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Sahara India chief Subrata Roy moves Supreme Court against Patna HC order

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The HC directions were issued on various anticipatory bail applications filed in cheating cases committed by non-banking finance companies (NBFCs). More than 600 applications are pending for the release of the matured amount by the Sahara company.

Sahara India chief Subrata Roy on Tuesday moved the Supreme Court against the Patna High Court’s order that asked him to be personally present before it on May 12 to explain his plan for payment of matured deposits to the small investors of his group companies.

The matter could not be taken up for hearing on Tuesday as one of the SC judges refused from hearing citing personal difficulty. The case is likely to be mentioned for an urgent hearing on Wednesday.

“…by way of last chance, the Sahara Group and other companies, who have been taking … deposits till about one month back, are directed to come with a plan for the return of the investment of the investors, and for that, Sri Subrata Roy, is directed to appear personally in this court..,” the HC said.

The HC had earlier directed the Sahara company to explain how the hard-earned money of poor investors deposited in different schemes of the Sahara Company could be returned. Sahara Credit Cooperative Society had told the HC that it does not have funds to refund the investors and would be able to do so only if the Securities and Exchange Board of India (Sebi) release its money.

The HC directions were issued on various anticipatory bail applications filed in cheating cases committed by non-banking finance companies (NBFCs). More than 600 applications are pending for the release of the matured amount by the Sahara company.

Roy told the SC that the HC could not have used its powers under Section 438 CrPC to “virtually convert the anticipatory bail proceedings into an omnibus exercise for recovering disputed dues and resolving alleged claims of fraud and cheating involving the public at large in Bihar.”

“It is discernible that the HC also noted some aspects of cheating by Nidhi companies and delved into the aspect of grievance redressal qua Nidhi companies; and thus, the scope of … an anticipatory bail petition was further enlarged to such an extent that even Nidhi companies were brought within the purview of an application under Section 438 CrPC,” he said in his appeal filed through counsel Gautam Awasthi.

He said that Roy had been added as a party in the purported capacity of being the director in Sahara Group of Companies, which is factually incorrect as all group companies were separate legal entities and being managed by their respective board of directors. “Roy or the Sahara Group had no nexus with the original complaint and none of the accusations was even remotely relatable to them,” the appeal stated. Despite that, the HC had issued a summoning order in the “most arbitrary manner,” it added.

While the HC had also issued directions to RBI for creating awareness regarding the functioning of Nidhi companies and also directed registration of a PIL in the alleged fraud by these companies, it had also impleaded Sebi, RoC (Bihar), Ministry of Corporate Affairs, Department of Economic office, etc in these proceedings.

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