M/S. Future Plus Services, vs Sebi

Date of Decision : 16.03.2023

Misc. Application No. 183 of 2023 And Appeal No. 242 of 2023

M/s. Future Plus Services, Proprietor Manish Parihar 418 Shanti Kunj, Gulab Bagh Colony, Indore, Madhya Pradesh - 452 010. ...Appellant

Versus

Securities and Exchange Board of India, SEBI Bhavan, Plot No. C-4A, G-Block, Bandra-Kurla Complex, Bandra (East), ...Respondent Mumbai - 400 051

Mr. Abhishek Mishra, PCS for the Appellant.

Mr. Vishal Kanade, Advocate with Mr. Manish Chhangani, Ms. Samreen Fatima and Mr. Sumit Yadav, Advocates i/b The Law Point for the Respondent.

CORAM : Justice Tarun Agarwala, Presiding Officer Ms. Meera Swarup, Technical Member

Per : Justice Tarun Agarwala, Presiding Officer (Oral) 2

1.

There is a delay in the filing of the appeal. For the reasons

stated in the application, the delay is condoned. The application

is allowed.

2. The present appeal has been filed against the order dated

November 14, 2022 passed by the Whole Time Member

("WTM" for convenience) of the Securities and Exchange

Board of India ("SEBI" for convenience) directing the

appellants to refund the money received from its clients/

investors as fee on account of carrying investment advisory

activities without getting itself registered under Section 12(1) of

the Securities and Exchange Board of India Act, 1992 ("SEBI

Act, 1992" for convenience) read with regulation 3 of the SEBI

(Investment Advisers) Regulations, 2013 ("IA Regulations

2013").

3. The appellant was further debarred from accessing the

securities market for a period of six months or till the expiry of

six months from the date of completion of refund to the

investors. Further, other directions were also issued.

4. Based on a complaint an investigation was conducted.

It was observed that the appellants were engaging and providing 3

investment advisory services without obtaining a certificate of

registration from SEBI.

5. Accordingly a show cause notice was issued to show

cause as to why amount of monies collected by the appellant

should not be refunded to the investors. In spite of service no

reply was filed.

6. The WTM after considering the material evidence on

record passed the impugned order holding that the activities

carried out by the appellants were investment advisory services

and the appellants were not registered under Section 12 of the

SEBI Act read with Regulation 3 of the IA Regulations, 2013.

The WTM further held that the activities carried out were

providing an assured return which was wholly illegal and,

consequently, directed the appellants to refund the amount

within three months.

7. We have heard Shri Abhishek Mishra, PCS for the

appellant and Shri Vishal Kanade, the learned counsel assisted

by Shri Manish Chhangani, Ms. Samreen Fatima and Shri Sumit

Yadav, the learned counsel for the respondent. 4

8. The only contention raised by the appellant was that the

direction to refund a sum of Rs. 77,10,753.72 was incorrect in

as much as certain credit entries did not relate to advisory

services and therefore the direction to refund such amount was

wholly incorrect.

9. Admittedly, the appellant was carrying out the advisory

services without getting itself registered under the SEBI Act and

its regulations. The activities that the appellant was carrying out

were thus unlawful and consequently the appellant is liable to

refund the amount collected to the investors. In this regard the

direction given by the WTM does not suffer from any error of

law.

10. The contention that the amount of Rs. 77,10,753.72 as per

bank statement does not relate entirely towards advisory

services but the only related to contra entries and other matters.

In this regard we find that no evidence has been filed by the

appellant to show that the amount did not relate to advisory

services. In the absence of cogent evidence and in the absence

of not filing any evidence before the WTM we are satisfied that

the direction of the WTM to refund the amount as stated in the

impugned order does not suffer from any error. 5

11. This order will be digitally signed by the Private Secretary

on behalf of the bench and all concerned parties are directed to

act on the digitally signed copy of this order. Certified copy of

this order is also available from the Registry on payment of

usual charges.

Justice Tarun Agarwala Presiding Officer

Ms. Meera Swarup Technical Member 16.03.2023 MADHUKAR Digitally signed by MADHUKAR SHAMRAO SHAMRAO BHALBAR

msb BHALBAR Date: 2023.03.17 11:20:51 +05'30'