#SEBISahara: SC (finally) gives SEBI green signal to sell Sahara’s properties [Read Timeline]

After hearing Sahara Group Chairman Subrata Roy for over two years, the Supreme Court of India has concluded that Roy will not be able to raise the money required for complying with the Court’s orders..The apex court has now ordered the Securities and Exchange Board of India (SEBI) to sell off Sahara’s properties to realise the money..The order was passed by a 3-judge Bench of Chief Justice TS Thakur, and Justices Anil R Dave and AK Sikri. Senior Advocates Kapil Sibal and Rajeev Dhavan appeared for Roy while SEBI was represented by Senior Advocate Arvind Datar who is briefed by KJ John & Co..Though Roy had been able to raise the Rs. 5,000 crore cash component required for bail, he was unable to come up with the remaining Rs. 5,000 crore by way of bank guarantees..The Court has now directed SEBI to appoint an independent agency to carry out the sale of Sahara’s properties..Origins.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 Justices KS Radhakrishnan and JS Khehar. However, the exception to this was when a Bench headed by 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. Kabir later provided his version of the events relating to his order..The matter then came back to the Bench of Justices Radhakrishnan and Khehar. The Bench which was irked by continuous deference of its orders by Roy, proceeded to sent him to jail and later came down heavily upon Sahara’s lawyers for mind games and attempts to intimidate the Bench. As of today, Roy and other directors are still languishing in Tihar jail..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 Justices Radhakrishnan and Khehar..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 (This conditional bail remains elusive for Roy to date)..April 21, 2014: Court reserves its order in the Habeas Corpus petition..May 6, 2014: Court pronounces its judgment in the Habeas Corpus petition. Refuses to release Roy while strongly condemning the “psychological offensives and mind games” resorted to by the Senior Advocates of Subrata Roy to seek recusal of judges in the matter..May 15, 2014: Justice JS Khehar recuses from the case. This came after Justice KS Radhakrishnan’s retirement from Supreme Court. Justice Radhakrishnan, had spoken about Justice Khehar in his farewell speech and had referred to him as a judge whose “fearlessness is unparalleled in Supreme Court history”. He had also spoken about the tremendous pressure which the two judges had undergone while hearing the case..A new Bench is constituted by the Chief Justice; it comprises Justice TS Thakur and Justice AK Sikri..May 19, 2014: The new Bench starts hearing the matter; It directs Roy to submit a concrete proposal for furnishing bail money while turning down the request to place Roy under house arrest instead of judicial custody..July 4, 2014: Court reserves its order in a plea seeking parole for Roy for 40 days and permission to sell three overseas hotels..July 22, 2014: Senior Advocate Rajeev Dhavan engages in a lengthy and excited dialogue with the Bench after the Bench’s refusal for a 40-day parole for Roy. Dhavan objects to what he perceived as Justice Thakur “making fun of him”. (By then, the Bench also had Justice Anil R Dave on it, since the court’s order of December 2012 was under consideration). Rajeev Dhavan was later replaced by Sahara (and subsequently, re-engaged)..The court, however, allows Sahara to sell its foreign properties to raise money..August 1, 2014: Court permits Roy to set up a make shift office in Tihar Jail’s conference room to negotiate deals with prospective creditors/ buyers..November 28, 2014: Sahara tells court that deals with respect to the three overseas hotels fell through; Seeks permission for sale of 4 domestic plots which is granted on December 2..January 9, 2015: Court grants Sahara permission to borrow from US based Mirach capital..February 5, 2015: Deal with Mirach falls through as Roy is fated to remain in jail..February 13, 2015: Reserve Bank of India moves Supreme Court seeks to implead itself, opposes Sahara India Financial Corp. Ltd from utilizing any of its assets, including securities, for paying dues to SEBI..March 4, 2015: Roy completes a year in jail..Another year was spent by Roy’s lawyers to get him out of jail but in vain. Meanwhile Roy authored a book titled “Life Mantras” which was released on February 1, as reported by Mint. On March 4 this year, Roy completed two years in Tihar jail..The Lawyers .Sahara, Roy and other Director have engaged nearly every available Senior Advocate in the matter..The following lawyers have been engaged by Sahara, Subrata Roy and other directors till date:.1. Kapil Sibal 2. Ram Jethmalani 3. CA Sundaram 4. S Ganesh 5. Fali S Nariman 6. Gopal Subramanium 7. Rajeev Dhavan 8. Ravi Shankar Prasad 9. Rakesh Dwivedi 10. PH Parekh 11. Abhishek Manu Singhvi.Senior Advocate Arvind Datar has been representing SEBI along with Advocate Pratap Venugopal from KJ John & Co.