SC sets aside HC order staying SFIO probe into 9 companies related to Sahara group

PTI, May 26, 2022, 1:13 PM IST

The Supreme Court on Thursday set aside a Delhi High Court order staying a Serious Fraud Investigation Office (SFIO) probe into nine companies related to the Sahara group.

A vacation bench of justices D Y Chandrachud and Bela M Trivedi allowed the appeal filed by the SFIO against the high court order.

The apex court observed that the high court was ”not justified” in staying the investigation in the matter.

The SFIO, a statutory corporate fraud investigating agency, had filed an appeal in the top 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.

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.

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

Solicitor General Tushar 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 caused serious prejudice to the ongoing investigation, it had said.

The high court had said the petitioners before it — 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, irreparable loss shall be caused to them.

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

It 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 the 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.