sebi:WTM/PS/CFD/DIL-I/36/OCT/2011
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Facts / Headnote
Investigation ordered into allegations of the complainant against DLF Limited and Sudipti Estates Private Limited for possible violations of the erstwhile DIP Guidelines, 2000 read with the Companies Act, 1956
Provisions invoked
- s. 370
Holding
SEBI ordered an investigation into the complainant's allegations against DLF Limited and Sudipti Estates Private Limited to ascertain whether there were violations of the erstwhile DIP Guidelines, 2000 read with the relevant provisions of the Companies Act, 1956. No finding of violation was made at this stage.
Full text
Page 2 of 18 2. Before proceeding further, it would be necessary to mention the background of the matter. DLF Limited (hereinafter referred to as the Company), earlier known as DLF Universal Limited, had through its merchant banker filed a Draft Red Herring Prospectus (hereinafter referred to as DRHP) during May 2006 with the Securities and Exchange Board of India (hereinafter referred to as SEBI). In the said DRHP, the Company had inter alia mentioned that the entity, Sudipti Estates Private Limited (hereinafter referred to as Sudipti) was its associate company. The said DRHP was withdrawn and thereafter, the Company had filed a fresh DRHP on January 2, 2007, wherein Sudipti was not mentioned as being associated with it. The said fresh DRHP was processed by SEBI and observations were given on May 7, 2007. The issue of the Company opened for subscription on June 11, 2007 and closed on June 14, 2007. Meanwhile, one Kimsuk Krishna Sinha (hereinafter referred to as the complainant), vide a letter dated June 4, 2007, which was received by SEBI on June 15, 2007 (a day after the closure of the public issue of the Company), stated that Sudipti had duped him of `34 crores (approx.) and that a First Information Report (FIR) was registered at the Connaught Place (New Delhi) Police Station. It was also stated in the said letter that DLF Home Developers Limited and DLF Estate Developers Limited were the subscribers of shares of Sudipti and therefore the said three entities were part of t
Page 3 of 18 subsidiaries has no connection with Sudipti. Thereafter, the complainant sent another letter dated July 19, 2007 to SEBI and while admitting the receipt of the reply dated July 11, 2007 from the Company, had alleged that he was a victim of the manipulations indulged in by the DLF Group through its associates/group companies, particularly Sudipti. The complainant requested SEBI to address his complaints.
Page 4 of 18 5. I note that, in the complaint dated June 4, 2007 which was received by SEBI on June 15, 2007 i.e. a day after the closure of the issue of the Company, the complainant inter alia stated that Sudipti, an associate of the DLF Group, has duped him of `34 crores (approx.) and in that respect, FIR No. 249/2007 was registered on April 26, 2007 at the Connaught Place Police Station, New Delhi. It was further stated that DLF Home Developers Limited and DLF Estate Developers Limited were the subscribers of shares of Sudipti and that Mr. Arun Kumar Bhagat and Mr. Vipen Jindal were the first directors of Sudipti. It was also stated that Mr. Praveen Kumar (director) and Mr. Pradeep Singh (agent) were the other persons intrinsically linked to Sudipti and were blatantly indulging in criminal conduct and against whom the aforesaid FIR was also lodged. According to the complainant, it was apparent that Sudipti, DLF Home Developers Limited and DLF Estate Developers Limited are sister concerns and inextricably linked and that the said three entities were part of the DLF Group. The complainant also stated that he reliably learnt that the Company is slated to be listed on the BSE and that an IPO is also in the offing and in view of the likelihood of innocent, gullible investors being influenced to blindly invest in the Company oblivious of the criminal conduct of the persons actually controlling the Company, requested SEBI to disallow/terminate the listing of the Company. In the F
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Source: SecMarx — sebi:WTM/PS/CFD/DIL-I/36/OCT/2011. 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.