SEBI bars ATM Agro Industries from collecting money from investors
ATM Agro illegally collected Rs1.86 crore through issuance of redeemable preference shares to 1,223 investors, says SEBI 
Market regulator Securities and Exchange Board of India (SEBI) has restrained ATM Agro Industries India Ltd from mobilising funds from investors. Further, the company and its directors are prohibited from issuing prospectus or any offer document or issue advertisement for soliciting money from the public for the issue of securities.
According to SEBI order, the company was engaged in fund mobilizing activity through issue of redeemable preference shares (RPS) and non-convertible debentures (NCDs) to more than 49 persons without complying with the relevant provisions of the Companies Act, 1956, read with SEBI (Issue and Listing of Debt Securities) Regulations, 2008.
The company and its directors are also restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in the securities market, according to the SEBI Order.
SEBI had received a complaint dated 8 July 2014, alleging mobilisation of funds inter alia by ATM Agro. SEBI began to investigate but the company was not forthcoming with information from its side. SEBI, when it approached the auditor of the company, found that the auditor disowned the signature and seal of the audit firm and alleged forgery. SEBI was also in receipt of another complaint against ATM Agro on 5 January 2015. 
SEBI investigation from published and government sources revealed that the company was incorporated on 30 September 2009, with the ROC, Kolkata with CIN No. as U01400WB2009PLC138634. Its Registered Office is at Judges Court Road, Circuit House More, Medinipur, Kolkata – 721101, West Bengal, India. The present directors are Taimur Ali Gayen, Yusuf Ali Gayen and Indrajit Roy. Sachindra Nath Bhattacharya, Hasem Mirza, Ashmin Khatun, Mirza Dinar,  Nandini Chatterjee,  Debashish Dasgupta, Kamal Kishore Lodha, Debabrata Ghosh, Pradip Das,  Tahidur Rahaman Gayen, Saiful Alam and Mohammad Younus, who were earlier directors in the company, have since resigned.
SEBI in its Order observed, “Under the Offer of RPS, it is observed that during the financial years 2010–11 and 2011–12, ATM Agro allotted redeemable preference shares to a total of 1,223 individuals/ investors and mobilised funds amounting to approximately Rs1.86 crore. The number of investors to whom allotments were made under the Offer of Redeemable Preference Shares alongwith the amount mobilised therein, during the Financial Years 2010–11 and 2011–12 would prima facie indicate that such Offer was a public issue of securities, as prescribed under the first proviso to Section 67(3) of the Companies Act, 1956.”
SEBI in its Order also observed, “Under the Offer of NCDs, it is observed that during the Financial Years 2010–11 and 2011–12, ATM Agro allotted NCDs amounting to a total of Rs7.39 crore. In addition, it is also observed from the debenture certificates submitted by complainants that ATM Agro may have most likely continued to issue NCDs during the Financial Year 2012–13 too. Although details regarding the number of investors under the Offer of NCDs is not available for the aforesaid Financial Years, the quantum of funds mobilised therein coupled with the letters receivedafrom ATM Agro’s auditors, would prima facie lead to the inescapable conclusion that such Offer was a public issue of securities as prescribed under the first proviso to Section 67(3) of the Companies Act, 1956.”
SEBI, in its strictures on the company, pointed out, “it will follow that since the Offer of Redeemable Preference Shares and Offer of NCDs are public issues of securities, such securities shall also have to be listed on a recognised stock exchange, as mandated under Section 73 of the Companies Act, 1956. In this regard, reference is made to Sections 73 of the Companies Act, 1956, of which sub-Sections (1), (2) and (3) are relevant for the instant case.”
SEBI hence infers, “it prima facie appears that ATM Agro has violated the provisions of Section 73 of the Companies Act, 1956, in respect of the Offer of Redeemable Preference Shares and Offer of NCDs.”
The debenture reserve created is also only Rs6.18 lakh and that too only in FY2011-12.
In view of these multiple violations by the company, SEBI has barred further fund mobilising activity by the company and its directors and has denied access to the securities market. 
To protect the money already collected from the public, SEBI has called for shall provide a full inventory of all its assets and properties. SEBI has also directed the company and its directors that they shall not dispose of any of the properties or alienate or encumber any of the assets owned /acquired by that company through the Offer of NCDs, without prior permission from SEBI.
SEBI has also directed the debenture trustees to also stay away from business by saying, “The Debenture Trustees, viz. Trustees of Secured Debentures Trust of ATM Agro  (represented by its Trustees, viz. Pratima Roy and Ram Sunder Bhattacharya) and ATM Secure Debenture Trust (represented by its Trustees, viz. Amit Samanta and Jagadish Chandra Nag), are prohibited from continuing with their assignment as debenture trustee in respect of the Offer of NCDs of ATM Agro and also from taking up any new assignment or involvement in any new issue of debentures, etc. in a similar capacity, from the date of this order till further directions.”
SEBI may, on its own, initiate prosecution or other legal action over and above this Order.


