Ceylinco Shriram payment plan to be expedited on Supreme Court order
The Ceylinco Shriram Company’s payment plan for depositors is to be expedited on a directive issued by the Supreme Court last week.
Chief Justice Mohan Peiris on Tuesday directed all relevant parties involved in the Ceylinco Shriram case to extend their fullest support to settle the money of disgruntled depositors within a short period of time.
He said that this case should not be allowed to drag on for several years
The Watawala Committee earlier appointed by the court to implement the payment plan noted that a sum of Rs 700 million is yet to be recovered from the loan given to Celestial Residencies project.
This payment is of vital importance to complete the payment plan so that all depositors will receive 60 per cent of the deposits, the committee said.
The Celestial Residencies project was taken over by the government of Sri Lanka under the Revival of Underperforming Enterprises or Underutilised Assets Act no 43 of 2011. At the time, the Watawala Committee received an offer to the value of US$60 million (about Rs 7.8 billion) and after settlement of liabilities of the project this would have enabled to settle the entire 100 per cent due to all investors, the committee revealed.
This iconic property of the failed Ceylinco Group would have to be sold to pay back depositors of crisis hit Ceylinco Group. The re-payment process has been delayed due to this reason, the committee said.
Ceylinco Shriram has already settled 84.5 per cent of the depositors numbering 4,928 with a total sum of Rs 2.6 billion. Five installment payments have been made and completed on 22nd October 2013 including a payment of Rs 1.1 million per depositor or 60 per cent of the deposit outstanding whichever is lower, the Watawala committee said.
With the collapse of Golden Key Credit Card Company Ltd in 2008 and its consequent impact on the Ceylinco Group, Ceylinco Shriram Company with a 12 year track record was unable to meet the customer liabilities in 2009 amounting to Rs. 6.8 billion representing 5,978 investors.
Ceylinco Shriram Company appointed Wealth Lanka Management to prepare a Payment Plan in 2009 in order to settle the customer liabilities.
On the orders made by the Supreme Court, the Central Bank evaluated and approved the payment plan in 2010, and court appointed the Watawala Committee to assist in the payment plan
The court has, from time to time based on the availability of funds given orders for the implementation of the payment plan in stages as per the reports filed by the Watawala Committee .