Feb 13 (Reuters) - India's capital markets regulator ordered
a freeze on the assets and bank accounts of two Sahara Group
companies, saying they failed to heed a Supreme Court order to
repay billions of dollars collected from investors in outlawed
The orders posted late on Wednesday by the Securities and
Exchange Board of India (SEBI) escalated a battle between the
regulator and unlisted Sahara, one of India's biggest business
groups and a household name in the country through its
sponsorship of the national cricket team.
SEBI also ordered a freeze on all bank accounts and
properties in the name of the Sahara Group founder, Subrata Roy,
and three other directors of the two firms, according to two
separate orders posted on the regulator's website.
A Sahara group spokesman had no immediate comment when
reached by Reuters.
Sahara owns the Grosvenor House hotel in London and last
year struck a deal to buy the Plaza Hotel in New York.
Sahara was ordered in August to repay sums raised by what
the court called "dubious" means from nearly 30 million small
investors, with 15 percent interest a year.
The Supreme Court in December had ordered Sahara to pay an
initial deposit of 51.2 billion rupees ($950 million) with SEBI
and pay 100 billion rupees in the first week of January and the
remainder in the first week of February.
The two Sahara firms raised a total of 257.8 billion rupees
in the outlawed bonds as of April 2011, according to Sahara
court affidavits cited by SEBI. The companies have argued that
only 26.2 billion rupees of that amount remains to be refunded
as they have repaid the remainder, SEBI said on Wednesday, an
assertion the regulator disputes.
The SEBI statement said its order will be implemented with
immediate effect and that India's central bank and the finance
ministry's Enforcement Directorate would be informed about the
The two Sahara group companies were asked by SEBI to give
details of any investment other than those mentioned in the
order within 21 days, said the order on the regulator's website.
(Reporting by Devidutta Tripathy in NEW DELHI and Sumeet
Chatterjee in MUMBAI; Editing by Tony Munroe/Mark Heinrich)