With the Securities and Exchange Board of India (SEBI) informing the Court that Sahara Group had failed to produce bank statements to show that it had refunded the deposits to the investors, the Supreme Court, on Tuesday, asked SEBI to verify the title deeds offered by Sahara for Rs.19,000 crore and to find out whether they are “saleable” or not.
During the resumed hearing before a bench of Justices K. S. Radhakrishnan and J. S. Khehar, senior counsel Arvind P. Datar, appearing for SEBI, submitted that Sahara had not furnished any bank statements as directed by the court earlier. Instead, it had offered voluminous documents to show that the two companies, which had been asked to refund the money, had got cash deposits in crores from sister concerns, and had paid them back to investors, he said.
“They have given us everything except what we want. First they said, don’t ask for money, the assets are there; then they said the assets had been sold and the money refunded. When we asked: ‘Who did you sell to? Show us the flow of money and payments,’ they said: ‘Everything has been paid in cash, there are no bank statements,” the consul said. He pointed out that all inter-entity transfers must be made by cheques, also any loans and advances must also be paid by cheques. He said that though a sum of Rs.25,199 crore was collected by way of cash from sister concerns, a sum of Rs.29,878 crore was shown to have been refunded. He said during May and June 2012, the group had received Rs.16,700 crore in cash and claimed it had repaid it to investors, which was quite unbelievable as it took three years to collect these deposits.
Justice Radhakrishnan observed that as per RBI regulation, all cash transactions could not be made in cash as transactions above certain value had to be through cheques only. He said “since no one was complaining, it should possibly assume that all investors had been paid and were happy.”
The Bench, while posting the matter for further hearing to February 20, asked SEBI to verify the title deeds of properties submitted by Sahara, as value for the amount due to the investors.
It also wanted SEBI to give the sequence of events, as to when Sahara first began refunding the money directly, and when they told the court that they had refunded the amount and the contradictions in the stand from time to time.
