Sebi bans Tower Infotech, Agragami Agro and 11 others from markets

Sebi has banned two firms -- Tower Infotech and Agragami Agro Farms -- as also their seven present and former directors along with four promoters from the securities market for at least four years for illegally raising funds.

The regulator has also asked them to refund the investor's money.

Sebi said that Tower Infotech had raised nearly Rs 46 crore from 49,489 investors through issuance of redeemable preference shares (RPS) and non convertible debentures (NCD), while Agragami garnered over Rs 3.45 crore by issuing RPS and secured RPS from over 200 allottees.

These funds were collected between 2005 and 2010 by Tower Infotech and Agragami raised them during 2008-13, added Sebi.

Since the shares were issued to more than 50 people by each firm, the offer of RPS and NCDs qualified to be a public issue and required compulsory listing of the securities on a recognised stock exchange. However both companies did not comply with the provision.

Among the other requirements, the firms were also required to register a prospectus with the Registrar of Companies (RoC) under the Companies Act, which they failed to do, the regulator said in a order dated July 27.

Accordingly, the companies its directors and promoters have been banned from the capital market till completion of four years from the date of complete refunds made to the investors concerned, Sebi said in similarly worded orders.

Moreover, the directors and the promoters have been restrained from associating themselves with any listed public company till the expiry of four years from the date of completion of refunds.

The regulator has also banned Shambhu N.De & Co., Pradip Majumdar of Tower Infotech and Ramesh Jorddar, Sunati Ghosh of Agragami from the capital markets for the same period for not registering as debenture trustees.