Order in the matter of Promotech Infratech Limited

WTM/SR/ERO/17/05/2014 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA, MUMBAI CORAM: S. RAMAN, WHOLE TIME MEMBER ORDER Under Sections 11, 11(4), 11A and 11B of the Securities and Exchange Board of India Act, 1992, against Promotech Infratech Limited and its Directors, viz. Shri Anukul Maiti, Smt. Kanika Maiti, Shri Swapan Roy, Shri Samar Mustafi and Shri Atanu Halder; its Debenture Trustee, viz. Shri Pulak Roy.

1. Securities and Exchange Board of India ("SEBI") received a letter dated June 6, 2013, from the Reserve Bank of India ("RBI"), forwarding a complaint dated April 26, 2013, in which it was alleged that Promotech Infratech Limited ("PIL") was involved in collection of public money without obtaining permission from SEBI. Vide the aforesaid letter dated June 6, 2013, SEBI was also informed that PIL was not registered with RBI under the Reserve Bank of India Act, 1934.

2. Thereafter, SEBI vide letter dated July 29, 2013, while stating: "It has come to our notice that you (PIL) are raising funds from public by issuing Non-Convertible Debentures (hereinafter referred to as "NCDs") ostensibly by way of private placement. No Prospectus or DRHP or statement in lieu of prospectus or information memorandum (was) filed with (SEBI)", advised PIL to furnish the following information within ten days from the date of receipt of the aforesaid letter, viz. – i. Copy of Prospectus/Red Herring Prospectus/Statement in lieu of Prospectus/Information Memorandum filed with ROC for issuance of NCDs. ii. Copy of the Memorandum and Articles of Association of the company; iii. Audited Balance Sheet and Profit & Loss Account of the company for the last 3 years; iv. Name, addresses and occupation of all the promoters/directors of the company; v. Names and details of the Key Managerial Personnel of the company; vi. Other information in respect of every series of NCDs issued by the company, viz. – a. Date of opening and closing of the subscription list; b. Details regarding the number of application forms circulated inviting subscription; c. Details regarding the number of applications received;

d. Details regarding the number of allottees and list of such allottees; e. Number of NCDs allotted and value of such allotment against each allottee's name. f. Details regarding subscription amount raised; g. Date of allotment of NCDs; h. Copies of the minutes of Board/Committee meeting in which the resolution has been passed for allotment; i. Date of dispatch of NCDs; j. Details of the total number of applicants for each of PIL's scheme besides the list of final allottee; k. Copies of application forms, pamphlets, advertisements and other promotional material circulated for issuance of NCDs. l. Terms and conditions of the issue of NCDs.

3. However, as PIL failed to submit the abovementioned information, SEBI vide another letter dated November 26, 2013, advised PIL to submit the abovementioned information within 7 days from the receipt of the aforesaid letter.

4. PIL replied to SEBI vide letter dated December 4, 2013, wherein it submitted the following information, viz. – i. Copy of the Memorandum and Articles of Association of the company; ii. Name, addresses and occupation of all the promoters/directors of the company; iii. Names and details of the Key Managerial Personnel of the company; iv. Information in respect of schemes launched for raising funds – "There is no any other scheme except issue of Debentures …" v. Other information in respect of Preference Shares/Debentures issued by the company, wherein it stated – a. "The Company had made the Private Placement of Debentures to friends, relatives and associates for which company had filed Form 10 with the ROC and the same has been approved by the ROC. A Certificate of Registration of Mortgage is attached … Since the allotment was done on Private Placement basis, no prospectus has been (filed) with ROC; b. The Company has till dated issued debentures on a single occasion through Private Placement. The Date of Opening of Series of Debentures was from November 1, 2012 to October 31, 2013. A Brochure cum Application Form is attached…

The Company had circulated 9000 Application Forms inviting subscription for Debentures. c. Till date the company has received 8593 Application Forms. d. List of allottees alongwith name and amount raised is attached … e. The Company had allotted 1144711 Debenture Certificate as per the list attached … f. The Company had allotted all the Debentures within 1 (One) month of the application received. g. Copies of the Minutes of Board/committee meeting in which the resolution has been passed for allotment is attached … h. The Company had not issued any pamphlets or any advertisement in regard to issue of Debentures. i. Terms and conditions of the issue of Debentures are annexed… j. The Company had till date redeem Debenture of ₹2316800. The amount of maturity is ₹2594816. A list of the same is annexed…"

5.1 The material available on record i.e. correspondences exchanged between SEBI and PIL alongwith the documents contained therein, have been perused. On an examination of the same, it is observed that – i. PIL was incorporated on September 19, 2012, with the ROC, Kolkata, West Bengal with CIN No. as U45400WB2012PLC186216, having its Office at 54/2, Rafi Ahmed Kidwai Road, Kolkata – 700016, West Bengal, India. The Directors in PIL are Shri Anukul Maiti, Smt. Kanika Maiti, Shri Swapan Roy, Shri Samar Mustafi and Shri Atanu Halder.

ii. PIL invited subscription for "Secured Non–Convertible Redeemable Debentures" ("Offer of NCDs"), in accordance with the following terms of the 'Information Memorandum', viz. -

Issue Size ₹150 Crore Nature of Secured Non–Convertible Redeemable Debentures Instrument Instrument Physical /Demat Form Face Value ₹100 per Debenture Issue Price ₹100 per Debenture Minimum 10 Debentures in multiples of 10 Debenture thereafter Subscription Tenure 364 days Put & Call None Option Redemption/ At par Maturity Coupon Rate Plan A B C D E F G H I Issue Price 1000 1000 1000 1000 1000 1000 minimum 10 Debentures @ 100 Per Debenture (100x10) Redemption 364 3 Years 5.6 8 Years 10 13 Period days Years Years Years Redemption 120 500 1000 3000 5000 9000 Premium Maturity 1120 1500 2000 4000 6000 10000 Amount Annualized 12% 13.75% 12.8% 17.71% 18.32% 18.11% Yield on Investment TD 3 Years 3 6 Years 6 Years 9 Years 9 12 12 Years Years Years Years Minimum 10 12% 12.5% 14% for 14.5% 15.5% 16% 18% 18.5% for Debentures General for General for General for General Senior Senior Senior Senior Citizen Citizen Citizen Citizen N.B.: Another 50% Bonus at the time of Redemption. Subject to achievement of the projected business target (for TD only) Interest Payment On Maturity iii. The "Offer of NCDs" is stated to have been made on a private placement basis pursuant to the Resolution of the Committee of Directors of PIL passed at the Board Meeting held on September 24, 2012.

iv. The Issue Opening Date and Issue Closing Date in respect of the "Offer of NCDs" were November 1, 2012 and October 31, 2013, respectively. The application under the "Offer of NCDs" must be made for a minimum of 10 Debenture (₹100 each) and in multiples of 10 Debenture (₹100 each) thereafter.

v. The investor(s) who can apply in respect of the "Offer of NCDs" are Individuals, Scheduled Commercial Banks, Financial Institutions, Insurance Companies, Mutual Funds and Bodies Corporate.

vi. The interest on debentures will accrue to the Debenture–holder(s) from the date of allotment. Further, the interest on application money will be paid to the applicant(s)/investor(s) at the respective coupon rate i.e. @12% per annum from the date of realization of demand draft (i.e. amount paid in lieu of application) upto the date of allotment.

vii. From the information submitted by PIL to SEBI, it is observed that it issued Secured Non–Convertible Redeemable Debentures since incorporation, to a large number of investors, details of which are reproduced below –

No. of Total Amount (₹ Year Type of Security Subscribers to in Crores) the Issue 2012 – 13 Secured Non – Convertible Redeemable Debenture 7811 10.56 2013 – 14 Secured Non – Convertible Redeemable Debenture 782 0.88 Total 8593 11.44

5.2 In the context of the abovementioned details of the "Offer of NCDs", the issue for determination in the instant matter is whether the mobilization of funds by PIL through the aforesaid Offer, is in accordance with the provisions of the SEBI Act, 1992 ("SEBI Act") read with the SEBI (Issue and Listing of Debt Securities), Regulations, 2008 ("Debt Securities Regulations"); the Companies Act, 1956 read with the Companies Act, 2013.

5.3 I note that the jurisdiction of SEBI over various provisions of the Companies Act in the case of public companies, whether listed or unlisted, when they issue and transfer securities, flows from the provisions of Section 55A of the Companies Act. While examining the scope of Section 55A of the Companies Act, 1956, the Hon'ble Supreme

Court of India in Sahara India Real Estate Corporation Limited & Ors. vs. SEBI (Civil Appeal no. 9813 of 2011) (Judgment dated August 31, 2012) (hereinafter referred to as the "Sahara Case"), had observed that: "We, therefore, hold that, so far as the provisions enumerated in the opening portion of Section 55A of the Companies Act, so far as they relate to issue and transfer of securities and non-payment of dividend is concerned, SEBI has the power to administer in the case of listed public companies and in the case of those public companies which intend to get their securities listed on a recognized stock exchange in India."

5.4 In this regard – i. Reference is also made to Sections 67(1) and 67(3) of the Companies Act, 1956, which are reproduced as under:

"67. (1) Any reference in this Act or in the articles of a company to offering shares or debentures to the public shall, subject to any provision to the contrary contained in this Act and subject also to the provisions of sub-sections (3) and (4), be construed as including a reference to offering them to any section of the public, whether selected as members or debenture holders of the company concerned or as clients of the person issuing the prospectus or in any other manner. (2) ... (3) No offer or invitation shall be treated as made to the public by virtue of sub-section (1) or sub-section (2), as the case may be, if the offer or invitation can properly be regarded, in all the circumstances- (a) as not being calculated to result, directly or indirectly, in the shares or debentures becoming available for subscription or purchase by persons other than those receiving the offer or invitation; or (b) otherwise as being a domestic concern of the persons making and receiving the offer or invitation … Provided that nothing contained in this sub-section shall apply in a case where the offer or invitation to subscribe for shares or debentures is made to fifty persons or more: Provided further that nothing contained in the first proviso shall apply to non-banking financial companies or public financial institutions specified in section 4A of the Companies Act, 1956 (1 of 1956).”

ii. While examining the scope of Section 67 of the Companies Act, 1956, the Hon'ble Supreme Court of India in the Sahara Case observed that:

"Section 67(1) deals with the offer of shares and debentures to the public and Section 67(2) deals with invitation to the public to subscribe for shares and debentures and how those expressions are to be understood, when reference is made to the Act or in the articles of a company. The emphasis in Section 67(1) and (2) is on the “section of the public”. Section 67(3) states that no offer or invitation shall be treated as made to the public, by virtue of subsections (1) and (2), that is to any section of the public, if the offer or invitation is not being calculated to result, directly or indirectly, in the shares or debentures becoming available for subscription or purchase by persons other than those receiving the offer or invitation or otherwise as being a domestic concern of the persons making and receiving the offer or invitations. Section 67(3) is, therefore, an exception to Sections 67(1) and (2). If the circumstances mentioned in clauses (1) and (b) of Section 67(3) are satisfied, then the offer/invitation would not be treated as being made to the public. The first proviso to Section 67(3) was inserted by the Companies (Amendment) Act, 2000 w.e.f. 13.12.2000, which clearly indicates, nothing contained in Sub-section (3) of Section 67 shall apply in a case where the offer or invitation to subscribe for shares or debentures is made to fifty persons or more. … Resultantly, if an offer of securities is made to fifty or more persons, it would be deemed to be a public issue, even if it is of domestic concern or proved that the shares or debentures are not available for subscription or purchase by persons other than those received the offer or invitation. … I may, therefore, indicate, subject to what has been stated above, in India that any share or debenture issue beyond forty nine persons, would be a public issue attracting all the relevant provisions of the SEBI Act, regulations framed thereunder, the Companies Act, pertaining to the public issue. …"

