SEBI asks Sun-Plant Agro not to collect money from investors under the pretext of ‘tree plantation’
Moneylife Digital Team 28 October 2010

Sun-Plant Agro, whose application was rejected by SEBI and was supposed to wind up its scheme in 2003, continued to raise funds under the guise of ‘sale of plants’, which was just a collective investment scheme

Market regulator Securities and Exchange Board of India (SEBI) has asked Kolkata-based Sun-Plant Agro Ltd not to collect any money from investors or to launch any scheme in the name of sale of plants.

In an order issued on Thursday, SEBI's whole time member Prashant Saran, asked Sun-Plant Agro not to dispose of any of the properties or alienate the assets of the scheme and not to divert any fund raised from the public at large kept in bank accounts and/or at the custody of the company.

Sun-Plant Agro was raising funds in the name of 'sale of plants'. It allegedly sold plants to purchasers, maintained the plants and thereafter provided returns on the amounts invested at the end of the scheme in the form of wood, even though no identity or marking of the particular plant which was sold, was provided to purchasers.

SEBI said that such activities of the company carry the features of a Collective Investment Scheme (CIS), specified under Section 11AA of the SEBI Act read with Regulation 3 of the SEBI (CIS) Regulations.

The company ought to have wound up the scheme in 2003 pursuant to rejection of the application for provisional registration by SEBI and the filing of the 'Winding Up and Repayment Report' by the company. However, the activities of Sun-Plant Agro and the details of amounts received by it against cost of trees during 2003 to 2010 prima facie indicate that even after submission of the Winding Up and Repayment Report in 2003, the company has been carrying out activities of a CIS without obtaining a Certificate of Registration from SEBI, the market regulator said.

Interestingly, the company, which calls itself 'ISO:9001:2008 certified eco-friendly organisation', has partnered with the West Bengal Wasteland Development Corporation (WBWDC). Sun-Plant Agro, with WBWDC, plans to plant the jatropha crop over about 30,000 acres in the arid districts of Bankura, Birbhum, West Midnapore and Purulia over the next 15 years.

shiv travel
5 years ago
How to get my refund for this company.i m also invest my money for this company.
8 years ago
This SunPlant and group of companies are totally a great fraud company. They made rules and regulations for themselves. I was a field worker of this Company. Every time they break the government rules and regulations, after getting order from SEBI they continued selling tree sale scheme in the name of environment and carbon Credit, and mislead it's consumers and shareholders. After getting tight instructions from SEBI they launch a new company named as SUN PLANT BIO ENERGY LTD and sale the same scheme on basis of an advertisement of Rakesh Sinha (Indian Forest Service official)of Kolkata. From 2006 the company mislead us in the name of bio fuel from jatropha and alge. They collect crores of money from public in the name of these scheme and don't return maturity to the customers. Some Directors and senior officials protect Sunplant whenever we asking them about govt rules and regulation, and they are now not with this company. I have heard a rule of SEBI that when a company sale debentures to public (more than 49 person) that have to register with SEBI but without a registration they sale its debentures to more than 1000 of customers. They always take illegal collections through manual basis. This company push youths to a darkness in the name of bright career. Most of branch offices are closed and they don't return customer's money. This company don't know how to do business, they only know to collect money like a clever thief.
Maloy Bhattacharjee
1 decade ago
Congratulation Mr. Roy & Mr. S.M.Ghosh ! I’m totally agreed with you. When a huge no. of company exploited public money in front of all, no one restrict them until they collect a lot of amount from poor and illiterate people. Arrest some one doesn’t indicate the public interest ( maturity ) but way to escape from the repayment liability.

Such a position the movement of SEBI doesn’t indicate adequate public interest. When with out any public ( customer ) complain a company who has been submitted every year’s audited balance sheet to SEBI ( 2003-4 to 2009-10 ) it’s painful that SEBI restrict the company to commit it’s business after a long period of 7 years.

We know that the primary work of SEBI is looking after the security market ( Primary & secondary Market ). There are so many companies, collected money from primary market and after that enlisted BSE,NSE and other stock market, abolished totally after collecting a huge public money. Is there any rule to SEBI to prevent that type of incident ? What is the way to repay share holder’s money from de-listed companies ? If basic terms & conditions are applicable on it, what is the basic role of SEBI on public interest?

