sebi:CO/02/ERO/04/2003
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Facts / Headnote
Company directed to refund money collected with returns due within one month, failing which prosecution, debarment and other referrals would follow
Provisions invoked
- s. 11B
- s. 4(3)
- s. 24
- s. 12
Regulations
- Reg. 73
- Reg. 65
- Reg. 70(1)(b)
Holding
The company was directed to refund the money collected under its scheme(s) with returns due to investors as per the terms of the offer within one month from the date of the order, failing which prosecution, debarment and other actions would follow.
Full text
The company did not submit the necessary information/clarifications. Instead, the company, sent two letters, both dated July 10, 2002, In one of the letters, the company stated that they did not fall under the category of a Collective Investment Management Company(CIMC), while in the other letter, the company sought the a clarification as to whether the application made by them seeking provisional registration was to be treated as rejected by SEBI and whether the company would get back Rs. 25,000/- paid for the application made by them and whether the company was required to obtain any permission from the Courts before dealing with the assets of the schemes of the company for repayment to the investors.
4. Writing to the department of company affairs, to initiate the process of winding up of the company. Place: MUMBAI Date: 2.4. 2003
Since the company did not submit the required documents within the stipulated time, i.e. by July 15, 2002, and failed to submit the information/clarifications as sought by SEBI despite receiving several reminders from SEBI, and since the company failed to satisfy SEBI that its affairs were not being conducted in the manner detrimental to the interests of the existing investors,in terms of Regulation 70(1)(b) of the said Regulations, the application of the company seeking grant of provisional registration was rejected on July 24, 2002, and communicated to the company vide letter dated July 25, 2002. The company was further informed that pursuant to the rejection of the said application, the company, as an existing Collective Investment Scheme, should wind up its existing scheme(s) and make repayment to the investors in the manner specified in Regulation 73 of the said Regulations.
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Source: SecMarx — sebi:CO/02/ERO/04/2003. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.