In an attempt to weed out illicit money pooling schemes, Sebi today restrained Vaibhav Pariwar India Projects Ltd from mobilising money through issuance of securities.
The firm and its directors have also been barred from accessing the securities market with immediate effect.
An initial probe by Securities and Exchange Board of India (Sebi) found that Vaibhav Pariwar raised Rs 14.47 crore from 6,959 persons through issuance of Non-Convertible Debentures (NCDs) from 2009-10 to 2012-13.
Sebi has prima facie found that issues were made to more than 50 people, which, under the rules, made it a public issue of debt securities requiring compulsory listing on a recognised stock exchange. It was also required to file a prospectus, which it failed to do.
"I am of the view that Vaibhav Pariwar is prima facie engaged in fund mobilising activity from the public, through the Offer of NCDs," and as a result of such activity has violated the provisions of Companies Act, Sebi Whole Time Member S Raman said in an interim order.
Accordingly, the market regulator has asked Vaibhav Pariwar not to mobilise any further funds from investors "through the issue of NCDs or through the issue of equity shares or any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly till further orders".
Further the company and its directors-- Rajesh Kumar Rai, Manoj Kumar Rai, Binay Kumar Lall and Indrakala Rai and its Debenture Trustees viz Ashok Kumar Banerjee and Chandrima Sarkar --"are prohibited from issuing prospectus or any offer document or issue advertisement for soliciting money from the public for the issue of securities, in any manner whatsoever, either directly or indirectly, till further orders".
The entities have also been asked not to dispose any assets acquired through the issue of NCDs as well as not to divert any funds raised from investors.
Besides, the company and its directors have to provide a full inventory of all its assets and properties and furnish all relevant information with Sebi within 21 days.
Also, Banerjee and Sarkar prohibited from continuing with their present assignment as a debenture trustee in respect of Vaibhav Pariwar and also from taking up any new assignment or involvement in new issue of debentures, etc. in a similar capacity.
These directions shall take "effect immediately and shall be in force until further orders.
