Capital market regulator Sebi today restrained Sun Heaven Agro India Ltd from mobilising funds from investors through issue of securities and has also barred the firm and its directors from dealing in markets till its further directions.
The market regulator found that Sun Heaven Agro India Ltd (SHAIL) had garnered over Rs 11 crore from more than 7,700 investors through issuance of redeemable preference shares and through such activity had "prima facie" violated various norms.
Sebi observed that Sun Heaven Agro India Ltd's (SHAIL) redeemable preference shares issue was made to over 50 persons which under the rules made it a public issue of debt securities and hence would require a compulsory listing on a recognised stock exchange. It was also required to file a prospectus, among others, which it failed to do.
In its interim order, Sebi said "there is no other alternative but to take recourse through an interim action against SHAIL and its directors for preventing that company from further carrying on with its fund mobilising activity under the offer of redeemable preference shares."
"I am of the view that prima facie, SHAIL is engaged in fund mobilising activity from the public, through the offer of redeemable preference shares and as a result of the activity has violated the provisions of the Companies Act," Sebi Whole Time Member S Raman said.
Accordingly, Sebi has asked SHAIL to "not mobilise funds from investors through the issue of or through the issuance of equity shares or any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly, till further directions".
Further, the company and its directors --Madhab Chandra Das, Khokon Biswas, Provash Bala, Kanai Lal Pramanik and Ganesh Dam including its former directors, Suranjan Mondal, Kashi Nath Chanda, Mritynjay Bar and Pijush Kanti Jana--are barred from issuing any offer document or advertisement for soliciting money from the public for the issue of securities.
The company and its directors, "are restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in the securities market, either directly or indirectly, till further directions," the market regulator said.
Sebi has also asked the entities not to dispose any of the properties or assets acquired by that company through the issue of redeemable preference shares, without prior permission from the regulator as well as not to divert the funds raised from public.
While asking SHAIL to provide a full inventory of all its assets and properties, Sebi has also asked the company to within 21 days from the date of receipt of the order submit all relevant and necessary particulars sought by the watchdog.
According to Sebi, SHAIL issued and allotted redeemable preference shares to about 7,772 individuals/investors and mobilised an amount of Rs 11.54 crore between 2009-10 and 2012-13.
