sebi:WTM/PS/159/IMD-CIS/WRO-ILO/FEB/2016
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Facts / Headnote
Held the Company's schemes are unregistered Collective Investment Schemes in violation of law; directed wind-up of schemes and refund to investors with winding-up and repayment report, asset freeze, information and inventory disclosure, and 4-year securities market debarment, without prejudice to prosecution and adjudication.
Provisions invoked
- s. 11A
- s. 24
- s. 19
- s. 11(1)
- s. 12
- s. 45
- s. 58A
- s. 620A
- s. 291
Regulations
- Reg. 65
- Reg. 3
- Reg. 4(2)(t)
Parties
- Skylark Land Developers and Infrastructure India Limited
- Mr. Dilip Kumar Jain
- Mr. Ram Shankar Yadav
- Mr. Durga Prasad Yadav
- Mr. Jaihind Kumar
- Mr. Anand Kumar Gupta
- Mr. Santosh Kumar Pandey
Holding
SEBI held that the plans offered by Skylark Land Developers and Infrastructure India Limited satisfy all four conditions under Section 11AA(2) and are therefore Collective Investment Schemes launched without registration in contravention of Section 12(1B) and Regulation 3, and directed wind-up, refund to investors, and consequential restraints.
Full text
Page 2 of 26 Collective Investment Schemes (“CISs”) without obtaining certificate of registration for carrying on such activity from SEBI as required under section 12(1B) of the SEBI Act, 1992 and regulation 3 of the SEBI (Collective Investment Scheme) Regulations, 1999 (“CIS Regulation”). The interim order had also alleged that illegal mobilization of funds from the public through such unauthorized CISs amounted to 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 (“the PFUTP Regulations”). In order to protect the investors, prevent the Company from further carrying on such unregistered CIS activity, to safeguard the assets acquired by the Company from public funds and also in view of the non-cooperation of the Company in furnishing information/documents as sought by SEBI during enquiry, the following directions were issued:
Page 3 of 26 2. The interim order afforded opportunity to the Company and its directors Mr. Dilip Kumar Jain, Mr. Ram Shankar Yadav, Mr. Durga Prasad Yadav, Mr. Jaihind Kumar, Mr. Anand Kumar Gupta and Mr. Santosh Kumar Pandey (collectively referred to as “noticees”) to file their
Page 4 of 26 5. The Company, vide letter dated April 13, 2015 sought personal hearing in the matter. Accordingly, in compliance with the principles of natural justice, an opportunity of personal hearing was afforded to the noticees on July 10, 2015. The schedule of this personal hearing was informed to the noticees vide SEBI letters dated May 27 and 28, 2015. In response, notice, Mr. Anand Kumar Gupta, vide his letter dated June 03, 2015, inter alia submitted as follows:
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Source: SecMarx — sebi:WTM/PS/159/IMD-CIS/WRO-ILO/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.