9911796707
TMI Blog2014 (10) TMI 670X X X X Extracts X X X X X X X X Extracts X X X X ..... ly permissible. By an ad interim ex parte order dated 24th November, 2010 SEBI directed Saharas not to offer their equity shares/OFCDS or any other securities to the public or invite subscription in any manner whatsoever either directly or indirectly pending further orders. Aggrieved by the said order Saharas approached the High Court at Bombay but the High Court not only declined to interfere with the directions issued by SEBI but also passed a further order on 23rd June, 2011, directing the promoter Mr. Subrata Roy Sahara and Directors Miss Vandana Bhargava, Mr. Ravi Shankar Dubey and Mr. Ashok Roy Choudhary of Saharas to jointly and severely refund the amount collected by Saharas in terms of the RHPs issued by them alongwith interest @ 15% p.a. from the date of the receipt of the deposits till the date of such repayment. Pursuant thereto the SEBI ordered that the refund of the amount shall be made only in cash through demand drafts or pay orders. The SEBI issued further directions including a direction that Sahara Commodity Services Corporation Limited (earlier known as SIRECL) and SHICL shall not access the security market for raising funds till the time the aforesaid payments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... along with the interest, as calculated, shall be deposited within the first week of February, 2013. The time for filing documents in support of the refunds made to any person, as claimed by the appellants, is extended by a period of 15 days. On receipt of the said documents, SEBI shall implement the directions contained in the order passed on 31st August, 2012. In default of deposit of the said documents within the stipulated period, or in the event of default of deposit of either of the two installments, the directions contained in paragraph 10 of the aforesaid order dated 31st August, 2012, shall immediately come into effect and SEBI will be entitled to take all legal remedies, including attachment and sale of properties, freezing of bank accounts etc. for realisation of the balance dues." 5. Pursuant to the above, Saharas deposited Rs. 5120/-crores with the SEBI but failed to pay the remaining amount. The balance amount payable is in the vicinity of Rs. 12280/-crores, exclusive of interest payable on the same. SEBI then filed Contempt Petitions No.412 and 413 of 2012 and, Contempt Petition No.260 of 2013 against the contemnors for non-compliance of the directions of this Court. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had to be deposited in cash before this Court while the balance amount of Rs. 5000/- crores had to be secured by a bank guarantee of a nationalised bank, furnished in favour of the SEBI. Upon compliance with those conditions the contemnors were directed to be released from the custody and the amount deposited by them to be transferred to the SEBI. Since we are directly concerned with this order, we may, as well, extract the same: "We have gone through the fresh proposal filed on 25.3.2014. Through the same is not in compliance with our Order dated 31.8.2012 or the Order passed by the three-Judge Bench of this Court on 5.12.2012 in Civil Appeal No.8643 of 2012 and on 25.2.2013 in I.A. No. 67 of 2013 in Civil Appeal No.9813 of 2011 with I.A. No.5 of 2013 in Civil Appeal No.9833 of 2011, we are inclined to grant interim bail to the contemnors who are detained by virtue of our order dated 4.3.2014, on the condition taht they would pay the amount of Rs. 10,000 crores - out of which Rs. 5,000 crores to be deposited before this Court and for the balance a Bank Guarantee of a nationalised bank be furnished in favour of S.E.B.I. and be deposited before this Court. On compliance, the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontended that the order passed by this Court on 26th March, 2014 granting interim bail subject to the conditions stipulated in the said order deserved to be modified as the conditions stipulated therein were not only onerous but incapable of being complied with in the facts and circumstances of the case. Alternatively, he contended that compliance with the conditions stipulated by this Court would require sale of several items of immovable properties held by Sahara Group of companies which sales can be finalised only if the contemnors were enlarged from custody with a view to enable them to negotiate the sale transactions. He submitted that keeping in view the extent and nature of the properties which shall have to be sold as also the amounts that have been ordered to be deposited compliance with the conditions stipulated by this Court is extremely difficult, if not impossible, unless the contemnors are enlarged from jail and allowed to take steps necessary for compliance. It was further contended by Dr. Dhawan that the restraint orders against the sale of the moveable and immoveable properties held by the 'Saharas' made it impossible for them to arrange compliance unless t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on for Saharas except to sell three other items of hotel properties situated outside the country. One of these hotels by the name Grosvenor House is situated in London while the remaining two hotels are in New York (U.S.A.). It was urged that the said three items of property also need to be sold to raise the margin money which the banks concerned insist upon to enable them to issue a bank guarantee. It was submitted that while the contemnors propose to mortgage Aamby Valley properties, details whereof are given in the Annexure B to I.As. No.101-103, the contemnors would require funds to service any financial arrangement made with the bank/banks. It was also contended that according to the estimate of the contemnors, the properties situated in London and New York would fetch an amount of Rs. 5,000/- crores to the contemnors which may be utilised in full or in part towards the margin money necessary for obtaining the bank guarantee(s). The estimated value of these three properties is indicated by the contemnors as under : Shares of entities owning the following offshore properties Value as per the Valuation report Expected Sales Value Immediate Advances expected Page No. Grosve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SEBI had no objection to the sale thereof to enable the contemnors to raise funds necessary for compliance with the directions of this Court. 