Rs 55 crore and counting: Sebi's expense bill to Sahara
Market regulator Sebi has incurred initial costs of more than Rs 55 crore in its humongous task of facilitating Rs 24,000-crore refund to bondholders of two Sahara firms after verifying their credentials and Saharas would have to clear all these bills.business Updated: Apr 07, 2013 14:06 IST
Market regulator Sebi has incurred initial costs of more than Rs 55 crore in its humongous task of facilitating Rs 24,000-crore refund to bondholders of two Sahara firms after verifying their credentials and Saharas would have to clear all these bills.
The final expense bill of the Securities and Exchange Board of India (Sebi) in this high-profile case could be much higher, as just two contracts -- for storage and scanning of investor documents and for providing a platform to facilitate redemption related services -- have cost it Rs 55.85 crore.
Sebi is verifying the credentials of more than three crore investors for the refund as per a direction from the Supreme Court, which has also ruled that Saharas would have to pay all the expenses borne by the regulator in this matter.
Sebi has contracted Stock Holding Corporation of India (SHCIL) for the work relating to storage, digitisation and scanning of investor documents and for creation of a database, a senior official said, while adding that this contract is worth Rs 25.97 crore.
Besides, another contract of Rs 29.88 crore was given to UTI Infrastructure Technology & Services for the work relating to redemption related activities in this case, he said.
The Supreme Court has also appointed a retired judge to oversee the matter at a monthly remuneration of Rs five lakh in addition to travelling, accommodation and other expenses, all of which are borne by Sebi and recoverable from Saharas.
All the administrative expenses including payments to the additional staff and experts, would also be borne by Saharas.
While detailed queries sent by PTI to Sahara remained unanswered, sources said that it has already received some expense bills from Sebi. However, it could not be ascertained whether Saharas have made any payments towards these expenses.
Sahara group claims that it has already repaid a vast majority of the investors and its total outstanding liability towards the bondholders is much less than Rs 5,120 crore given by it to Sebi towards the refund process.
After Sahara firms were told by the Supreme Court to hand over the investor documents to Sebi, the group sent 128 trucks with more than 31,000 cartons of papers to the regulatory authority's headquarters in Mumbai.
Finding it impossible to store them at any of its offices, Sebi decided to keep them at a warehouse of SHCIL Projects Ltd, a subsidiary of SHCIL.
The Navi Mumbai warehouse, having 32 lakh cubit feet of storage capacity, has automatic robotic systems for handing of documents and their storage in safe vaults.
In its order dated August 31, 2012, the Supreme Court had allowed Sebi to engage investigators, other experts and supporting staff for the investor verification and refund processes. The court had also ruled that all these expenses would be borne by Saharas and be paid to Sebi.
First Published: Apr 07, 2013 14:03 IST