sebi:WTM/SR/ERO/BLO/61/03/2015
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Facts / Headnote
Interim prohibitory directions issued against TSL, its directors and promoters; show cause notice issued as to why further directions under Sections 11(1), 11(4), 11A and 11B of the SEBI Act should not be imposed
Provisions invoked
- s. 11
- s. 55A
- s. 22
- s. 73
- s. 4A
- s. 30
- s. 67(3)
- s. 67
- s. 56
- s. 67(1)
- s. 67(2)
- s. 73(1)
- s. 2(36)
- s. 60
- s. 73(2)
- s. 56(1)
- s. 56(3)
Regulations
- Reg. 13
- Reg. 16
- Reg. 9
- Reg. 8
- Reg. 15
- Reg. 22
- Reg. 7
- Reg. 6
- Reg. 5
- Reg. 4(5)
- Reg. 4(2)(a)
- Reg. 4(2)(b)
- Reg. 4(2)(c)
- Reg. 4(2)(e)
- Reg. 4(2)(d)
- Reg. 4(3)
Holding
SEBI held that TSL's offer of Redeemable Preference Shares (RPS) to 65 allottees constituted a public issue under Section 67(3) of the Companies Act, 1956, thereby triggering obligations of prospectus registration, compulsory listing, and compliance with the Issue and Listing of Non-Convertible Redeemable Preference Shares Regulations, 2013, which TSL prima facie violated. SEBI issued interim directions restraining TSL, its directors and promoters from mobilizing fresh funds, accessing the securities market, and disposing of assets, and issued a show cause notice for further directions.
Full text
Page 2 of 13 a. Copy of Prospectus/Red Herring Prospectus/Statement in lieu of Prospectus/Information Memorandum filed with the Registrar of Companies ('RoC') for issuance of debentures/preference shares; b. Date of opening and closing of the subscription list for the said debentures/preference shares; c. Details regarding the number of application forms circulated inviting subscription for debentures/preference shares; d. Details regarding the number of applications received; e. Details regarding the number of allottees and list of such allottees; f. Number of debentures/preference shares allotted and value of such allotment against each allottee's name; g. Details regarding subscription amount raised; h. Date of allotment of debentures/preference shares; i. Copies of the minutes of Board/Committee meeting in which the resolution has been passed for allotment; j. Date of dispatch of debentures/preference shares certificates; k. Details of the total number of applicants for each of the company's schemes besides the list of final allottees; l. Copies of application forms, pamphlets, advertisements and other promotional material circulated for issuance of debentures/preference shares; m. Terms and conditions of the issue of debentures/preference shares.
Page 3 of 13 RoC, Cuttak however provided the documents available with them viz. Memorandum and Articles of Association of the company, copies of Form 32, Annual Return and Balance Sheet as on March 31, 2012.
Page 4 of 13 iv It is observed from the copies of brochure cum application forms provided by complainants that the company issued RPS with face value of Rs. 10/- each under the following terms and conditions: PLAN A B C D E Issue Price Minimum 100 Redeemable Preference Shares 1000/- 1000/- 1000/- 1000/- 1000/- Redemption Period 3 Years 4.6 Years 6.6 Years 10 Years 12 Years Redemption Premium 750/- 1,000/- 2,000/- 5,000/- 9,000/- Redemption Amount 1,750/- 2,000/- 3,000/- 6,000/- 10,000/-
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Source: SecMarx — sebi:WTM/SR/ERO/BLO/61/03/2015. 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.