Stringent measures, including seizure and confiscation of property, have been proposed to protect investors from money spooling companies in the much-awaited bill being moved by the West Bengal government following the Saradha Group scam.

Copies of the bill, to be moved by Finance Minister Amit Mitra on Tuesday for consideration and passage, were circulated among members on the first day of a two-day special session of the Assembly today.

The West Bengal Protection of Interest of Depositors in Financial Establishments Bill, 2013, has provisions for powers to enter premises and inspect documents and search and seizure and confiscation of property.

Though Parliamentary Affairs Minister Partha Chatterjee had on Sunday said the bill will have retrospective effect, the word ‘retrospective’ is not used in the bill.

But the bill says that a designated court which will look into these issues “may give direction to the competitive authority like the director of Economic Offences, for effective implementation of the provisions, sources said.

The bill has been framed to protect depositor interest, to regulate and to impose restrictions on such financial establishments to curb unscrupulous activities and to make liable every person, including promoter, partner, director, manager and employee, responsible for the management.

The competent authority shall, after making an assessment of the deposit liabilities, apply before the designated court from time to time seeking permission for making payment to depositors from out of the money realised.

The designated court shall be presided by a judge to be appointed by the state government with concurrence of the chief justice of the Calcutta High Court.

The earlier West Bengal Protection of Depositors Interest Bill 2009 introduced by the previous Left Front government on December 22, 2009 will be withdrawn.

Taking note of mushrooming of financial establishments in the state in the recent past, the bill says it is observed that such establishments have been gaining wrongfully by receiving money as deposits from the public, particularly of the middle class and poorer sections of the society.

These financial establishments, it said, did this by making impracticable or commercially not viable promises or by offering highly attractive rates of interest or rewards, with the intention of not fulfilling the obligation of refunding the deposits on maturity or with intention of not rendering proper services assured, to the investors at the time of accepting the deposits.

It said that such fraudulent defaults in payments by financial establishments has been causing great resentment and uproar among the public, which in turn, is responsible for creating various law and order problems, besides causing many cases of human tragedies.

Government Chief Whip Sobhandev Chattopadhyay said there will be a three-hour discussion on the bill. Mr Chatterjee will move a motion for adoption by the House for withdrawal of the previous bill.

Nothing new in the bill: Surya Kanta Mishra

Senior CPI(M) leader Surya Kanta Mishra questioned why a new bill was being introduced to protect interests of depositors in chitfunds when it was similar to the bill passed by the previous Left government.

“There is 90 per cent similarity between the two bills. Then what is the need for this new bill needs to clarified. Why is the old bill being called back?” asked Mr. Mishra, the Leader of the Opposition.

Mr. Mishra also took a dig at the chief minister’s statement that her government was unaware of chit funds operating in the state before April 15.

“The chief Minister and the Saradha Group were like a family. The CM was seen inaugurating many newspapers and channels of this group,” Mr. Mishra said.

Echoing the same sentiments, Congress leader Manas Bhuinya, said 98 per cent of the contents of the new bill has provisions of the previous bill. “If implemented the bill will have no power to punish offenders,” he said.