SEBI Recovers Dues Worth Rs. 6.57 Crore from Sahara Group Firms, its Chief Subrata Roy and Others
SEBI Recovers Dues Worth Rs. 6.57 Crore from Sahara Group Firms, its Chief Subrata Roy and Others
The Securities Exchange Board of India (SEBI) has recovered its outstanding dues worth Rs. 6.57 crore from Sahara India Real Estate Corporation, its chief Subrata Roy, and others in the case pertaining to flouting norms in issuance of optionally fully convertible debentures.
The SEBI in its recovery order observed, “in view of the payment of the amount of Rs. 6.57 crore due under the certificate, the said certificate is hereby completed.”
The amount included interest, all costs, charges and expenses incurred in respect of all the proceedings taken for recovery of the said sum, for non-payment of penalty imposed.
In December, the Market Regulator had directed to attach the bank and DEMAT accounts of Sahara India Real Estate Corporation (now known as Sahara Commodity Services Corporation), Subrata Roy, Ashok Roy Choudhary, Ravi Shanker Dubey and Vandana Bharrgava to recover Rs. 6.42 crore for violating regulatory norms in the issuance of OFCDs (Optionally Fully Convertible Debentures).
The recovery proceedings were initiated against these entities after they had failed to pay Rs. 6 crore fine imposed on them by Sebi in June 2022.
The background of the case is related to issuance of Optionally Fully Convertible Debentures (OFCDs) by Sahara India Real Estate Corporation and Sahara Housing Investment Corporation during 2008-2009.
The companies raised money through the public issue of securities by issuing OFCDs without following the various procedures intended to protect the interest of the investors, in respect of public issues, prescribed under the norms.
The SEBI found that the subscription towards the OFCDs was solicited by the two companies from the general public throughout the country, without adequately informing them about the risks involved in the instruments.
Accordingly, the SEBI had held that the issuance was allegedly done in contravention of the provisions of the SEBI’s ICDR (Issue of Capital and Disclosure Requirements) Regulations and SEBI (Prohibition of Fraudulent and Unfair Trade Practices).
