New Delhi: The Supreme Court dismissed Sebi's appeal against an interim order of the Allahabad High Court staying the market regulator's decision to ban some Sahara group entities from raising public funds.

The development comes as a relief to Sahara, which is now free to raise funds from the public. The apex court observed that while Sahara was free to share information sought by Sebi with the regulator, this was not a compulsion.

Sebi had challenged the Allahabad HC's order staying the regulator's November 24 decision to ban several Sahara group entities from raising money from the public for allegedly violating public issue norms and refusing to cooperate with Sebi.

Disposing the appeal, an SC bench comprising Chief Justice S H Kapadia and Justices K S Radhakrishnan and Swatanter Kumar said it would not like to interfere with the interim order of the HC.

When the Sebi counsel cited non-availability of information from Sahara-countered by Sahara by saying Sebi lacked jurisdiction over an unlisted company- the bench said that the group could provide information sought by the market regulator without prejudice to its contention before the HC, which is scheduled to hear the issue on January 12.

Sahara, in its challenge to Sebi's November 24 order before the Lucknow bench of the HC, had termed the action of the market regulator ex parte and hence violated the principles of natural justice. It had also argued that Sebi lacked jurisdiction over the group companies as they were neither listed nor intending to list their shares in the stock exchanges.

The HC, in its interim order, had stayed the Sebi order and told the regulator not to take a final decision in the inquiry during the pendency of Sahara's petition.