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Appearing before SEBI on Wednesday, Sahara India chief had made an issue of having to pick the tab for the market regulator’s work of returning the money to Sahara Group investors.
What indeed has been happening at Securities and Exchange Board of India?
It transpires that the market regulator has just about finished digitising the records of the over three crore Sahara group investors.
The work was tendered out in January after SEBI received 156 truckloads of records in over 35,000 cartons from Sahara.
The documents are in the custody of Stock Holding Corporation of India’s subsidiary, SHCIL Projects, whose job is to store, scan, digitise and create the database.
The contract, awarded by SEBI is worth about Rs 25.97 crore. UTI Infrastructure Technology and Services has also been roped in by SEBI for redemption-related work, for which it is to be paid Rs 29.88 crore. The two bills, totalling Rs 55.85 crore, are to be borne by Sahara.
Sources said the work is being done in the presence of a SEBI official and a Sahara employee and both are required to certify it. SEBI can access the password-protected e-document. The warehouse of SHCIL Projects, a robot-controlled facility, stores and handles the documents.
Investor verification
Last August, the Supreme Court directed SEBI to verify the credentials of investors for refund, while stating that all expenses for the purpose should be billed to Sahara.
The sources said the SEBI tender is only for the digitisation process. All verification, such as whether the investors reside in the addresses they’ve furnished or have shifted, need not be ascertained by them.
The physical verification that lies ahead is no easy task given the number of investors (over three crore) involved. In fact, there aren’t even as many demat accounts for securities trading active in the country.
On Wednesday, after appearing in person following SEBI summons, Subrata Roy, Chairman of Sahara India, said he had conveyed his ‘grave concern’ at ‘un-matured accounts’ not being refunded, though Sahara had remitted Rs 5,120 crore to SEBI for the purpose.
He also requested SEBI to take all possible steps to verify the documents and accelerate the refund process.
Court rulings
On August 31 last year, the Supreme Court had ordered Sahara India Real Estate Corporation Ltd (SIRECL) and Sahara Housing Investment Corporation Ltd (SHICL) to refund the money they raised through optionally fully-convertible debentures with 15 per cent interest in three months.
SIRECL had raised Rs 19,400 crore and SHICL Rs 6,380 crore.
On December 5, the apex court extended Sahara’s deadline by three months to repay the sum in instalments. Even then the two companies failed to comply.
On February 13 this year, SEBI ordered the attachment of all movable and immovable properties, bank accounts, and demat accounts of the two Sahara companies and their four promoters for non-compliance with the Supreme Court orders.
>raghavendrarao.k@thehindu.co.in
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