Legal proceedings against Sahara Group will continue, says Sebi chief

The ongoing legal dispute between the Sahara Group and the Securities and Exchange Board of India (Sebi) will continue in the courts of law even after the death of group founder Subrata Roy.

Sebi chairperson Madhabi Puri Buch on Thursday clarified the regulator’s stance and said the legal proceedings were against the group and not an individual.

“The case is against the group or entities and not against one individual. Passing of one person doesn’t change anything. The investor refund process will continue,” said Buch while speaking on the sidelines of a capital market summit organised by industry body FICCI.

This assumes significance as Sebi and Sahara Group have been involved in a long-drawn tussle and Roy’s demise has brought into focus once again the issue of refunds worth Rs 25,000 crore to nearly 30 million individual investors. 

According to the regulator’s own disclosures, it has made refunds totalling only around Rs 138 crore as on March 31, even though the amount earmarked for refunds was pegged at a whopping Rs 25,163 crore—including the accrued interest—as on March 31.

Asked why only a small amount of refunds have been made so far, Buch said the process was happening as per the directions of the committee appointed by the Supreme Court.

“Our actions are dependent on the directions of the SC-appointed committee. As per their recommendations, multiple rounds of advertisements have happened. Disbursements have happened to whoever is coming ahead with proof of investment,” she said.

Incidentally, the Sahara Group has repeatedly alleged that the capital markets regulator has not done enough to refund the investors of the company even after the business house deposited around Rs 24,000 crore. 

The matter goes back to 2011, when Sebi ordered two Sahara group entities—Sahara India Real Estate Corporation Ltd (SIREL) and Sahara Housing Investment Corporation Ltd (SHICL)—to refund the money the companies had raised from nearly 30 million individual investors through instruments known as Optionally Fully Convertible Bonds (OFCDs).

Also Read: Subrata Roy's Sahara scam: Where is Rs 25,000 crore submitted to Sebi and how to claim refund?