Sebi Still Holds Over Rs23k cr of Sahara Bondholders’ Money

The Securities and Exchange Board of India (Sebi) held Rs23191 crore of Sahara Group bondholders’ money in an escrow account as of March 31, 2021, according to the regulator’s annual report of 2020-21. In August 2012, the Supreme Court had directed the capital markets regulator to attach assets of Sahara Group.

The amount held on March 31 included Rs15473 crore of the money recovered and the interest on it, the annual report said.

Till November 30, Sahara Group companies had deposited Rs15,485 crores into the designated ‘Sebi-Sahara Refund’ account out of the principal amount of Rs25781.37 crores, according to news reports quoting finance minister Nirmala Sitharaman response to a query on the matter in the Lok Sabha.

The money recovered by Sebi was supposed to be paid back to the bondholders and investors of Sahara. However, claims worth only Rs129 crore had been paid out to Sahara’s bondholders as of March 31, 2121, Sebi’s annual report showed. Sources said the majority of these investors are yet to come forward to claim their money.

“Sebi had made numerous attempts to reach out to the Sahara investors including conducting a newspaper ad campaign to find the investors,” said a person with direct Knowledge of the matter. “In some cases, investors have been forward, however, they are unwilling to provide Sebi their Permanent Account Number (PAN) or even handover Sebi original deposit documents.”

An email to Sebi remained unanswered.

In response to an ET query, a Sahara spokesperson said,” In its last advertisement that was published in April 2018, Sebi made it clear that it would not entertain any further claim received after July 2018. It means that for SEBI, there are no more claimants to be paid and Sahara’s entire Rs24000 crore deposited is unreasonably held by Sebi. This huge amount of money is lying unutilized, idle in the banks which is not only hurting the interest of Sahara as a business organization but also impeding the economic growth of our country.”

Sebi’s crackdown on Sahara was the regulator’s first one against a large-sized collective investments scheme. The regulator also functioned as a recovery agency in this case as it auctioned off properties of Sahara.

Legal experts said Sebi can only make refunds to investors who make legitimate claims-by providing the required documents. Also, there are concerns over Sebi’s information-sharing arrangement with government agencies including the income tax department.

According to Sebi annual reports for FY17,30,398 account of Sahara Investors were provided Rs85 crore worth refunds by the regulator. In FY21, 45451 accounts were settled with payments to a tune of Rs129 crore.

“The special account can be closed if Sebi deems it fit but the question remains as to what happens to the money,” said a former Sebi official. “It can either go to the consolidated fund of India or investor protection fund managed by Sebi. However, Sahara has already moved various judicial bodies seeking a refund of excess attachment. The issue is may not be settled any time soon.” S-ET

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *