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TABLE OF CONTENTS

LIST OF TERMS...................................................................... V
SYNOPSIS OF FACTS......................................................... VIII
SUMMARY OF ARGUMENTS............................................... X
ARGUMENTS ADVANCED.................................................... 1
I. WHETHER THE DIVORCE NOT BEING IN CONFORMITY
WITH ISLAMIC LAW BE DECLARED AS A NULLITY?...........1
A. That Triple-talaq is not recognized under the Holy Quran,
under any source of Shia Law and that the requisite procedure
for talaq under the Quran was not followed......................................1
II. WHETHER DOMESTIC VIOLENCE ACT, 2005 TO THE
EXTENT THAT IT GIVES RIGHTS TO WOMEN BEYOND THE
PERIOD OF IDDAT IS AGAINST ARTICLE 25 OF THE
CONSTITUTION?............................................................2
A. That Right to Religion is subject to public order, morality
and health and subject to the other provisions of Part III of the
Constitution of India................................................................................... 2
B. That the Domestic Violence Act, 2005 is applicable to
Muslim women.............................................................................................. 3
III. WHETHER THE COURT SHOULD REJECT SHAHEENS
APPLICATION UNDER THE DOMESTIC VIOLENCE ACT AND
WHETHER AFREEN CAN BE MADE RESPONDENT UNDER
THE SAME ACT?............................................................4
A. The court should grant relief to Shaheen under the
Domestic Violence Act, 2005..................................................................4
B. That the cousin can be made a respondent under the Act .4
C. That the apartment in Greater Palash comes under the
definition of shared household under section 2(s) of the Act. 4
D. That the court should pass a protection order under
Section 18 and residence order under Section 19 of the Act.....5
PRAYER................................................................................... XI
LIST OF TERMS
SAHARA GROUP - Sahara
SYNOPSIS OF FACTS

SAHARA GROUP - Sahara India Group is an Indian multinational organization headquartered


in Lucknow. Broadened business in finance, infrastructure & housing, media & entertainment,
consumer merchandise retail venture etc. It was started by Mr. Subrata Roy Sahara in 1978.

ISSUE OF OFCDs - Sahara India decided to issue OFCDs by two companies Sahara India
Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC) through
subscriptions from investors with effect from 25th April 2008 up to 13th April 2011.

COLLECTION OF 2400 CRORE - Sahara India Raised Rs.2400 crores from 30 million
investors via OFCDs for the purpose infrastructural projects.

SAHARA PRIME CITY- Sahara India decided to raise money through Sahara Prime City
through an initial public offering IPO. In the process the company filed a Red Herring Prospectus
and disclosed the workings and financial status of other group companies.

THE FLAW- SEBI, spotted violation of rules done by SIREC and SHIC and found the money
raised through OFCDs was masked as private placements and exceeded the maximum limit of
people.

THE RULE- Section 67(3) of Companies Act 1956 specifically mentions that when any
security is offered to and subscribed by more than 50 persons it will be deemed to be a Public
Offer and Sahara taking money from 30 million investors have violated the law.

THE DISPUTE- SEBI delivered a directive dated 23rd June, 2011 directing the two Sahara
India companies to refund the money collected back to the investors and restrained the agents of
the two companies as well as Mr. Subrata Roy from get into the securities market until further
orders.

SECURITIES APPELLATE TRIBUNAL- Sahara India appealed before The Securities


Appellate Tribunal (SAT) against the order dated 23rd June, 2011. SAT gave its decision in favor
of SEBI and maintained the order given by SEBI to Sahara Group dated 18th October, 2011.
STATEMENT OF ISSUES

