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CIS: Sebi slaps Rs 25L fine on Ally Multi Trade, 3 directors

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Press Trust of India New Delhi
Last Updated : Jan 02 2018 | 9:20 PM IST
Markets regulator Sebi has imposed a penalty of Rs 25 lakh on Ally Multi Trade India and its three directors for mobilising funds from public by carrying out illegal collective investment scheme (CIS) activities.
The directors of Ally Multi Trade India -- presently known as Ally Housing & Development -- are Chetan Yashwant Thakur, Vijay Dattaram Chavan and Suryakant Sambu Bhosle.
According to an order dated December 29, over Rs 2.42 crore was mobilised from the investors through two schemes -- Installment Payment Scheme (IPS) and Single Payment Scheme (SPS).
Following a probe, the Securities and Exchange Board of India (Sebi) observed that the schemes -- IPS and SPS -- involved pooling of funds from investors for purchase of an unidentifiable interest in undivided agricultural land on payment made in instalments.
Also, as per the terms and conditions of the schemes' agreement, the pooled funds were to be utilised for the development of the land as well as conducting agricultural activities on it.
Noting that the schemes

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carried out by Ally Multi Trade India constitute collective investment scheme, Sebi said the firm was carrying out CIS activities, without obtaining a certificate of registration in accordance with the provisions of CIS Regulations.
The regulator also said that the firm and directors had illegally mobilised funds from general public by carrying out CIS.
In a separate order dated December 29, Sebi also imposed a penalty of Rs 25 lakh on Karn Merchant Bankers for violating norms.
Sebi said that Karn was actively involved in the unauthorised issuance of secured non-convertible debentures by Amazan Capital.
The regulator also noted that Karn "failed" to exercise due skill, care and diligence in the conduct of all its business and it has "deliberately" failed to maintain transparency, fairness and professionalism, while acting as a registered intermediary with Sebi as merchant banker.
For violating Merchant Bankers Regulations, Sebi has imposed a fine of Rs 25 lakh on Karn.

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First Published: Jan 02 2018 | 9:20 PM IST

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