Supreme Court allows Centre's plea for Rs 5,000 cr from SEBI-Sahara fund to repay depositors

New Delhi: The Supreme Court on Wednesday allowed a plea by the Central government seeking Rs 5,000 crore allocation out of Rs 24,000 crore, which was deposited by Sahara group with the SEBI, to pay back to the depositors.

A bench, headed by Justice M.R. Shah and comprising Justice C.T. Ravikumar, passed the direction on the application filed by the government in a PIL by Pinak Mani Mohanty. It said the amount should be disbursed to depositors duped by the Sahara group of cooperative societies and the entire process will be monitored by a former judge of the top court, R. Subhash Reddy.

"The manner and modalities for making the payment is to be worked out by the Central Registrar of Cooperative Societies in consultation with Justice R. Subhash Reddy, former judge of this court, and Gaurav Agarwal, advocate," the bench said.

"Out of the total amount of Rs 24,979.67 crore lying in the 'Sahara-SEBI Refund Account', Rs 5,000 crore be transferred to the Central Registrar of Cooperative Societies, who, in turn, shall disburse the same against the legitimate dues of the depositors of the Sahara Group of Cooperative Societies, which shall be paid to the genuine depositors in the most transparent manner and on proper identification and on submitting proof of their deposits and proof of their claims and to be deposited in their respective bank accounts directly."

It further added that the amount be paid to the respective genuine depositors of the Sahara Group of Cooperative Societies out of the aforesaid amount of Rs 5,000 crore at the earliest, but not later than nine months from today and balance amount be again transferred to the Sahara-SEBI refund account.

Solicitor General Tushar Mehta appeared on behalf of the Centre in the matter. The apex court was informed that Rs 2,253 crore had been taken out of the Sahara Credit Cooperative Society Ltd., i.e., one of the four Sahara group multi-state cooperative societies and deposited with SEBI in the Sahara-SEBI refund account and the amount lying in the account is lying unutilised.

"The genuine depositors of the Sahara Group of Cooperative Societies, which otherwise, shall be entitled to get back their money, the prayer sought in the present application seems to be reasonable and which shall be in the larger public interest/interest of the genuine depositors of the Sahara Group of Cooperative Societies," noted the bench.

Mohanty, in the PIL, had sought a direction to pay to the depositors, who invested in several chit fund companies and Sahara credit firms.

The Centre had sought money from the fund, which was formed after the top court in August 2012 directed two Sahara firms -- Sahara India Real Estate Corporation Ltd (SIRECL) and Sahara Housing India Corporation Ltd (SHICL) -- to refund investors.