Sebi has barred Kolkata-based Eminence Infraprojects and its five directors from the capital markets for at least four years and asked them to refund the money raised from investors without complying with the public issue norms.
Besides, they have been restrained from associating themselves with any listed public company from the date of the order till the expiry of four years from the date of completion of refunds to investors, Sebi said in an order dated October 30.
The directors are - Somenath Banerjee, Apu Halder, Supriya Singha Roy, Tarun Kumar Das and Koushik Mukherjee.
The regulator noted that the company had issued redeemable preference shares (RPS) to at least 331 investors during 2010 11, 2011-2012 and 2012-2013 and raised over Rs 39 lakh.
Since the shares were issued to more than 50 people, the offer of RPS qualified to be a public issue and required compulsory listing of the securities on a recognised stock exchange. However, the firm did not comply with the provision.
Among other requirements, the firm was to register a prospectus with the Registrar of Companies (RoC) under the Companies Act, which it failed to do.
The company and its directors have been asked to refund the money collected by the firm, "during their respective period of directorship through the issuance of RPS" from investors with an annual interest of 15 per cent, as per the ruling.
After completing the repayments, they have been directed to file a report of such completion with Sebi, within a period of three months, certified by two independent Chartered Accountants.
In case these entities fail to comply with the order, Sebi may recover such amounts in accordance with provisions of securities laws. Besides, it may initiate appropriate action against them, including adjudication proceedings.
Also, it would make a reference to the state government or local police to register a civil or criminal case against these entities for offences of "fraud, cheating, criminal breach of trust and misappropriation of public funds".
In an interim order passed in August 2015, Sebi had restrained the company and its present and former directors; and promoters from accessing the securities market and directed the firm not to mobilise fresh funds from the investors "till further directions".
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