sebi:WTM/SM/IVD/ID4/6826/2019-20
Facts / Headnote
Company restrained from accessing the securities market for 5 years; existing holdings frozen; proceedings against Noticees 2 and 3 not proceeded with under Sections 11, 11B and 11(4) of the SEBI Act
Provisions invoked
- s. 19
- s. 12A
- s. 77(2)
Regulations relied on
- SEBI (PFUTP) Regulations, 2003 — 3(a)
- SEBI (PFUTP) Regulations, 2003 — 3(b)
- SEBI (PFUTP) Regulations, 2003 — 3(c)
- SEBI (PFUTP) Regulations, 2003 — 3(d)
- SEBI (PFUTP) Regulations, 2003 — 4(1)
- SEBI (PFUTP) Regulations, 2003 — 4(2)(f)
- SEBI (PFUTP) Regulations, 2003 — 4(2)(k)
- SEBI (PFUTP) Regulations, 2003 — 4(2)(r)
Parties
- Crew B.O.S Products Ltd (Noticee no. 1)
- Mr. Robin Bartholomew (Noticee no. 2)
- Mr. Puneet Nikore (Noticee no. 3)
Holding
The Company (Noticee no. 1) was held to have violated Section 12A(a), (b), (c) of the SEBI Act read with Regulations 3(a)-(d) and 4(1), 4(2)(f), (k), (r) of the PFUTP Regulations by concealing material facts about its GDR issue arrangement, and was restrained from accessing the securities market for 5 years. The two director Noticees were found to have played a proactive and collusive role, though directions under Sections 11, 11B and 11(4) were not issued against them.
Full text
Order in the matter of Crew B.O.S Products Ltd Page 2 of 31 Table no. 1 GDR issue date No. of GDRs Issued (mn.) Capital raised (US$ mn.) Local custodian No. of equity shares underlying GDRs Global Depository Bank Lead Manager Bank where GDR proceeds deposited GDRs listed on 25- Jul- 05 1.8182 5.00 ICICI Bank Ltd., Mumbai
Order in the matter of Crew B.O.S Products Ltd Page 3 of 31 Bank wherein, the GDR proceeds would be deposited and a further resolution was passed authorizing Banco Bank to use the GDR proceeds of the Company as security against loan if any. During the course of investigation, it was also found that the Company had not disclosed to the investors about the fraudulent arrangement so made by it to ensure the successful issuance/subscription/allotment of the GDR by facilitating a loan to Fusion in terms of the aforesaid Credit Agreement. It was further concealed from the public that the proceeds of GDR would be kept as security with the Banco Bank and would not be available for the Company’s immediate use. Thus, the Company misled the Shareholders/investors at large by providing partial and distorted information, about issuance of GDR to the public. SHOW CAUSE NOTICE, REPLY AND HEARING:
Order in the matter of Crew B.O.S Products Ltd Page 4 of 31 2019, have filed additional responses to the SCN. In compliance with the principles of natural justice, vide letter dated March 22, 2019, Noticees were provided with an opportunity of personal hearing on June 26, 2019, however, on receiving a request from the Noticees, the hearing was adjourned to August 02, 2019. On the day of the personal hearing held on August 02, 2019, Noticee 2, Noticee no. 3 and an authorised representative on behalf of Noticee no. 1, appeared before me and made oral
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Source: SecMarx — sebi:WTM/SM/IVD/ID4/6826/2019-20. 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.