March salary for Sahara staff may get delayed

Under pressure from a long-running investor refund battle with Sebi, the Sahara group has informed its staff that their salaries may get delayed due to prevailing adverse situation, including attachment of its bank accounts.

The group is working hard to normalise things despite adverse conditions, it said, adding that staff salaries for March, 2014, scheduled to be released tomorrow, may get delayed because of "unforeseen reasons".

In a circular, Sahara India Pariwar's Chief General Manager (HR) Gaurav Sharma has told all business divisions and department heads to inform workers in their respective divisions and departments about the delay and urge them "to stay united in this challenging phase".

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The Sahara group has been fighting a long-running battle with markets regulator Sebi over refund to investors from which two group entities had raised over Rs 24,000 crore (Rs 240 billion) through issuance of certain bonds.

Sahara had deposited Rs 5,120 crore (Rs 51.20 billion) with Sebi in December 2012, but claimed that it had already refunded over Rs 20,000 crore (Rs 200 billion) directly to investors.

Rejecting these claims, Sebi in February, 2013 had ordered attachment of all bank accounts and frozen all its assets last year.

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Interestingly, the staff circular has been issued within days of an entity related to the group floating the idea for collection of at least Rs 100,000 each from Sahara employees and 'well-wishers' to garner necessary funds to secure group chief Subrata Roy's release from Tihar Jail.

65-year-old Roy has been in Tihar jail since March 4.The Supreme Court had earlier this month proposed a conditional interim bail for him asking the group to deposit Rs 10,000 crore (Rs 100 billion), including Rs 5,000 crore (Rs 50 billion) as bank guarantee.

"As you all are aware, Sahara India Pariwar an emotionally integrated family, since inception has always ensured that salaries are paid on the first day of every month without any compromise whatsoever," Sharma said in the circular.

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"However, with the prevailing restrictions imposed on us in operating the bank accounts of the group companies we are unable to utilise even the available fund.

"In spite of the ongoing hardship, we are making sincere efforts to normalise the situation, but for now, we regret to inform you that disbursal of salary for the month of March 2014 will be delayed," the circular added.

Sharma further said that the workers would be kept "updated about the developments on continual basis".

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The Supreme Court had ordered on August 31, 2012, refund of over Rs 24,000 crore by two Sahara firms to an estimated three crore investors. The group was asked to deposit the money with Sebi, which was asked to facilitate the refund to genuine investors after verifying their credentials.

Later in December that year, Sahara was asked to deposit the money in three installments including an immediate payment of Rs 5,120 crore (Rs 51.2 billion).

Under the new scheme proposed last week, it was said that the collections would be made in lieu of shares in Saharayn e-Multipurpose Society Ltd, which would be alloted to each contributing employee of the entertainment-to-retail business conglomerate, which claims to have a workforce of over 11 lakh salaried and field workers.

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The contribution 'appeal' was made through a one-page letter signed by directors of this Society and 'associates' of the group and asked each employee of the Sahara India Pariwar and their well-wishers to contribute Rs 100,000, Rs 200,000, Rs 300,000 or even more as per their wish and capacity.

Sahara officials said that the letter was not issued by Subrata Roy or by the management and "it is only an emotional initiative from people in reaction to prevailing situation" and should not be construed as Sahara group or the management asking its workers to make any contribution.

Sahara group claims to have total networth of over Rs 68,000 crore (Rs 680 billion) and assets totalling more than Rs 1.5 lakh crore (Rs 1.5 trillion).

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A Sahara counsel had said in a statement that an embargo has been imposed on sale of assets, while bank accounts of entire group have already been frozen by Sebi.

"Further, the title deeds of assets having value over Rs 20,000 crore (Rs 200b billion) are lying with Sebi only. If case by case the court allows to sell assets, it will be a distress sale which would not fetch more than 20-25 per cent of the real value of the asset.

Moreover, money from the sale of bigger assets will only come in long term installments in view of Indian financial strength," he had said in a statement.

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Talking about the contributions made by the Sahara India Pariwar's chief guardian Subrata Roy Sahara, the appeal said that a "profitable scheme" is being proposed by Saharayn E-Multipurpose Society Ltd for the workers, associates and well-wishers of the group.

It also called for support from all workers of the group in the current scenario, when the Supreme Court had ordered freeze on sale of assets and bank accounts of the group.

Even if the freeze order is removed, these assets would not fetch right valuation, it added, while requesting all employees and field workers of the group to make their contribution.