s m ghosh
Replied to Maloy Bhattacharjee comment 1 decade ago
arindam choudhury
Replied to s m ghosh comment 1 decade ago
i am fully agree with Mr. Ghosh
netai chandra Roy
1 decade ago
An order of honorable Mr. Prashant Saran -the whole time member of SEBI notified on dt. 21/10/2010 not to collect money from public and it was published in Annandabazar Patrika before issued the PR from SEBI (which issued on 28/10/2010). It is seem to me mysterious, because Sun Plant does not collect investment from public it sale its extra stock of trees and it was also supported by SEBI (SEBI inspection team inspected scrutinized project and accounts letter on 2002) Where SEBI said clearly “this company made its day to day Expenditure Maturity, Prematurity by selling their extra stock of trees” so following questions are arise here :
1. How tree sale becomes a CI scheme?
2. Company does not inviting investment for Cultivating plant. They approach the people to sell their growing trees in various project in various state. Whether a Producer/Farmar have a right to sell or not his own cultivated product?
3. For the interest of customer Company made an agreement as MOU because it have expertise for tree maintaining which purchaser have not. Company insured every plant against natural calamities on behalf of customer/purchaser without MOU it is not possible. Till maturity of the sold tree served customer/purchaser interest is wrong?
4. Company indicating projects area i.e. state/district/mouja/project no./tree no. of sold tree/trees bearing to its customer/purchaser through a sale and maintenance agreement. So what is the problems to identify the tree/trees?
5. In our country AMC is allowed on sold goods/products. So company made a MOU as AMC for 7 years. What is the problem?
6. Is there any incident of deprive customer ?
The above questions are arising because last 7 years I have been observing the company and its thousands of customers and worker from very closer and saw they feel proud for the company because the company is fighting against global worming /day to day increasing unemployment/ to increase national asset development/ earn carbon credit/ make India green and clean .
In the question of reduce GHG and produce new trees Govt./non Govt. organization / Semi Govt. institution are trying vigorously to combat day by day increasing GHG but in many areas they failed but by the way of tree sale it produce more than 10 lacks of trees in its age.
In the question of reduce unemployment company made opportunity of earning thousands of its field force as well as tree project worker and more then five hundred office worker.
In the question of Bio Fuel Company is on the way of produce ECO friendly fuel BIO-Diesel from Jetropha and Algel-Diesel through carbon sequestences.
Now West Bengal Westland Development Corporation made a agreement to produce bio-diesel from jatropha by using barren waste land in various area of W.B. through this process lacks of poor people get job and produce ECO friendly BIO-Diesel which can save foreign Currency utilized for oil import.
So, SEBI have to think twice Sun Plant Agro Ltd. Is doing CIS or Provide employments/jobs, Produce national assets which increasing national GDP, Produce Oxygen and reduce Carbon di-oxide and also its activity help in reducing GHG which is the burning problem now a days in the almost all the countries of the world.
Netai Chandra Roy
North 24 Parganas, West Bengal
In favor of Green India-Clean India
Which is the slogan of Sun-Plant Agro Ltd. also
s m ghosh
1 decade ago
If the plantation/trees under insurance coverage or under contract of insurance to which insurance act applies will not come under CIS.

A Collective Management company should be in-corporated under provisons of the companies act 1956 and registered with SEBI under the SEBI(CIS) Regulation 1999,whose object is to organise operate and manage a collective investment scheme.
Buyer - seller deal ie product/commodities selling and AMC Will come under consumer re-dressal forum.
SUNPLANT is neither NBFC nor a Registered CI Management Company, so I THINK SEBI'S HANDS ARE TIGHT & CAN'T CROSS THE LIMITATION.
s m ghosh
1 decade ago
why SEBI was sleeping with one eye open ?
After 7 years they are passing the order to a company who is trading & maintaining tree as per ISO norms with valid 9001:2008 CERTIFICATE on quality management.
Recently the company has entered in a Joint Venture project with WBWDC under Forest Department Govt Of WB for waste land development through Bio energy crop & medicinal plant cultivation where large number of farmers are involved.This is under GREEN INDIA MISSION providing employment to the needy rural masses. Any action at this juncture may hamper the JV project badly.
I feel suitable directives to be given considering the future of rural masses.

R Balakrishnan
1 decade ago
A normal affair. RBI is sleeping. Our laws do not prescibe any deterrent penalty for violations. There are perhaps at least half a dozen collective schemes in every small town. Only when people lose money, the regulators clamp down.
Here, praise to SEBI for acting before a complaint of money loss, which is sure to happen. Surely the money raised so far, has gone out of the company's books.
Replied to R Balakrishnan comment 1 decade ago
I agree with you sir. Recently Sahara has launched an MLM plan and it is being promoted vigorously in small towns in states like Gujarat and Uttar Pradesh. One of agents who visited me was harping on the brand name of Sahara and the main marketing pitch was that since it is the beginning stage of the MLM scheme "we" can make money before the scheme becomes redundant and widespread like Amway and many others.
Free Helpline
Legal Credit