sebi:WTM/MPB/EFD-1-DRA-IV/89/2017
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Facts / Headnote
Directed SAIL and directors Biswanath Bhattacharya, Sanjoy Kumar Layek, Prakash Mandal and Hridhi Pratim Neogy to jointly and severally refund Rs. 24.58 Lakhs collected via NCDs with 15% p.a. interest from eighth day of collection, with asset disclosure, escrow, public notice and CA-certified compliance, and restrained them from securities market for 4 years from completion of refunds; restrained Swarnabhumi Agritech India Debenture Trust and Gautam Bandopadyay from securities market for 4 years.
Provisions invoked
- s. 19
- s. 12(1)
- s. 12
- s. 55A
- s. 73
- s. 28A
- s. 4A
- s. 67(3)
- s. 67
- s. 117B
- s. 56
- s. 73(2)
- s. 73(1)
- s. 2(36)
- s. 60
- s. 67(1)
- s. 27(2)
- s. 56(1)
- s. 117C
- s. 56(3)
Regulations
- Reg. 7
- Reg. 6
- Reg. 9
- Reg. 17
- Reg. 12
- Reg. 25
- Reg. 28
- Reg. 8
- Reg. 15
- Reg. 14
- Reg. 200
- Reg. 4(4)
- Reg. 2(e)
- Reg. 4(2)(a)
- Reg. 19
- Reg. 26
- Reg. 107
- Reg. 4(2)(b)
- Reg. 4(2)(d)
- Reg. 4(2)(c)
Parties
- M/s Swarnabhumi Agritech India Ltd.
- Biswanath Bhattacharya
- Sanjoy Kumar Layek
- Prakash Mandal
- Hridhi Pratim Neogy
- Swarnabhumi Agritech India Debenture Trust
- Gautam Bandopadyay
Holding
SAIL's 2011-2012 Offer of NCDs to at least 200 persons was a deemed public issue that violated Sections 56, 60 read with 2(36), 73, 117B and 117C of the Companies Act, 1956 and the ILDS Regulations, and its unregistered debenture trustee violated Section 12(1) SEBI Act. SAIL and its four directors were held jointly and severally liable to refund collections with 15% interest and all noticees were restrained from the securities market for four years.
Full text
Order in the matter of M/s Swarnabhumi Agritech India Ltd. Page 2 of 24 in the financial years 2011-2012 (hereinafter referred to as “Offer of NCDs”) and raised an amount of Rs. 24.58 Lakhs from 36 allottees. The number of persons to whom the offer of NCD was made, the number of allottees and funds mobilized has been collated from the documents submitted by the company. It was also observed that SAIL created a charge for an amount of Rs. 10.00 Crores on January 06, 2012 and appointed Swarnabhumi Agritech India Debenture Trust (represented by its trustee, viz. Gautam Bandopadyay) as Debenture Trustee for the Offer of NCDs by that company. Therefore, it was concluded that the actual number of persons to whom NCDs was offered, the number of allottees and amount mobilized could possibly be more than the above indicated figures.
Order in the matter of M/s Swarnabhumi Agritech India Ltd. Page 3 of 24 6. Further, SAIL created a charge for an amount of Rs. 10.00 Crores on January 06, 2012 and appointed Swarnabhumi Agritech India Debenture Trust (represented by its trustee, viz. Gautam Bandopadyay) as Debenture Trustee for the Offer of NCDs by the company. Swarnabhumi Agritech India Debenture Trust (represented by its trustee, viz. Gautam Bandopadyay) was not registered as debenture trustee for the offer of NCDs by that company. It was also alleged that the E- Form 10 filed by the company (date of creation of charge is 06.01.2012) with the RoC, the scrutiny of the Trust Deed attached with the E Form 10 shows that a company named M/s Greentouch Solar Limited (associate company of Swarnabhumi Group) has provided its fixed assets as security for the issue of debentures of Rs.10 Crores by SAIL and the security for issue of debentures has not been provided by SAIL which is highly prejudicial to the interests of the debenture holders.
Order in the matter of M/s Swarnabhumi Agritech India Ltd. Page 4 of 24 Bandopadyay) were also advised to show cause as to why suitable directions/prohibitions including restraining it/them from accessing the securities market and further restraining it/them from buying, selling or dealing in securities, in any manner whatsoever, for an appropriate period should not be issued under Sections 11(1), 11(4), 11A and 11B of the SEBI Act read with Regulation 25 of (Debenture Trustees) Regulations, 1993.
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Source: SecMarx — sebi:WTM/MPB/EFD-1-DRA-IV/89/2017. 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.