NEW DELHI: The Supreme Court on Thursday ordered resumption of probe against Sahara Group companies by the Serious Fraud Investigation Office (SFIO) and revived the lookout circulars against its directors, including Subrata Roy, in a case related to non-payment of investment proceeds to investors.
A vacation bench of Justices D Y Chandrachud and Bela M Trivedi set aside interim orders of the Delhi HC , which had stayed the ministry of company affair's October 31, 2018 order asking the SFIO to probe into the investors' complaints, as recommended by Registrar of Companies, against three Sahara companies - Q Shop Unique Products Range Ltd, Q Gold Mart Ltd and Housing Investment Corporation.
Appearing for the SFIO, solicitor general Tushar Mehta said the HC erred by ordering stay on the investigations unmindful of the SC ruling that the three month time frame for completion of investigation, as mentioned in the statute, was not mandatory. He said given the complex web of money transfers within the numerous group and group-controlled companies, the time limit for completion of probe by the SFIO has been extended from time to time by the ministry of corporate affairs.
Mehta said that the probe agency apprehends that the directors may flee the country taking advantage of the stay on look out circulars, which if happens would further complicate the probe. Though the SC bench set aside the HC's interim orders, it said this decision would not have any reflection on the merits of the petitions filed by Sahara companies before the HC. The SC also asked HC to decide the matter preferably within two months of resumption of normal work after the summer recess.
In its appeal, the SFIO said, "During the investigations, it was found that three companies, which were originally under investigation, collected huge funds, that is more than Rs 50,000 crore from the public in the guise of different schemes promising higher returns. However,the investors were not repaid their maturity amounts and were then forced to convert their deposits into schemes of other companies /entities of the group."
The SFIO found that six other companies - Aamby Valley Ltd, Qing Aamby City Developers Corporation, Sahara India Commercial Corporation, Sahara Prime City Ltd, Sahara India Financial Corporation and Sahara India Real Estate Corporation - were intertwined with the three Sahara companies, which were initially under probe.