Besides, the Securities and Exchange Board of India (Sebi) has barred the firm and its directors from the capital markets for four years.
Mass Infra Realty had garnered funds illegally through issuance of Non-Convertible Redeemable Debentures (NCDs).
A Sebi probe found that the company had raised 37.90 crore (approximately) by allotting NCDs to about 14,256 persons between 2011-14.
Since the shares were issued by the firm to more than 50 people, it qualified as a public issue that requires compulsory listing on a recognised stock exchange. It was also required to file a prospectus, among other things, which it failed to do.
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In an order dated April 25, the regulator has directed the company and its directors to refund the money along with an interest of 15 per cent per annum.
The firm and its directors have been restrained and prohibited from buying, selling or otherwise dealing in the securities markets for four years and the ban will continue till the completion of refunds to investors.
In case the firm fails to comply with the order in three months, Sebi would make a reference to the state government or local police to register a case against them for fraud, cheating and misappropriation of public funds.
Further, Debenture Trust Suraksha and Mass Debenture Trust are prohibited from offering themselves as debenture trustees in the securities market, without obtaining registration from Sebi. They have also been restrained from accessing the securities market for four years.
The directions would come into force with immediate effect.