iii. In the instant matter, for ascertaining whether the "Offer of NCDs" is a public issue or an issue on private placement basis in accordance with Section 67 of the Companies Act, 1956, the no. of subscribers is of utmost importance. In the facts of the instant case, it is observed that although the "Offer of NCDs" is stated to have been made on a private placement basis, yet, through the same offer, PIL circulated 9000 Application Forms inviting subscription towards the "Offer of NCDs", out of which it received 8593 investors and mobilized funds amounting to approximately ₹11.44 Crores. In addition, it is observed that although PIL, in its letter dated December 4, 2013, submitted that: "The Company had made the Private Placement of Debentures to friends, relatives and associates"; however, the invitation made by it for subscription to "Offer of NCDs" extended to Individuals, Scheduled Commercial

Banks, Financial Institutions, Insurance Companies, Mutual Funds and Bodies Corporate. Such a generalized category of investor(s) cannot be said to satisfy the condition of specificity as required under Section 67(3) of the Companies Act. The aforesaid facts clearly indicate that the number of persons to whom the "Offer of NCDs" was made by PIL was 8593 and hence, was way beyond the prescribed limit of forty–nine persons. In addition, PIL is not stated to be a non-banking financial company or a public financial institution within the meaning of Section 4A of the Companies Act and therefore, is not covered under the second proviso to Section 67(3). In view of the aforesaid, the "Offer of NCDs" would prima facie qualify as a public issue under the first proviso to Section 67(3) of the Companies Act, 1956, which has been elucidated by the Hon'ble Supreme Court of India in the Sahara Case. In this regard, it is pertinent to note that by virtue of Section 55A of the Companies Act, Section 67 of that Act, so far as it relates to issue and transfer of securities, shall also be administered by SEBI in the case of companies who intend to get their securities listed.

5.5 I note that – i. From the abovementioned, it will follow that since the "Offer of NCDs" is a public issue of securities, such securities shall also have to be listed on a recognized 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, which is reproduced as under:

"73. (1) Every company intending to offer shares or debentures to the public for subscription by the issue of a prospectus shall, before such issue, make an application to one or more recognised stock exchanges for permission for the shares or debentures intending to be so offered to be dealt with in the stock exchange or each such stock exchange. (1A) … (2) Where the permission has not been applied under subsection (1) or such permission having been applied for, has not been granted as aforesaid, the company shall forthwith repay without interest all moneys received from applicants in pursuance of the prospectus, and, if any such money is not repaid within eight days after the company becomes liable to repay it, the company and every director of the company who is an officer in default shall, on and from the expiry of the eighth day, be jointly and severally liable to repay that money with interest at such rate, not less than four per cent and not more than fifteen per cent, as may be prescribed, having regard to the length of the period of delay in making the repayment of such money. (3) All moneys received as aforesaid shall be kept in a separate bank account maintained with a Scheduled Bank 1 [until the permission has been granted, or where an appeal has been preferred against the refusal to grant such. permission, until the disposal of the appeal, and the money standing in such separate account shall, where the permission has not been applied for as aforesaid or has not been granted, be repaid within the time and in the manner specified in sub-section (2)]; and if default is made in complying with this sub-section, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to five thousand rupees.”

ii. In the Sahara Case, the Hon'ble Supreme Court of India also examined Section 73 of the Companies Act, 1956, wherein it observed that – "Section 73(1) of the Act casts an obligation on every company intending to offer shares or debentures to the public to apply on a stock exchange for listing of its securities. Such companies have no option or choice but to list their securities on a recognized stock exchange, once they invite subscription from over forty nine investors from the public. If an unlisted company expresses its intention, by conduct or otherwise, to offer its securities to the public by the issue of a prospectus, the legal obligation to make an application on a recognized stock exchange for listing starts. Sub-section (1A) of Section 73 gives indication of what are the particulars to be stated in such a prospectus. The consequences of not applying for the permission under sub-section (1) of Section 73 or not granting of permission is clearly stipulated in sub-section (3) of Section 73. Obligation to refund the amount collected from the public with interest is also mandatory as per Section 73(2) of the Act. Listing is, therefore, a legal responsibility of the company which offers securities to the public, provided offers are made to more than 50 persons."

