Winding up RNBC not a blow: Sahara

Group says winding up of parabanking arm was as per mutual agreement with RBI

The Sahara group on Tuesday said the winding up of its parabanking arm was in line with its agreement with the Reserve Bank of India (RBI) in 2008 and was not a blow as being reported.

"It is in pursuance of this mutually decided upon arrangement and as per the wish of Sahara that the RBI has cancelled this licence and therefore is not at all any kind of blow, etc, to Sahara in any manner, as is being mentioned by some," the group said in a statement.

In 2008, RBI had issued an order to wind up Sahara India Financial Corporation Ltd (SIFCL). The group moved the Supreme Court, which then directed RBI to give a hearing to Sahara. "In pursuance of this, SIFCL and RBI, in a series of meetings in a mutually accepted manner decided a sunset period for the NBFC business of SIFCL whereby, from 2011, SIFCL was to stop taking fresh deposits and return the erstwhile deposits and eventually, in 2015 close the NBFC," the statement said.

The statement further said the Sebi order to close Sahara Mutual Fund did not have any major consequences on the group.

"The actual reason behind Sebi's action is that Sebi has asked to change the sponsor company in which Shri Subrata Roy Saharaji was there. Sebi can only explain the basis of their decision to do so. However, Sahara is in the process of doing the needful as Sebi has directed," the statement added.

The group said that it "stands on strong foundations which are evident from its un-withered standing even during the current constraints."

"Sahara will overcome this momentary constraint once its bank accounts and properties are de-freezed by the Hon'ble SupremeCourt and our Chairman's judicial custody is recalled," the statement added.