Deposit Rs5,000 cr or face Aamby Valley auction, SC tells Sahara

22 March 2017

The Supreme Court on Tuesday said that it would direct auction of Sahara group's prime Aamby Valley property near Pune if the company failed to deposit Rs5,000 crore of the Rs14,000 crore it owes to investors by 17 April.

A bench of Justices Dipak Misra, Ranjan Gogoi and A K Sikri said that it would be left with no option but to sell the property if the group failed to deposit the amount. The bench had already in February directed attachment of the Aamby Valley property, worth nearly Rs40,000 crore.

The SC had in August 2012 ordered Sahara to repay over Rs25,000 crore to investors by depositing the amount with the Securities and Exchange Board of India after it found that two group companies - Sahara Real Estate and Sahara Housing - had illegally collected the sum from three crore investors (See: Sahara agrees to refund Rs24,000 crore to investors in 3 months).

Sahara has so far deposited over Rs11,000 crore, of which Rs6,000 crore was paid after the apex court sent Roy and two directors to jail on 4 March 2014.

On the last date of hearing, the court had rejected the Sahara's plea to allow it to grant time till July 2019 to refund the amount and directed it to pay instalment of Rs 5,000 by 17 April.

In the meantime, the bench asked US-based real estate company MG Capital LLC, which offered to buy Sahara's Plaza Hotel in New York, to deposit Rs750 crore in a Sebi-Sahara bank account to show its bona fides.

The company told the bench it was ready to pay $550 million to buy Sahara's share in Plaza Hotel and the amount of Rs750 crore would also be deposited by 10 April. The bench thereafter asked Sebi to give bank account details to the company for transferring the amount from the US to India.

The Sahara group had earlier assured the court that it would try to sell 13 prime properties across India, including townships and land, to raise over Rs5,000 crore.

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