New Delhi: The Supreme Court on Thursday rejected a plea by the Sahara Group to postpone the auction of its Aamby Valley township near Pune. The sale notice for the property is set to be advertised on 14 August.
Accordingly, the auction process will continue and at the same time, Sahara will be entitled to enter into negotiations for an investment in the Aamby Valley project.
“We are not inclined to entertain the application. If Sahara enters into an agreement with any organization and deposits all the money it owes, an order will be passed the next day," said a bench headed by justice Dipak Misra.
The court was responding to an application by the Sahara Group seeking to postpone the auction of Aamby Valley on account of a proposed agreement between the group and Royal Partners Investment Fund Ltd, a Mauritius-based company, for an investment of $1.67 billion in the project by the latter.
Kapil Sibal, counsel for Sahara, urged the court to postpone publication of the sale notice and said nobody would be prejudiced by such a move. Highlighting the difficulty that Sahara would have to face, Sibal added, “If the court does not postpone the auction, the value of the property will diminish and we will face difficulty in negotiations with prospective buyers."
Securities and Exchange Board of India (Sebi) counsel Arvind Datar said there was no such Mauritius-based firm as stated by Sahara, opposing the proposed agreement.
Subject to approval of the agreement by the court, 50% of the invested amount, i.e., Rs5,000 crore, would be deposited towards the designated Sebi-Sahara refund account and the balance used for the development and completion of the project.
Sahara, in its application, had submitted that the transaction would go through only if the court’s order initiating auction of the Aamby Valley project was stalled.
“Royal Partners Investment Fund Ltd has put a condition that their investment would be possible only if Aamby Valley is not announced for any sale/auction, else they will withdraw from the proposal," the application stated.
On 25 July, the court had directed the official liquidator of the Bombay high court to initiate the first two steps of the Aamby Valley auction process. This would include publication of the sale notice of the property and satisfaction of the KYC (know-your-customer) norms to be submitted by prospective bidders.
The court had also asked Sahara Group to deposit Rs1,500 crore in a dedicated Sebi account by 7 September. It was, however, clarified that the auction process (beyond the first two steps) would be stopped if Sahara furnished the payment in time.
The court has been recovering money from the group in instalments. Sahara has paid Rs16,000 crore till now.
The markets regulator moved the apex court in August 2014 to recover Rs36,000 crore from Sahara to refund investors who had purchased securities from two group firms, through schemes that Sebi ruled were illegal.