SC reserves order on Subrata Roy's plea for 40 days parole

The Supreme Court Friday reserved its order on the plea by Sahara Group chief Subrata Roy seeking the court's nod for selling its three overseas hotels to generate Rs.10,000 crore and for his release on 40 days parole to put through the international transaction.

Roy and two other directors Ravi Shankar Dubey and Ashok Roy Choudhary are currently under custody since March 4 for the failure of two group companies to comply with the apex court's Aug 31, 2012 and Dec 5, 2012, order to return investors' money, which in 2012, was Rs. 24,000 crores.

Two Sahara real estate and housing finance companies - Sahara India Real Estate Corporation Limited (SIRECL) and Sahara Housing Investment Corporation Limited (SHICL) - had collected the money from investors through optionally fully convertible debentures (OFCDs) in 2008 and 2009 that it has been asked to return through market regulator SEBI.

While reserving the order, a bench of Justice T.S.Thakur, Justice Anil R. Dave and Justice A.K.Sikri asked both Sahara and the market regulator to crystallise the issues that are pending before the court for adjudication.

The court asked the income tax department to file an affidavit, comprehensively stating the details of tax assessments made by it, action, if any, taken by it or proposed to be taken by it and the status of various cases rooted in OFCD transactions.

Giving the tax authorities two weeks time to file a comprehensive affidavit, the court pulled up the department for its impleadment application.

As Additional Solicitor General Tushar Mehta told the court that the tax department wanted to assist it, the court said that it did not need its assistance but wanted to know what action, if any, it has taken in the matter.

"What have you done so far? Did you take any action? You are an ornamental annexure to the proceeding. You want to intervene. There is a judgment and so many orders. You must stir out of your inaction," Justice Thakur said, admonishing the tax authorities.

The court also asked counsel both of Sahara and SEBI - Rajiv Dhawan and Arvind Dattar respectively - to speak to senior counsel Shekhar Naphade to assist the court in the matter as amicus curiae.

At the outset of the hearing, Dattar told the court that SEBI had no objection to Sahara selling its three hotels - Grosvenor House Hotel in London and the New York Plaza and Dream New York hotels in New York.

All that the market regulator was interested in was that Sahara should comply with the direction of the court and deposit Rs. 10,000 crore - a part payment of investors money - and also a condition for Roy and the other two's release from jail, he added.

However, Dattar opposed the plea for 40 days parole to Roy and two other directors saying that they could be allowed to come out of jail for three hours a day to carry out transactions through video conferencing and then return to custody.

Taking a cue from Dattar's suggestion, Dhawan once again reiterated his earlier plea of placing Roy and two other directors under house arrest at any government guest house.