In addition, they have been restrained from buying, selling, or otherwise dealing in the securities market “till the expiry of one year from the date of completion of refunds to investors”.
Mumbai-based Aakruti made allotment of equity shares to a total of 284 persons on seven instances from April 2007 to December 2007, hence, there was an obligation to file a prospectus in connection with the issue of securities and comply with the relevant provisions of the Companies Act, 1956 and DIP ((Disclosure and Investor Protection) Guidelines, Sebi said in its order on Monday.
However, the company didn’t comply with the regulatory provisions, it added.
“The company engaged in fund mobilising activity from the public, through the offer/allotment of equity shares and has contravened the provisions of… the Companies Act, 1956 and …provisions pertaining to the DIP Guidelines read with ICDR (Issue of Capital and Disclosure Requirements) Regulation,” Sebi noted.
Accordingly, Sebi said Aakruti along with Manilal V Patel and Vithal S Patel shall forthwith refund, to the investors, the money collected by the company, during their tenures through the issuance of equity shares (including the application money collected from investors), with an interest of 15 per cent per annum.
Manilal V Patel and Vithal S Patel were managing directors of Aakruti when the company made the allotment of equity shares to 284 people during the financial year 2007-2008, as per the order.
In case of failure to comply with the directions, Sebi, on the expiry of six months period may recover such amounts, from the company, and the directors liable to refund.
Apart from Patels, the markets regulator has restrained over a dozen individuals, who were promoters and directors of the company, from the securities markets for a period of six months.