Markets regulator Sebi has directed Karmbhoomi Real Estate and its directors to refund within 3 months the investors' money it had raised illegally.
The company and its directors have also been barred from the capital market for four years.
A Securities and Exchange Board of India (Sebi) probe found the company was running Collective Investment Schemes (CIS) without obtaining regulatory approvals.
The company was soliciting money from investors through the sale and purchase of agricultural land schemes.
"As the company is carrying out unregistered CIS activities, it becomes necessary to direct the company to wind up the CIS and refund its investors' money or assets along with requisite interest along with other necessary directions," Sebi said in an order dated November 30.
Accordingly, Sebi has directed the company and its directors to "wind up the existing CIS and refund the money collected with returns which are due to its investors...Within a period of three months."
The company and its directors will continue to be barred from the securities market, even after the completion of four years "till all the CIS are wound up and all the money mobilised through such schemes are refunded to its investors with returns which are due to them".
In case the firm fails to comply with Sebi's directions, the regulator would make a reference to state government/ local Police and register a civil/criminal case against Karmbhoomi Real Estate and its directors.
Besides, it would make a reference to the Ministry of Corporate Affairs to initiate the process of winding up of the firm. It would also initiate attachment and recovery proceedings against the firm.
(REOPENS DCM8)
In a separate order, the regulator imposed a fine of Rs 2 lakh on Inter Continental Corporation Ltd for failing to obtain SCORES authentication and also not resolving an investor complaint within the specified time.
The firm had violated the provisions of Sebi's August 2012 circular which directed all the companies listed on stock exchanges to obtain SCORES authentication and also redress the pending investor grievances within the stipulated time period.
"Lack of due diligence demonstrated by the noticee (the firm) is a risk to the securities market and thus loss to the investors to that extent," Sebi's Adjudicating Officer Prasad P Jagadale said in the order.
