Monday 24 June 2013

Sahara freeze order gets Sebi Rs 52 cr in cash, investments

Market regulator Securities and Exchange Board of India (Sebi) has been able to get hold of cash and investments totalling about Rs 52 crore and details of 450 acres of land so far through its attachment orders against the Sahara group entities.

In a high-profile case involving refund of Rs 24,000 crore to the bondholders of two Sahara companies, Sebi had passed orders for attachment of various properties and freezing of accounts in February, after the entities failed to deposit the entire money. The cash totalling Rs 23 crore, received from various banks pursuant to these orders, has been invested in a term deposit for now, while investments worth about Rs 28 crore in mutual funds and demat accounts have also been frozen, sources said. After passing its attachment orders, Sebi informed all banks, depositories, mutual funds and non-banking financial companies (NBFCs), among others, about the matter and also requested the Reserve Bank of India (RBI) to direct the chiefs of the banks to transfer the money of Sahara firms to a designated Sebi account.

Sebi had also approached the collectors of as many as 600 districts to request them not to permit the Sahara entities and persons concerned from any sale or transfer of properties attached by the regulator. As a result, the district collectors and revenue officers from various parts of the country have provided Sebi with details of 450 acres of land belonging to Sahara, sources added.

The regulator had already asked the Supreme Court's permission to appoint an Officer on Special Duty and other officers to deal with the objections and claims relating to the property to be sold and for conducting the sale of the property to garner funds for refunding the investors' money.

Sahara has so far deposited Rs 5,120 crore with Sebi towards the refund and claims that this amount is more than sufficient to meet the liabilities towards its bondholders since the group has already paid close to Rs 20,000 crore directly to the investors.

The money was raised by Sahara Housing Investment Corporation and Sahara India Real Estate Corp from about 30 million investors, through issuance of certain bonds. However, these claims have been disputed by Sebi before the Supreme Court, which is expected to resume hearing the case next month. Meantime, Sebi has begun the process of refunding the money to genuine investors after verifying their credentials. A pilot study conducted by Sebi for ascertaining the genuineness of investor documents filed by Sahara, however, found close to 99 per cent of the bondholders were untraceable, said sources. Under this programme, Sebi sent redemption notices inviting claims to 21,000 bondholders but it received less than 300 claims, currently under examination.

While more than 7,000 notices returned undelivered, there was no response in respect of over 13,000 notices. Sebi will refer these case to Sahara for further verification, sources said. Last month, Sebi began inviting claims from Sahara bondholders in a prescribed format and has said it would directly transfer the refund money to the bank accounts of the genuine investors and they can not get the money without having a bank account.

The apex Court last month told Sebi to begin refunding the money from Rs 5,120 crore deposited with it so far, while the matter would be heard further by the apex court on July 17.

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