17. We have given our careful consideration to the submissions made at the bar. It is apparent, from the submissions made at the bar, that these IAs have two limbs: In the first instance, the contemnors want relaxation in the restraint orders over the Bank deposits and immovable properties to comply with the directions of this Court regarding deposit of the amounts. That part of the prayer does not pose any difficulty, as the same is in aid of compliance with the directions of this Court. Second set of prayers is for grant of bail or relaxation of jail conditions in the interregnum. Here, we have our reservations. We are not inclined to modify order dated 26th March, 2014 granting interim bail to the contemnors upon conditions stipulated in the said order. We say so because the background in which the contemnors came to be committed to the jail and the finding recorded by the Court that they have at all earlier stages tried to adopt dilatory tactics and avoided to comply with the orders passed by the Court does not in our view call for any m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We, however, find considerable merit in the submission made by Dr. Dhawan that the restraint order issued by the SEBI and by this Court forbidding transfer and alienation of moveable and immoveable assets by the Sahara Group of companies has the effect of preventing the contemnors from complying with the directions of this Court which require them to deposit Rs. 5,000/- crores in cash besides a bank guarantee for a similar amount of Rs. 5,000/-crores. While it is true that the contemnors stand committed to prison for their non-compliance with the directions of this Court, nothing should prevent them from taking steps to comply with the said directions or the conditions subject to which they have been granted interim bail. Restraint against transfer of the assets by the contemnors and the companies promoted by them precisely has the effect of doing so. The question, however, is as to what extent should the orders of restraint be modified. That aspect assumes importance because of the fact that Saharas need to eventually deposit a substantial amount which according to the current estimate may be in the neighbourhood of Rs. 30,000 to Rs. 35,000 crores inclusive of interest accrued o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also directed Saharas to get the amount outstanding towards the loan transactions qua the said properties confirmed from the Bank of China so as to give us a clear picture of the extent of liability that remains to be discharged against the said assets. The fact that the valuation reports regarding the three assets were prepared at the instance of the Bank of China shall also have to be verified and confirmed by the Bank of China, especially because no sale of the assets in question can be permitted at a price lesser than the price at which the said assets have been valued by the valuers who are said to be valuers of repute. Directions regarding sale of the assets outside the country can, therefore, await the furnishing of information and verification of the facts. 23. In the result we dispose of these I.As with the following directions: (i) The prayer for modification of the terms stipulated in our order dated 26th March, 2014 granting interim bail to the contemnors is declined and the I.As to that extent dismissed. (ii) Prayer for shifting the contemnors to a guest house for continued custody and detention till they comply with the directions of this Court for their release ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he details whereof are given in Annexure B to IAs No.101-103, for purposes of furnishing a bank guarantee for an amount of Rs. 5,000/-crores and/or for deposit of Rs. 5,000/- crores if there is any shortfall despite encashment and sales permitted in terms of (iii)(a) and (iii)(b) above. (e) In modification of the orders dated 26th March, 2014, we direct that the Bank guarantees to the tune of Rs. 5000/- crores shall be furnished from a nationalised bank or a scheduled bank only. Co-operative Bank Guarantees shall not suffice. (iv) In so far as sale of the three properties situated outside the country are concerned, the question is left open to be determined after the requisite documents/information is made available by Sahara in terms of our order dated 29th May, 2014. (v) Keeping in view the importance of the issues that fall for determination in these proceedings and the ramifications that the directions issued by this Court may have as also the fact that one very important order which is sought to be enforced in these proceedings was passed by a three-Judge Bench, we refer these proceedings to a three-Judge Bench to be constituted by the Hon'ble Chief Justice of India. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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