After Sahara Group chief Subrata Roy's demise, undistributed fund of over ₹25,000 crore in focus with Sebi

livemint.com:

₹25,000 crore lying with the capital markets regulator Sebi's account have come back into focus after the demise of Sahara Group's chief Subrata Roy. Roy passed away in Mumbai on Tuesday night at the age of 75 after battling a prolonged illness.

He faced multiple regulatory and legal battles in connection with his group firms that were accused of circumventing regulations with Ponzi schemes, allegations his group always denied. In 2011, capital markets regulator Sebi ordered two Sahara Group firms -- Sahara India Real Estate Corporation Ltd (SIREL) and Sahara Housing Investment Corporation Ltd (SHICL) -- to refund the money raised from nearly 3 crore investors through certain bonds known as Optionally Fully Convertible Bonds (OFCDs).

This order came after the regulator ruled that the funds were raised by the two firms in violation of its rules and regulations. After a long process of appeals and cross-appeals, the Supreme Court on August 31, 2012 upheld Sebi's directions asking the two firms to refund the money collected from investors with 15 per cent interest.

Sahara was eventually asked to deposit an estimated ₹24,000 crore with Sebi for further refund to investors, though the group has been maintaining that it had already refunded more than 95 per cent of investors directly. According to the capital markets regulator's latest annual report, the Securities and Exchange Board of India (Sebi) issued ₹138.07 crore in refunds over 11 years to investors of two Sahara Group firms.

Meanwhile, the amount deposited in specially-opened bank accounts for the repayment has risen to more than ₹25,000 crore. In the absence of claims from a majority of the bondholders of the two Sahara companies, the total amount refunded by Sebi