sebi:WTM/PS/81/SRO/HLO/MAR/2015

SEBI · SEBI · 2014-10-08 · Prashant Saran, Whole Time Member

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Facts / Headnote

Interim restraining directions issued against the company and its promoters/directors; show cause notice issued as to why further directions including refund of money should not be imposed

Provisions invoked

Regulations

Parties

Holding

Astha Green Energy Ventures India Limited's equity share allotments to 50 or more persons constituted public issues, requiring compliance with the Companies Act, 1956, SEBI Act, and ICDR/DIP Regulations, which the company failed to do; the company and its promoters/directors are restrained from mobilizing funds, accessing the securities market, and diverting public funds pending further proceedings.

Full text

Page 2 of 11 ii. Details of the board of directors of the Company, including details regarding the name, address, DIN number, PAN number, etc. iii. Details of the shareholders of the Company including details regarding name, address, number of shares held, etc. iv. Details of the Promoters of the Company: name, address, occupation and number of shares held, etc. v. Details of the group companies (that are controlled directly or indirectly by the Promoters), subsidiaries and associates. vi. Copies of the Annual Reports for the immediately preceding three financial years. vii. Audited balance sheet and profit & loss account of the Company for the last 8 years. viii. Copy of the Memorandum and Articles of Association of the Company. ix. Names and details of the Key Managerial Personnel of the Company. x. Other information in respect of every issue of shares by the Company. a) Date of opening and closing of the subscription list; b) Details regarding number of application forms circulated inviting subscription; c) Details regarding the number of applications received; d) Details regarding number of shares allotted and value of such allotment against each allottee’s name; e) Copies of the board resolution and general meeting resolution authorizing such issuance; f) Copies of the minutes of board/ committee meeting in which the resolution has been passed for allotment; g) Copies of application forms, pamphlets, advertisements, and other promotional materials circulated for issuance

Page 3 of 11 name was changed to Astha Green Energy Ventures India Limited and a new certificate of incorporation was issued on January 08, 2013. The CIN number of Astha is U65993AP2005PLC046775 and its registered office is at Plot No. 226, Road No. 78, Phase III, Jubilee Hills, Hyderabad - 500 033, Telangana, India. b. As per the details submitted by the Company, Mr. M. Keshav Reddy, Mr. Kunduru Raghuveer, Mr. M. Jayanth Reddy, Mr. K. Jayaveer, Mr. N. Ram Bhupal Reddy, Mr. N. Jayapal Reddy and Mr. M. Arjun Reddy are the promoters in Astha. The directors in Astha are Mr. Keshav Reddy Mereddy, Mr. Arjun Reddy Mereddy and Mr. Jayanth Reddy Mereddy. c. From the details of the allotment of shares as submitted by Astha, it is noted that the Company had allotted 'equity shares', the relevant extract of the same are as follows: TABLE - A S.No. Date of allotment No. of allottees No. of shares Value of allotment () Date of Board resolution passed 1 10/12/2007 214 1,76,90,680 17,69,06,800 10/12/2007 2 31/03/2009 89 1,65,522 8,27,61,000 30/03/2009 3 04/03/2010 49 68,136 3,40,68,000 04/03/2010 4 05/03/2010 45 61,570 3,07,85,000 05/03/2010 5 06/03/2010 43 2,26,453 11,32,26,500 06/03/2010 6 30/03/2013 40 77,74,462 17,88,12,626 30/03/2013 Total 480 2,59,86,823 61,65,59,926

Page 4 of 11 9. As detailed in table A above, Astha had issued equity shares to 214 investors on December 10, 2007 and 89 investors on March 31, 2009 and a total of about 25.97 crores had been collected from the investors. It is also seen that Astha had made a continuous allotment of equity shares to 49, 45 and 43 investors on March 04, 2010, March 05, 2010 and March 06, 2010 respectively aggregating to about 17.80 crores. In terms of Section 67(3), no offer or invitation shall be treated as made to the public by virtue of sub-sections (1) or (2), as the case may be, if the offer or invitation can properly be regarded, in all circumstances – (a) as not being calculated to result, directly or indirectly, in the shares or debentures becoming available for subscription or purchase by persons other than those receiving the offer or invitation; or (b) otherwise as being a domestic concern of the persons making and receiving the offer or invitation. In terms of the proviso to the aforesaid section, the provisions of Section 67(3) shall not apply in a case where the offer or invitation to subscribe for shares or debentures is made to fifty persons or more. Therefore, if an offer of securities is made to fifty or more persons, it would be deemed to be a public issue, even if it is of domestic concern or proved that the shares or debentures are not available for subscription or purchase by persons other than those receiving the offer or invitation. The number of persons to whom the

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Source: SecMarx — sebi:WTM/PS/81/SRO/HLO/MAR/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.