The Supreme Court on Thursday refused to stay the auction of Sahara’s prime property Aamby Valley despite the group claiming that a Mauritius-based company has agreed to invest $1.67 billion against the mortgage of Aamby Valley.
This amount translates into more than Rs 11,000 crore, sufficient for Sahara to pay off the Rs 9,000 crore liability it owes to the Securities and Exchange Board of India (SEBI). But the Bench headed by Chief Justice Dipak Misra was skeptical about the offer and asked the company to first make a deposit of Rs 1,500 crore by September 11, after which the court said it will pass appropriate orders, if necessary, on the next date.
Sahara head Subrata Roy was present in the court and was represented by senior advocate Kapil Sibal. Sibal sought permission to put off the auction process beginning August 14 for a month, informing the court that a Mauritian company, Royal Partners Investment Fund limited, has entered into an agreement with the company to invest $1.67 million. He said if the notice for auction gets published, the value of the property will go down, thus reducing the negotiating power of the company.
However, SEBI’s senior counsel Arvind Datar informed the court that no such company existed in Mauritius. He added that there was no question of stay of auction proceedings as the terms of the auction were fixed over a considerable period of two months. Even advertisements for auction had been released, costing approximately Rs 4.5 crore.
The Bench, also comprising Justices Ranjan Gogoi and AK Sikri asked SEBI, “Can auction be recalled once the notice gets published.” Datar replied that once the auction is through, it cannot be stopped midway although he agreed that publication of notice can be recalled. But he objected to the company bringing the offer at the last minute, considering that the matter was heard last on July 25.
The Bench said, “We will not stay the auction process. If Sahara enters into any agreement, that man (who enters agreement) must take the risk. If money comes by, we can consider passing appropriate orders protecting the interest of the company.”
The Aamby Valley project, valued at about Rs 34,000 crore situated at Pune, Maharashtra is a prime property of the Sahara group which it has never allowed to be mortgaged or sold despite several provocations by the Bench. The court had allowed the property to go under the hammer, tired of Sahara’s delay to pay the dues it owed to SEBI under a debenture scheme.