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Supreme Court refuses to give Sahara more time to deposit Rs 24,000 crore with SEBI

Source : ANI
Last Updated: Mon, Feb 25, 2013 14:01 hrs

New Delhi: The Supreme Court on Monday rejected the Sahara Group's plea to extend the deadline for depositing money with the Securties and Exchange Board of India (SEBI).

Dismissing the Sahara Group's petition, the apex court bench headed by Chief Justice Altamas Kabir said the latter has been given sufficient time to deposit the money.

It maybe recalled that the Sahara Group was ordered in August last year to repay the amount raised by what the Supreme Court called "dubious means" from nearly three crore small investors.

The court then said that the amount that should be deposited with SEBI would include a 15 per cent interest.

The two Sahara firms raised a total of Rs. 2,578 crore in bonds as of April 2011, according to Sahara court affidavits cited by SEBI. In December, the court ordered Sahara to make an initial deposit of Rs. 5,120 crore and another Rs. 10,000 crore in the first week of January 2012 and the remainder in the first week of February with SEBI.

Monday's hearing took an interesting turn when M.N. Krishnamani, the president of the Supreme Court Bar Association, told Chief Justice Kabir that it should not hear the case and that the case should instead be sent to the bench which had directed the company to pay around Rs 24,000 crore to SEBI.

A clearly upset Chief Justice told Krishnamani, "What do you know about this petition? Without knowing even a word how can you say this?"

Krishnamani said he wanted to caution the bench, to which the Chief Justice of India retorted, "We do not need your caution. Please wait for our orders."

SEBI ordered a freeze on the assets and bank accounts of two Sahara group companies on February 13, saying they had failed to heed the Supreme Court order to repay investors.

According to media reports, more than 100 bank accounts of the group were affected by the order. The market regulator 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, Sahara Housing Investment Corporation and Sahara India Real Estate Corporation, according to two separate orders posted on the regulator's website.

The orders escalated the battle between the regulator and the unlisted Sahara. In a statement issued after the SEBI order, Sahara said the directives were based on "old facts" and had not taken into account redemptions it has made since January 2012, adding that its total liability was unlikely to exceed the Rs. 5,120 crore it had deposited with the regulator. It added that the orders for attaching assets of individuals are "incorrect".

The group also ran a major advertisement campaign in newspapers claiming that "Sahara has nothing to pay (and) rather Sahara shall soon be eligible to take a big refund from Sebi", and that it was submitting to Sebi the provisional balance sheets of two companies as on December 31, 2012, for more clarity on the matter.

On Friday, SEBI cautioned investors and general public against transacting with the Sahara companies or persons associated with these companies. "Anyone transacting with them (Sahara India Real Estate Corp, Sahara Housing Investment Corp and their three promoters and directors) would be doing so at their own peril," it said. 



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