According to Bar and Bench, the Supreme Court on Thursday overturned a Delhi High Court judgement to suspend a probe into financial irregularities in nine Sahara Group entities. According to Live Law, the Delhi High Court issued the stay order in December, stating that the reasons for ordering the probe were insufficient. It stated that the investigating agency did not finish the probe within the three-month time frame.
The inquiry is being conducted by Serious Fraud Investigation Office, a central agency that looks into cases of corporate fraud.The High Court had also said that the decision to launch the inquiry prima facie appeared to be contrary to the provisions of the Companies Act as six of the firms which were added to the investigation later were not holding companies or subsidiary companies or being managed by the other three that were first brought under the scanner.
At Thursday’s hearing, Solicitor General Tushar Mehta told the Supreme Court that that the inquiry could not be completed in three months and instead took three years as the amount under investigation was Rs 1 lakh crore and many companies were involved in the alleged fraud.“There is no such mandate under the [Companies] Act that if probe is not completed within three months, the probe itself will come to an end,” Mehta said. Senior Advocate Kapil Sibal, who represented the Sahara Group, argued that the Companies Act of 2013 should not apply in this case because the transactions under inquiry occurred in 2011. The Supreme Court, on the other hand, ruled that a temporary suspension of the probe was improper. “The High Court has entirely destroyed an exceptional inquiry,” it stated. “This is an unusual order.” It must be preserved.”