SEBI case against Sahara firms: Argument on framing of charges

The prosecution today began argument on framing of charges in two cases filed by the Securities and Exchange Board of India (SEBI) against Sahara group chairman Subrata Roy and three others.
Prosecutor Poornima Advani told the court that two companies promoted by Roy -- Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment (SHI) -- issued Optionally Fully Convertible Debentures (OFCD) in 2009 without stating correct facts in the prospectus and misleading the investors.
They had no approval for 'Red Herring Prospectus' from SEBI, and didn't list OFCDs on the stock exchange, she said.
OFCDs were issued without executing debenture trust deed, appointment of debenture trustees and creation of security reserve for debenture redemption, she added.

Roy and other accused today filed applications seeking discharge from the case which may be heard on June 28.
Meanwhile, Roy's doctor, R N Jain, filed an affidavit stating that Roy could not attend the court last month as he was undergoing treatment for gastroenteritis.

However, Advani said that Roy was not at his house during the period when he was supposedly undergoing treatment. Besides, the ailment does not require bed rest and he could have attended the court, she said.
Judge M G Deshpande said he was not "adjudicating" this matter.
"My limited purpose was to ensure Roy's presence before the court," the judge said.

Apart from Roy, three directors of Sahara group firms are accused in the case.