Sebi's refund to Sahara investors reach Rs 138 crore since 2012

Sebi has processed Rs 138 crore refunds to investors of two Sahara companies in a decade, while the amount deposited in specially-opened bank accounts for the repayment has risen to over Rs 24,000 crore.

These disclosures have been made by the Securities and Exchange Board of India (Sebi) in its latest annual report.

In the absence of claims from a majority of the bondholders of the two Sahara companies, which were asked to return the money to nearly 3 crore investors along with interest in August 2012 through a Supreme Court order, the total amount refunded by Sebi rose by just about Rs 9 crore during the last fiscal, 2021-22, while the balance in Sebi-Sahara refund accounts rose by Rs 1,515 crore during the year.

In its annual report, the regulator said that it received 19,650 applications as of March 31, 2022, involving total refund claims of Rs 82.31 crore. Of this, it has issued refunds of Rs 138 crore, including Rs 68 crore as interest, in 17,526 cases.

The remaining applications were closed either due to their records not being traceable in the documents or data provided by two Sahara Group firms -- Sahara India Real Estate Corporation Ltd (SIREL) and Sahara Housing Investment Corporation Ltd (SHICL).

In its previous update, Sebi had put the total amount refunded by it as of March 31, 2021 at Rs 129 crore (concerning 19,616 applications).

Sebi further said pursuant to various orders passed by the Supreme Court and the attachment orders passed by the regulator, an aggregate amount of Rs 15,507 crore has been recovered by it as of March 31, 2022.

"These amounts along with interest earned on them after providing for making refunds to the bondholders have been deposited in various nationalised banks in terms of the judgment dated August 31, 2012 of the Supreme Court. As of March 31, 2022, the total amount deposited in these banks is Rs 24,076 crore," Sebi said.

This amount stood at Rs 23,191 crore and Rs 21,770.70 crore as of March 31, 2021 and March 31, 2020 respectively.

Sebi had ordered Sahara India Real Estate Corporation Ltd and Sahara Housing Investment Corporation Ltd in 2011 to refund the money raised from investors through certain bonds known as Optionally Fully Convertible Bonds (OFCDs) after the regulator ruled that the funds were raised by the two firms in violation of its rules and regulations.

After a long process of appeals and cross-appeals, the Supreme Court on August 31, 2012 upheld Sebi's directions asking the two firms to refund the money collected from investors with 15 per cent interest.

Sahara was eventually asked to deposit an estimated Rs 24,000 crore with Sebi for further refund to investors, though the group has been maintaining that it had already refunded more than 95 per cent of investors directly.