sebi:WTM/GM/SEBI/ERO/IMD/23/JUNE/2017
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Facts / Headnote
Interim directions issued restraining SGIL and its directors from accessing the securities market, disposing of assets, and diverting funds; show cause notice issued as to why refund of Rs. 8,10,92,200 with 15% interest and a four-year market ban should not be imposed.
Provisions invoked
- s. 62
- s. 73
- s. 4A
- s. 67(3)
- s. 67
- s. 56
- s. 73(2)
- s. 73(1)
- s. 60
Parties
- SGIL (Sagar Gold India Limited)
- Kali Sankar Majhi
- Bhakta Prasad Das
- Arunangshu Manna
- Tapas Kumar Giri
- Bibekananda Maiti
- Pralay Kanta Bhattacharyya
- Avedananda Khila
- Shubhranshu Shekhar Maikap
Holding
SGIL's offer and allotment of preference shares to 6,386 allottees prima facie constitutes an offer to the public under Section 67(3) of the Companies Act, 1956, triggering obligations under Sections 73, 56 and 60, which SGIL prima facie breached. Interim directions were issued restraining SGIL and its directors from accessing the securities market and disposing of assets pending show cause.
Full text
Page 2 of 9 (iv) As proof of delivery for letter issued to Kali Sankar Majhi was not received and no reply was received from him, an attempt was made to deliver the letter to him by hand delivery. However, the director was not available at that address. (v) Letter issued to Avedananda Khila was delivered, however, no reply was received from him.
Page 3 of 9 5. Information regarding mobilization of funds and signatory details pertaining to SGIL contained in documents like Annual Accounts, Annual Returns, Form 2 etc., were downloaded from the MCA portal.
Page 4 of 9 RELEVANT PROVISIONS OF LAW AND PRIMA FACIE FINDINGS 9. Section 67 of the Companies Act, 1956 deals with the conditions or circumstances under which an offer of shares/debentures by a company would be construed as one made to the public. Extracts of the relevant provisions of section 67 of the Companies Act, 1956, dealing with offer of shares or debentures to the public, are reproduced as under: "Construction of reference to offering shares or debentures to the public, etc. 67. (1) Any reference in this Act or in the articles of a company to offering shares or debentures to the public shall, subject to any provision to the contrary contained in this Act and subject also to the provisions of sub- sections (3) and (4), be construed as including a reference to offering them to any section of the public, whether selected as members or debenture holders of the company concerned or as clients of the person issuing the prospectus or in any other manner. (2) Any reference in this Act or in the articles of a company to invitations to the public to subscribe for shares or debentures shall, subject as aforesaid, be construed as including a reference to invitations to subscribe for them extended to any section of the public, whether selected as members or debenture holders of the company concerned or as clients of the person issuing the prospectus or in any other manner. (3) No offer or invitation shall be treated as made to the public by virtue of sub- section (1) or sub- sec
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Source: SecMarx — sebi:WTM/GM/SEBI/ERO/IMD/23/JUNE/2017. 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.