The Reserve Bank of India (RBI) on Monday cancelled the certificate of registration of Sahara India Financial Corporation under the RBI Act.
Following the cancellation of registration certificate, Sahara India Financial Corporation cannot transact the business of a non-banking financial institution, the central bank said in a statement.
The registration of the Lucknow-headquartered company stands cancelled with effect from September 3, the RBI said.
Sahara Group has been engaged in a long-running regulatory and legal battle with Securities and Exchange Board of India (Sebi) ever since the capital market regulator ordered refund by two Sahara entities. Recently, Sebi had cancelled the registration of Sahara Mutual Fund saying it was no longer “fit and proper” to carry out this business.
Sahara Group’s chief Subrata Roy is in jail for over a year now after failing to arrange Rs 10,000 crore in bail amount.
The Supreme Court had earlier said that Sahara owes as much as Rs 36,000 crore to bond investors, which it has to deposit within 18 months and in 9 instalments. The top court also ruled that if its chief Mr Roy fails to deposit any three instalments, he and two other directors of Sahara, who are also currently in Delhi’s Tihar Jail, will be taken into custody.