 "Sebi issues Rs 6.42 cr demand notice to Sahara group in OFCD issuance case")
Sebi on Wednesday sent a notice to Sahara Group firm, its chief Subrata Roy and others asking them to pay Rs 6.42 crore within 15 days in a case pertaining to flouting regulatory norms.
Sebi also warned of attachment of assets and bank accounts, if they fail to make the payment.
The notice came after the entities failed to pay the fine imposed on them by the Securities and Exchange Board of India (Sebi).
The regulator, in its order in June, levied a fine totalling Rs 6 crore on five entities -- Sahara India Real Estate Corporation (now known as Sahara Commodity Services Corporation), Subrata Roy, Ashok Roy Choudhary, Ravi Shanker Dubey and Vandana Bharrgava -- for violating regulatory norms in the issuance of optionally fully convertible debentures (OFCDs).
The case relates to issuance of OFCDs by Sahara India Real Estate Corporation and Sahara Housing Investment Corporation during 2008-2009. They raised money through public issue of securities by issuing OFCDs without following the various procedures intended to protect the interest of the investors, in respect of public issues, prescribed under the norms, as per Sebi.
According to Sebi, the subscription towards the OFCDs was solicited by the two companies from the general public throughout the country, without adequately informing them about the risks involved in the instruments.
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The issuance was allegedly done in contravention of the provisions of the Sebi's ICDR (Issue of Capital and Disclosure Requirements) Regulations and PFUTP (Prohibition of Fraudulent and Unfair Trade Practices).
In its fresh notice, Sebi directed the five entities to pay Rs 6.42 crore, which includes interest and recovery cost, within 15 days.
In the event of non-payment of dues, the markets regulator will recover the amount by attaching and selling moveable and immoveable property of the entities. Besides, they face attachment of their bank accounts.
Also, the regulator takes the route of arrest and detention in prison to recover the amount.