“We may retire but we will ensure and make sure our orders are complied with.”– Justices KS Radhakrishnan and JS Khehar.Never before in the recent history of the Supreme Court of India has a matter received so much attention as the ongoing dispute between government regulator, Securities and Exchange Board of India (SEBI) and Indian conglomerate, Sahara. The drama which has been playing out for more than 2 years arguably reached a crescendo when Sahara Group Chairman, Subrata Roy was summoned to the Court. The excitement was apparent from the dense crowd outside court room 7 on that day, the sheer number of people nearly resulting in a stampede. I watched with amusement as the security personnel, unaware of the identity of some of the senior lawyers involved in the case, refused to let them into the courtroom. The thespians, their opponents, the judges and the media have all perfected their roles to synonymise the case with the term, “court room drama”..How it all began.The case itself relates to the Optionally Fully Convertible Debentures (OFCD) issued by two Sahara Companies –Sahara India Real Estate Corporation Limited (SIRECL) and Sahara Housing Investment Corporation Limited (SHICL). Market regulator SEBI, while processing the Draft Red Herring Prospectus of another Sahara Group Company, Sahara Prime Limited, discovered that the issue of the OFCDs was in contravention of the provisions of the Companies Act, 1956 and the SEBI Act, 1992. Observing that the companies had raised sizeable amounts from the public without conforming to the disclosure and investor protection norms, SEBI on June 23, 2011 directed a refund of the amount raised along with an interest of 15 per cent..Sahara filed an appeal an appeal before the Securities Appellate Tribunal (SAT) which confirmed the SEBI order. An appeal against the SAT order was moved before the Supreme Court. The matter was largely heard by a Division Bench comprising Justices KS Radhakrishnan and JS Khehar. However, the exception was when a Bench headed by former Chief Justice Altamas Kabir extended the deadline to refund the money in December 2012. This act of the Court came under immense scrutiny especially after then SCBA President MN Krishnamani subsequently objected to another Bench hearing the matter..As of today, Roy and other directors are still languishing in Tihar jail. The Court in its order today granted interim bail to the contemnors on the condition that an amount of Rs. 10,000 crore be paid by them. Lawyers for the contemnors made it clear that it would not be possible to raise such an amount with the directors still in jail. The matter will be heard at 2 pm tomorrow..Case time line:.August 31, 2012: Supreme Court confirms SAT order, directs Sahara to refund Rs. 17,400 crore within 3 months. Delivers 270 page judgment, makes it clear that SEBI free to take recourse to all legal remedies if Sahara fails to pay up..December 5, 2012: Court extends the deadline for repayment. Directs that Rs. 5,120 crore be paid upfront and remainder be paid in two instalments in January and February 2012..February 6, 2013: Court issues notice to Sahara in contempt petition filed by SEBI for non compliance with August 31 judgment. Court also pulls up SEBI for failing to take action against Sahara.April 22, 20013: Sahara’s failure to reply in contempt petition evokes strong response from Court, directs them to file response within a week..May 2, 2013: Court directs proceedings relating to this matter in SAT and Allahabad High Court be stalled..October 28, 2013: Sahara directed to make available to SEBI title deeds of property worth Rs. 20,000 crore; Senior Counsel Aryama Sundaram manages to prevent restraining order against Subrata Roy and other directors..November 21, 2013: Subrata Roy and other directors restrained from travelling abroad, Sahara restricted from selling its property; Court takes exception to Sahara’s conduct, says “it is a mockery of our order.”.January 9, 2014: Justices Radhakrishnan and Khehar come down heavily upon Sahara for refusing to disclose source of money claimed to have been refunded; “We have shown you much indulgence, but you want the stick, we will give you the stick.”, Justice Radhakrishnan remarks..February 20, 2014: Court issues summons to Subrata Roy and 3 other directors of Sahara..February 26, 2014: Roy fails to appear, Senior Advocate Ram Jethmalani appearing for Roy submits that Roy was attending to his sick mother, produces a medical certificate issued by Sahara hospital; Court refuses to accept Jethmalani’s arguments, issues non bailable arrest warrant against Roy..March 4, 2014: Subrata Roy appears before the Supreme Court. Gwalior based lawyer smears ink on Roy’s face in the court premises. Supreme Court directs Sahara to come up with a proposal for refund and orders Roy and other directors to be sent to judicial custody in Tihar jail..March 7, 2014: Sahara’s fresh proposal for repayment rejected by the Court, calls it a “big insult” and “dishonourable”..March 12, 2014: Habeas Corpus petition filed in the Supreme Court seeking Roy’s release. Ram Jethmalani tries to get it listed before the Chief Justice who, however, lists the matter before J. Radhakrishnan and J. Khehar..March 25, 2014: Sahara submits fresh proposal for refund.March 26, 2014: Court grants conditional bail to Roy and other contemnors on payment of Rs. 10,000 crore – Rs. 5, 000 crore to be deposited in the court and for the balance a bank guarantee of a nationalised bank to be furnished in favour of SEBI. Court also directs SEBI to examine the fresh proposal submitted by Sahara..The Lawyers involved.The following senior advocates have been engaged by Sahara, Subrata Roy and other directors till date:.1. Ram Jethmalani 2. CA Sundaram 3. S Ganesh 4. Fali S Nariman 5. Gopal Subramanium.6. Rajeev Dhavan 7. Ravi Shankar Prasad 8. Rakesh Dwivedi 9. PH Parekh 10. Abhishek Manu Singhvi.Senior Advocate Arvind Datar has been representing SEBI along with Advocate Pratap Venugopal from KJ John & Co. The Union government was represented by former Additional Solicitor General Harin Raval in the main matter.
