In an unprecedented order, market regulator Securities and Exchange Board of India has seized the assets and properties of two Sahara companies, Sahara India Real Estate Corporation (SIRECL) and Sahara Housing Investment Corporation (SHICL).
It has also frozen the bank accounts of these two companies, their promoters and directors.
Action against Sahara includes attachment of development rights in land owned by Aamby Valley Ltd and of 90-95 per cent stake held by the Group in various SPVs (special purpose vehicles).
The order also talks about freezing all bank and demat accounts of Sahara’s head, Subrata Roy Sahara, and three directors of the companies — Vandana Bhargava, Ravi Shankar Dubey and Ashok Roy Choudhary. All movable and immovable properties of these four have been attached.
Court stand
This move comes within a week of the hearing in the Supreme Court. The apex court had said the market regulator is free to freeze accounts and seize properties of the group’s two companies for defying court orders by not giving refunds to investors.
The apex court had, on August 31 last year, directed the companies to refund around Rs 24,000 crore to their investors within three months with interest at 15 per cent per annum, as compensation for raising the amount in violation of rules and regulations.
The apex court had also pulled up the regulator for not taking action according to its August 31, 2012 order, that had asked the market regulator to attach properties and freeze bank accounts of the companies if the group failed to repay its investors with interest.
The crux of the order was the Optional Fully Convertible Debentures (OFCD) the Sahara companies had issued. According to the two orders, SIRECL had issued OFCD worth Rs 19,400 crore and SHICL for Rs 6,380 crore as on April 13, 2011. These figures were mentioned by the two companies in an affidavit dated January 4, 2012.