Supreme Court rejects SEBI petition in Sahara case
04 January 2011
The Supreme Court has refused to entertain a special leave petition moved by the Securities and Exchange Board of India (SEBI) seeking to restrain the Sahara group from raising money from the market. The apex court has instead asked the market regulator to go back to the high court for any redressal.
A three-judge bench headed by the Chief Justice of India refused to interfere in the matter of Sahara's optionally fully convertible debentures (OFCDs) and confirmed the high court's order allowing Sahara to continue mobilising funds.
The SC, however, allowed SEBI to continue probe into Sahara India Real Estate Corporation's alleged irregularities in its offer documents to investors.
The SC also allowed SEBI to seek any information from Sahara in the course of the enquiry, including the names of investors in the nearly Rs4,843.37 crore amount raised through sale of debentures.
Sahara is planning to raise a further Rs20,000 crore each for Sahara India Real Estate Corporation and Sahara Housing Investment Corporation Ltd.
The SC has directed the Lucknow bench of the Allahabad High Court to hear and decide the case expeditiously.
With the SEBI failing to secure a stay on Sahara India Real Estate Corporation's bond issue plans, the company can now continue to raise money from investors.
SEBI had moved the Supreme Court against an Allahabad High Court order seeking to immediately stop Sahara from raising more money.