SC breather for Sahara real estate firms
In a major relief to Sahara Group's two real estate companies, the Supreme Court Wednesday asked market regulator SEBI to accept their pay order of Rs.5,120 crore as part payment of the investors' money collected through debentures.
The apex court Aug 31 directed the Sahara companies to deposit Rs.17,400 crore with 15 percent interest with the Securities and Exchange Board of India (SEBI) within three months, which the company failed to do.
The apex court bench of Chief Justice Altamas Kabir, Justice S.S. Nijjar and Justice J. Chelameswar Wednesday said that besides depositing Rs.5,120 crore, the Sahara Group companies - the Sahara India Real Estate Corporation and Sahara Housing Investment Corporation - would deposit the remaining amount in two instalments.
The court said the Sahara companies would deposit a sum of Rs.10,000 crore in the first week of January next year and the balance amount in the first week of February.
If the company failed to pay the first instalment, the SEBI could seize their accounts and recover money in terms of the Aug 31 order, it said.
Senior counsel Gopal Subramaniam appearing for Sahara companies urged that the court should direct the market regulator to refund the excess money that would go to the SEBI in pursuance of the court's order.
Subramaniam told the court that the two Sahara companies had returned the money of the investors who had approached them earlier but the amount paid to them was still reflected in the court's order.
The court directed the companies to submit all the relevant documents to the market regulator within 15 days.
The court brushed aside SEBI's submission that the court should recall his objections that the Aug 31 order should have been modified by the judges who passed it.
"My objection should be recorded that the order (of Aug 31) should have been modified by the bench that had passed it," the SEBI counsel told the court.
Senior counsel Vikas Singh, who appeared for a group of investors, said the "court is passing the order in the guise of protecting the interest of investors and investors are not being heard".
That was not fair, he said.
The court Aug 31 directed the Sahara companies to return to investors Rs.17,400 crore with 15 percent interest that they had collected through optionally fully-convertible debentures (OFCD) in 2008 and 2009.