New Delhi: The prolonged legal battle between the Sahara Group and the Securities and Exchange Board of India (SEBI) encountered a significant turn when the Supreme Court of India instructed the Sahara Group to submit property deeds valued at Rs 20,000 to the market regulator.
Supreme Court directs the Sahara Group to pay deeds in three weeks
The apex judicial authority expressed its distrust towards the Sahara Group, stating that the company is engaged in excessive evasive tactics. As per the Court's ruling, if the Sahara Group fails to provide the deeds within three weeks, Subrata Roy and other executives will be prohibited from leaving the country without prior consent.
The Sahara Group must transfer the property documents to SEBI by November 11, with the Supreme Court scheduled to reconvene for this case on November 20. Previously, the Court had urged both Sahara and SEBI to devise a strategy for reimbursing Rs 19,000 crore to the investors.
In earlier proceedings, two Sahara Group companies—Sahara India Real Estate Corp Ltd and Sahara India Housing Investment Corp Ltd—had raised approximately Rs 24,000 crore via convertible debentures (OFCDs), in contravention of public issue regulations. OFCDs refer to company bonds that can be converted into equity shares.
Although the Sahara Group had consented to utilize its real estate assets as security, SEBI expressed skepticism regarding the worth of these assets. Consequently, SEBI insisted that the group sell its properties to facilitate payback to investors.
Last August, the Supreme Court mandated the Group to return Rs 24,000 crore to investors, plus an interest rate of 5 percent annually, within a span of three months. This directive was issued while the Court examined a petition filed by SEBI against the Sahara housing entities and their directors for their failure to timely refund investors' funds.