Red Corner Notice against man holding power of attorney

A U.S. company that had proposed to buy Sahara’s Plaza Hotel in New York struck a sour note in the Supreme Court on Monday when it said it was no longer interested in going ahead with the plan.

The court then ordered the Union of India to issue a Red Corner Notice against one Prakash Swamy, who holds the power of attorney in the application filed by MG Capital Holdings LLC, New York, offering to buy the luxury hotel for $550 million.

The Supreme Court had asked the company to prove its bona fides by depositing ₹750 crore with the SEBI-Sahara refund account. The payment was not made. The company’s lawyer, instead, informed the court on Monday that his client was not interested any more in the purchase as it found after due diligence that there was difficulty in going ahead with the transaction.

Deadline set

A Bench led by Justice Dipak Misra directed the Union of India to ensure that Mr. Swamy, who belongs to Chennai, did not leave the country. It ordered the Union to issue a Red Corner Notice in the course of the day.

The court also ordered the Superintendent of Police, Chennai, to ensure that Mr. Swamy is brought before it on April 27, 2017. It gave Mr. Swamy 10 days to deposit ₹10 crore into the Sahara-SEBI refund account. The money would be forfeited towards costs, the court said. The court would issue non-bailable warrants of arrest against him if he failed to pay up. He has been ordered to deposit his passport with the Regional Passport Officer, Chennai, Shastri Bhavan, by April 18.

His lawyer was asked to hand over the address of Mr. Swamy and the latter’s passport details to the Centre’s counsel in the course of the day.