SC to hear Sahara Life’s ‘siphoning off’ policyholders’ fund charges
Apex court had flayed the Sahara India Life Insurance Company for failing to recover Rs 78.15 crore from its major shareholder Sahara India Financial Corporation
image for illustrative purpose
Mumbai The Supreme Court will be hearing a case on Sahara India Life Insurance on Monday (July s) as the law officer representing the Insurance Regulatory Development Authority of India (IRDAI) was on his legs in another matter, when the case was heard a week ago.
While hearing the case on Monday last, the apex court had flayed the Sahara India Life Insurance Company for failing to recover Rs 78.15 crore from its major shareholder Sahara India Financial Corporation, terming it a “gross defaulter” and has “siphoned off” its policy holders’ money.
However, Sahara Life has refuted the charges of siphoning of money.
The observations were made by a Bench led by Justice Abhay S Oka while hearing the insurance regulator’s appeal challenging the Securities Appellate Tribunal’s decision to stay its order directing Sahara India Life Insurance Company to transfer its life insurance business to SBI Life Insurance Company.
Senior counsel Kapil Sibal, appearing for the Sahara LI, argued that Rs 1,300 crore has been handed over to the insurance regulator and the company cannot service any policy holder now, the Bench said “you have been given a long rope. Bring back Rs 78 crore by Friday. Repeated opportunities were given to you. You don’t want to bring back money and want policy holders to suffer… you can’t take this court for a ride.” The judges also went on the say Sahara India Life had “siphoned off money to Sahara India (Financial Corporation).”
Earlier, the bench while seeking response from Sahara India Life had said that "some solution has to be found to protect the interest of 3,300 people who have filed their claims." It also asked Sahara to submit details of the mechanism to find a solution and posted the matter for further hearing on July 10.
IRDAI had moved the SC against the tribunal’s stay, stating that its June 2 order to immediately transfer the life insurance business of the Sahara firm to SBI Life was passed due to the former’s “rapidly deteriorating financial position, and the vacation of the stay was required to “ring-fence the assets/investments” of the Sahara firm from “possible diversion or siphoning off”.
