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Subrata Roy’s Death Spotlights ₹ 25,000 Crore Lying In SEBI Account

After Sahara Group CEO Subrata Roy passed away, undistributed funds worth over ₹ 25,000 crore that were in the capital markets regulator Sebi’s account have come back into the spotlight.

Mr Roy died on Tuesday night in Mumbai at the age of 75 after a long illness.

He was involved in numerous regulatory and legal battles involving his group firms that were accused of skirting regulations with Ponzi schemes, allegations that his group always denied.

In 2011, the capital markets regulator Sebi ordered two Sahara Group companies, Sahara India Real Estate Corporation Ltd (SIREL) and Sahara Housing Investment Corporation Ltd (SHICL), to refund funds raised from nearly 3 crore investors through Optionally Fully Convertible Bonds (OFCDs).

This order was issued after the regulator determined that the funds were raised in violation of its rules and regulations by the two firms.

After a lengthy process of appeals and cross-appeals, the Supreme Court upheld Sebi’s orders requiring the two firms to refund the money collected from investors with 15% interest on August 31, 2012.

Sahara was eventually asked to deposit an estimated 24,000 crore with Sebi for additional refunds to investors, despite the fact that the group has maintained that it has already refunded more than 95% of investors directly.

According to the capital markets regulator’s most recent annual report, the Securities and Exchange Board of India (Sebi) refunded 138.07 crore to investors in two Sahara Group firms over an 11-year period.

As for the repayment, over ₹ 25,000 crore has been placed in specially opened bank accounts.

In the absence of claims from a majority of the bondholders of the two Sahara companies, the total amount refunded by Sebi increased by about 7 lakh during the fiscal year 2022-23, while the balance in Sebi-Sahara refund accounts increased by 1,087 crore.

According to the annual report, as of March 31, 2023, Sebi had received 19,650 applications involving 53,687 accounts. As a result, “refunds have been made concerning 17,526 applications involving 48,326 accounts for an aggregate amount of ₹ 138.07 crore, including the interest amount of ₹ 67.98 crore.” The remaining applications were closed because their records could not be traced in the data provided by two Sahara Group companies.

Sebi had previously stated that the total amount refunded by it as of March 31, 2022, was 138 crore for 17,526 applications.

Furthermore, Sebi stated that as of March 31, 2023, it had recovered an aggregate amount of 15,646.68 crore through various orders issued by the Supreme Court and attachment orders issued by the regulator.

In accordance with the Supreme Court’s decision dated August 31, 2012, this amount, along with the accrued interest after refunds to eligible bondholders, was deposited in nationalised banks.

“The total amount deposited in nationalised banks as of March 31, 2023 is approximately 25,163 crore,” Sebi stated.

As of March 31, 2022, March 31, 2021, and March 31, 2020, this amount was 24,076 crore, 23,191 crore, and 21,770.70 crore, respectively.

Meanwhile, the Centre began the process of refunding 5,000 crore of depositors’ funds in four Sahara Group cooperative societies in August.

Previously, in July, Cooperation Minister Amit Shah launched the ‘CRCS-Sahara Refund Portal’ to facilitate the return of funds to investors. On the portal, approximately 18 lakh depositors have registered.

The government announced in March that the money would be returned to the four cooperative societies’ 10 crore investors within nine months.

The announcement came after the Supreme Court directed that 5,000 crore be transferred from the Sahara-Sebi refund account to the Central Registrar of Cooperative Societies (CRCS).

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Source: NDTV

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