Unlike its earlier order that imposed severe time restrictions on Sahara, the apex court today gave the Subrata Roy-led Sahara Group time till February to repay Rs24,000 crore it had raised from investors through bond sales plus an interest of 15% on the amount. This order is quite different in spirit from the earlier order
Giving more time to the Sahara Group, the Supreme Court on Wednesday asked Sahara India Real Estate Corporation (SIRECL) and Sahara Housing Investment Corporation (SHICL) to refund Rs24,000 crore of investor's money by February next year.
A bench headed by Chief Justice Altamas Kabir asked Sahara India Real Estate Corp and Sahara Housing Investment Corp to deposit first demand draft of Rs5,120 crore immediately with market regulator Securities and Exchange Board of India (SEBI) and the balance in two instalments.
The apex court told the Sahara Group to pay first instalment of Rs10,000 crore by first week of January and remaining by first week of February. The amount will have to be paid by the Sahara Group with 15% interest as per the 31st August directive, the Supreme Court said.
Yesterday, the Sahara Group was given one more day by the apex court to spell out when it would return Rs27,000 crore invested by people in its group companies.
Chief Justice Kabir had come down heavily on the companies for not implementing the apex court's order and said they are not entitled to a hearing, but finally agreed to hear Sahara's plea saying he is more concerned about investors’ money.
On Monday, the apex court rapped the Sahara Group for not refunding Rs27,000 crore to investors, saying its every step was “very shaky” and questioned its ‘unjustifiable’ conduct against the interest of the common investors.
Last week, the Sahara Group, through newspaper ads claimed that from 1978 to 30 September 2012, it received/raised Rs2.25 lakh crore from the public. The company claimed that so far it repaid Rs1.7 lakh crore to its 14.7 crore investors and as on September end has a net outstanding liability of Rs54,364 crore.
Market regulator SEBI had insisted that strong action be taken against the Group's companies and said that it has also filed a contempt petition against them.
The court was hearing the Sahara Group's plea against the order of Securities Appellate Tribunal (SAT) which had dismissed its petition against market regulator SEBI in a case involving refund of about Rs24,000 crore with interest to about three crore investors.
In their appeal before the SAT, two Sahara Group companies had sought the Tribunal's intervention in refund of investors' money and had accused the market regulator SEBI of wrongly charging them of non-compliance with a Supreme Court order in that regard.
The Tribunal, however, had said that any further direction in the case could be sought and granted by the Supreme Court alone and dismissed the appeal.
The apex court had asked SIRECL and SHICL to refund an estimated Rs27,000 crore with an annual interest of 15%.
Earlier, the court had asked the companies to furnish the documents related to these investors to SEBI within 10 days and refund the money within three months, failing which the regulator was asked to freeze the accounts and attach properties of the two companies.
In a statement sent through PR Agency- BNK24x7, Satish Kishanchandani, Counsel for Sahara stated, "Sahara had offered to pay the amount payable to the outstanding OFCDs holders. Sahara had kept two Pay Orders ready. As per the certificate of the statutory auditor, the outstanding liability of both the companies towards the outstanding OFCDs is Rs2620 crore only as on 30 November 2012. On 30th November, Sahara offered pay orders of Rs2,620 crore and also a buffer amount of Rs2,500 crore subject to certain verification of some pending/continuing at company's end."
"However, the Supreme Court directed that Sahara should pay Rs17,400 crore along with interest as stated in the Order. Today, Sahara was ready to offer Bank Guarantee of Rs14,780 crore so that this amount plus Rs2,620 crore would become Rs17,400 crore. Pay Orders for about Rs5,120 crore should be paid to SEBI and the remaining amount be paid in two instalments Rs10,000 crore in the first week of January 2013 and the remaining amount in the first week of February 2013. As Sahara has already redeemed OFCDs, SEBI is required to return the excess amount if any, to Sahara after payments to the outstanding OFCD holders. Till the time the said amounts are repaid to Sahara as aforesaid to that extent there would be double payment," the release said.