SUBSCRIBE(free)-Daily Updates (Click Verification Link Received in Your Email)

SEBI Order: Micro Finance Ltd To Refund Money Collected Through Cumulative Convertible Preference Shares

SEBI Order in the matter of Micro Finance Limited:

Shri R K Agarwal, Whole Time Member, SEBI has passed an order dated October 27, 2016 under section 11(1), 11(4), 11A and 11B of the Securities and Exchange Board of India Act, 1992 against the company Micro Finance Limited (MFL) and its Directors/Promoters, viz. Mr. Durga Prasad Misra, Mr. Ashok Kumar Patnaik, Mr. Baikuntha Nath Patnaik, Ms. Padmabati Patnaik, Ms. Santilata Patnaik, Ms. Sashi Patnaik, Mr. Haricharan Jena, Mr. Dharmananda Swain, Dr. Jugal Kishore Satapathy and Mr. Bijoy Kumar Routray.

The Order, inter alia, directs as under:

(i) The noticees i.e. Micro Finance Limited and its promoters and directors including Mr. Durga Prasad Misra, Mr. Ashok Kumar Patnaik, Mr. Baikuntha Nath Patnaik, Mr. Dharmananda Swain, Dr. Jugal Kishor Satapathy and Mr. Bijoy Kumar Routray shall within a period of three months from the date of this order, jointly and severally refund the money collected through the issue of Cumulative Convertible Preference Shares to the allottees with interest at the rate of 15% per annum from the date of receipt of money till the date of such refund.

(ii) Such refund shall be made only in cash through a Demand Draft or Pay Order.

(iii) Micro Finance Limited and its directors shall within fifteen days from the date of this Order submit to SEBI complete details of their assets (alongwith proofs thereof) certified by a peer reviewed Chartered Accountant.

(iv) Micro Finance Limited and its directors are permitted to sell assets of the company and deposit the sale proceeds in an Escrow Account opened with a nationalized bank. Such proceeds shall be utilized for the sole purpose of making refund/ repayment to the allottees till the full refund/ repayment as directed above is made.

(v) Micro Finance Limited and its directors shall issue a public notice, in all editions of one English national daily and one vernacular daily with wide circulation, detailing the modalities for refund, including details of contact persons including names, addresses and contact details, within fifteen days of this order.

(vi) Within seven days of completion of refund/ repayment as directed hereinabove, Micro Finance Limited and its directors shall file a certificate of such completion with SEBI from two independent peer reviewed Chartered Accountants who are in the panel of any public authority or public institution. Such certificate shall be issued by the Chartered Accountants after verifying the relevant documents including bank accounts of the Noticees and satisfying themselves that the refund has actually been made.

(vii) For the purpose of this order, a peer reviewed Chartered Accountant shall mean a Chartered Accountant, who has been categorized so by the Institute of Chartered Accountants of India.

(viii) Micro Finance Limited and its directors/ promoters namely Mr. Durga Prasad Misra, Mr. Ashok Kumar Patnaik, Mr. Baikuntha Nath Patnaik, Ms. Santilata Patnaik, Ms. Sashi Patnaik, Mr. Haricharan Jena, Mr. Dharmananda Swain, Dr. Jugal Kishor Satapathy and Mr. Bijoy Kumar Routray are restrained from, directly or indirectly, accessing the capital market by issuing prospectus, any offer document or advertisement soliciting money from the public and are further prohibited from buying, selling or otherwise dealing in the securities market, directly or indirectly, in whatsoever manner for a period of four years or till the date of refund of money to the allottees, whichever is later.

(ix) Mr. Durga Prasad Misra, Mr. Ashok Kumar Patnaik, Mr. Baikuntha Nath Patnaik, Ms. Santilata Patnaik, Ms. Sashi Patnaik, Mr. Haricharan Jena, Mr. Dharmananda Swain, Dr. Jugal Kishor Satapathy and Mr. Bijoy Kumar Routray are also restrained from associating themselves, with any listed public company and any public company which intends to raise money from the public, for a period of four years or till the date of refund of money to the allottees, whichever is later.

(x) For the reasons stated above in this Order, the directions imposed on Ms. Padmabati Patnaik, vide the interim order dated January 14, 2015, are revoked and the proceedings against her is disposed of.

(xi) For the purposes of sub-paragraphs (viii) and (ix) the period of restraint shall be counted from the date of the interim order.

The company was engaged in fund mobilizing activity through issue of of Cumulative Convertible Preference Shares to more than 49 persons without complying with the provisions of the Companies Act, 1956.

The full text of the order is available on the SEBI website: link


Source: SEBI Press Release No. 152/2016 dated November 04, 2016
Submit/See Comments With: or

No comments:

Post a Comment