In 2021, Sahara Group said that around INR 25,000 crores (with interest) had already been deposited into the Sahara-Sebi account, and SEBI was 'unreasonably keeping INR 25,000 crore of Sahara and its investors.'
Sahara India Investors’ Refund Status: On Monday, June 20, the Insurance Regulatory and Development Authority of India (IRDAI) petitioned the Supreme Court to review the Securities Appellate Tribunal’s decision to stay its order requiring Sahara India Life Insurance Company to transition its life insurance business to SBI Life Insurance Company.
The Insurance Regulatory Development Authority of India’s (IRDAI) Solicitor General informed Justice Surya Kant’s vacation bench that the SAT stay might have an impact on the servicing of Sahara policyholders and asked for a prompt hearing on the matter.
The insurance regulator stated that its order of June 2 to immediately transfer the life insurance business of the Sahara firm to SBI Life was passed due to the former’s rapidly deteriorating financial position, and as the prudential regulator being seized of the company’s state of affairs, for protecting and promoting the interests of the former holders of life insurance policies issued by Sahara by transferring its life insurance business to another fit and proper i.e. SBI Life.
Based on varied documents, SEBI has finally made refunds for a total of 17,526 bondholders who were eligible for an aggregate amount of 139.07 crores through NEFT/RTGS (to their respective account no. and IFSC codes provided).
Subrata Roy Sahara formed this conglomerate in 1978 with its headquarters in Lucknow, Uttar Pradesh, India. Roy was one of the top ten individuals on India Today’s 2012 High and Mighty power list. Even today, India referred to him as a “Treasure Hunter.” Roy’s company’s business plan includes sub-sectors such as finance, entertainment, infrastructure, healthcare, insurance, retail, education (edunguru), electric cars (Sahara evols), artificial intelligence, etc. As a major sports promoter in India, the corporation sponsored and owned numerous sports teams. Additionally, Sahara India made substantial contributions to the Indian entertainment industry.
From having a stake in a Formula One motor racing team to agreeing to buy a controlling stake in New York’s Plaza Hotel, Sahara garnered the trust of global giants. Additionally, its title sponsorship of the Indian National Cricket Team and Indian National Hockey Team made it a household name in India. What transpired that led to the company’s inclusion on the list of India’s largest con artists? And why does Sahara owe the public so much money? Here, we will discuss the frauds made by Sahara until 2011 and the most recent news concerning Sahara India in 2022.
Where did the Sahara hoax originate, you inquire? Let’s delve a little deep.
A private company must do an Initial Public Offering in order to raise cash through the stock market for the first time (IPO). The company must submit a Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) [a regulatory agency for the securities and commodity markets in India] to request authorization to do so. A DRHP is a draught incorporating all company-related information and a request for approval to sell company shares to the general public. On the basis of the DRHP study, SEBI grants approval to solicit public investment in the company’s stock. Now, let’s examine how Sahara Group became embroiled in an acrimonious conflict with SEBI, in which SEBI accused Sahara Group of fraud.
On September 9, 2009, Sahara Prime City (a Sahara Group real estate investment) submitted the DRHP, where SEBI assessed and identified a few concerns with how the business was raising capital for Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC).
On the same dates of December 25th, 2009 and January 4th, 2010, SEBI received reports stating that SIREC and SHIC had been soliciting cash for months under the guise of bonds: Optionally Fully Convertible Debentures (OFCD). Further inquiry found that Sahara Group has previously raised more than 24,000 crores through OFCD from around 2,500,000 to 3,000,000 small and large investors.
When SEBI requested clarification, Sahara stated that the bonds were hybrid and so not subject to SEBI’s jurisdiction. Sahara noted that the Registrar of Companies (ROC) under the Ministry of Corporate Affairs is responsible for the governance of such a bond, and that before to deploying the bond, DRHP had been approved by ROC.
Approval to acquire funds from more than 50 individuals is expected to be obtained from SEBI, hence Sahara’s fundraising efforts to date were deemed illegal. Both companies were therefore instructed to cease soliciting payments from the public and refund the monies with 15% interest.
The regulator issued the final order on June 23, 2011, while the group appealed to the Securities Appellate Tribunal. On October 18, 2011, the Tribunal approved and sustained SEBI’s orders, requiring the Sahara businesses to refund the agreed-upon amount to all investors.
When the Sahara India Group appealed to the Supreme Court, the court also issued an order requiring both Sahara companies to deposit the outstanding amount with SEBI to more than 2.5 crore investors within three weeks, either by providing sufficient bank guarantees or by seizing properties equal to the amount raised through OFCDs.
In February 2014, Subrata Roy Sahara and two other directors, Ravi Shankar Dubey and Ashok Roy Choudhary, were detained for the group’s failure to pay the remaining two instalments, despite having paid the needed first instalment.
On March 4, 2014, Roy and two other directors were transferred to the high-security Tihar Jail in Delhi.
Roy was granted parole in 2016 after serving almost two years in prison.
After so many years of contention, we all had questions, but the most pressing was: when will Sahara refund the investors’ money? How can you receive a return in 2022 if you are an investor in Sahara groups?
Here, we answer all of your inquiries and provide you with the most recent Sahara Group news for 2022 so that you may understand the present state of Sahara group investors.
Roy stated on the occasion of the 42nd Foundation Day that he has always adhered to the tradition of regular payments, but that in the past seven years, due to “undesirable circumstances,” payments had been postponed.
