Heera Gold scam: Telangana HC fines Heera Group, its founder Nowhera Shaik ₹5 Cr for trying to stall property auction

Hyderabad: Telangana High Court has imposed a Rs 5 crore penalty on M/s Heera Group of Companies and its founder, Nowhera Shaik, for filing a misleading petition aimed at stalling the auction of properties attached in the Heera Gold scam.

Last-minute move to block auction rejected

The order was passed by Justice Nagesh Bheemapaka while dismissing Writ Petition No. 39108 of 2025, filed as a lunch motion to stop the auction of 59 immovable properties scheduled for December 26, 2025.

The court directed the petitioners to deposit the cost amount with the Prime Minister’s Relief Fund within eight weeks from the date of the order.

Challenge to ED-led auction

The Heera Group had questioned the auction process initiated by the Enforcement Directorate (ED) and conducted through the Metal Scrap Trade Corporation (MSTC), which functions under the administrative control of the Ministry of Steel.

The petition alleged that the auction was illegal, arbitrary, and violative of principles of natural justice.

Claims on undervaluation

The petitioners contended that the reserve prices fixed for the properties were far below market value and argued that the process was inconsistent with the Supreme Court’s directions issued on March 5, 2025.

Appearing for the petitioners, senior counsel Samala Ravendar sought cancellation of the auction catalogue, claiming that the valuation of the 59 properties was unfair and misleading.

Court: Issues already settled by Supreme Court

Rejecting the arguments, Justice Bheemapaka observed that the Supreme Court had already examined the matter and expressly permitted the ED to proceed with the auction of the Heera Group’s properties.

The High Court held that raising identical issues again amounted to an attempt to mislead both the High Court and the apex court.

‘Abuse of process of law’

The court took strong exception to the conduct of the petitioners, terming the litigation an abuse of the process of law and a deliberate effort to delay recovery proceedings.

It noted that the auction was part of a larger exercise to restore money to thousands of investors allegedly cheated in the multi-crore Heera Gold investment scam.

Exemplary costs imposed

In a rare and punitive measure, the court imposed exemplary costs of Rs 5 crore as a penalty jointly on M/s Heera Group and Nowhera Shaik for wasting judicial time and attempting to obstruct lawful proceedings.

Auction to proceed as scheduled

With the dismissal of the writ petition, the court cleared the way for the MSTC auction to go ahead as scheduled on December 26, between 11 am and 3 pm, under the Prevention of Money Laundering Act.