Sahara chief Subrata Roy's one year in Tihar jail
Moneylife Digital Team 04 March 2015
Saharashri and two of his lieutenant are still languishing in jail since the Sahara group has so far failed to muster Rs10,000 crore of legitimate funding to get them out on bail. In the meantime, his trolls continue to post foolish comments on every article about Subrata Roy and Sahara group
 
Today, it is one year that Sahara group chief Subrata Roy is languishing in Tihar jail. He brought this upon himself through constant defiance of regulators and the Supreme Court. Nevertheless, clearly, no lessons are learnt.  To have an army of trolls post foolish comments from IP addresses that can be traced to Lucknow, is crass immaturity. We are making no attempt to block them because they are the best examples of why Mr Saharashri is languishing in jail. Will good sense prevail?
 
The Sahara group chief is lodged in Tihar jail since 4 March 2014 for non-refund of over Rs20,000 crore with interest to depositors.  
 
The Sahara group's all efforts to raise Rs10,000 to secure bail for its chief has so far proved futile. In fact, last month, even the apex court expressed concern over how Sahara Group would raise money to secure its chief's release even as the group was seeking extension of facilities inside Tihar jail premises by four to six weeks to enable him negotiate deals with prospective buyers.
 
"You are struggling to pay Rs10,000 crore. How will you pay Rs30,000 crore after coming out," the bench headed by Justice TS Thakur had said.
 
For those who have forgotten, a path-breaking judgement of the Supreme Court, in August 2012, asked two realty companies of the Sahara group to refund Rs24,000 crore collected from investors through an unregulated, debenture-like instrument. But, after paying up just Rs5,120 crore, Sahara resorted to drama and hurled allegations against the regulator through an ill-considered advertisement campaign. It has not been able to prove the existence of even a fraction of the large investor base that it had claimed. The group’s antics angered the apex court; Subrata Roy was held in contempt and sent to jail until the Sahara group deposited Rs10,000 crore, in addition to the money already deposited with the Securities & Exchange Board of India (SEBI).
 
Sahara Group has been trying to raise funds for months to secure release of its chief Subrata Roy, as also that of two other senior officials, from Tihar Jail in New Delhi, where they have been lodged for one year.
 
Yet, after 12 months, the Saharashri, as people from group like to call Roy and the group's two other senior officials are still in jail. 
 
This is strange, given a man like Roy, who reportedly had an endless supply of money to buy marquee properties around the world, sponsor the Indian cricket team for years, gift lavish bungalows to cricketers, claim ownership of several sports teams and stadia and throw lavish parties, cannot muster Rs10,000 crore of legitimate funding to get himself out of jail?
 
Last week, there were reports about Sahara group facing a liquidity crunch for past one year due to embargo and double payment for investor refund, resulting into many problems like meeting employee salary, statutory and other operating obligations. The salary delays are mainly being faced by the staff members in the corporate offices of the crisis-hit group, while there are also delays on certain statutory payments and operating obligations or expenses related to day-to-day business due to difficulty in fund flows.
 
The group has over 10 lakh full-time and part-time employees, including permanent staff at its various companies, permanent agents who get regular incentive payments besides a large number of part-time agents.
 
While the exact number of persons whose salaries and other payments have been delayed could not be ascertained, sources said their numbers could run into "tens of thousands".
 
In a fresh twist to crisis-hit Sahara Group's efforts to raise funds, its iconic London hotel property Grosvenor House, estimated to be worth over Rs5,000 crore, has been put on sale by lenders.
 
Grosvenor House, a landmark property on Park Lane in London, is one of the three marquee hotels owned by Sahara outside India, the other two being Plaza and Dream Downtown in New York.
 
According to a report in the Telegraph daily, Grosvenor House may fetch about 500 million British pounds, more than 470 million British pounds that Sahara Grosvenor House Hospitality Ltd had paid for the hotel in 2010.
 
The report further said that Deloitte was appointed administrators to Sahara last night after "it defaulted on debts tied to the hotel" and they will work with realty consultancy Jones Lang LaSalle (JLL) to find a buyer.
 
Sahara was in talks with US-based Mirach Capital for a syndicate loan arrangement linked to the three properties to replace an existing loan from Bank of China, but the deal fell apart and the two parties warned each other of legal action.
 
Last month, in a new turn of events in the case, the Reserve Bank of India (RBI) had moved the Supreme Court seeking to implead itself as a party in the company's tussle with Securities and Exchange Board of India (SEBI). RBI had sought to stop one of its Sahara group companies from disposing off assets for securing Roy's release.
 
In an application, the central bank had urged the apex court to restrain Sahara India Financial Corporation Ltd (SIFCL) from utilising any of its assets, including securities, for paying dues to SEBI on the ground that SIFCL is residuary non-banking financial company and fell under its (RBI) regulatory control.
 
Prior to this, the Sahara group had informed the Supreme Court that the proposed transactions for a loan of around $1,050 million from abroad for raising Rs10,000 crore to ensure Roy's release from jail had failed.
 
Earlier on 9th January, the Court had allowed Sahara Group to go ahead with its proposed transactions with some conditions. The conditions, included approval of RBI for the transfer of funds raised in the US to India to meet the requirement set for release of Roy.
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