The petitions of two Sahara companies has been rejected by the Supreme Court for review of its August 31 judgment directing them to refund Rs 24,000 crore they had collected between 2008 and 2011 from over 2.96 crore investors flouting mandatory regulatory provisions and the Companies Act.
The three-month deadline given by the bench of Justices K S Radhakrishnan and J S Khehar, which authored the August 31 judgment, was extended on December 5 by a three-judge bench headed by Chief Justice Altamas Kabir allowing the Sahara firms to deposit the money in two installments, one in January first week and the second by February first week.
Since the Sahara firms had deposited Rs 5,120 crore with market regulator Securities and Exchange Board of India (Sebi) on December 5 claiming that they owed only Rs 2,000-odd crore to the investors and the rest as buffer for any additional claim, it had moved an additional application seeking stay of the August 31 judgment and in the alternative seeking to give bank guarantee for Rs 10,000 crore, which was the first installment due in January first week. But on Tuesday, the bench of Justices Radhakrishnan and Khehar refused to stay operation of the August 31 judgment and also rejected the review petitions of Sahara India Real Estate Corporation Ltd and Sahara Housing Investment Corporation Ltd. This means, the Sahara firms will have to deposit the balance amount of nearly Rs 19,000 crore with Sebi soon.
However, they have also mentioned another application before the bench headed by Chief Justice Altamas Kabir seeking to point out that their liability was limited to Rs 2,000-odd crore since most investors had been refunded through their field officers.
While rejecting review of the August 31 judgment, Justices Radhakrishnan and Khehar told that “We do not find any inconsistency in the view expressed by both of us.
In its August 31 judgment, the court had said Sebi was right in faulting SIRECL and SHICL for the manner in which they raised huge funds bypassing statutory requirements. SIRECL had floated Optionally Fully Convertible Debentures ( OFCDs) as an open-ended scheme and collected over Rs 19,400 crore from April 25, 2008 to April 13, 2011 from 2.21 crore investors.