sebi:WTM/PS/150/CIS-NRO/CHLO/FEB/2016
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Facts / Headnote
Held schemes are unregistered Collective Investment Schemes; directed abstention from collecting money/launching CIS, winding up of existing CIS and refund with returns within three months with repayment report, inventory of assets, 4-year securities market restraint, with extended restraint, police reference, MCA winding-up reference and attachment on default.
Provisions invoked
- s. 11A
- s. 24
- s. 19
- s. 12
Regulations
- Reg. 65
- Reg. 3
- Reg. 4(2)(t)
Parties
- G.C.A. Marketing Private Limited
- Mr. Amardeep Singh Cheema
- Mr. Gurdeep Singh
Holding
GCA Marketing Private Limited's contract farming/assured harvest plans are Collective Investment Schemes under Section 11AA, operated without registration in violation of Section 12(1B) and Regulation 3 of the CIS Regulations, rendering the company and its directors liable to wind up the schemes, refund investors with returns, and suffer market restraint.
Full text
Page 2 of 24 10, 2010-11 and 2011-12, etc., in order to ascertain whether it was carrying on the activities of a 'Collective Investment Scheme' (hereinafter referred to as ‘CIS’). However, the same had returned undelivered.
Page 3 of 24 4. SEBI upon examining the material available on record, prima facie found that the activity of mobilising funds by GCA under the scheme/ plan with promise of returns satisfies the features of CIS as defined in Section 11AA of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as the ‘SEBI Act’) without obtaining a certificate of registration from SEBI for operating CIS as required under Section 12(1B) of the SEBI Act read with Regulation 3 of the SEBI (Collective Investment Schemes) Regulations, 1999 (hereinafter referred to as ‘CIS Regulations’). The mobilization of funds by GCA through its schemes, was also prima facie found to be a fraudulent practice in terms of Regulation 4(2)(t) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practice Relating to Securities Market) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’).
Page 4 of 24 Company and its directors in connection with the interim order, requested for four weeks’ extension for submitting the reply. Thereafter, the advocate for the noticees vide another e-mail dated March 17, 2015, requested for an inspection of the documents available on record. The request was considered and an inspection of the documents available on record was granted to GCA on March 30, 2015.
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Source: SecMarx — sebi:WTM/PS/150/CIS-NRO/CHLO/FEB/2016. 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.