Need to resolve row over amount to be paid by Sahara Group: Supreme Court

The Supreme Court on Friday said there is a need to resolve the dispute over the total amount which Sahara Group was liable to pay to its investors even if the group complied with the condition of paying Rs 10,000 crore to ensure the release of its chief Subrato Roy from jail.

"We will accept the bank guarantees but we would also like to address the issue of balance amount that has to be paid," a bench comprising Justices T S Thakur, A R Dave and A K Sikri said. The apex court on August 31, 2012 had said the group was required to refund Rs 24,000 crore with 15 per cent interest in three months to the depositors. It had on March 26, 2014 asked 65-year-old Roy, who has been in Tihar Jail since March 4, 2014, to pay Rs 10,000 crore to get bail, out of which Rs 5,000 crore should be paid in cash and rest in bank guarantees.

SEBI accepted the draft of bank guarantees which the Sahara group has to furnish which was also approved by the apex court in Friday's hearing. The issue of payment of balance amount arose as the claim of Sahara refunding the amount has been disputed by SEBI with its senior counsel Arvind Dattar maintaining that there have been contradictions on refund theory by Roy's group and even the apex court in the past had not agreed to it.
He said even the Securities Appellate Tribunal (SAT) did not accept Sahara's stand on refund.

Dattar said there was also a need for fixing the schedule for Sahara to refund the remaining amount after complying with the amount of bail condition. The bench agreed with the submission and said "bank guarantees would be made encashable by SEBI if Sahara is unable to pay the balance amount".

Senior advocate Kapil Sibal, representing the group, asked the bench as well as SEBI and senior advocate Shekhar Naphade, who is assisting the court as amicus curiae, in the matter to accept the draft of the bank guarantees which would be from a scheduled bank. Sibal did not disclose the name of the bank but assured that it was not any of the cooperative banks. He said negotiations were underway for selling Sahara Group's offshore properties for raising sufficient fund. The bench accepted Sibal's plea to consider Sahara's application in which it sought permission to utilise balance of assets for meeting out its other liabilities after complying with the order to pay Rs 10,000 crore for getting Roy out of the jail.

The bench said the application and other issues will taken for consideration on May 14. It said the application has to be looked into as in view of freezing of assets of Sahara Group companies it may not be possible for them to meet out their liabilities towards Salaries, wages, statutory liabilities and other corporate liabilities.

The apex court had on March 23 expressed "prima facie satisfaction" and granted three months time to Sahara Group for selling its offshore properties for raising Rs 10,000 crore to ensure the release of Roy. The bench said in the eventuality of failing in negotiations, its properties would be put to auction by appointing a 'court receiver' for alienating its assets.

The court had also extended its August 1, 2014 order allowing Roy to use the conference room in Tihar jail complex to hold negotiations with potential buyers to sell his three luxury hotels--Dream Downtown and The Plaza in New York and Grosvenor House in London--to raise Rs 10,000 crore to get regular bail.