Allahabad high court grants interim stay on SEBI directive to Sahara

The Lucknow bench of the Allahabad High Court has granted Sahara India Group interim protection from the Securities and Exchange Board of India's 24 November order that barred the group from raising money from the capital market.

A division bench of Justice DP Singh and VK Dixit asked SEBI as also the registrar of companies (RoC) to file responses by 4 December and to abstain from taking any coercive action till then.

"Till then, no coercive action shall be taken by the respondents," the judges said.

SEBI had barred Sahara Housing Investment Corp Ltd and Sahara India Real Estate Corp Ltd, two group companies, from raising money from the public for alleged violation of issue norms.

The two companies are headed by key officials of the group, including group chief Subrata Roy.

Sahara had challenged the order saying market regulator SEBI did not have the jurisdiction to proceed against unlisted firms as these came under the jurisdiction of the ministry of corporate affairs. SEBI, however, did not accept the view.