sebi:WTM/PS/34/NRO/LKO/AUG/2015

SEBI · SEBI · 2013-05-14 · Prashant Saran, Whole Time Member

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Facts / Headnote

Ex-parte interim directions imposed on the Company and its directors; show cause notice issued to three directors (Mr. Chhote Lal Shukla, Mr. Vishwa Bandhu Vashishta, Mr. Mukesh Kumar Khare) as to why further directions including refund with 15% interest should not be imposed; replies to be filed within 21 days.

Provisions invoked

• s. 11
• s. 24
• s. 19
• s. 55A
• s. 73
• s. 67(3)
• s. 67
• s. 73(2)
• s. 73(1)
• s. 2(36)
• s. 60
• s. 67(1)
• s. 60B(9)
• s. 67(2)
• s. 73(3)
• s. 621
• s. 60B(2)
• s. 60B(3)

Regulations

• Reg. 107
• Reg. 111

Holding

SEBI held that Togo Retail Marketing Limited's allotments of equity shares to 2,767 investors (March 31, 2004), 5,596 investors (March 31, 2005) and 61 investors (March 31, 2009) constituted public issues under Section 67(3) read with its first proviso of the Companies Act, 1956, and that the Company failed to comply with the applicable provisions of the Companies Act, 1956, DIP Guidelines and ICDR Regulations. SEBI imposed ex-parte interim prohibitory directions on the Company and its directors restraining them from mobilizing funds, issuing offer documents, disposing of assets, diverting funds, and accessing the securities market.

Full text

Page 2 of 15 of one Togo Retail Marketing Limited (hereinafter referred to as 'Togo' or 'the Company')(earlier known as Multi-Ex Marketing & Communications Limited).Having received the complaint, SEBI initiated a preliminary examination and asked Togo vide letter dated May 14, 2013, to inter alia furnish the following information/ documents: i. Copies of the Memorandum and Articles of Association of the Company. ii. Annual Returns, Balance Sheet and Profit & Loss Account of the Company since incorporation. iii. Name, addresses, PAN and contact details of all the past and present promoters/directors/ Key Managerial Personnel of the Company. iv. Brochures pertaining to the schemes/offers made available to the public. v. Application forms required to be submitted by investors/applicant to participate in the scheme/offers vi. Copies of the registration letter/certificates and allotment letter issued to the investors who subscribed to such schemes/offers. vii. Copies of the agreements, if any, that are required to be entered into by investors/applicants with the Company at the time of joining the schemes/offers. viii. Details of the scheme wise amounts mobilised by the Company along with the number of investors under the scheme/offers. ix. Certified copies of audited financial statements for the financial years 2009-10, 2010-11 and 2011-12. x. Copies of the Income Tax Return filed by the company for the last three years. xi. Details of the regulatory approvals obtained, if any, fo

Page 3 of 15 3. As information was not forthcoming, SEBI issued a reminder letter dated June 11, 2013, to the Company, which was returned undelivered. Further, based on the examination of the documents received from the RoC, SEBI vide its letter dated August 21, 2013, sought following additional information from the Company: i. Copy of the Memorandum and Articles of Association of the Company. ii. Audited Balance Sheet and Profit & Loss Account of the Company for the last 3 years. iii. Name, addresses and occupation of the promoters/directors of the Company. iv. Statement of mobilization of funds through issue of preference shares, duly certified by the Statutory Auditors of the Company. v. Names and details of the Key Managerial Personnel of the Company. vi. Copies of the Annual Report and Annual Return filed with RoC since incorporation. vii. Copies of Tax Returns filed with the Income Tax authorities since incorporation. viii. Other information in respect of each and every series of preference shares issued by the Company, viz.- a. Details regarding filing of the Prospectus/Red Herring Prospectus with ROC. b. Date(s) of opening and closing of the subscription list. c. The details of opening and closing of the issue, quantum of funds raised and proposed to be raised. d. List of agents with addresses who were appointed by the company. e. Details regarding the number of application forms circulated inviting subscription. f. Details regarding the number of applications receive

Page 4 of 15 Thereafter, SEBI vide letters dated November 07, 2013 and December 11, 2013, issued further reminders to the Company and its aforesaid directors.

Source: SecMarx — sebi:WTM/PS/34/NRO/LKO/AUG/2015. 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.