sebi:WTM/RKA/ERO/BLO/161/2016
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Facts / Headnote
Company and directors found liable for violating public issue norms; directed to refund subscription money with 15% interest; directions against Ms. Padmabati Patnaik revoked; interim order disposed of.
Provisions invoked
- s. 19
- s. 28A
- s. 67(3)
- s. 56
- s. 73(2)
- s. 291
- s. 2(36)
- s. 60
- s. 2(60)
- s. 56(1)
- s. 56(4)
Regulations
- Reg. 4(2)
- Reg. 107
- Reg. 111
Parties
- Micro Finance Limited
- Mr. Durga Prasad Misra
- Mr. Ashok Kumar Patnaik
- Mr. Baikuntha Nath Patnaik
- Ms. Padmabati Patnaik
- Ms. Santilata Patnaik
- Ms. Sashi Patnaik
- Mr. Haricharan Jena
- Mr. Dharmananda Swain
- Dr. Jugal Kishore Satapathy
- Mr. Bijoy Kumar Routray
Holding
Micro Finance Limited and its directors were held liable for violating public issue norms by issuing CCPS without complying with the Companies Act, 1956, DIP Guidelines, and ICDR Regulations, and were directed to refund the subscription amount of ₹88,91,98,400 with 15% interest to allottees. Directions against Ms. Padmabati Patnaik were revoked as she was found to have no connection with the company during the period of irregularity.
Full text
Order in respect of Micro Finance Limited and others. Page 1 of 12 WTM/RKA/ERO/BLO/161 /2016 SECURITIES AND EXCHANGE BOARD OF INDIA
Order in respect of Micro Finance Limited and others. Page 2 of 12 c. From the extract of the minutes of meetings of the Board of Directors of MFL held between September 30, 2005 - March 25, 2013, it is prima facie noted that the Company has allotted CCPS (Cumulative Convertible Preference shares) of `100 each on several occasions, the details of which are as follows: … … it is seen that MFL had issued CCPS in various tranches and had mobilized funds to the tune of `88,91,98,400 from 1,21,222 allottees till March 25, 2013. I note that the number of allottees is substantial. It is also noted that the number of allottees in each of the offer and allotment is more than 50.”
Order in respect of Micro Finance Limited and others. Page 3 of 12 in its bank accounts and/or in the custody of the Company without prior permission of SEBI until further orders. e. Micro Finance Limited and its promoters and directors including Mr. Durga Prasad Misra, Mr. Ashok Kumar Patnaik, Mr. Baikuntha Nath Patnaik, Ms. Padmabati Patnaik, Ms. Santilata Patnaik, Ms. Sashi Patnaik, Mr. Haricharan Jena, Mr. Dharmananda Swain, Dr. Jugal Kishor Satapathy and Mr. Bijoy Kumar Routray are restrained from accessing the securities market and are further prohibited from buying, selling or otherwise dealing in securities in any manner whatsoever, either directly or indirectly, till further directions. f. Micro Finance Limited and its promoter and directors including the above named persons shall co-operate with SEBI and shall furnish all the documents. g. Micro Finance Limited, its promoters and directors are also directed to provide a full inventory of all their assets and properties and details of all their bank accounts, demat accounts and holdings of shares/ securities, if held in physical form.”
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Source: SecMarx — sebi:WTM/RKA/ERO/BLO/161/2016. 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.