A Sahara group counsel told Securities Appellate Tribunal (SAT) that the group was ready to submit a payorder of Rs 5,120 crore to repay OFCD (Optionally Fully Convertible Debentures) subscribers. This is roughly a fifth of total outstanding the two group firms said they had in August 2011. Sahara had moved SAT asking it to direct Sebi or the registrar of SAT to accept the said amount. SAT rejected the appeal. An email questionnaire sent to Sahara group spokesperson asking for the details of the remaining amount remained unanswered at the time of going to press.
“Mr. Gopal Subramaniam, learned senior counsel, appearing for the appellants, strenuously argued before us that the appellants are forced to approach this Tribunal in view of the conduct of the respondent Board in not accepting the documents tendered by them and it is apprehended that the pay order amounting to Rs 5,120 crore for repaying the amount to the OFCD subscribers will also not be accepted by the Board. The last date for depositing this amount is November 30, 2012 and if the amount is not accepted, it may amount to violation of the order passed by the Hon’ble Supreme Court,” SAT said in its order dismissing the appeal.
Legal experts following the case said that this is the amount Sahara is offering as the final settlement. “It appears that they will now say, this is the outstanding left,” said a former Sebi official. Sebi in its recent newspaper advertisements had said that it has received complaints saying that OFCD amount is transferred to other group companies without consent of investors. It also had advised OFCD bondholders not to part with the documents to anyone other than Sebi. It has also initiated criminal proceedings against group chief Subrata Roy Sahara and directors of the two firms. Business Standard reported on Thursday that the group agents are collecting sehmat patras from bondholders showing refunds while they underlying amount is transferred to other group plans such as Sahara Q Shop.
In affidavits filed with the SAT last year, Sahara India Real Estate said it had an outstanding of Rs 17,656 crore owed to 22.1 million investors after premature redemptions. Sahara Housing Invest corp said it had an outstanding of Rs 6,373 crore owed to 7.5 million subscribers taking the total outstanding of these two firms on that day to Rs 24,029 crore.
Almost a year later, the Supreme Court on August 31, 2012 had ordered the companies pay back the entire sum to the respective investors with an interest of 15 per cent per annum as it held that the money was raised illegally in violation of securities and companies laws. The companies were directed to submit all the necessary documents showing details of subscribers within a period of 10 days to Sebi. Sebi was ordered to verify the documents and ensure the refund process was completed by November 30. Assuming an interest of 15 per cent on the deposit for one year, the total dues would have been at least Rs 27,633 crore.
However, Sebi has alleged that the group has violated the Supreme Court orders by not submitting the required documents in time. It has filed a contempt petition with the Supreme court for violation of the court’s directions. Meanwhile, Sahara group has also filed a review petition in the Supreme Court.
