Sahara SEBI Issue – Statement from Keshav Mohan, Advocate

We are disappointed with the judgment that has been delivered by the Hon’ble Supreme Court earlier today. We are still in the process of reading and understanding the judgment. The voluminous evidence that we have already submitted to substantiate our stance may have possibly been misunderstood.We maintain that we have already refunded to 93% of our investors. Most of the payments made were in cash, as per the RBI norms and in accordance with SEBI and SAT orders. In addition to ledger entries, we had also submitted original vouchers, receipts and other concerned documents in original being physical proof of the payments and are with SEBI pending verification.

We expect to return to the Hon’ble Court in the near future with further evidence of our compliance of the Hon’ble Court’s previous orders, and to satisfy the Hon’ble Court of our earnest intentions moving forward.
The Hon’ble Court has indicated that it expects us to make a new proposal. Since the beginning, we have been trying hard to present the best practical proposal. We have always maintained that this will be actually a double payment which we are asked to make hence a serious relook into the business and financial status is required each time. In light of today’s direction, we will try our best to derive a fresh proposal to the best of our capacity and hoping to satisfy the Hon’ble Court. For this, we would also apply to the Hon’ble Court that our properties and bank accounts be defreezed so that we are in a position to come up to the expectations of the Hon’ble Supreme Court.
We take this opportunity to reiterate our deep and abiding respect for the Hon’ble Supreme Court of India and our commitment to follow the order in letter and spirit.

Keshav Mohan
 Advocate

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SAHARA SEBI: IMAGINE !

Sahara India Pariwar

Let’s Imagine! Imagine Charlie Chaplin not being the legendary comedian that he was. Or Arnold Swarzeneger not the action icon we all know him as. Imagine Sachin Tendulkar not being the celebrated cricketer but a regular 9 to 5 school teacher or if electricity was never invented. What would it be like if Newton had never discovered the Law of Gravity or Einstein had not made those elaborate inventions? What if Elvis continued driving trucks or Satyajit Ray wasn’t an illustrious story teller? Difficult and rather unfamiliar and absurd hypothesis! Would these people be still famous, brilliant and celebrated if they were not in their chosen professions? What would have our lives been like in the absence of these people or their world changing contributions to humanity? The answer can only be left to one’s imagination and with no certainty can anyone claim that they be who they are today or what would our existence been like, if these men were not true to their calling.

Now for a moment, let’s imagine a bit further. Would Sahara India have avoided the existential crisis, they are in today, had they not chosen to provide a sound, secure & lawful financial structure to a stratum of the society who has always stood ignored amongst the tall claims of social and economic development? What would the lives and future of these millions of depositors would have been like if they didn’t have a secure medium to invest and save and flourish? What would the future of the children growing in these millions of households have hold? Would they be educated? Would there be employment for the unemployed or the less skilled or the poor? Would there have been economic empowerment for the have nots who do not have the means or the sanction to even hold a bank account or a legitimate Id? Would the chief of Sahara India, Subrata Roy, have saved himself the witch hunt by a National Regulator or avoided jail had he chosen to create a lush empire and focused on serving himself rather than serving the people? Such a swarm of hypotheticals starting with just one simple question, “Imagine?”

Sadly, there are no simple answers. Only simple questions. The answers are complex, unfathomable and lead down to a road of nefarious possible motives, juxtapositions & outcomes. SEBI’s motives juxtaposed with the Court’s senseless brickbat blows on the Sahara Chief only adds insult to the common man’s understanding of productive regulation and fair justice. Even more dangerously, the imagination of SEBI and the Courts have taken a turn for the worse and seem to be more heavily invested in feeding their own egos, their illogic and mindless banter rather than using that imagination to serve and secure.
Currently, SEBI has been claiming that investor accounts provided by Sahara are fictitious and the regulator’s independent verification has failed to make any headway. SEBI so far has been able to repay less than 1 crore rupees to OFCD investors even though its been 18 months since Sahara deposited 5,120 crore rupees with the market watchdog. Interestingly, in 2008, Sahara had paid back around 4 crore depositors under strict supervision of Reserve Bank of India. The central bank, then, did not stumble upon any such fictitious account and the OFCD issue had almost same set of investors. So is SEBI imagining these investors as fictitious or is it disguising its incompetence. To further add to the comedy of errors, the Supreme Court has expressed its displeasure over SEBI’s tardy pace in verifying these investor accounts in Sahara’s OFCD issue. I can only imagine the embarrassment the courts must be facing at the hands of the regulator’s malfunction. And who is paying the price for all this mockery. The innocent, the lawful and the poor!

Let’s tax our imagination one more time and explore another set premise. What if Sahara is innocent? What if the Sahara supremo is being wrongfully accused and punished? Is SEBI acting in the best interest of the depositors or is it blinded by its punitive sense of dominion? What would it be like if SEBI realized and acknowledged that these investors in question are for real? What would it be like if there was no Sahara to begin with? Are these questions that have real and heavy implications or are they just plain rhetoric?
The answers can only be left to unfold as time and events pass by. The outcomes would be real and the consequences can either set unhealthy & dire precedents or can pave way to a truthful, mindful and fair premise. Just
IMAGINE..!!!

