Top Court To Hear SFIO’s Plea Against High Court Order Staying Probe Into Sahara Group Firms

The Supreme Court Wednesday said it would hear on Thursday the plea filed by Serious Fraud Investigation Office (SFIO) challenging the Delhi High Court order staying the investigation into nine companies related to the Sahara group.

The matter came up for hearing before a vacation bench of Justices D Y Chandrachud and Bela M Trivedi.

The counsel appearing for the group firms requested the bench to take up the matter on Thursday saying senior advocate Kapil Sibal, who is leading them in the matter, is out of town.

“I am requesting your lordships to take it tomorrow because Mr. Sibal is out of town. He is leading us,” the lawyer said.

Solicitor General Tushar Mehta, appearing for the SFIO, said he is not opposing the request and it has been assured that nobody would fly in the meanwhile because there is a flight risk.

“On the request of the counsel for the respondents, list tomorrow,” the bench said.     

The SFIO, a statutory corporate fraud investigating agency, has filed an appeal in the apex court against the December 13, 2021 order of the Delhi High Court staying all subsequent actions and proceedings, including coercive measures and lookout notices, against the Sahara group chief and others.

On May 17, the top court had agreed to consider listing for hearing the SFIO's plea challenging the high court order.

Mehta had then told the apex court that there was some apprehension on the part of the petitioner (SFIO) with regard to another bench recently staying a lookout circular against Sahara Group chief Subrata Roy.

“The petitioner SFIO has filed the plea against the final judgement of the Delhi High Court whereby the high court erroneously granted interim relief to Respondents 1 to 3 by staying the operation, implementation, and execution of the investigation orders dated October 31, 2018, and October 27, 2020, passed by the Central government and stayed all subsequent actions and proceedings initiated pursuant thereof including coercive proceedings and lookout notices issued against the respondents,” the SFIO had said in an application seeking urgent hearing of its appeal.

The proceedings have been stayed which seriously prejudice the ongoing investigation, it had said.

The high court had also stayed the operation and implementation of two orders of the SFIO for an investigation into nine companies related to the Sahara Group.

It had said the petitioners Sahara Housing Investment Corporation Ltd and others have made out a prima facie case for grant of interim relief and the balance of convenience is also in their favour and if the interim relief is not granted, the irreparable loss shall be caused to them.

The high court had also issued notice to the Centre and asked it to file a response to the petition.

The court had stayed the Centre's October 31, 2018, and October 27, 2020 orders.

"... We hereby stay the operation, implementation, and execution of the orders dated October 31, 2018, and October 27, 2020, passed by the respondents as well as subsequent actions and proceedings initiated pursuant thereto, including coercive proceedings and look-out notices, qua the petitioners herein…..till the next date of hearing," the high court had said.

The petitioners (Sahara firm and others) had submitted that the first order was passed by the Centre on October 31, 2018, for an investigation into the affairs of three companies -- Sahara Q Shop Unique Products Range Ltd, Sahara Q Gold Mart Ltd, and Sahara Housing Investment Corporation Ltd.

The Sahara firm, in the plea, had said perusal of the October 27, 2020 order revealed that no reason has been assigned as to why it was considered necessary that an investigation be made against the six companies -- Aamby Valley Ltd, Qing Amby City Developers Corporation Ltd, Sahara India Commercial Corporation Ltd, Sahara Prime City Ltd, Sahara India Financial Corporation Ltd, and Sahara India Real Estate Corporation Ltd.

The petitioners had submitted in the petition that the six companies have never been, at any relevant time, the subsidiary or holding companies of the three other companies already under investigation.