The Securities and Exchange Board of India (SEBI) on Tuesday urged the Supreme Court to award maximum punishment to Sahara India's head Subrata Roy and three other directors of its companies for contempt of court by not complying with its order of returning Rs.24,000 crore to investors.
"Here is a case where contempt was committed not once, not twice but three times," senior counsel Arvind Datar told an apex court bench of Justice KS Radhakrishnan and Justice Jagdish Singh Khehar. The bench was hearing SEBI's contempt petition against Sahara India.
"These directors and officers should be given maximum imprisonment," Datar told the court.
SEBI moved the court seeking action against Sahara India Real Estate Corporation and Sahara Housing Investment Corporation Ltd and their directors for not having complied with the orders of August 31, 2012, December 5, 2012, and February 25, 2013, directing it to deposit Rs.24,000 crore to SEBI so that it could refund investors.
Describing the defiance of the apex court verdict as "brazen and blatant", Datar urged the court to ask Roy and the other directors to appear before the court and deposit their passports.
Datar reminded the judges that it was just 21 days away from the first anniversary of their August 30, 2012, judgment asking the Sahara companies to deposit Rs.24,000 crore.
Opposing the SEBI's plea, senior counsel Ram Jethmalani told the court that the law of contempt has assumed constitutional dimensions and since the market regulator has not mentioned any name other than two companies in their petitions, "it is not permissible for the court to travel to any piece of paper that is not before it".
Jethmalani said it was the burden of SEBI to prove its case beyond doubt and it is more so because it also involves threat to liberty. The matter will come up for the next hearing Aug 13.