Patna HC Directs For Personal Presence Of Sahara Group Chief Subrata Roy To Explain Group's Plan To Return Investors' Money

The Patna high court earlier this week directed Sahara India Group Head Subrato Roy to remain personally present before the Court on May 11 and to come up with a plan for the return of the investment of the investors.The Bench of Justice Sandeep Kumar issued this order in 3 anticipatory bail applications after it came across certain cases of cheating committed by Non-Banking Financial Companies.The case in briefNow, during the course of the hearing of these matters, it came to the Court's knowledge that a large number of complaints are pending before the authorities under the Bihar Protection of Interest of Depositors (in Financial Establishments) Act, 2002 against the Sahara group of companies.These complaints pertain to non-payment of maturity amount by different entities of Sahara Group registered as NBFCs, Multi-Purpose Cooperative Society, etc. complaining that the Sahara Group has evaded payment of maturity amount of the investors.A common complaint raised by the investors is that whenever they approach the local offices of Sahara Group for payment of the maturity amount on their investments in different schemes then they are forced to transfer their investment to a new scheme, if it may be by reinvestment or by the issuance of some kind bonds etc.Submissions made by Sahara and SEBIIn view of this, the Court issued a notice to Sahara Group and SEBI for a refund of the amount invested by the general public in different Sahara Group entities. Before the court, Sahara Group submitted that about Twenty-Five Thousand Crores Rupees belonging to the Sahara Credit Cooperative Society Limited has been lying with SEBI and it was their specific plea that they are ready to pay the investors' investment if SEBI returns the amount to them.However, SEBI argued before the Court that since the matter with regard to the amount lying with SEBI is pending before the Supreme Court, the Patna HC should not pass any orders regarding that amount. Court's observationsAt the outset, the Court opined that since SEBI has already moved the Supreme Court for appropriate direction with regard to the amount lying with them, therefore, it wouldn't be appropriate for the HC to direct SEBI for returning the amount to Sahara Group.However, the Court did not find any force in the contention made by the Sahara Group that their money is lying with SEBI as it noted that the Group, through different entities, has been collecting the investments from the public at large till one month back."The Sahara Group has continued to collect investment and has done the same till about one month back, and therefore, they are duty bound to return the maturity amount to the investors. Poor persons having investment of Rs.10,000/-, 20,000/- etc. are the sufferers, who are not being paid the maturity amount," the Court remarked.The Court also termed it as surprising that SAHARA submitted before the Court they do not have funds to refund the investment of the investors and they will be able to refund the investment of the investors if SEBI releases the amount lying with them."The stand of Sahara Group is surprising. If they have been accepting the deposits by promising good returns to the investors after 2013 then they are duty-bound to honour their commitment. They cannot say that they do not have funds. If they say that they do not have funds then they will have to explain as to what happened to the money collected by them since 2013 till one month back. In the opinion of this Court, the stand of the Sahara Group, as mentioned above, is most unreasonable and therefore, their proposal is hereby rejected."Considering the aforesaid, by way of last chance, the Sahara Group and other companies, were directed to come up with a plan for the return of the investment of the investors, and for that, Subrata Roy, was directed to appear personally in the Court on May 11, 2022. Click Here To Read/Download Order

Patna HC Directs For Personal Presence Of Sahara Group Chief Subrata Roy To Explain Group's Plan To Return Investors' Money

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