sebi:WTM/MPB/EFD-I-DRA-IV/40/2019
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Facts / Headnote
Violations found; refund with 15% interest directed jointly and severally against SDCL and three directors; market access restrictions imposed on all noticees and debenture trustee for 4 years; asset inventory and escrow account directions issued.
Provisions invoked
- s. 19
- s. 12(1)
- s. 81
- s. 55A
- s. 73
- s. 12
- s. 28A
- s. 4A
- s. 67(3)
- s. 67
- s. 117B
- s. 56
- s. 73(2)
- 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. 16
- Reg. 9
- Reg. 17
- Reg. 12
- Reg. 8
- Reg. 15
- Reg. 14
- 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)
- Reg. 5(2)(b)
Parties
- Siyaram Development and Construction Limited (SDCL)
- Mr. Prasanta Bera
- Mr. Biraja Bera
- Ms. Paromita Dey
- Mr. Biswajit Roy
- Mr. Arun Sardar
- Mr. Aravinda Mondal
- Mr. Sridhar Mukherjee
- Mr. Abdul Mandal
- Ms. Kalpana Guha
Holding
SDCL's offer of Secured Redeemable Debentures to 63 or more allottees was deemed a public issue under the first proviso to Section 67(3) of the Companies Act, 1956, and the company and its directors during the relevant period violated Sections 56, 60, 73, 117B and 117C of the Companies Act and Section 12(1) of the SEBI Act read with Regulation 7 of the Debenture Trustees Regulations. SDCL, Mr. Prasanta Bera, Mr. Biraja Bera and Ms. Paromita Dey are jointly and severally liable to refund the amounts collected with 15% interest per annum.
Full text
Order in the matter of Siyaram Development and Construction Limited Page 2 of 33 Hennur, Bangalore- 560043. 2. Securities and Exchange Board of India (hereinafter referred to as “SEBI”) received a complaint from an investor regarding non-payment of maturity amount of his investment in debentures issued by the company. Along with the said complaint, the complainant forwarded copies of two letters of allotment of Secured Redeemable Debentures (hereinafter referred to as “SRDs”) issued by SDCL.
Order in the matter of Siyaram Development and Construction Limited Page 3 of 33 debentures to the investors by floating various types of schemes and collected huge amounts of money. They also stated that the postdated cheques issued by the company to the investors have bounced as there is no money in the accounts of the company. It is also stated that the directors of the company closed their offices in various districts of Assam and thereby cheated the investors and misappropriated the collected money.
Order in the matter of Siyaram Development and Construction Limited Page 4 of 33 a copy of Trust Deed filed by SDCL with RoC that the company has been authorized to issue debentures amounting to ` 20 crore and a charge of ` 20 crore was created on November 18, 2010 to secure the issuance of debentures in favour of Ms. Kalpana Guha as a Debenture Trustee. − It is further observed that the company was authorized to issue and allot the debentures aggregating to a nominal value not exceeding ` 50 crore in terms of resolutions dated March 12, 2012. − It is mentioned in the Auditor’s Report for the year ended March 31, 2012 that “The company had issued Secured Non-Convertible Redeemable Debentures at different Coupon rate for different tenure. The closing balance of debenture as on 31.03.2012 is ` 4,22,16,926/- on private placement basis.” It is observed that the same amount i.e. ` 4,22,16,926/- has been mentioned under the heading ‘Long Term Borrowing’ in ‘Notes on Financial Statements for the year ended March 31, 2012 of the company. The corresponding amount as on March 31, 2010 has been stated as ` 4,08,78,400/- and ` 3,84,55,100/- as on March 31, 2011. − Moreover, a simple collation of data from the copies of letters of allotment and copies of “principal & dividend warrants” provided by complainants indicates that SDCL allotted SRDs to at least 63 allottees. It is evident from the copies of the letters of allotment that the debentures were allotted during FY 2010-11 to 2012- 13
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Source: SecMarx — sebi:WTM/MPB/EFD-I-DRA-IV/40/2019. 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.