THE APPELLANTS RESPECTFULLY ASKS THE HONBLE ALLAHABAD HIGH COURT ,


THE FOLLOWING QUESTIONS:
________________________

___________

ISSUE I

WHETHER SEBI HAS THE POWER TO INV ESTIGATE


AND SETT LE IN TH IS MATT ER

ISSUE 2

WHETHER THE HYBRID OFCDS FALL WITH IN TH E


DEFINITION OF "SECURITIES" WITHIN THE
MEA NING OF COMPANIES ACT AND SEBI ACT

ISSUE 3

WHETHER THE ISSUE OF OFCDS TO MILLIONS OF


PERSONS WHO CONTRIBUTED TO THE ISSUE IS A
P R I V AT E P L A C E M E N T O R N O T
ARGUMENTS ADVANCED

I .gWHETHER SEBI HAS THE POWER TO INVESTIGATE AND


SETTLE IN THIS MATTER

A. THAT SEBI HAS POWER TO INVESTIGATE AND ADJUDICATE IN THIS MATTER,


BEING A SPECIAL BODY SEBI HAS BEEN BESTOWED WITH SPECIAL POWERS TO
PROTECT THE INTERESTS OF THE INVESTORS AS PER REGULATION UNDER THE
SEBI ACT 1992.
1. It is most humbly submitted that as per Section 11 of the SEBI Act 1992, SEBI holds the right
to protect the interests of investors in securities and to promote the development of, and to
regulate the securities market, by such measures as it thinks fit. SEBI has special powers and its
powers are not derogatory to any other provisions existing in any other law either general or
special. In reference to the welfare of the investors, SEBI has the right to intervene in the
proceedings of Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment
Corporation (SHIC).
2. It is further submitted that it is expressly mentioned under Section 11 Clause 2(A) and (B) of
the SEBI Act 1992. SEBI has power to regulate the business in stock exchanges and any other
securities markets. In this scenario Sahara India have issued and also registering and
regulating the working of stock brokers, sub-brokers, share transfer agents, investment advisers
etc and such other intermediaries who may be associated with securities markets in any
manner. In this case all the provisions of
II.ghhfWHETHER THE HYBRID OFCDS FALL WITHIN THE
DEFINITION OF "SECURITIES" WITHIN THE MEANING OF
COMPANIES ACT AND SEBI ACT

. ROCs role in the entire episode is critical since it cleared the proposal without raising the
most basic questions. Consider these facts. Both the companies had negligible net worth.
SIREC had an equity capital of only Rs 10 lakh and a negative net worth at the time of
issuance while the net worth of SHIC was around Rs 10 lakh. But both the companies
planned to raise Rs 20,000 crore each. Imagine applying for a bank loan of Rs 20,000 crore
with only Rs 10 lakh as your contribution. A banker would fall laughing on such a proposal,
but ROC allowed the Sahara Group companies to go ahead with the proposal. More than
one law was flouted by Sahara in issuing these OFCDs, which it calls private placement.

4. Firstly, the sheer size of the issue makes it a public issue. Any company seeking money
from more than 50 persons has to take the approval of Sebi in doing so, in which case the
company would have to make all the disclosures required as per Sebi norms. The Sahara
group had sought money from nearly 30 million investors. Apart from the size and number
of investors, another deliberate error was keeping the issue open ended; ideally such issues
should be closed within six weeks. In fact a Sahara group company kept an issue of Rs
17,250 crore open for 10 years.
5. Saharas money-making machine could have continued had it not committed another
major mistake. Sahara decided to tap the stock markets to raise money through Sahara
Prime City. In doing so the company had to file a Red Herring Prospectus and disclose
working and financials of other group companies. This is when K M Abraham spotted
SIREC and SHIC and found that the money raised through OFCDs was camouflaged as
private placements.

6. Abraham found out that even though the Sahara group companies collected money they
did not have proper records of the identity of its investors. How and to whom would they
then return the money? Even professional agencies were unable to locate the investors.

7. The two companies, Abraham alleged, intended to rotate money between group
companies. Though the OFCD instruments were issued in the name of the two companies,
cheques were sought in the name of Sahara India.

8. When Sebi issued its order on the wrongdoings of the Sahara group on June 23, 2011,
Sahara group took the matter with Securities Appellate Tribunal (SAT). But SAT held the
Sebi findings to be correct. SAT in its order said What it (Red Herring Prospectus) did not
disclose was the fact that the information memorandum was being issued to more than 30
million persons inviting them to subscribe to the OFCDs and there lies the catchThis
concealment is, indeed, very significant and goes to the root of the controversy.

9. Sahara group then approached the Supreme Court but in August 2012, the honourable
court asked the group to repay an amount of over Rs 24,000 crore to Sebi within 90 days.
The regulator will then distribute the money to bonafide investors. But suddenly Sahara said
it had repaid most of the money over the last one year and an amount of just over Rs 5,000
crore was pending.

Does ofcd come under the jurisdiction of sebi.


Whether the hybrid OFCDs fall within the definition of "Securities" within the
meaning of Companies Act, SEBI Act and SCRA so as to vest SEBI with the
jurisdiction to investigate and adjudicate. Observations of SC: OFCDs issued by
the two companies are in the nature of "hybrid" instruments but it is "Security"
within the meaning of Companies Act, SEBI Act and SCRA. Although the definition
of "Securities" under section 2(h) of SCRA does not contain the term "hybrid
instruments" but it is inclusive definition and covers all "Marketable securities".
OFCDs were offered to millions of people hence it were marketable. The name
itself contains the term "Debenture", it is deemed to be a security as per the
provisions of Companies Act, SEBI Act and SCRA.