Companies & Sectors
Can't pay Rs.36,000 crore in 18 months, Sahara tells SC
The Sahara Group on Tuesday told the Supreme Court that it was not possible for it to repay, in 18 months, Rs.36,000 crore of investors' money that it had collected in 2007-08 in 18 months as was ordered by the court on June 17.
 
"There is no business house in the country or in the world which can deposit Rs.36,000 crore in 18 months time," senior counsel Kapil Sibal, appearing for jailed Sahara chief Subrata Roy, told a bench of Justice T.S.Thakur, Justice Anil R.Dave and Justice A.K.Sikri.
 
He said that he was getting an application ready that would be moved in a week's time pointing to the difficulty in arranging Rs.36,000 crore to return the investors money.
 
His admission came as Justice Thakur asked him that suppose Sahara was not able to repay the entire amount.
 
At this, senior counsel Arvind Dattar, appearing for market regulator SEBI, told the court that Sahara had told in the past that it can and would return the investors money and it had the resources to do so.
 
In response, Sibal said: "If I have told the court that I can and I will pay but if I am not abler to (return) then I can be sent to jail."
 
The apex court had June 19 given Sahara's two companies - SIRECL and SHFCL - 18 months to repay the investors' money which they had collected in 2007-08 through OFCDs.
 
Subrata Roy and two directors of the Sahara group were sent to judicial custody for its failure to comply withy its August 31, 2012 and December 2012 order to return investors Rs.24,000 crore along with 15 percent interest. The total amount along with interest component now stands at Rs. 36,000 crore.
 
Telling the court that they stood on a stronger wicket asd far as their claim that they have already paid a substantial amount of investors money, Sibal told the court that the Income Tax Appellate Tribunal has accepted that two Sahara companies have already returned money of the 85 percent of the investors.
 
He said that thought its contention was not accepted by the Income Tax authorities but the same has found favour with the appellate tribunal.
 
As the court asked him that he had submitted all the documents to SEBI and which were the documents he was referring to, Sibal said that these were PAN card numbers showing TDS.
 
In the meanwhile, the court asked a Gorakhpur-based real estate developers to deposit a bank draft of Rs. 11 crores - 10 percent of Rs.110 crore that it has offered to pay for buying 54.71 acres of Sahara land in the eastern Uttar Pradesh town. The court said that the draft should be favouring secretary general, Supreme Court.
 
This is nearly double of Rs.65 crore that Sahara has told the court it was getting for the same land from another developer.
 
As Sahara objected to the offer saying that it would come in the way of the release of Subrata Roy from jail and it was about to get Rs.65 crore from the first buyer, the court asked the new buyer to deposit Rs.65 crore immediately and the remaining Rs.45 crore in three to four months.
 
As counsel appearing for the new buyer wanted time to take instructions, the court gave him time till Monday with a rider that he would deposit a demand draft of Rs. 11 crores by Wednesday to establish his bonafide.

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European Commission says Grexit cannot be ruled out
At the end of a Eurogroup summit, European Commission President Jean-Claude Juncker said Grexit cannot be ruled out though he does not want Greece to leave the Eurozone.
 
"Friday morning will be the last moment," Juncker said on Tuesday night, setting a deadline for the Greek government to present "credible and comprehensive" proposals to move forward, Xinhua reported.
 
The European Union has called a 28-member state summit on Sunday, signalling the bloc already has "a Grexit scenario prepared in detail".
 
We have a humanitarian plan if needed, he said.
 
"I am strongly against Grexit but I cannot prevent it if (the) Greek government does not do what is asked of it," Juncker told reporters.

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Eurogroup meeting ends fruitless, Greece insists it tabled proposals
An emergency Eurogroup meeting in Brussels on the Greek debt deal ended inconclusive on Tuesday, with lenders saying that they expected to discuss Greece's proposals on Wednesday during a Eurogroup teleconference.
 
The finance ministers of euro zone countries didn't receive new proposals they had expected from Greece on Tuesday, Eurogroup head Jeroen Dijsselbloem said after the crucial meeting.
 
"We welcome our new Greek colleague and listen to his assessment of situation after the 'no' vote in Greece," he said in a short statement, adding that there are no new proposals from new Greek Finance Minister Euclid Tsakalotos, Xinhua reported.
 
"The Greek government will send a new request letter for European Stability Mechanism (ESM) support, as soon as it comes in, I am hopeful that tomorrow morning we will have another conference call in the Eurogroup to formally start the process of dealing with the request," Dijsselbloem said.
 
He noted that the group will ask the European Union institutions to look at the financial situation in Greece.
 
"And then the institutions will come back to us, and we will see whether we can formally start the negotiations," he said.
 
However, Greek government sources dismissed the criticism, insisting that Greece's new Finance Minister Tsakalotos had in fact presented proposals.
 
"Is the problem that we do not have proposals, or that they do not like our proposals? " a government source asked, according to the Greek national news agency AMNA.
 
The Greek side stressed that Greece's proposals had been rejected again.
 
The statements from both sides were made as Greek Prime Minister Alexis Tsipras was holding a meeting with German Chancellor Angela Merkel and French President Francois Hollande in Brussels ahead of the extraordinary euro zone summit which convenes later on Tuesday on the Greek issue.
 
According to government sources in Athens, the Greek side is requesting a two-year, 29-billion-euro-worth ($32 billion) bailout programme through the ESM. 
 
Meanwhile, several European partners prefer a bridge agreement for a few months first in exchange for the swift implementation of reforms by the Greek side as a test before a comprehensive deal is discussed.
 
Officials and analysts from both sides warn that the situation is perilous. Greek banks are closed and capital controls have been imposed in Greece since June 29, ATMs are expected to run out of cash this week, and without emergency assistance, Greece seems to be heading to default and possibly an exit from the euro zone.
 
Since July 1, Greece has been in arrears to the International Monetary Fund and needs to repay 3.5 billion euros in loan installments to the European Central Bank by July 20. 
 
Earlier in the day, European Commission (EC) president Jean-Claude Juncker called on partners to put "egos" aside and return to the negotiation table to avoid a "Grexit".
 
"We have to put our little egos, and in my case very large ego, away and we have to deal with the situation we face," Juncker said.
 
The US urged "a compromise" between Athens and international creditors and suggested a package of reforms and financing.
 
"The referendum is over, but our view here at the White House remains the same... it will require both a package of financing and reforms that will allow Greece to achieve, or at least be on a path towards some debt sustainability, but also be on a path towards economic growth," White House spokesman Josh Earnest said.
 
French Prime Minister Manuel Valls warned that an eventual Grexit from the eurozone would put the economic recovery of the European bloc on edge and likely trigger political instability in the region. 
 
"France is convinced that we cannot take the risk of a Greek exit from the eurozone for economic reasons but mainly for political ones. It is Europe that is in question," the French premier told RTL radio.
 
Following the Eurogroup group meeting, a euro zone EU leaders emergency summit was underway in Brussels, Belgium, to find a way for an agreement between Athens and its creditors.

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