SC allows central bank to take action against the group for encashing securities worth Rs 484 cr
More trouble is brewing for Sahara chief Subrata Roy. The Supreme Court on Tuesday allowed the Reserve Bank of India’s (RBI) to initiate proceedings against the company for encashing securities worth Rs 484 crore.
The apex court allowed RBI to initiate action against Sahara India Financial Corporation Ltd (SIFCL), a non-banking financial firm, for allegedly “breaching” the central bank norms by encashing securities and diverting them to Sahara India, a partnership firm, for paying the depositors instead of depositing the amount in the Sebi- Sahara refund account as directed by it.
“You are in more trouble now. Your problems are increasing. These are all your own doing. How can you sell the securities without our permission. How could you sell the securities and rout the amount to other sister concerns. We allowed you to encash the securities and deposit the money in Sebi-Sahara account so that it would go to the investors," a bench headed by Justice T S Thakur said.
It has also asked the company not to encash the securities. Sahara’s counsel told the court that the money was utilised for payment to investors, and argued for a hearing before passing any order on it.
The court subsequently directed Sahara to submit the list of investors to whom they have paid and whether it was in cash or cheque. The RBI counsel argued that the central bank had carried out inspection of the company at annual intervals under the RBI Act and it was noticed that the deposit-taking activity of SIFCL was not in conformity with the RBI rules.
He submitted that Sahara auditor says the encashed securities worth Rs 484.67 crore were diverted to SIFCL instead of depositing in Sebi-Sahara accounts and only Rs 3 crore were paid to depositors. "How can you disown your own auditor. You are in more trouble now. Sebi, income tax and RBI all are here. We don't know how many others will come here,” the bench noted.
The bench also declined to extend the facilities given to Roy inside Tihar jail. Sahara had claimed that it was working on three more deals for the sale of its assets. The court had allowed Roy to move to a conference room inside the jail court complex to facilitate the sale of Sahara properties that in turn would be used to raise money for Roy’s Rs 10,000 crore bail.
Sahara’s recent agreement with the US-based Mirach Capital Group fell by the side. Mirach was to loan $2 billion to the Sahara group.
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