SC signals for the sale or transfer of property owned by the Sahara group

In a fresh proposal filed by Sahara group chief Subrata Roy, the Supreme Court on Thursday allowed to lift the ban on the sale or transfer of property owned by the Sahara group. The court under an earlier order froze the assets. This unfreezing would help Sahara to comply with the Rs. 10,000-crore bail condition. Earlier the apex court ruled that 10,000-crore should be furnished as Rs. 5,000 crore in cash and Rs. 5,000 crore through bank guarantee. Read Live Law story here

The Sahara group has pleaded that it would deposit Rs. 3,000 crore in five working days and another Rs. 2,000 crore in 15 working days, and furnish a bank guarantee for Rs. 5,000 crore in 60 working days. Further the international properties of the group such as Grosvenor House in London, the Plaza and Dreams Downtown hotels in New York is mortgaged to the Bank of China and hence the valuation of the stake cannot be assessed immediately.

The SC bench comprising of Justice T.S. Thakur and Justice A.K. Sikri has asked the Sahara group to produce within one week the valuation of the assets from two reputed valuers and the Bank of China’s approval for sale of the properties. The confirmation must clearly indicate that the bank is agreeable to the sale of Sahara’s interests in these properties. Moreover the documents should indicate their true market value, the bench stated.

Advocate Rajeev Dhavan appearing for Mr. Roy, Ravi Shankar Dubey and Ashok Roy Choudhary implored for the release of Roy and the other two Sahara directors, as it would be impossible for the group to raise the money as long as Mr. Roy was in jail. No buyer would be willing to negotiate with others who did not have financial powers. Rajeev Dhavan even suggested the option of house arrest at a guest house at the expense of Sahara group.

But Justice Thakur retorted:

“We understand your concern. But consider the magnitude of the problem and the money that is to be refunded. We have to strike a balance between personal liberty and the enormity of the problem.”

The counsel for SEBI Mr. Pratap Venugopal, intimated the court about the safeguards that SEBI had put forth for ensuring that Sahara would repay the investors. The safeguards were in the nature of declaring details of buyers, terms of sale and submitting letters of intent. The buyers shouldn’t be related to the Sahara Group in any way, according to the safeguards.

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