Sebi today banned Oscar Management Services and its seven promoters and directors from the securities market for at least four years and directed them to refund the money collected illegally from the investors.
According to an interim order passed by Sebi in September 2016, Oscar Management Services Ltd (OMSL) had issued 4.5 lakh equity shares valued at Rs 45 lakh to a total of 450 persons during the financial year 2007-08.
As per the order, since the number of persons to whom the offer of equity shares was made, was above the limit of 49 persons as prescribed under the Companies Act, the offer qualified as a public issue of securities and these had to be compulsorily listed on a recognised stock exchange. However, the firm did not comply with this provision.
Among others, the company had also failed to comply with the requirement of compulsory registration of prospectus with the registrar of companies before making a public offer.
For the "prima facie" violations, through its interim ruling Sebi had ordered OMSL to cease from mobilising fresh funds from investors and the firm and its promoters and directors were restrained from the securities market "till further directions".
In its fresh ruling today, Sebi directed OMSL and its promoters and directors to "jointly and severally" refund the money collected through the offer and allotment of equity shares with an annual interest of 15 per cent within a period of 90 days.
While all the entities have been banned from the securities market till the refund is done, they have also been restrained from accessing it "for a period of four years from the date of completion of the refund".
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In case the entities fail to comply with the direction to refund the investors, the Securities and Exchange Board of India (Sebi) would "initiate recovery proceedings" against them.
The promoters and directors are Pravash Chandra Rout, Muna Mahadev Patro, Tara Prasad Hotta, Kriti Ranjan Bastia, Abani Kanta Pattnaik, Sachitra Parto and Guru Baliarsingh.