Centre may take over Rs 25,000-cr unclaimed Sahara funds lying with SEBI
Union government works out legalities to transfer unclaimed corpus to Consolidated Fund of India, which may be used for ‘pro-poor programmes’
With the death of Subrata Roy, the founder of the Sahara Group, last week, the Union government has set its eyes on the corpus of more than Rs 25,000 crore that is lying unclaimed in the Sahara-SEBI Refund Account.
According to a report by The Economic Times, the Centre is working out the legalities of transferring the corpus to the Consolidated Fund of India. Though the Centre will put in place a provision to refund investors if they stake claim over the money they invested, it is highly unlikely as few claimants have approached the Securities and Exchange Board of India (SEBI) in the past decade since the Sahara-SEBI Refund Account was created at the behest of the Supreme Court.
Therefore, the Centre is actively mulling the option of taking over the deposits in the Sahara-SEBI Refund Account and transferring them to the Consolidated Fund of India. A separate account for refunding investors is also on the cards. The funds could be used for pro-poor programmes or any other public welfare, ET quoted an official as saying.
In 2011, the SEBI ordered Sahara India Real Estate Corporation Ltd and Sahara Housing Corporation Ltd to refund the Rs 25,000 crore the two Sahara Group companies had raised from 3 crore investors who had bought optionally fully convertible bonds the group had floated on the market. The market regulator had held that the Sahara Group companies had raised the funds in violation of its norms and had ordered them to refund to investors with 15 per cent interest.
The Sahara Group challenged the order in Supreme Court. However, the top court upheld the SEBI order and directed the companies to deposit the funds with the SEBI. Group chairman Roy was arrested in 2014 for non-compliance of the Supreme Court order and was released in 2016 on parole.
According to media reports, the Sahara Group deposited Rs 24,000 crore in special accounts with various nationalised banks controlled by the SEBI. On March 31, 2023, the total deposits in the Sahara-SEBI Refund Account stood at Rs 25,163 crore with accrued interest. Rs 138 crore was refunded to 17,526 investors.
Roy’s demise has again put the spotlight on the unclaimed funds.