sebi:WTM/SR/CIS/WRO-ILO/47/03/2015
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Facts / Headnote
Interim order restraining SRREBSL and its directors from mobilizing further funds; treated as show cause notice as to why the schemes should not be held to be a collective investment scheme
Provisions invoked
- s. 11A
- s. 12
- s. 11
- s. 45
Regulations
- Reg. 65
- Reg. 3
- Reg. 4(2)(t)
Parties
- Shri Ram Real Estate and Business Solution Limited
- Mr. Sanjay Mewada
- Shri Babaloo Prajapati
- Shri Gopal Meena
- Shri Subhash Deshmukh
- Shri Vijay Singh
- Shri Sohan Kumar Patel
- Shri Nirmal Dhaneliya
- Shri Jagdish Meena
Holding
The schemes offered by SRREBSL for mobilization of funds from the public prima facie satisfy all four conditions of a 'collective investment scheme' under Section 11AA of the SEBI Act, and SRREBSL has contravened Section 12(1B) of the SEBI Act and Regulation 3 of the CIS Regulations by operating without registration.
Full text
Page 2 of 17 d. Copies of applications forms that are required to be submitted by investors/applicants to participate in the schemes. e. Sample copies of the registration letter and allotment letter issued to the investors who subscribed to the schemes. f. Sample copies of the agreement letter/ contract required to be entered into by investor/applicant under the schemes. g. Details of the scheme wise amount mobilized till date along with the number of investors under the schemes. h. Name, address of each investor and amount deposited by each of them. i. Address of all the branches of SRREBSL operating in India. j. Certified copy of audited financial statement for the FY 2009-10, 2010-11, 2011-12 and 2012-13. Trial Balance for 2013-14 (from April 2013 till date of submission of information). k. Copy of Income Tax Return filed by the company for the last three years. l. Details of any other similar scheme(s), if any, floated by the company or its group/associates company.
Page 3 of 17 (5) As no information was received from SRREBSL in reply to SEBI's letters dated July 03, 2013 and December 04, 2013, another reminder dated January 21, 2014 was issued to SRREBSL and its Directors/Chairman by registered post with acknowledgement. The copy of the complaint and documents were enclosed with the aforesaid letter and sought explanation on the same. SRREBSL was also advised to provide the complete details sought vide SEBI’s letters dated July 03, 2013 and December 04, 2013. However, the said letters of SEBI once again got returned undelivered.
Page 4 of 17 (8) I have carefully considered the material available on record such as complaints received by SEBI, correspondence exchanged between SEBI and SRREBSL, information available on MCA21 portal, documents furnished by complainant, etc. In this context, the issue for determination is whether the mobilization of funds by SRREBSL under its schemes falls under the ambit of 'collective investment scheme' in accordance with Section 11AA of the SEBI Act.
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Source: SecMarx — sebi:WTM/SR/CIS/WRO-ILO/47/03/2015. 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.