He further stated that all assets (mortgaged or sold) had been deposited in a Sebi-Sahara account according to a Supreme Court-imposed ban. Roy also stated, “We cannot use even a single rupee from this for organisational activities or to compensate the esteemed investors.”
“Keeping in mind the Supreme Court’s directives, certain deals have been struck that will fix Sahara’s issues by this year, 2020,” Roy stated.
As of February 1, 2020, Sahara group deposited INR 15,448.67 crore to the refund account, and a check for INR 41.59 crore crores was also deposited in late January. In terms of applications, SEBI received a total of 19,560 requests for a total of 53,361 bond certificates worth INR 81.3 crore. Anurag Thakur, the Minister of State for Finance, revealed that SEBI has already returned a total of INR 109.86 crore to 14,146 applicants for a total of 34,499 certificates.
As the money was only intended to pass via SEBI, SEBI published advertising inviting investors to request for refunds. The final advertising were distributed during the month of June 2018, informing individuals that the deadline for submitting refund claims was July 2, 2018, and that no claims would be processed beyond that date.
Roy mentioned in his letter to investors in 2020 that approximately INR 23,000 crores had already been deposited into the Sebi-Sahara account, but after nearly 9 years of orders, SEBI could only repay a little over INR 129 crores to the investors of both Sahara companies: Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC).
In 2021, Sahara Group said that around INR 25,000 crores (with interest) had already been deposited into the Sahara-Sebi account, and SEBI was “unreasonably keeping INR 25,000 crore of Sahara and its investors.”
About the newspaper advertisements distributed by SEBI, Sahara stated that, as of July 2018, SEBI ceased to accept any refund forms. The Sahara Group claimed, “This enormous sum of money is sitting inert in the banks, which is not only detrimental to Sahara as a commercial organisation but also to the economic prosperity of our country, especially in these trying times of economic recession.”
“In this manner, Sahara provides sustenance to almost 14 lakh people in their own villages and towns. It is the second largest human capital in the country, after Indian Railways. This sum might have been used by the organisation to generate more employment and work, which would have benefited the country’s economy,” the report continued.
According to SEBI’s annual report for 2020-2021, the Supreme Court has appointed Justice (Retired) B.N. Agarwal to oversee its proceedings in this issue. Additionally, that the court receives periodic updates and informational reports. SEBI has submitted 22 status reports to the Supreme Court in the Sahara matter as of March 31, 2021. SEBI has also filed an Interlocutory Application with the Supreme Court, dated October 21, 2021, seeking additional guidance on the case.
In the most recent update to the Sahara fraud 2022, SEBI has finally refunded a total of 17,526 bondholders who were eligible for a total of 139.07 crores via NEFT/RTGS, based on various documents (to their respective account no. and IFSC codes provided). And additional actions are necessary before the Supreme Court.
Various sources have reported various measures taken to advance the Sahara refund case; the following are a few of the most recent updates on the Sahara India Scam:
Navin Jaiswal, an MLA from the BJP, raised questions in the state assembly over the Sahara India fraud. He stated that the underprivileged have invested more than 25,000 billion rupees (INR) in Sahara programmes and are now having trouble getting their money back. He demanded the establishment of a hotline for Sahara scam victims. The state of Jharkhand’s finance minister, Rameshwar Oraon, said that they are monitoring the situation and working to assist the victims.
The refund requires information regarding the investors’ names, addresses, Sahara account numbers, the number of bonds purchased, the amount invested, and the method of payment (cash, check, or draught). The investors must also give pictures, evidence of identification, bank account information, and actual bond certificates in addition to the information for the electronic transfer of funds to their accounts.
Proof of any significant address or marital status changes since the time of their investment is also required.
Moreover, SEBI specifies that, if applicable, income tax will be deducted at source, unless a form claiming exemption from deduction at source is submitted with the refund application in compliance with the applicable Income Tax Act.
If investors have any questions regarding their investments, they should contact SEBI at sebi@sebi.gov.in. The refund number for Sahara is 1800 266 7575 or 1800 22 7575 (toll-free).
Additional information regarding the Sahara fraud is forthcoming. We update information as it becomes available, so check back for updates.
If you have invested your hard-earned money in Sahara India Group and now feel trapped, this is the news you need to hear. The complaint relates to Sahara India Group’s public offering of Optionally Fully Convertible Bonds to approximately three crore investors (OFCDs). Sahara India issued securities without adhering to the regulations designed to protect investor interests. In 2011, SEBI ordered Sahara India to restore all investors’ funds, but many depositors still have not recovered their funds as of today.
The government is taking stringent measures against the issue and attempting its best to return all investors’ funds. Previously, Sahara India also informed all investors of the repayment via newspaper letters, but nothing transpired. In recent developments, the High Court has ordered Sahara India to present a plan for the interest-bearing repayment of investor deposits. Sahara India Real Estate Corporation (SIRECL), Sahara Housing Investment Corporation (SHICL), Subrata Roy, and three others were fined Rs.12 crores for violating the SEBI Act.
Recently, a consumer association in the Gopalganj region of Bihar demanded that Sahara return all investors’ maturing deposits with 9 percent interest.
SEBI requests that investors email sebi@sebi.gov.in with any questions regarding their investments. SEBI refund number for Sahara: 1800 266 7575 or 1800 22 7575 (toll-free).
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