“We may retire but we will ensure and make sure our orders are complied with.”– Justices KS Radhakrishnan and JS Khehar.Never before in the recent history of the Supreme Court of India has a matter received so much attention as the ongoing dispute between government regulator, Securities and Exchange Board of India (SEBI) and Indian conglomerate, Sahara. The drama which has been playing out for more than 2 years arguably reached a crescendo when Sahara Group Chairman, Subrata Roy was summoned to the Court. The excitement was apparent from the dense crowd outside court room 7 on that day, the sheer number of people nearly resulting in a stampede. I watched with amusement as the security personnel, unaware of the identity of some of the senior lawyers involved in the case, refused to let them into the courtroom. The thespians, their opponents, the judges and the media have all perfected their roles to synonymise the case with the term, “court room drama”..How it all began.The case itself relates to the Optionally Fully Convertible Debentures (OFCD) issued by two Sahara Companies –Sahara India Real Estate Corporation Limited (SIRECL) and Sahara Housing Investment Corporation Limited (SHICL). Market regulator SEBI, while processing the Draft Red Herring Prospectus of another Sahara Group Company, Sahara Prime Limited, discovered that the issue of the OFCDs was in contravention of the provisions of the Companies Act, 1956 and the SEBI Act, 1992. Observing that the companies had raised sizeable amounts from the public without conforming to the disclosure and investor protection norms, SEBI on June 23, 2011 directed a refund of the amount raised along with an interest of 15 per cent..Sahara filed an appeal an appeal before the Securities Appellate Tribunal (SAT) which confirmed the SEBI order. An appeal against the SAT order was moved before the Supreme Court. The matter was largely heard by a Division Bench comprising Justices KS Radhakrishnan and JS Khehar. However, the exception was when a Bench headed by former Chief Justice Altamas Kabir extended the deadline to refund the money in December 2012. This act of the Court came under immense scrutiny especially after then SCBA President MN Krishnamani subsequently objected to another Bench hearing the matter..As of today, Roy and other directors are still languishing in Tihar jail. The Court in its order today granted interim bail to the contemnors on the condition that an amount of Rs. 10,000 crore be paid by them. Lawyers for the contemnors made it clear that it would not be possible to raise such an amount with the directors still in jail. The matter will be heard at 2 pm tomorrow..Case time line:.August 31, 2012: Supreme Court confirms SAT order, directs Sahara to refund Rs. 17,400 crore within 3 months. Delivers 270 page judgment, makes it clear that SEBI free to take recourse to all legal remedies if Sahara fails to pay up..December 5, 2012: Court extends the deadline for repayment. Directs that Rs. 5,120 crore be paid upfront and remainder be paid in two instalments in January and February 2012..February 6, 2013: Court issues notice to Sahara in contempt petition filed by SEBI for non compliance with August 31 judgment. Court also pulls up SEBI for failing to take action against Sahara.April 22, 20013: Sahara’s failure to reply in contempt petition evokes strong response from Court, directs them to file response within a week..May 2, 2013: Court directs proceedings relating to this matter in SAT and Allahabad High Court be stalled..October 28, 2013: Sahara directed to make available to SEBI title deeds of property worth Rs. 20,000 crore; Senior Counsel Aryama Sundaram manages to prevent restraining order against Subrata Roy and other directors..November 21, 2013: Subrata Roy and other directors restrained from travelling abroad, Sahara restricted from selling its property; Court takes exception to Sahara’s conduct, says “it is a mockery of our order.”.January 9, 2014: Justices Radhakrishnan and Khehar come down heavily upon Sahara for refusing to disclose source of money claimed to have been refunded; “We have shown you much indulgence, but you want the stick, we will give you the stick.”, Justice Radhakrishnan remarks..February 20, 2014: Court issues summons to Subrata Roy and 3 other directors of Sahara..February 26, 2014: Roy fails to appear, Senior Advocate Ram Jethmalani appearing for Roy submits that Roy was attending to his sick mother, produces a medical certificate issued by Sahara hospital; Court refuses to accept Jethmalani’s arguments, issues non bailable arrest warrant against Roy..March 4, 2014: Subrata Roy appears before the Supreme Court. Gwalior based lawyer smears ink on Roy’s face in the court premises. Supreme Court directs Sahara to come up with a proposal for refund and orders Roy and other directors to be sent to judicial custody in Tihar jail..March 7, 2014: Sahara’s fresh proposal for repayment rejected by the Court, calls it a “big insult” and “dishonourable”..March 12, 2014: Habeas Corpus petition filed in the Supreme Court seeking Roy’s release. Ram Jethmalani tries to get it listed before the Chief Justice who, however, lists the matter before J. Radhakrishnan and J. Khehar..March 25, 2014: Sahara submits fresh proposal for refund.March 26, 2014: Court grants conditional bail to Roy and other contemnors on payment of Rs. 10,000 crore – Rs. 5, 000 crore to be deposited in the court and for the balance a bank guarantee of a nationalised bank to be furnished in favour of SEBI. Court also directs SEBI to examine the fresh proposal submitted by Sahara..The Lawyers involved.The following senior advocates have been engaged by Sahara, Subrata Roy and other directors till date:.1. Ram Jethmalani 2. CA Sundaram 3. S Ganesh 4. Fali S Nariman 5. Gopal Subramanium.6. Rajeev Dhavan 7. Ravi Shankar Prasad 8. Rakesh Dwivedi 9. PH Parekh 10. Abhishek Manu Singhvi.Senior Advocate Arvind Datar has been representing SEBI along with Advocate Pratap Venugopal from KJ John & Co. The Union government was represented by former Additional Solicitor General Harin Raval in the main matter.
