The Supreme Court on Monday directed the Sahara Group to deposit in three weeks the original title deeds of properties worth Rs. 20,000 crore to the Securities and Exchange Board of India (SEBI).
“Till the title deeds are submitted the contemnors cannot leave the country without the permission of the court,” the court said. A Bench of Justices K.S. Radhakrishnan and J.S. Khehar, hearing contempt petitions filed by the SEBI for not complying with the August 31, 2012 directions on refund of deposits, expressed its displeasure to senior counsel Aryama Sundaram for the contemnors continuing to play hide and seek with the court.
In its brief order, the Bench said: “Mr. C.A. Sundaram, senior counsel appearing for respondent No.5 (alleged contemnor), brought to our notice letter dated October 17 received from the Managing Director and CEO of the PNB Investment Services Limited. The same is taken on record. Mr. Sundaram, on the basis of the said letter and on instructions received from the Sahara Group of Companies, submitted that the alleged contemnors are willing to make available to the SEBI the original title deeds of unencumbered properties, worth Rs. 20,000 crore, along with proper valuation reports, within… three weeks from today. SEBI, in turn, will examine the same and make their response, which shall be considered by this court on the next date of hearing. Till the above direction is complied with, to the satisfaction of SEBI, the alleged contemnors [the respondents] shall not leave the country without the permission of this court.”
The court had already issued contempt notices to the Managing Director and Directors of Sahara India Real Estate Corporation and Sahara Housing Investment Corporation and was hearing the petitions. Justice Khehar told counsel: “You have driven everybody round. From day one restraint was ours.” When the Bench indicated that Mr. Roy would not be allowed to go abroad, Mr. Sundaram said the court should not pass any order that would violate Article 21. Mr. Roy’s behaviour had never caused any suspicion so far.
Submitting the proposal, Mr. Sundaram said it was not possible to pay Rs. 20,000 crore in cash and the company would liquidate if it was directed to pay cash. He said: “I am finished if I have to pay over Rs 19,000 crore cash. My company would liquidate. The banks are also not willing to grant loan as they do not consider it safe.” He gave details of properties, including Ambey Valley, and said title deeds of various assets would run into thousands of pages as there were 30,000 title deeds.
However, Justice Khehar told counsel: “You indulge too much in hide and seek. We cannot trust you any more. There is no escape for you and the money has to come. Your interests will be protected if investors’ money is paid.” Senior counsel Arvind Datar, appearing for the SEBI, did not accept the proposal. He said selling the properties through financial institutions would become a cumbersome process. He suggested that Sahara itself sell the properties and hand over Rs. 20,000 crore. The Bench posted the matter for further hearing on November 20.
