A New Delhi-based plantation company which failed to register with the Securities and Exchange Board of India (Sebi) has taken the regulator to court. In a simultaneous development, 4 out of the 9 Mumbai-based collective investment schemes (CIS) which have applied for registration, have undertaken restructuring to fall within the Sebi regulations.
According to Dharmishta Raval, Sebi executive director (legal), Paramount Biotech Industries Ltd has filed a case against the regulator in the Allahabad High Court challenging the authority of Sebi to regulate plantation companies. The petitioner has said that the Sebi regulations are in violation of the Constitution of India which states that agriculture land is a central subject. Thus, Sebi cannot regulate these schemes. The regulations are also in violation of the Companies Act, it has contended.
"The matter was heard by the court on Monday where we said that the government had through an amendment to the Sebi Act in 1995 empowered Sebi to regulate CIS. The definition of a CIS has been further clarified in a recent amendment to the SCRA. We also informed the court that the Supreme Court is already seized of the matter," said Raval.
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"The court has adjourned the matter to January 26 and has not yet admitted the petition as," said Raval. Meanwhile, 4 Mumbai-based plantation companies -- Parasrampuria, La Mark Farms Ltd, Four Seasons Farms Ltd and Green Gold Forestry Ltd -- have worked out restructuring of their schemes so that they can conform to the Sebi guidelines.
These 4 companies have a total investor base of 1,20,000 investors and have mobilised funds from investors to the tune of Rs 125 crore. According to S Sodhi, chairman of La Mark Farms and a consultant to the other entities, the Parasrampuria group is merging 22 schemes into one to be called PPL Millennium.
The total corpus of these schemes is about R