iii. In the facts of the instant case, since the "Offer of NCDs" was made to fifty persons or more by PIL, the same will attract the requirement of compulsory listing before a recognized stock exchange in terms of Section 73(1) of the Companies Act, 1956. It therefore prima facie appears that PIL has violated the provisions of Section 73(1) of the Companies Act, 1956, since it has failed to ensure listing with a recognised stock exchange of the securities issued under the "Offer of NCDs".

iv. As per Section 73(2) of the Companies Act, 1956, the obligation to refund the amount with interest that was collected from investors under the "Offer of NCDs" is mandatory on PIL. In this regard, there is no evidence on record to indicate whether or not PIL has paid interest to the investors where such Debentures are not allotted within 8 days under the "Offer of NCDs", as per the aforesaid Section. In view of the same, I find that PIL has prima facie not complied with the provisions of Section 73(2) of the Companies Act, 1956.

v. Section 73(3) of Companies Act, 1956, says that all moneys received shall be kept in a separate bank account maintained with a Scheduled Bank and if default is made in complying with this sub-Section, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to five thousand rupees. In the instant case, there is no evidence on record to indicate whether or not funds received from the investors under the "Offer of NCDs" has been kept in separate bank account by PIL. In view of the same, I find that PIL has prima facie not complied with the provisions of Section 73(3) of Companies Act, 1956.

5.6 Under Section 2(36) read with Section 60 of the Companies Act, 1956, a company needs to register its prospectus with the ROC, before making a public offer or issuing the prospectus. As per the aforesaid Section 2(36), “prospectus” means any document described or issued as a prospectus and includes any notice, circular, advertisement or other document inviting deposits from the public or inviting offers from the public for the subscription or purchase of any shares in, or debentures of, a body corporate. As mentioned above, since the "Offer of NCDs" was made to fifty persons or more, it has to be construed as a public offer. Having made a public offer, PIL was required to register a prospectus with the ROC under Section 60 of the Companies Act, 1956. In this regard, PIL in its letter dated December 4, 2013, submitted: "… no prospectus has been (filed) with ROC". In view of the same, I find that PIL has not complied with the provisions of Section 60 of Companies Act, 1956.

5.7 Under Section 56(1) of the Companies Act, 1956, every prospectus issued by or on behalf of a company, shall state the matters specified in Part I and set out the reports specified in Part II of Schedule II of that Act. Further, as per Section 56(3) of the Companies Act, 1956, no one shall issue any form of application for shares in or debentures of a company, unless the form is accompanied by abridged prospectus, contain disclosures as specified. Based on the material available on record, I find that PIL has not complied with the provisions of Section 56(1) and 56(3) of the Companies Act, 1956 and therefore, has prima facie violated the aforesaid provisions.

5.8 Under Section 117B of the Companies Act, 1956, no company shall issue a prospectus or a letter of offer to the public for subscription of its debentures, unless it has, before such issue, appointed one or more debenture trustees for such debentures and the company has, on the face of the prospectus or the letter of offer, stated that the debenture trustee or trustees have given their consent to the company to be so appointed. Based on the material available on record, I find that PIL has not complied with the provisions of Section 117B of the Companies Act, 1956 and therefore, has prima facie violated the aforesaid provisions.

