New Delhi, June 15 The Supreme Court reserved its verdict on a plea by Sahara group of companies, dealing in real estate and housing, challenging a tribunal’s direction to repay money collected from investors through debentures.
The apex court bench of Justice K.S. Radhakrishnan and Justice J.S. Khehar reserved the order after arguments spread over three weeks wherein senior counsel Fali Nariman and Gopal Subramanium, who had appeared for the Sahara group of companies, contested the Securities Appellate Tribunal’s (SAT) award of Oct 18, 2011.
The tribunal directed Sahara India Real Estate Corp Ltd. (SIRECL) and Sahara Housing Investment Corp Ltd. to return, along with interest, investors’ Rs.19,400 crore collected through optional fully convertible debentures (OFCD).
The Sahara group contended that its mobilisation of money from investors was in the nature of private placement and it imposed no obligation on it to get listed in any stock exchange.
It also contended that the Securities and Exchange Board of India (SEBI) could not have proceed against it in the absence of a complaint by investors.
The stock market regulator told the court that SIRECL resorted to the massive mobilization outside the well developed investor protection frame work developed by the SEBI that provided checks and balances and statutory protection of investors.
In an earlier hearing, Chief Justice S.H. Kapadia asked the petitioner companies to state how they had secured the investors’ money.
The companies were also asked to state the manner in which they had deployed the investors’ money.