SEBI summons Sahara Group firms over unlisted OFCDs
This Supreme Court judgment addresses the Securities and Exchange Board of India's (SEBI) authority to regulate Optionally Fully Convertible Debentures (OFCDs) issued by Sahara Group companies, determining whether these were public issues requiring listing on stock exchanges under Indian securities laws. It matters to citizens as it clarifies regulatory boundaries for investment products.
Sahara India Real Estate Corporation Limited (SIRECL) and Sahara Housing Investment Corporation Limited (SHICL), controlled by Sahara Group, and investors who subscribed to their OFCDs.
- SEBI has powers under Section 55A(b) of the Companies Act, 1956 to administer provisions relating to issue and transfer of securities to the public by listed companies or companies intending to get securities listed.
- OFCDs offered by Sahara Group were not listed on any recognized stock exchange as per their RHP and IM.
- SIRECL and SHICL issued OFCDs through private placement to associates of Sahara Group without public advertisement.
- SEBI issued summons under Section 11C of the SEBI Act to SIRECL for non-compliance with regulatory requirements.
- SIRECL claimed compliance with Section 60B of the Companies Act by filing RHP with Registrar of Companies (RoC).
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Document details
| Official title | Demat 2.0: From Electronic Ownership Records To Programmable Securities Infrastructure |
| Source body | Government documents surfaced by the press |
| Reference number | 20845b98b241e425 |
| Status | closed (sc_judgment) |
| Year | — |
| Closing date | — |
| Documents | 1 |