5.9 As per Section 465(1) of the Companies Act, 2013, the Companies Act, 1956, "shall stand repealed". However, Section 465(2)(i) of the Companies Act, 2013, provides that:

"(2)Notwithstanding the repeal under sub-section (1) of the repealed enactments,— (a) anything done or any action taken or purported to have been done or taken, including any rule, notification, inspection, order or notice made or issued or any appointment or declaration made or any operation undertaken or any direction given or any proceeding taken or any penalty, punishment, forfeiture or fine imposed under the repealed enactments shall, insofar as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provisions of this Act;"

5.10 In addition to the above, reference may be made to the Debt Securities Regulations, which were framed by SEBI in exercise of its powers under Section 30 of the SEBI Act and are applicable to the public issue and listing of debt securities. It may be relevant to note that under the aforesaid Regulations, 'debt securities' have been defined as 'non-convertible debt securities which create or acknowledge indebtedness, and include debenture…' In this context, I find that PIL, through the "Offer of NCDs", which is a public issue of debt securities, has prima facie violated the following provisions of the aforesaid Regulations, which contain inter alia conditions for public issue and listing of debt securities, viz.

i. Regulation 4(2)(a) – Application for listing of debt securities ii. Regulation 4(2)(b) – In-principle approval for listing of debt securities iii. Regulation 4(2)(c) – Credit rating has been obtained iv. Regulation 4(2)(d) – Dematerialization of debt securities v. Regulation 4(4) – Appointment of Debenture Trustee vi. Regulation 5(2)(b) – Disclosure requirements in the Offer Document vii. Regulation 6 – Filing of draft Offer Document viii. Regulation 7 – Mode of disclosure of Offer Document ix. Regulation 8 – Advertisements for Public Issues x. Regulation 9 – Abridged Prospectus and application forms xi. Regulation 12 – Minimum subscription xii. Regulation 14 – Prohibition of mis-statements in the Offer Document xiii. Regulation 15 – Trust Deed xiv. Regulation 19 – Mandatory Listing xv. Regulation 26 – Obligations of the Issuer, etc.

5.11 Further, it appears reasonable to infer from the following that PIL was formed only for the purpose of fund mobilization through the "Offer of NCDs" – i. PIL was incorporated on September 19, 2012. ii. The "Offer of NCDs" was stated to have been made on a private placement basis pursuant to the Resolution of the Committee of Directors of PIL passed at the Board Meeting held on September 24, 2012. iii. The Mortgage and Charge in respect of the "Offer of NCDs" was created on September 25, 2012 and to that effect, PIL was issued Certificate of Registration of Mortgage on October 5, 2012. iv. The "Offer of NCDs" occurred w.e.f. November 1, 2012 i.e. immediately within a month and a half of PIL's date of incorporation, which was September 19, 2012.

5.12 Upon a consideration of the aforementioned paragraphs, I am of the view that PIL is prima facie engaged in fund mobilising activity from the public, through the "Offer of NCDs" and a result of the aforesaid activity has violated the aforementioned provisions of the Companies Act, 1956 (Section 56, Section 60 read with Section 2(36), Section 73, Section 117B) read with Section 465 of the Companies Act, 2013 and the Debt Securities Regulations.

6. SEBI has a statutory duty to protect the interest of investors in securities and promote the development of, and to regulate, the securities market. Section 11 of the SEBI Act has empowered it to take such measures as it thinks fit for fulfilling its legislative mandate. Further, as per the provisions of Section 55A of the Companies Act, 1956 read with Section 465 of the Companies Act, 2013, administrative authority on the subjects relating to public issue of securities is exclusively with SEBI. For this purpose, SEBI can exercise its jurisdiction under Sections 11(1), 11A, 11B and 11(4) of the SEBI Act read with Section 55A of the Companies Act, 1956 and Section 465 of the Companies Act, 2013, over companies who issue Secured Non–Convertible Redeemable Debentures to fifty persons or more, but do not comply with the applicable provisions of the aforesaid Companies Acts and the Debt Securities Regulations (as mentioned in paragraphs 5.1– 5.12 above).

