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The Supreme Court on Thursday set aside the Delhi High Court order staying the investigation proceedings including the coercive proceedings and lookout notices in a probe against Sahara Housing Investment Corporation Limited and other Sahara companies. The probe against the companies was being conducted by the Serious Fraud Investigation Office.

A vacation bench of Justice DY Chandrachud and Justice Bela M Trivedi noted, "We are of the view that the High Court was not justified in staying the investigation."

The bench was hearing a plea filed by the Serious Fraud Investigation Office challenging the order of the Delhi High Court order staying the investigation against Sahar Companies and their Directors.

The High Court had stayed the investigation on the following grounds: 

• The investigation of a company should be completed within a stipulated period. (In the present case the period was of 3 months which has expired.)
• Order authorizing the investigation into 6 other companies is in violation of Section 219 of the Companies Act, 2013.
• The Order does not furnish the reason to compel the Central Government to order an investigation.

Solicitor General Tushar Mehta submitted that the total amount involved in the fraud is Rs. one lakh crore. "The High Court has noted that considering layers of companies involved in the probe could not be completed in 3 months and took years. There is no mandate under the law stating that the investigation will come to an end if the same is not completed within the stipulated period," he contended.

To this, Justice Chandrachud sought Senior Advocate Kapil Sibal's response over the issue. "This is a very extraordinary order of staying an investigation," he noted.

Sibal, appearing for the Sahara companies, submitted that there must be some material on record for the Board of Directors to be involved.

However, the bench directed the order of the High Court to be set aside. Court opined, "Undoubtedly the High Court has the power to pass such extraordinary orders, but the finding of the High Court staying the investigation was not warranted."

The bench has asked the High Court to decide the pending writ petitions expeditiously. "We are of the view that the High Court was not justified in staying the investigation," Court held.

Cause Title: Serious Fraud Investigation Office Vs. Sahara Housing Investment Corporation Limited & Ors.