Regulator Sebi today asked Real Tulip India and its directors to refund the money that the company had collected illegally from the public and has also barred them from the markets for at least four years.
The Securities and Exchange Board of India (Sebi) noted that Real Tulip had collected over Rs 1 crore through the issuance of non-convertible debentures (NCDs) from over 400 investors in 2011-2012, 2012-2013, the regulator said in an order.
The securities were issued to over 50 people and accordingly the offer of NCDs qualified to be a public issue and required compulsory listing of securities on a recognised exchange. However, the firm 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.
"Real Tulip was engaged in fund mobilising activity from the public, through the offer of NCDs and has contravened the provisions of ... the Companies Act and ... provisions pertaining to the Sebi (Issue and Listing of Debt Securities) Regulations," Sebi Whole Time Member Madhabi Puri Buch said.
Accordingly, Sebi has directed the company and its five directors -- Dipankar Ghosh, Tirtha Halder, Maloy Kumar Guha, Malay Halder, Prosenjit Sil -- to refund the money collected by the company, during their respective period of directorship through the issuance of NCDs along with an annual interest of 15 per cent.
After completion of refund, they have been directed to file a report of such completion with Sebi, within three months, certified by two independent chartered accountants.
In case these entities fail to comply with the order, Sebi may recover such amounts in accordance with provisions of securities laws.
Further, Sebi has prohibited the company and its directors from the securities markets till the refund and a further period of four years from the date of completion of the refund to investors. Also, they have been restrained from associating themselves with any listed public company during the period under review.
Besides, Sebi has banned Real Tulip Debenture Trust and Kanan Bala Halder from accessing securities market for a period of four years.
In November 2014, the regulator had barred the firm from raising funds through issuance of securities and had also restricted the company and its directors from dealing in capital markets.
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