Lok Sabha Question No. 4062 (UNSTARRED), answered on 2018-08-10
Subject: Financial Frauds
Ministry: CORPORATE AFFAIRS
Asked by: Tejpratap Singh,Yadav, ANJU BALA

## GOVERNMENT OF INDIA

## MINISTRY OF CORPORATE AFFAIRS

ANSWERED ON FRIDAY, THE 10 TH  AUGUST, 2018

## LOK SABHA UNSTARRED QUESTION NO. 4062 [SHRAVANA 19, 1940 (SAKA)]

## FINANCIAL FRAUDS

## QUESTION

4062.

SHRI TEJ PRATAP SINGH YADAV:

SHRIMATI ANJU BALA:

Will the Minister of CORPORATE AFFAIRS be pleased to state:

कारपोरेट कार्य मंत्री

- (a) whether the Government has received several complaints of financial fraud against Sahara Q Shop as they are not able to return investment of lakhs of investors and if so, the details thereof along with the reaction of the Government thereto;
- (b) whether Securities and Exchange Board of India (SEBI) has returned money to all investors of  Sahara  Group  companies  and  if  so,  the  details thereof and if not, the reasons therefor;
- (c) whether  the  SEBI  is  directed  to  accommodate  investors  of  other schemes of Sahara India Group namely Sahara India Q Shop as investors were forced to convert their investments into Sahara Q Shop from Sahara India  Real  Estate  Corp  (SIREC)  and  Sahara  Housing  Investment  Corp (SHIC) and if so, the details thereof along; and
- (d) the  details  of  corrective  steps  being  taken  by  the  Government  to prevent/avoid such type of financial frauds in future in the country?

## ANSWER

MINISTER OF STATE FOR LAW AND JUSTICE AND CORPORATE AFFAIRS

(SHRI P. P. CHAUDHARY)

- (a):   This Ministry has received 537 complaints till date against Sahara Q Shop  Unique  Products  Range  Limited  of  Sahara  India  Group  for  not returning  the  matured  amount  to  the  investors.    Pursuant  to  the  said complaints, the Ministry has ordered Inquiry u/s 206 of the Companies Act, 2013.
- (b):   No, Madam. The Hon'ble Supreme Court vide its Order dated August 31, 2012 had directed SEBI to make refunds to the investors of Optionally Fully  Convertible  Debentures  (OFCDs)  in  only  two  of  the  Sahara  Group Companies namely, Sahara India Real Estate Corporation Limited (SIRECL)

and  Sahara  Housing  Investment  Corporation  Limited  (SHICL).  As  per  the directions of the Hon'ble Supreme Court, SEBI had started the process of refunding  the  moneys  to  the  investors  of  OFCDs  of  the  above  two companies viz., SIRECL and SHICL. In this regard, SEBI had issued a Press Release  on  28.05.2013  and  Press  Advertisements  during  the  months  of August-September  2014  and  December  2014,  advising  the  investors  at large to make necessary applications to SEBI for refund of their moneys invested  in  the  OFCDs  of  the  aforesaid  two  Companies  viz.,  SIRECL  and SHICL. SEBI has also made available the format of Application for Refund on  its  website  (www.sebi.gov.in)  to  enable  the  investors  to  make  their applications for refund. Further, SEBI had recently issued Press Advertisements  on  March  26,  2018  and  June  19,  2018  informing  the investors  that  July  2,  2018  (cutoff  date)  was  the  last  and  final  date  for receiving  applications  for  refund  and  that  no  application  was  to  be accepted/entertained  beyond  the  cutoff  date.  Further,  SEBI  had  also informed investors that this was the last and final opportunity provided to the OFCD holders of the above two companies, to make their applications for refund.

As  on  March  31,  2018,  SEBI  had  received  15,146  applications involving  43,405  accounts,  and  made  refunds  with  respect  to  12,522 applications involving 35,300 accounts  for an aggregate  amount  of Rs.98.56 Crore including the interest of Rs.45.26 Crore.

- (c):   No, Madam. SEBI has informed that the Hon'ble Supreme Court vide its  Order  dated  August  31,  2012  directed  SEBI  to  make  refunds  to  only those investors, who had invested in Optionally Fully Convertible Debentures (OFCDs) of Sahara India Real Estate Corporation Ltd., (SIRECL) and/or Sahara Housing Investment Corporation Ltd. (SHICL).  Accordingly, the  investments  in  other  Schemes/Group  Companies  of  Sahara  including the Sahara Q-Shop are prima facie not covered in the said Order of Hon'ble Supreme Court.
- (d):   The Government has taken stringent measures against non compliant companies and directors.

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