Supreme Ccourt gives last chance to Sahara to negotiate deal for Roy’s release

Friday, Mar 13, 2015,21:07 IST By metrovaartha A A A

New Delhi | Sahara Group was today granted the third and last opportunity by the Supreme Court to g negotiate a deal for selling its offshore properties for raising Rs 10,000 crore to ensure the release of its Chief Subrato Roy, who has been in jail for a year for non-refund of over Rs 20,000 crore to depositors.
The apex court, which was inclined to appoint a ‘court receiver’ for alienating the assets of the Group, refrained from passing such an order after its newly-engaged senior counsel Kapil Sibal pleaded for another chance for complying with the directions. We are inclined to accept the submission of the senior counsel and therefore, we grant another opportunity to negotiate the proposed deal.
The outline of the proposed deal has to be shared within a week with the SEBI and amicus curiae, a bench headed by Justice T S Thakur said while hinting that two to three months time can be given for working out the proposed deal. However, the bench declined a plea for extension of special facilities to Roy in Tihar Jail precincts to negotiate the proposed deals. It only agreed to extend the time of  two hours a day earlier allowed to interact with potential buyers by another three hours keeping in view the international time zone with the facility of two laptops and mobile phones.
The bench said the facility of using the conference room in Tihar Jail cannot be extended till the seriousness of the proposed deal gets examined by the market regulator SEBI and senior advocate Shekhar Naphade, who is assisting the court as amicus curiae in the matter that The bench, also comprising Justices A R Dave and A K Sikri, agreed with Sahara’s plea that the proposed deal should be maintained confidential by SEBI and the amicus curiae. Sibal also accepted that the outline of the proposed deal shall be furnished to the SEBI and amicus curiae along with all required documents to demonstrate that it is a serious attempt.
The Bench noted that two earlier attempts to negotiate the deal in the past had to be aborted and the third and final chance was  being given to Saharas to generate the required money to discharge the order of this court. It also said previous orders passed time to time to negotiate the proposed deals did not fructify in result and it was in this background there was an inclination to appoint court receiver to alienate the groups’ properties for arranging the money.
The apex court had asked 65-year-old Roy to pay Rs 10,000 crore to get bail, out of which Rs 5,000 crore should be paid in cash and rest in bank guarantees. The day’s hearing also witnessed a blame game between Sahara Group and Mirach Capital for the failure of the second proposed deal. Senior advocate Rajiv Dhawan, appearing for Sahara Group, made an attempt to blame Mirach Capital and 32-year-old man, Saransh Sharma, who was acting as its front, for the failure of the deal which was mired in controversy due to forgery of some documents.
However, two counsels, who were watching the proceedings on behalf of Mirach, vigrously protested and submitted that senior advocate should make any statement with some responsibility and Mirach was ready to explain the entire episode in anaffidavit. The apex court was informed on February 11 about the failure of the proposed secon deal in which Mirach Llc of the US was supposed to provide junior loan of USD 650 million and another USD 400 million in investment to the embattled group.
During the hearing, SEBI and Naphade also made submissions about reports that Bank of China has appointed administrator for alienating Sahara’s properties in the United Kingdom and the same would be possible in the US. However, Sahara’s counsel said there have been communication with the administrator and it was assured that the property in London would not be alienated.
Bank of China had lent money to Sahara in purchase of stakes in three overseas hotels, Dream Downtown and The Plaza in New York and Grosvenor House in London. The court posted the next hearing on March 23 saying that RBI has initiated action by issuing show cause notice to Sahara in pursuant to its February 24 order for allegedly encashing securities, deposited with RBI and diverting them to pay depositors to the tune of Rs 484 crore without the court’s nod. Sahara Group also filed an affidavit on the issue and RBI and the amicus curiae have been asked to respond within two weeks.
The apex court had allowed RBI to initiate action against Sahara India Financial Corporation Ltd (SIFCL), a non-banking financial firm, for allegedly breaching the central bank norms by encashing securities and diverting them to Sahara India, a partnership firm, for paying the depositors instead of depositing the amount in the SEBI- Sahara refund account as directed by it. The bench had restrained the group from further alienating and transferring remaining directed securities of SIFCL and had sought a response as to how they diverted the money to the tune of Rs 484.67 crore despite a specific direction against it by the court on July 4, 2014.