sebi:CO/376/IES/11/2002
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Directions issued prohibiting VFSSL from accessing the capital market and/or dealing in securities market in any capacity for a period of five years with effect from 25th November, 2002, running concurrently with the order dated 11th September, 2002 in the Rajesh Exports Ltd. case, in force up to and including 24th November, 2007.
Provisions invoked
- s. 11B
- s. 4(3)
- s. 11
Parties
- Viswapriya Financial Services & Securities Ltd. (VFSSL)
Holding
VFSSL was held to be a person 'associated/connected with the securities market' subject to directions under Section 11B of the SEBI Act, 1992, and was found guilty of aiding, abetting and conniving with the promoters of IFSL in creating an illusion of minimum subscription to the public issue of IFSL, in violation of the terms of the prospectus and SEBI Disclosure and Investor Protection Guidelines.
Full text
Minimum subscription of 90% is mandatory for each issue of capital to public and if the company does not receive 90% of issued amount from public subscription before the closure of issue, as per the provision of Companies Act, SEBI Disclosure and Investor protection Guidelines and terms of prospectus, the company is under obligation to refund the subscription to the public unless underwriting obligations have been invoked.
said public issue, Mr. Urmilesh Gandhi had apparently flown to Madras along with Shri Dilip Gajjar, PRO of IFSL, to tie up funds with VFSSL.
apparently issued after the date of closure of the issue. (vi) CBI vide its letter dated 14th December, 1998 had accepted that stock invests No.104117 to 104128 totalling Rs.80 lacs which were used by VFSSL for subscribing to the public issue of IFSL, were issued only on 27.5.95.
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Source: SecMarx — sebi:CO/376/IES/11/2002. 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.