New Delhi, Dec. 5: The Supreme Court today directed the Sahara group to refund Rs 24,000 crore to its three crore investors in nine weeks amid stiff opposition from Sebi and depositors over staggered payments.
The order directed the Sahara group to make an immediate payment of Rs 5,120 crore and the balance in two instalments.
The first instalment of Rs 10,000 crore has to be made by the first week of January and the remaining by the first week of February.
The bench headed by Chief Justice Altamas Kabir also directed the group to supply the documents relating to investors within 15 days and warned that failure to fulfil its directive on the payment of the money to Sebi would lead to the attachment of assets.
The virtual modification of the directives of another bench of the apex court by the Chief Justice evoked strong protest from the Securities and Exchange Board of India (Sebi), which objected to the alteration of the August 31 verdict directing the group to make the refund by November-end or face attachment proceedings.
Interestingly, the apex court passed the order when a review plea of Sahara of the August 31 verdict and a contempt petition against it by Sebi are pending before a bench of justices K.S. Radhakrishnan and J.S. Khehar, who had passed the earlier order against the companies.
Sebi’s counsel Arvind Dattar opposed the order dictated by the Chief Justice along with justices S.S. Nijjar and J. Chelameswar and said it was not right to modify the earlier verdict given by a different bench.
He submitted that Sahara's plea must be heard by the bench of justices Radhakrishnan and Khehar, which had passed the verdict against the group's two companies — Sahara India Real Estate Corporation Ltd and Sahara Housing Investment Corporation Ltd.
At one stage, Chief Justice Altamas Kabir ticked off Dattar for insisting that the court must record his statement in its order that the case must be heard by justices Radhakrishnan and Khehar.
“We will record what we feel to record. We cannot record what you say,” the Chief Justice shot back.
The Universal Investors’ Association, representing the depositors of the Sahara group, objected to the order, saying it was pronounced without hearing their arguments.
Appearing for the association, senior advocate Vikas Singh said, “You are saying that the order is being passed to protect the investors and you are passing the order in the guise of protecting the investors, but what is there for them if investors are not heard. It is not fair.”
He said his petition should not be disposed of along with Sahara's petition, but the Chief Justice retorted, “No, sorry.”
During the hearing, the bench said that at the moment, it appeared that the Sahara group was not in a position to make the entire payment as directed by the apex court by the August 31 verdict.
“We have taken a slightly liberal view with the concern of depositors and not with the company,” it said.
With today’s order, the court modified the August 31 verdict which had set a three-month deadline ending November to the Sahara group to make the refund.
Sahara today said it had offered to repay the holders of optionally fully convertible debentures (OFCDs). Sahara claimed it had kept two pay orders ready.
“As per the certificate of the statutory auditor, the outstanding liability of both the companies towards the outstanding OFCDs is Rs 2,620 crore only as on November 30, 2012.
“On November 30, 2012, Sahara offered pay orders of Rs 2,620 crore and also a buffer amount of Rs 2,500 crore, subject to certain verification of some pending/continuing at company's end,” Sahara’s counsel Satish Kishanchandani said.