Sebi has banned Sai Prakash Organic Food and its six current and former directors from the securities market for at least four years and directed them to refund the money collected from investors via illegal collective investment schemes (CISs).
Besides, the directors have also been restrained "from holding position as directors or key managerial personnel of any listed company" for 4 years, according to a Sebi order dated July 16.
The ruling follows an interim order passed by Sebi in January 2015 in which it had observed that the entities were involved in illegal mobilisation of funds from the public through various schemes for promoting organic farming and purchasing and developing agriculture farms.
The activities were in the nature of CIS and without obtaining requisite certificate of registration, the order had said.
The company had mobilised over Rs 25 crore from 2010-11 to 2013-14.
In the absence of any evidence provided to refute the prima facie findings in the interim order, the activities of the company constitute CISs and have been carried out without seeking registration from the regulator, thereby contravening the CIS Regulations, Sebi said.
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It has also directed the firm and directors to wind up the existing CIS and refund the investors within a period of three months from the date of the order.
Following the completion of the refund, the firm and its present directors -- Ranvajay Pratap Singh Baghel, Mragendra Singh Baghel and Dheerendra Krishan Pratap -- have to submit a winding up and repayment report (WRR) to Sebi, within seven days.
If the entities fail to comply, the regulator will initiate recovery proceedings against them.
The former directors of the firm are Pushendra Singh Baghel, Pushpanjali Singh Baghel and Shahendra Singh Baghel.
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