SC to hear Sebis plea against Sahara in Dec

Written by Indu Bhan | Indu Bhan | New Delhi | Updated: Nov 21 2012, 05:39am hrs
The Supreme Court has decided to hear in the first week of December market regulator Sebis petition seeking to initiate contempt proceedings against the Sahara Group companies and its managing director, Subrata Roy, for non-compliance of the apex courts directions, asking them to refund R24,000 crore raised from investors through optionally fully convertible debentures (OFCDs).

A Bench, headed by Justice KS Radhakrishnan, directed to list the contempt petition for hearing in December first week after Sebi counsel P Venugopal mentioned the matter for early hearing. In its contempt plea against the Sahara companies, Subrata Roy Sahara and directors Ashok Roy Choudhary, Ravi Shankar Dubey, Vandana Bhargava Sebi alleged that the companies were guilty of willful and deliberate violation and non-compliance of the apex courts judgment of August 31 that also asked them to furnish documents within 10 days to Sebi to ascertain the identity of investors who have invested in the OFCDs.

Meanwhile, the Sahara Group has moved the Securities Appellate Tribunal, seeking more time to submit the documents related to about 3 crore investors in the case involving its two group companies Sahara India Real Estate Corporation (now known as Sahara Commodity Services Corporation) and Sahara Housing Investment Corporation.

The companies have moved the tribunal, asking it to direct Sebi to allow them time till January 31 to submit the documents related to the case. The 10-day deadline set by the Supreme Court, in its order dated August 31, for the two entities to submit details of the concerned investors, has already expired.

The apex court on August 31 had asked the two Sahara Group entities to refund around R24,000 crore collected from investors under the scheme. To expedite the whole process of refund, the apex court had also asked the Sahara firms to furnish all documents, particularly the application forms submitted by the subscribers, the approval and allotment of bonds, and all other documents to Sebi within 10 days. However, Sebi said while it had initiated all the steps to comply with the August 31 directions, the Sahara Group firms have not only failed to comply with the directions, but have also indicated their clear intention not to do so.