Former MP and Director in the Oriental Housing Development Finance Corpn. Ltd H S Hanspal was convicted by Additional Sessions Judge Pawan Kumar Jain on a complaint filed by the Securities and Exchange Board of India (SEBI).
While convicting Hanspal for illegally raising funds to the tune of Rs 1.18 crore in violation of the provisions of the SEBI Act, the court also imposed a fine of Rs five lakhs on the company.
The court, however, during sentencing adopted a lenient view after considering Hanspal's plea that he had refunded an amount of Rs 89.22 lakh out of the overall amount of Rs 118.96 lakh raised by the company during 1997-98. It also observed that the convict was 78-years-old and had no criminal history.
"Considering the mitigating factors that the company accused had refunded the amount to the tune of 89.22 lakhs in the year 2000 itself and the fact that convict is an old person of 78 years of age and no previous criminal antecedents, I am of view that convict deserves a lenient view.
"Ends of justice will be met if he is burdened with substantial amount of fine, thus, I hereby impose a fine of five lakhs each on both the convicts (Hanspal and the company)," the judge said.
SEBI had filed a complaint against the convict on January 21, 2003, alleging that he had collected money from people by floating a Collective Investment Schemes (CIS) during 1997-98 without obtaining a registration certificate for the same.
During the trial, the convict, had told the court that he was not a Director in the company and was not in-charge of the day to day affairs of the company.
