.

The bench declined to entertain the eleventh hour plea and observed that the auction formed part of a lawful process under the Prevention of Money Laundering Act for liquidation of attached assets and restitution to thousands of investors.

Terming the writ an abuse of judicial process, the court imposed costs of Rs 5 crore on the petitioner and observed that repeated attempts to derail recovery proceedings could not be countenanced, particularly in cases involving large-scale mobilisation of public money under the guise of high-return investment schemes.

With the dismissal of the writ, the cout cleared the way for the auction to proceed as scheduled on December 26 between 11 am and 3 pm, facilitating the continued liquidation of assets attached in connection with the Heera Gold case. The imposition of heavy costs was viewed as a strong judicial message against obstructive litigation in financial fraud cases, even as the outcome of the pending review petition is awaited; the broader recovery process for affected investors continues.