Sebi has barred Cuttack-based Shrivallis Securities, its seven directors and promoters from dealing in capital markets till further orders after finding a "prima facie" violation of public issue norms by the company.
Besides, the market regulator directed the firm not to dispose of their assets or divert funds raised from the public through offer of RPS and cooperate with the regulator in providing the required information.
After Shrivallis failed to submit the documents sought by Sebi, the regulator from the Registrar of Companies (RoC), Odisha, found that the company had issued Redeemable Preference Shares (RPS) to 421 persons during 2011 to 2013 to raise Rs 4.4 crore.
Since the shares were issued to over 50 people, the offer of RPS qualified to be a "prima facie" public issue and required compulsory listing of securities on a recognised stock exchange among other requirements which it "prima facie" failed to do, Sebi noted.
"The money mobilization on the part of Shrivallis Securities Ltd has prima facie placed the investors at grave risk by not following the requirements of law applicable to a public issue," Securities and Exchange Board of India (Sebi) said in order dated October 30.
Accordingly, Sebi banned Shrivallis, its directors -- Smruti Ranjan Biswal, Sweta Biswal and Sambit Mohanty-- and promoters -- Subrat Kumar Routray, Snigdha Biswal, Ramarani Mohanty and Kalla Chidambareswar Rao -- from securities market till further orders.
Disclaimer: No Business Standard Journalist was involved in creation of this content