Supreme Court expresses concern over Rs10,000 crore payment for Roy’s release

While asking the counsel for Sahara to file appropriate application for extension of facilities for Subrata Roy in Tihar jail, the Supreme Court expressed concern about the Rs10,000 crore payment for securing Roy’s release


The Supreme Court on Tuesday expressed concern over how Sahara Group would raise money to secure its chief Subrata Roy's release even as the group sought extension of facilities inside Tihar jail premises by four to six weeks to enable him negotiate deals with prospective buyers.
The apex court expressed concern about the payment of money to be made by Roy to secure his release from jail. "You are struggling to pay Rs10,000 crore. How will you pay Rs30,000 crore after coming out," the bench asked.
A bench headed by Justice TS Thakur also asked the counsel for Sahara group to file an appropriate application in regard to its request.
Earlier in a new turn of events in the case, the Reserve Bank of India (RBI) had moved the Supreme Court seeking to implead itself as a party in the company's tussle with Securities and Exchange Board of India (SEBI). RBI had sought to stop one of its Sahara group companies from disposing off assets for securing Roy's release.
In an application, the central bank had urged the apex court to restrain Sahara India Financial Corporation Ltd (SIFCL) from utilising any of its assets, including securities, for paying dues to SEBI on the ground that SIFCL is residuary non-banking financial company and fell under its (RBI) regulatory control.
Prior to this, the Sahara group had informed the Supreme Court that the proposed transactions for a loan of around $1,050 million from abroad for raising Rs10,000 crore to ensure Roy's release from jail had failed.
Earlier on 9th January, the Court had allowed Sahara Group to go ahead with its proposed transactions with some conditions. The conditions, included approval of RBI for the transfer of funds raised in the US to India to meet the requirement set for release of Roy. The Sahara group chief is lodged in Tihar jail since 4 March 2014 for non-refund of over Rs20,000 crore with interest to depositors.



Ralph Rau

2 years ago

This whole business model of Sahara looks very strange to me.

Sahara has clearly not been able to establish that there are legitimate depositors.

This seems to be a money laundering scheme to convert black money of a few individuals.

There may be a few actual depositors who serve to hide the real operation ?

For his sheer arrogance and repeated contempt of the courts should he be shown any mercy ?

Dayananda Kamath k

2 years ago

Is supreme court doing penance for its wrong decision of asking such a huge amount as bail money. How can they provide all these facilities that too to sell property of its groupe companies for his release. is it not supreme court abetting duping other sakeholders in the company whose property is being sold to provide for bail money for release of sahra are they not liable for breach of trust. legal luminaries should enlighten the public.

SEBI mulls new group to check manipulation in penny stocks

To check market manipulation through penny stocks, the market regulator wants stock exchanges to create a new group T+ for scrips that are found to be prone to market manipulation


Market regulator Securities and Exchange Board of India (SEBI) would soon ask stock exchanges to create a new group for shares that are found to be prone to market manipulation through 'penny stocks', says reports.
The new group may be called 'T+' and would include shares that remain susceptible to manipulative activities despite having been put in the 'T' group. In T group the trading is restricted to delivery-based trades within a small price band of up to 5% and intra-day trades are not allowed.
The stocks in the new group could be subjected to even shorter price bands of up to 2%, while other restrictions could be put in place to ensure that only genuine trades are permitted on those counters, a senior official has been quoted as saying in reports.
It has been noticed that operators tend to push up the prices of T-group stocks ahead of their exit from such restricted trading categories, while the shares are dumped after luring gullible retail investors to these counters.
SEBI has already consulted stock exchanges and other stakeholders on this issue and the necessary framework for the new group would be put in place soon.
The stock exchanges classify various stocks traded on their platforms into several groups such as A, B, T and Z on certain qualitative and quantitative parameters.
The A-Group stocks are generally large-caps with strong business fundamentals, high public float of shares and better compliance record on corporate governance and regulatory fronts. The B-Group stocks mostly include mid-caps and some small-caps.
The T- Group includes stocks, which are settled on a trade-to-trade basis as a surveillance measure. These stocks usually attract a price band of five per cent, which is the maximum permissible limit within which the share price can move.
Under the trade-for-trade or T group segment, no speculative trading is allowed and delivery of shares and payment of consideration amount are mandatory.
The Z group includes companies, which have failed to comply with its listing requirements and/or have failed to resolve investor complaints.


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