7.1 From information obtained by SEBI from the MCA 21 Portal, it is observed that PIL appointed Shri Pulak Roy as Debenture Trustee for the issue of NCDs by that company, which is also observed from the extracts of the Minutes of the Meeting of the Board of Directors of PIL held on September 24, 2012 (as submitted vide PIL's letter dated December 4, 2013). Further, it is observed that PIL created a charge for an amount of ₹150 Crores in favour of Promotech Infratech Debenture Trust.

7.2 Section 12(1) of the SEBI Act states that: "No… trustee of trust deed … shall buy, sell or deal in securities except under, and in accordance with, the conditions of a certificate of registration obtained from the Board in accordance with the regulations made under this Act". Further, Regulation 7 of SEBI (Debenture Trustees) Regulations, 1993 ("Debenture Trustees Regulations"), provides that: "no person should act as a debenture trustee unless he is either – i. a scheduled bank carrying on commercial activity; or ii. a public financial institution within the meaning of section 4A of the Companies Act, 1956; or iii. an insurance company; or iv. body corporate."

7.3 Based on the material available on record, I find that Shri Pulak Roy has prima facie failed to meet the eligibility criteria specified under the provisions of the Debenture Trustees Regulations and therefore, has acted as unregistered Debenture Trustee, which is a violation of the abovementioned provisions of the SEBI Act read with the Debenture Trustee Regulations.

8. Protecting the interest of investors is the foremost mandate for SEBI and therefore, steps have to be taken in the instant matter to ensure only legitimate fund raising activities are carried on by PIL and no investors are defrauded. In light of the same, I find there is no other alternative but to take recourse through an interim action against PIL and its Directors alongwith its Debenture Trustee, viz. Shri Pulak Roy, for preventing that company from further carrying on with its fund mobilising activity under the "Offer of NCDs".

9. In view of the foregoing, I, in exercise of the powers conferred upon me under Sections 11, 11(4), 11A and 11B of the SEBI Act read with the Debt Securities Regulations and the Debenture Trustee Regulations, hereby issue the following directions – i. PIL shall not mobilize funds from investors through the issue of Secured Non– Convertible Redeemable Debentures or through the issuance of equity shares or any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly till further directions; ii. PIL and its Directors, viz. Shri Anukul Maiti, Smt. Kanika Maiti, Shri Swapan Roy, Shri Samar Mustafi and Shri Atanu Halder, are prohibited from issuing prospectus or any offer document or issue advertisement for soliciting money from the public for the issue of securities, in any manner whatsoever, either directly or indirectly, till further orders; iii. PIL and its abovementioned Directors shall provide a full inventory of all its assets and properties; iv. PIL and its abovementioned Directors shall not dispose of any of the properties or alienate or encumber any of the assets owned/acquired by that company through the issue of Secured Non–Convertible Redeemable Debentures, without prior permission from SEBI; v. PIL and its abovementioned Directors shall not divert any funds raised from public at large through the issue of Secured Non–Convertible Redeemable Debentures, which are kept in bank account(s) and/or in the custody of PIL; vi. Shri Pulak Roy is prohibited from continuing with his present assignment as a debenture trustee in respect of the issue of Secured Non–Convertible Redeemable Debentures of PIL 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.

10. The above directions shall take effect immediately and shall be in force until further orders.

11. The prima facie observations contained in this Order are made on the basis of the material available on record i.e. correspondences exchanged between SEBI and PIL alongwith the documents contained therein; information obtained from the 'MCA 21 Portal'. In this context, PIL and its abovementioned Directors; its Debenture Trustee, viz. Shri Pulak Roy may, within 21 days from the date of receipt of this Order, file their reply, if any, to this Order and may also indicate whether they desire to avail themselves an opportunity of personal hearing on a date and time to be fixed on a specific request made in that regard.

12. This Order is without prejudice to the right of SEBI to take any other action that may be initiated against PIL and its abovementioned Directors; its Debenture Trustee, viz. Shri Pulak Roy, in accordance with law.

Place: Mumbai S. RAMAN Date: May 15, 2014 WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA