Sebi’s crackdown on the two Sahara group firms—Sahara Housing Investment Corp (SHICL) and Sahara India Real Estate Corp (SIRECL)—comes exactly a week after the Supreme Court criticized the market regulator for delays in acting against these firms that had raised money from three crore investors and failed to refund Rs 24,000 crore along with 15% interest. Passing two separate orders, the market regulator said the two companies had raised Rs 6,380 crore and Rs 19,400 crore respectively from the public and committed “various illegalities” while raising these funds.
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Sahara case: Sebi asks banks to transfer money to refund a/c
Mumbai: “I direct the freezing of all the bank accounts, demat accounts of Subrata Roy Sahara, Vandana Bhargava, Ravi Shankar Dubey and Ashok Roy Choudhary with immediate effect. I further direct attachment of all movable and immovable properties standing in the names of …these individuals are restrained from alienating, disposing or in any manner encumbering the movable and immovable properties standing in their individual names,” said Sebi’s wholetime member Prashant Saran in the order.
Sebi directed them to furnish details of all these properties in their name within 21 days. Besides, Sebi also asked banks to transfer the amounts lying in those accounts to the Sebi-Sahara Refund Account. A copy of the order has been sent to the Reserve Bank of India and the Enforcement Directorate.
In a statement later, Sahara said that its total liability is not likely to exceed Rs 5,120 crore, which has already been deposited with Sebi. “Today’s order of Sebi for attachment of these assets is based on old facts and details of assets as of January, 2012. Since, then facts have changed in view of redemptions made by Sahara from time to time. This fact of redemption was known to Sebi. Hence, today’s order does not take into account the changed facts and circumstances,” it said. It further said that as per the SC order the the liability to refund the monies is of SIRECL and SHICL. “Hence, attachment, of assets of the individuals by Sebi is incorrect”, the statement said.
The purchase value of the attached properties at cost price is pegged at over Rs 20,000 crore, which would now be substantially higher. This includes the attachment of Sahara’s prized 1,020 acres of land in Amby Valley near Mumbai, bought for Rs 4,845 crore and 43% of equity shares of Aamby Valley Limited bought for Rs 6,443 crore. Besides, it also includes a 59% stake in the Versova project bought for Rs 3,327 crore, stakes in townships projects and various other land parcels across the country.
It may be recalled that apex court in its order on August 31, 2012, had asked Sebi to ascertain the genuineness of an estimated three crore bondholders of Optionally Fully Convertible Debentures (OFCDs) of the two Sahara group companies and thereafter facilitate refund of the money with interest. Following the court directive, Sebi decided to carry out in-person verification of these bondholders.
However, the court later allowed the Sahara group firms to refund the money in three instalments till the first week of February 2012. These included an immediate payment of Rs 5,120 crore, followed by an instalment of Rs 10,000 crore in the first week of January and the balance by the first week of February. In its orders on Wednesday, Sebi said that neither of the two instalments were paid and therefore it was forced to take action.
Sahara has claimed that only Rs 2,620 crore remains to be refunded to investors since it had already paid back Rs 19,400 crore. The two Sahara group firms had raised Rs 24,029 crore from investors by selling OFCDs between 2008 and 2011, which according to the market regulator was in violation of public-issue norms under the Companies Law and the Sebi Act.
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SEBI should rather come up with some appropriate mechanism to back their claims against Sahara. SEBI is just trying to malign the genuineness of the noble initiative conceptualized by Sahara group, the Bharat Bhawna Diwas. The Bharat Bhawna Diwas was absolutely inclined to one motto - By the nation, for the nation.
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