The Supreme Court on Friday proposed constituting a verification committee to examine claims of thousands of present and former employees of the Sahara Group seeking payment of unpaid salaries, gratuity and other terminal dues from the SEBI-Sahara Refund Account.
The proposal came while hearing a batch of interlocutory applications filed by Sahara entities, employees and cooperative societies, with the Court observing that the first step should be to identify genuine employees and quantify the amounts payable before deciding the source of payment.
During the hearing, it was submitted that around 770 claimants had approached the Court through 34 interlocutory applications claiming unpaid salary, basic wages and other service benefits. Separately, Sahara informed the Court that it had furnished a list of approximately 16,000 persons whom it claimed were employees of Sahara Group companies and sought a mechanism for disbursing their unpaid dues, including salary, pension and other retiral benefits.
A draft proposal placed before the Court envisages a committee that would verify the identity of claimants, their employment records, appointment letters, tenure of service, documentary proof supporting the claims and the quantum allegedly due. The committee would submit its report within three months of its first hearing.
The Bench of Justice MM Sundresh and Justice Prasanna B Varale indicated that the committee’s role would be limited to verification and facilitation, and not adjudication of disputed claims.
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“We are only contemplating appointment of a committee only for this specific purpose of identifying the employees and then quantifying their entitlement. Thereafter, it will come before us and on the report of the committee, we’ll hear all of you and then pass an order…There are two broadly two exercises it will do. Number one, it will identify the employees… Then it will say how much amount they will be entitled to.”
Counsel appearing for SEBI raised concerns that payments from the SEBI-Sahara Refund Account could be made only in respect of companies whose assets had actually been sold and deposited into that account. The Bench, however, observed that such issues would be considered after the verification exercise was completed.
The Court further clarified that, at this stage, the committee would examine only the claims already pending before the Court, including the applications filed by employees and Sahara, so that the exercise remains manageable and no fresh claims are entertained midway.
The Bench also indicated that once the committee submits its report, it would consider all consequential issues, including the appropriate source of funds and the manner of disbursal.
Key Observations
● The Court proposed constituting a verification committee to scrutinise claims of present and former Sahara employees.
● The committee will verify employment status and quantify unpaid salary, gratuity and terminal dues.
● It will function as a verification and facilitation mechanism, not an adjudicatory body.
● The Court indicated that questions regarding the source of payment from the SEBI-Sahara Refund Account would be decided after the committee’s report.
● Only pending applications before the Court will presently be considered by the committee to avoid an open-ended verification process.