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Bhadra Sinha, Hindustan Times
New Delhi, December 05, 2012
In a relief to the Sahara Group the Supreme Court on Wednesday gave two more months to the company to pay back its investors who had deposited money in the optionally fully convertible debentures (OFCD). The OFCD were floated by Sahara India Real Estate Corporation Limited (SIRECL) and Sahara Housing Investment Corporation Limited (SHICL).

A three-judge bench headed by Chief Justice Altamas Kabir directed the company to make an upfront payment of Rs. 5,120 crore to market regulator SEBI. The first payment of Rs. 10,000 crore would be paid to SEBI within the first week of January 2013, while the balance would be paid during the first week of February.

Despite SEBI’s objections, the bench also extended by 15 days the time period to submit details related to the investors and documents supporting Sahara's claim of having refunded some amount. The regulator argued the bench wasn't an appropriate forum to pass orders as the final verdict holding that the OFCDs were illegal was delivered by another bench.

The direction is likely to render SEBI's contempt application pending before a bench of Justice KS Radhakrishnan and Justice JS Khehar infructuous. It was this bench that had on August 31 directed Sahara to pay Rs. 24,000 crore along with 15% interest to its investors. Sahara's review petition against the verdict too is pending.
It had even directed the company to submit investors' details to SEBI within 10 days of the order and fixed a three moth time limit asked it to pay back by November 30.

Since Sahara had failed to comply with the directions of furnishing the requisite documents to SEBI, the regulator moved a contempt plea before the two-judge bench.