Supreme Court Grants Sahara More Time to Pay Fine
The Supreme Court has provided Sahara Real Estate Firms with a measure of relief by granting them additional time to settle their outstanding fine. The apex court directed the Securities and Exchange Board of India (SEBI), which serves as the market regulator, to consider Sahara's application for an extension.
Background of the Order
Sahara Real Estate Firms were previously mandated to reimburse funds raised through debentures, impacting approximately 3 crore investors who had invested in these firms.
Non-Compliance with Initial Order
Notably, Sahara Real Estate Firms failed to comply with the Supreme Court's initial directive issued on August 31. This order required the firms to remit ₹17,400 crore, along with a 15% interest charge.
Terms of the Payment Extension
- Initial Deposit: The Supreme Court bench, led by Chief Justice Altamas Kabir, instructed the Real Estate Firms to promptly deposit ₹5,120 crore. Justices J. Chelameswar and S.S. Nijjar were also on the bench.
- Installment Payments: Sahara Group companies, including Sahara India Real Estate Corporation and Sahara Housing Investment Corporation, must deposit the remaining sum in two installments.
- The first installment of ₹10,000 crore was due in the first week of January.
- The second installment was scheduled for the first week of February.
- SEBI's Authority: SEBI is authorized to seize Sahara's accounts if they fail to meet the January 2013 deadline.
Sahara's Defense
Gopal Subramaniam, representing Sahara companies, informed the Supreme Court that the firms had already repaid some early investors. He maintained that this amount should be deducted from the total fine.
The Supreme Court instructed the firms to submit relevant documentation to SEBI within a couple of weeks.
Rejection of SEBI's Appeal
The court dismissed SEBI's appeal to recall the modifications made by the judges. Vikas Singh, representing one of the Sahara companies, stated that the court's order was intended to protect investors' interests.
Initial Findings
The Supreme Court's August 31 order stemmed from findings that Sahara companies had raised funds through OFCDs, with some investors deemed to be non-genuine. Subsequently, the court ordered the firms to refund the amounts to the investors.
Dance time comes back to Sahara