Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: TDS :: VAT RATES :: list of goods taxed at 4% :: due date for vat payment :: empanelment :: ACCOUNTING STANDARD :: ARTICLES ON INPUT TAX CREDIT IN VAT :: articles on VAT and GST in India :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT Audit :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARDS :: cpt :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4%
« From the Courts »
 The Principal Commissioner Of Income Tax-4 Vs. Inter Globe Technology Quotient Pvt. Ltd.
 Akum Drugs And Pharmaceuticals Limited Through: Director Shri. Sanjeev Jain Vs. Income Tax Officer, Ward-2(1) & Anr.
 Pr. Commissioner Of Income Tax Central-2 New Delhi Vs. Meeta Gutgutia Prop. M/s Ferns „n? Petals
 Prabhatam Investment Pvt. Ltd vs. ACIT (ITAT Delhi)
 CIT vs. Laxman Industrial Resources Pvt.Ltd (Delhi High Court)
  State Of Jharkhand vs. Lalu Prasad Yadav (Supreme Court)
 CIT vs. Krishan K. Aggarwal (Supreme Court)
 Ambuja Cements Ltd. Vs. Commissioner, Service Tax Commissionerate, Delhi
 Director Of Income Tax (Exemptions) Vs. Vishwa Hindu Parishad
 ITAT Proposes Important Changes To Tribunal Rules
 Meherjee Cassinath Holdings Pvt. Ltd vs. ACIT (ITAT Mumbai)

Tribunal upholds Sebi order against 2 Sahara firms
October, 19th 2011

The Securities Appellate Tribunal (SAT) on Tuesday upheld an order passed by the market regulator against two Sahara group companies and directed them to return money raised from the public in violation of securities regulations with an interest of 15%.

The appellants in both the appeals shall now repay within six weeks from today, said the order.

Sahara India Real Estate Corporation and Sahara Housing Investment Corporation had raised money from the public by issuing a hybrid instrument known as optionally fully convertible debenture, or OFCD. The money was to be used for funding projects worth an estimated Rs40,000 crore, according to the Securities and Exchange Board of India (Sebi) order.

Sebi found the method of raising capital to be violative of various regulations and passed an order against the companies in June this year.

On Tuesday, SAT dismissed the appeal against the order.
The tribunal struck down the argument that OFCDs were not securities and therefore did not fall under Sebis jurisdiction. It also ruled against an argument that the money was not raised by a public issue though it was collected through an information memorandum circulated to over three crore people through ten lakh agents and over 2900 branch offices.

SAT also noted that the company withheld material facts from the Registrar of Companies. Not only did the company withhold material facts from the RoC, it also failed to furnish to its shareholders all material particulars of persons from whom capital was sought to be raised on private placement basis, SAT noted.

The tribunal also drew attention to the conduct of the RoC. Even the conduct of the RoC leaves much to be desired. We say so because the RHP (Red Herring Prospectus) was presented to him. The fact that the company had a capital base of only Rs10 lakh with no other assets or reserves and was a loss-making company and was going to collect Rs20,000 crore by private placement should have alerted him and he should have made necessary queries in this regard, said the order.

There were 2.21 crore investors for the OFCDs, which raised more than Rs19,400 crore, according to one affadavit mentioned in the SAT order. Of this, Rs17,656 crore was outstanding as of August 31, 2011.

A second affidavit not mentioned in the order but reported in the media held a further Rs6,373 crore to be outstanding, taking the total capital to be repaid to Rs24,029 crore.

Sahara said Sebi had previously taken a contradictory stand on the jurisdiction of private placements. Such a contradictory act by a responsible regulator can only happen in our system... on the one hand Sebi clearly replies to Parliament that the private placement of debenture is not under its jurisdiction but on the other hand, Sebi submits to the court of law an entirely opposite statement in the case of Saharas issue, i.e. private placements comes under Sebis jurisdiction, it said in a statement.

A Sahara spokesperson said the group will appeal again in the Supreme Court.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Multi-level Marketing MLM India Affiliate Marketing Affiliate Marketing Software MLM Software MLM Solutions Multi level marketing solutions MLM Servi

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions