IN FRESH trouble to Sahara group, the Supreme Court on Wednesday (February 6) said that Securities and Exchange Board of India (SEBI) is free to freeze accounts and seize properties of its two companies for defying court orders by not refunding Rs24,000cr ($450.40m/£285.89m) to investors.
The apex court also pulled up SEBI for not taking action against the companies – Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC) – as per its August 31, 2012 order which had asked it to attach properties and freeze bank accounts of the companies.
It issued notice to the group to respond within four weeks why contempt action should not be initiated against the companies for not complying with its order.
“What steps are you taking? You are not taking any action. The judgment tells you what to do but you are not doing it,” a bench of justices KS Radhakrishnan and JS Khehar said.
The market regulator submitted that it is taking action and issued notice to the companies and approached civil court in Bombay for freezing bank accounts.
Not satisfied by its contention, the bench said that issuing notice is not enough and that SEBI has to follow its last year’s order.
“Why you gave notice and did not take action. You have to execute our order,” the bench said.
The bench also made it clear that the proceedings pending before it on contempt plea against the companies would not come in the way of SEBI taking action against the group.
India’s top court in last August directed the companies to refund the money to investors within three months with 15 per cent interest per annum for raising the amount from its investors in violation of rules and regulations.
In stinging observations against the companies, the court had said that such economic offences must be dealt with “iron hand”.
