Roy's wait continues as Sebi, I-T add riders

Income tax department wants claims of Rs 8,000 cr to be protected; Sebi wants bank guarantee be linked to full payment

Fresh hurdles cropped up for Sahara chief Subrata Roy on the way to freedom from Tihar jail, as the Securities and Exchange Board of India (Sebi) and the income tax (I-T) department urged the Supreme Court for safeguards to ensure recovery of all their dues before releasing him on bail.

The court reserved its order after asking the Sahara counsel if he would be ready to give a scheme “howsoever broad it may be” to deposit the total dues, which, according to Sebi, has swelled to at least Rs 39,000 crore, along with interest.

The Bench headed by T S Thakur said it was keen on linking the trigger point of encashing the Rs 5,000-crore bank guarantee to the payment of the larger dues. “We would like this aspect to be held at this stage… so that we give a clear road map,” Thakur said. The Sahara chief is in the process of giving a Rs 5,000-crore bank guarantee and an equal cash amount to secure bail. He has been lodged in the jail since March 2014. Sahara has so far paid Rs 3,827 crore in cash towards the bail.

The I-T department also expressed concern about recovering claims of Rs 7,594crore and interest of Rs 382 crore,  upheld by the I-T appellate tribunal. “Not to talk of the penalty, which can go from 100 per cent to 300 per cent,” the department’s counsel said. The counsel intervened when Sahara counsel Kapil Sibal was seeking the court’s permission to sell the 72 properties attached by a Sebi order.

“If these properties are sold off to pay Sebi and investors, what happens to the sovereign demand?” the IT department counsel asked the court.

Earlier, Sebi counsel Arvind Datar demonstrated how the apex court had rejected the theory of refunds. “Not once, but four times,” Datar said, reading out paragraphs from earlier order that discussed the Sahara claims in detail.

Sahara lawyers Sibal, Rajeev Dhavan and S Ganesh made several attempts to impress upon the court to hear arguments on the refunds. But, the court was convinced its earlier orders had clearly rejected the Sahara argument that substantial portion of the dues to the 29 million investors have been refunded directly. Thakur said the court had “totally debunked the theory” as a “pack of lies.” He added “We are not in a position to review the judgment. We are only enforcing it.”

He also said the court order would direct Roy to surrender back to custody, if he defaulted on payment of the entire dues.

The bench then asked Sibal to give a timeline on how long it would take for the group to pay back the entire dues. Sibal said, "The client has to come out. We will prepare a scheme and come back to you."

When the bench was not impressed, Sibal pleaded that Roy be released for a period of six weeks so as to enable him to sew up a scheme for repayment of the dues. He also explained to the court how difficult it was to sell properties for a person lodged in the jail.

The apex court sent Roy to jail after the group?s repeated failure to comply with its August 2012 order that directed two group companies to deposit Rs 24,029 crore raised from over 29 million investors, along with an interest of 15 per cent per annum. In November 2012, Sahara deposited Rs 5,120 crore and claimed that the remaining amount was directly refunded to the investors.