Supreme Court Scrutinizes Sahara-Adani Mega Property Deal, Appoints Amicus to Untangle Claims

New Delhi – The Supreme Court of India is now at the center of a proposed multi-billion dollar real estate transaction, as it weighs a plea from the beleaguered Sahara Group to sell 88 of its properties, including marquee assets like Aamby Valley City, to Adani Properties Private Limited. The move, aimed at finally settling the group's long-standing liabilities to investors, has prompted the apex court to broaden the case's scope, impleading key government ministries and appointing an amicus curiae to navigate a web of competing claims.

A special bench comprising Chief Justice of India B.R. Gavai, Justice Surya Kant, and Justice M.M. Sundresh on Tuesday, October 14, sought responses from the Union Government and the Securities and Exchange Board of India (SEBI) on the application filed by Sahara India Commercial Corporation Ltd (SICCL). The court has scheduled the next hearing for November 17, setting the stage for a critical decision in the decade-long legal battle.

The case stems from the landmark 2012 Supreme Court judgment ordering two Sahara group companies to refund over ₹24,000 crore, with interest, to millions of investors from whom the funds were raised through Optionally Fully Convertible Debentures (OFCDs) in violation of securities laws. While Sahara claims to have deposited around ₹16,000 crore into a dedicated SEBI-Sahara account, the regulator maintains that a liability of over ₹9,000 crore remains outstanding.

A Strategic Pivot: One Buyer for All Assets

In a significant strategic shift, Sahara has executed a term sheet with Adani Properties for the sale of 88 assets in a single transaction. Representing Sahara, Senior Advocate Kapil Sibal argued that this consolidated approach is necessary after years of failed piecemeal attempts by SEBI to liquidate the attached properties. Sibal presented a comprehensive plan where the sale proceeds, estimated at over ₹12,000 crore, would be directly deposited to satisfy the group's outstanding liabilities.

The proposal gained a powerful ally in Senior Advocate Mukul Rohatgi, who, appearing for Adani Properties, stated his client's readiness to acquire the entire portfolio in one go. In a move designed to expedite the process, Rohatgi conveyed that Adani Properties is willing to acquire the assets "even with existing claims, to avoid further litigation." This aggressive stance signals the buyer's intent to absorb the legal risks associated with disputed titles, a major hurdle in previous sale attempts.

The properties in question are extensive and high-value, including the sprawling Aamby Valley City and Hotel Sahara Star in Maharashtra, and the Sahara Shaher and Sahara Ganj commercial complexes in Lucknow, along with large land parcels across multiple states.

Widening the Circle: Government Ministries and Amicus Curiae Step In

Recognizing the national scale and financial implications of the proposed sale, the bench heeded the advice of Solicitor General Tushar Mehta. Mehta submitted that the deal "appeared reasonable but required consideration by the Union Government." He argued that the government needed to examine the proposal and present its perspective, leading the court to direct Sahara to implead the Ministries of Finance and Corporate Affairs. Some sources also noted the inclusion of the Ministry of Cooperation, reflecting the fact that many cooperative societies had invested in Sahara entities.

"The Central government may also have to examine and put its thoughts before the court. Please consider impleading the Secretaries of the Ministries. So, we can also present our picture,” Solicitor-General Tushar Mehta submitted.

This development marks a significant expansion of the dispute beyond its original contours of a corporate-regulator conflict, bringing central government oversight directly into the resolution process.

Further complicating the matter are the numerous third-party claims on the properties. Senior Advocate Gopal Sankarnarayanan highlighted that many of the 88 properties are already entangled in disputes or subject to prior agreements. To address this, the court has tasked Senior Advocate Shekhar Naphade, the amicus curiae in the case, with a crucial and complex assignment.

"We request the amicus to take the assistance of a counsel who can collate such information in a chart showing properties where rights are crystallised, where disputes exist, and where there is a shadow of doubt,” the Bench directed.

Naphade is now responsible for identifying which properties are free from encumbrances, which are disputed, and where ownership rights are ambiguous. This methodical vetting process is essential for the court to grant any approval and ensure the finality of the transaction.

The SEBI Stance and Human Cost

SEBI, represented by Senior Advocate Arvind Datar, maintained a pragmatic stance. The regulator stated it had no objection to the sale, provided the transaction is supervised by the court and the price is not less than 90% of the circle rate or market value—a condition previously set by the court for Sahara's asset sales. SEBI’s primary interest remains the recovery of the outstanding ₹9,000 crore for the investor refund account.

Amidst the high-stakes corporate maneuvering, the court also turned its attention to the human element of Sahara's decline. The bench explicitly directed the Sahara Group to examine and address the long-pending salary claims of its workers, acknowledging that many have gone unpaid for years.

The Path Forward: A Test for Judicial Oversight

The application from SICCL underscores the group's weakened state following the death of its founder, Subrata Roy, in November 2023. The company stated that its capacity to manage and monetize assets has diminished, necessitating a court-supervised resolution to bring closure to the protracted contempt proceedings and satisfy all stakeholders.

The hearing on November 17 will be pivotal. The Supreme Court will consider the responses from the newly impleaded ministries, SEBI, and the preliminary findings of the amicus curiae. The bench will then face the complex decision of whether to approve the sale to Adani Properties as a single lot or to continue with a piecemeal approach.

The outcome will not only determine the fate of the Sahara Group and its vast real estate empire but also potentially create a new judicial framework for resolving large-scale, multi-stakeholder corporate insolvencies that fall outside the traditional ambit of the Insolvency and Bankruptcy Code (IBC). The court's handling of the competing interests—of secured and unsecured creditors, investors, employees, and government bodies—will be closely watched by the legal and corporate communities alike.