In Brief
Two art investment trusts (Yatra Art Fund I and II), established under the Indian Trusts Act, 1882, collected principal amounts of Rs. 10.95 crores and Rs. 21.92 crores respectively from 50 and 132 investors. SEBI ordered them to register as collective investment schemes or refund investor monies. The Supreme Court held that any scheme pooling funds for investment returns with investor non-control constitutes a collective investment scheme, regardless of legal structure (trust or otherwise), and can only be lawfully operated as a registered Collective Investment Management Company. The Court ordered repayment of remaining principal within six months and interest at 10% per annum within nine months, with compliance reports to SEBI."
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