The Supreme Court of India, during the hearing of contempt pleas against Sahara India, directed the conglomerate to present a plan outlining how it intends to deposit the outstanding amount into the Sahara-SEBI Refund Account by sale of properties, while denying the attachment attempts by the Directorate of Enforcement ( ED ).
The Division Bench comprising Supreme Court Justices Sanjiv Khanna, MM Sundresh, and Bela M Trivedi presided over the matter, which was heard for nearly the entire day and scheduled for further hearing today. Significant arguments were made regarding the recovery of the remaining sum Sahara was ordered to deposit.
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For context, in 2012, the Supreme Court ordered two Sahara companies to refund approximately ₹25,000 crores, along with 15% interest, to over two crore small investors who had invested in their debentures between 2008-2011. This amount was to be deposited with SEBI. Following Sahara’s failure to deposit the required amount, contempt pleas were filed.
Representing Sahara, Senior Advocate Kapil Sibal argued that the company intended to fulfil its obligations and should be allowed to receive a fair value for its properties. However, Justice Bela M Trivedi pointed out that similar promises had been made ten years ago, leading to the contempt proceedings for non-compliance.
Justice Sanjiv Khanna stated that Sahara’s properties could be attached and sold. He added that while Sahara’s request to obtain a fair price for its properties could be considered, the Court would not delay the recovery process. Justice Khanna further emphasised that Sahara had already been given full freedom to sell its properties, even at or below the circle rate with permission.
The Applications filed by the Enforcement Directorate (ED), based on a SEBI criminal complaint, were discussed. Sibal contended that the transactions in question occurred before 2013, and thus, there was no scheduled offence at the relevant time. Justice Khanna remarked that commencing action under the Prevention of Money Laundering Act (PMLA) might result in zero recovery for investors, and advised the ED to consider whether such attachment proceedings were necessary in this case.
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However, no orders were passed as no representative from the ED was present to argue the matter.
The Court also clarified that Sahara must be involved in the process of selling its properties, and addressed SEBI allegations of fictitious and benami transactions, which Sahara’s counsel vehemently denied.
Justice Khanna suggested that Sahara could file an application if it wished to withdraw any amount from the SEBI-Sahara Account, which the Supreme Court would consider.
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