Sebi has banned Active Rural Development India Ltd (ARDIL) and its four directors from the securities market for at least four years and directed them to refund the money that the company had collected illegally from investors.
According to a Sebi order dated January 4, ARDIL had issued and allotted secured redeemable non-convertible debentures (NCDs) to at least 1,524 investors during the financial years 2011-12 and 2012-13 and raised an amount of over Rs 1.35 crore.
Since the securities were issued to more than 50 people, the offer of NCDs qualified as a public issue and required their compulsory listing on a recognised stock exchange. However, ARDIL did not comply with the provision.
Among other requirements, the firm was required to register a prospectus with the Registrar of Companies (RoC) under the Companies Act, which it failed to do.
The firm and the directors have to refund the money with an annual interest of 15 per cent, noted the Securities and Exchange Board of India (Sebi).
The four directors have also been restrained from associating themselves with any listed public company till the expiry of four years from the date of completion of refunds to investors.
Of the four, three -- Dilip Kumar Diwakar, Polaki Umashankar Rao and Ganesh Kumar Singh -- are incumbent while one Vandana Saha is an erstwhile director.
Sebi has also restrained Active Debenture Trust, Abhinash Kumar Jha and Jagdish Kumar Singh from accessing the securities market for a period of four years after noting that they had dealt in the offer of NCDs as debenture trustees without having a certificate of registration.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)