Sebi bars Express Cultivation, 9 others from securities mkt

Regulator Sebi has banned Express Cultivation Ltd (ECL) and nine individuals from the securities market for four years for collecting money illegally from the investors.

Among the nine individuals, while four -- Sushree Mazumder, Tanmoy Mridha, Sagar Majumder and Manoj Kumar Dhali -- are present directors of ECL, two -- Ashish Dhali and Sankar Baidya -- are former directors, according to a Sebi order dated October 3.

The remaining three persons -- Santosh Sardar, Subhasree Majumdar and Sunil Baran Majumdar -- are promoters of the firm.

In the order, the regulator noted that ECL had issued and allotted Redeemable Preference Shares (RPS) to 970 investors during the financial years 2010-11, 201112 and 201213 and raised Rs 1.02 crore.
 

Since the shares were issued to more than 50 people, the offer of RPS qualified to be a public issue and required compulsory listing of the securities on a recognised stock exchange. However, ECL did not comply with the provision.

Among other requirements, the firm was to register a prospectus with the Registrar of Companies (RoC) under the Companies Act, which it failed to do.

In an interim order passed in 2016, Sebi had restrained ECL, its promoters and past and present directors from accessing the capital market till further directions.

In the fresh ruling, the regulator has also directed ECL and its present and former directors to refund the money collected by the firm through the issuance of RPS, including the money collected from investors with an interest of 15 per cent per annum.

The firm and its present directors are permitted to sell the assets of the company for the sole purpose of making the refunds and deposit the proceeds in an escrow account opened with a nationalised bank, the Securities and Exchange Board of India (Sebi) said.

Besides, the present and former directors have also been restrained from associating themselves with any listed public company and any public company which intends to raise money from the public or any intermediary registered with Sebi, from the date of the order till the expiry of four years from the date of completion of refunds to investors.