SAT asks Sahara firm, ex-directors to deposit Rs.2,000 cr with SEBI
The Securities Appellate Tribunal (SAT) on Thursday ordered Sahara group firm Sahara India Commercial Corporation Ltd (SICCL) and its then directors including Subrata Roy to deposit Rs.2,000 crore with SEBI (Securities and Exchange Board of India) within four weeks. The fund will be kept by market regulator SEBI in an escrow account. Following the deposit of the amount, the attachment order against the company and its directors would be lifted, SAT said in an order.
“We direct the appellant No.1 Sahara India Commercial Corporation Ltd. And appellant no.2 Sahara India…To provide a full inventory of all the assets and properties and details of all the bank accounts in India and abroad, Demat accounts, and holding of mutual funds/ shares/ securities (in physical or in Demat form) to SEBI within four weeks,” SAT said. The Tribunal further said such details would be provided in an affidavit to be sworn by Sahara Group chief Subrata Roy.
Considering old age and medical exigencies of the company’s then directors A S Rao and Ranoj Das Gupta, the Tribunal directed withdrawing attachment orders issued against them. The present appeal has been filed against a SEBI order passed in October 2018, whereby Sahara India Commercial Corporation Ltd (SICCL) and its then directors were asked to refund Rs.14,000 crore collected by the company through issuance of Optionally Fully Convertible Debentures (OFCDs) along with 15 percent annual interest. The funds were raised without complying with the regulatory norms.
The order by SAT had also barred SICCL as well as its then directors and associated entities from the markets and from associating with any public entity. The case relates to the collection of funds between 1998 and 2009 from nearly 2 crore investors through the issuance of certain bonds. In March 2014, Supreme Court ordered the arrest of Subrata Roy and got bail only in November 2016. During his more than two years jail stay, Sahara Group had deposited more than Rs.22,000 crore.[1]
In April 2021, SEBI’s recovery officer issued a notice of demand directing the appellants (the company and its then directors) to deposit a sum of Rs.14,106 crore within 15 days failing which recovery would be made. Since no amount was paid, the recovery officer issued an attachment order in October 2021 directing the banks to attach the bank accounts and Demat accounts, among others, of the appellants.
References:
[1] SEBI wants Subrata Roy to pay Rs 62,600 cr dues immediately, sent back to jail if he fails – Nov 20, 2020, The Print
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