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True Indian Subrata Roy :Pride of India

                                            True Indian Subrata Roy :Pride of India

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SAHARA-SEBI STANDOFF

 The Supreme Court is set to hear Sahara chief Subrata Roy’s petition on Tuesday. Sahara has raised some points over its legal battle with stock market regulator Sebi
Sahara says it has already paid 93% of the investors. Per investor average deposit is of 8,400. Hence, it can be repaid in cash as per law In last 17 months, Sebi repaid only 1 cr and is holding 5619 cr (including interest), argues Sahara .

    No verification process has been started by Sebi in the last 17 months, disobeying court’s August 31, 2012 order, the company says
Sahara offered guarantee of the entire amount through bank trustee security; but when it was rejected, the company says it offered irrevocable bank guarantee.This has not been accepted .

    At the heart of the matter lies Sebi’s demand, under directions of the Supreme Court, of an additional 20,000 crore along with 15% interest to investors .The company says Sebi has alleged that Sahara’s investors are fictitious and untraceable.

  Sahara says that in 2008, it had repaid around 4 crore depositors under supervision of the Reserve Bank of India. The company says in response to Sebi’s assertion that many of the 20,000 letters to depositors didn’t elicit a response, Sahara had submitted affidavits and KYC
documents confirming their existence .

    Sahara says it remains Sebi’s responsibility to ascertain the authenticity of its claim that it has repaid most of their money.  If Sebi continues to insist that investors do not exist, then, by the same logic, the regulating body — born out of the specific mandate of protecting investors — also ceases to have any further stake or role to play in the case, the company said in a statement .
   
Sahara says a proper verification process has not been implemented to ascertain the existence of its depositors — despite conclusive evidence forwarded to Sebi
in the form of original documents, repayment vouchers and receipts. Sahara says as a market regulator, Sebi does not have the power to regulate unlisted entities. Sebi is looking to sell properties belonging to third parties which have been kept as security with Sebi, even when it has no authority to effect any such sale without the consent of the titleholders of the properties.

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SEBI trying to ‘siphon off’ investor refund: Sahara

The Securities and Exchange Board of India has claimed that it has spent close to Rs 60 cr in 2013-14 on locating genuine investors of SIRECL and SHICL.

Subrata Roy

Sahara India has alleged that market regulator Securities Exchange Board of India (SEBI) is trying to "siphon off money from the funds" deposited by the group for refunding the investors of Sahara India Real Estate Corp Ltd (SIRECL) and Sahara Housing Investment Corp Ltd (SHICL). SEBI has claimed that it has spent close to Rs 60 cr in 2013-14 on locating genuine investors of Sahara group companies Sahara India Real Estate Corp Ltd (SIRECL) and Sahara Housing Investment Corp Ltd (SHICL).

"We have spent a huge chunk of our money on this and we are running out of money now. We had requested the Supreme Court to allow us to use the funds deposited by Sahara India so as we can meet the expenses incurred on this task," said a senior official from SEBI requesting anonymity.
The official explained that SEBI has spent a large amount on not just locating the investors but also on the storage of the documents submitted by Sahara. In an email response to The Sunday Guardian, Sahara India's counsel, Keshav Mohan, stated, "We suspect that this is a highly malicious campaign initiated by SEBI with a very clear intention to siphon off money from the funds that Saharas have deposited with SEBI, purely for the repayment to its investors. It is really unfortunate and unbecoming of a regulator, the way SEBI is blowing hot and cold, both at a time."
He further pointed out that on Thursday, the counsel for SEBI had argued in the Supreme Court that SIRECL and SHICL issues were public issues, while now SEBI has made a plea that Sahara's investors are untraceable. "We ask SEBI to disclose the basis of their contention, else withdraw their statement. The fact is that, when SEBI sent letters to about 20,000 account numbers and did not receive any responses for them, we immediately got affidavits from a large number of such investors and submitted to SEBI the affidavits, authentic Know Your Customer (KYC) documents and photographs of almost all those investors, who the regulator had tried to contact. Those who were already paid, confirmed that they had received redemption of their investments to their full satisfaction," Mohan noted.
In a strong rebuttal to SEBI's allegations, Mohan further added that the market regulator has not been following directions and has not refunded even Rs 1 cr to the investors, in the last 15 months. "It is not known, why SEBI is not following this direction, and why it is only interested in extracting money from Sahara...SEBI's intentions are unfair and acutely malafide."
Mohan also pointed out to the fact that on 4 March, SEBI told the court that it had completed the scanning and digitisation of the 3.03 crore investors' documents provided by Sahara. Therefore the verification process has still not started.
Mohan also recounted that the Minister of State for Finance, Namo Narayan Meena in a reply to a question in Parliament had said that the money given by Sahara is for refund to the investors only and the money would not be utilised for any other purpose. "The money received by SEBI will only be used for the repayment of the investors and till now SEBI has only refunded only Rs 1 cr. This is a sinister attempt by SEBI to eat away investors' money. Till now, in Saharas' case SEBI has not shown any intention to protect the interest of investors, for which it has been constituted... we will not let SEBI make this another Golden Forest Case where investors have still not got their hard earned money and will stand and fight till the end in the interest of our investors."

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