sebi:WTM/PS/69/ERO/IMD/OCT/2015
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Facts / Headnote
Liability found for illegal public issue of Redeemable Preference Shares; Company and four directors directed jointly and severally to refund with interest and subjected to market-access, disclosure and asset restraints
Provisions invoked
- s. 19
- s. 27
- s. 55A
- s. 73
- s. 28A
- s. 4A
- s. 67(3)
- s. 73(2)
- s. 67(1)
- s. 67(2)
- s. 67
- s. 73(1)
- s. 2(36)
- s. 60
- s. 56(1)
- s. 56(3)
- s. 73(3)
Parties
- Orchid Cultivation Projects India Limited
- Mr. Sumanta Banerjee
- Mr. Rajiv Kumar Singh
- Mr. Jyotirmoy Bhattacharjee
- Mr. Subir Kumar Paul
Holding
Orchid Cultivation Projects India Limited made a deemed public issue by allotting Redeemable Preference Shares to 124 persons on June 30, 2012 raising Rs. 7.60 lakh without complying with Sections 56, 60 and 73 of the Companies Act, 1956, and the Company with directors Sumanta Banerjee, Rajiv Kumar Singh, Jyotirmoy Bhattacharjee and Subir Kumar Paul were held jointly and severally liable to refund with 15% p.a. interest compounded half-yearly and restrained from the securities market.
Full text
Page 2of 13 activities are carried on by the Company and its directors, SEBI had issued the following directions: “… … 7. In view of the foregoing, I, in exercise of the powers conferred upon me under Sections 11, 11(4), 11A and 11B of the SEBI Act, hereby issue the following directions – i. OCPIL shall not mobilize funds from investors through the Offer of Redeemable Preference Shares or through the issuance of equity shares or any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly till further
Page 3of 13 3. The interim order forwarded to the Company,Mr. Jyotirmoy Bhattacharjee and Mr. Subir Kumar Paul had returned undelivered. In view of the same, attempts were made to deliver the interim order by hand delivery/ pasting on the last known addresses of these persons.The interim order forwarded to Mr. Sumanta Banerjee and Mr. Rajiv Kumar Singh were duly delivered.
Page 4of 13 c. The Company vide letter dated March 21, 2014, relieved him from all the responsibilities and obligations as director to the Company,with retrospective effect from July 15, 2013. d. He was indemnified by the Company against all possible claims and demands arising in due course both prior and subsequent to the resignation. e. He had not received any deposit/ funds.
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Source: SecMarx — sebi:WTM/PS/69/ERO/IMD/OCT/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.