Taking strict action against entities engaging in illicit fund raising activities, Sebi has barred Kolkata-based Prism Infracon from mobilising money through issuance of securities and has also restricted the firm as well as its directors from accessing capital markets.
The company allegedly raised about Rs 60 crore from more than 21,000 investors during the period from 2009-10 to 2012-13 through issue of secured redeemable non-convertible debentures (NCDs).
Securities and Exchange Board of India (Sebi) found that these activities by the firm were prima facie in violation of various capital market norms.
The market regulator observed that the company had issued NCDs to over 50 persons which under the rules made it a public issue of securities and hence would require a compulsory listing on a recognised stock exchange. The company was also required to file a prospectus, among others, which it failed to do.
Accordingly in an interim order today, Sebi said that steps were required to be taken in the matter "to ensure only legitimate fund raising activities are carried on by Prism Infracon Ltd and no investors are defrauded".
The regulator has directed the firm not to mobilise funds from investors through issuance of equity shares or any other securities, till further orders.
The firms and its directors have been prohibited from the capital markets as well as from issuing offer documents, advertisement for soliciting money from the public for the issue of securities, till further directions.
Further, the Sebi order has asked the company and its directors not to divert any funds raised from public at large.
Prism Infracon has also been asked to provide a full inventory of all its assets and properties as well as furnish complete and relevant information sought by the regulator relating to the matter.
Sebi has also prohibited -- Tapas Kumar Dey, Hemanta Banerjee and Abhishek Loharuka -- from continuing with their present assignment as debenture trustees in respect of the Offer of NCDs of Prism Infracon and also from taking up any new assignment or involvement in any new issue of debentures.
According to the regulator, the debenture trustees failed to meet the eligibility criteria specified under the norms.
Sebi probe found that Prism Infracon had raised funds to the tune of Rs 59.37 crore through Offer of NCDs during the years 2009-10, 2010-11, 2011-12 & 2012-13 from more than 21,378 persons.
