Order in the matter of Subha Commercial Services Ltd

WTM/PS/195/ERO-GLO/MAR/2016 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA CORAM: PRASHANT SARAN, WHOLE TIME MEMBER ORDER Under Sections 11, 11(4), 11A and 11B of the Securities and Exchange Board of India Act, 1992 In the matter of Subha Commercial Services Limited In respect of: 1. Subha Commercial Services Limited [PAN: AAQCS2617C], 2. Mr. Goutam Ghosh [PAN: AXAPG9340C], 3. Mr. Uttam Ghosh [PAN: BBWPG4454J], 4. Mr. Biswajit Sukla Das [PAN: AZGPD5682C] and 5. Mr. Ashim Das [PAN: ALPPD1324E]. Date of Hearing: October 08, 2015 Appearances: For Noticees: Mr. Gautam Ghosh For SEBI: Dr. Anitha Anoop, General Manager, Mr. Pradeep Kumar, Assistant General Manager, Mr. Marc Lalrohalan, Assistant General Manager. 1. Securities and Exchange Board of India (hereinafter referred to as ‘SEBI’), vide an ex-parte interim Order dated May 08, 2015 (hereinafter referred to as ‘the interim order’) had observed that the company, Subha Commercial Services Limited (hereinafter referred to as ‘Subha’ or ‘the Company’) is prima facie engaged in fund mobilising activity from the public, through the Offer of Redeemable Preference Shares (hereinafter referred to as ‘RPS’) and had allegedly violated the provisions of Sections 56, 60 (read with Section 2(36)), 67, 73 of the Companies Act, 1956 and the SEBI (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations, 2013. In order to protect the interest of investors and to ensure that only legitimate fund raising activities are carried on by the Company and its directors, SEBI had issued the following directions: “… … 6. In view of the foregoing, I, in exercise of the powers conferred upon me under Sections 11(1), 11(4), 11A and 11B of the SEBI Act, hereby issue the following directions – i. SCSL shall forthwith cease to mobilize any fresh funds from investors through the Offer of RPS or through any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly, till further directions; ii.

SCSL (CIN:U51909TR2011PLC008328; PAN: AAQCS2617C) and its directors namely Shri Goutam Ghosh (DIN: 03534885; PAN: AXAPG9340C), Shri Uttam Ghosh (DIN: 05204287; PAN: BBWPG4454J), Shri Biswajit Sukla Das (DIN: 03534899; PAN: AZGPD5682C) and Shri Ashim Das (DIN: 03534849; PAN: ALPPD1324E) 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. SCSL and its abovementioned Directors, are restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in the securities market, either directly or indirectly, till further directions. iv. SCSL shall provide a full inventory of all its assets and properties; v. The Directors of SCSL shall provide a full inventory of all their assets and properties; vi. SCSL 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 Offer of RPS, without prior permission from SEBI; vii.

SCSL and its abovementioned Directors shall not divert any funds raised from public at large through the Offer of RPS, which are kept in bank account(s) and/or in the custody of SCSL; viii. SCSL and its abovementioned Directors shall, within 21 days from the date of receipt of this Order, provide SEBI with all relevant and necessary information as sought by SEBI. 7. The above directions shall take effect immediately and shall be in force until further orders. … … 10. This Order is without prejudice to the right of SEBI to take any other action that may be initiated against SCSL and its abovementioned Directors, in accordance with law.” 2. The interim order observed that the prima facie observations made therein were on the basis of the documents received from the office of the Sub Divisional Magistrate, West Tripura, correspondences exchanged between SEBI and the Company alongwith the documents contained therein and the information/ documents obtained from the ‘MCA-21’ portal. The interim order was also treated as a show cause notice which advised the Company and its directors to file their replies within 21 days from the date of its receipt and also seek an opportunity of personal hearing.

3. The interim order was forwarded to the Company and its directors namely Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das vide letters dated May 08, 2015. The letter issued to Mr. Ashim Das had returned undelivered. The Company vide letter dated May 30, 2015, replied to the interim order. Later vide another letter dated June 08, 2015, the directors namely Mr. Goutam Ghosh, Mr. Uttam Ghosh and Mr. Biswajit Sukla Das replied to the interim order.

4. Subsequently, SEBI proceeded further and granted an opportunity of personal hearing to the Company and its directors on October 08, 2015. The scheduled date was communicated vide SEBI’s letter dated October 01, 2015. Vide the said letter, the Company and its directors were advised that in case they fail to appear for the personal hearing before SEBI on the aforesaid date, then the matter would be proceeded ex-parte on the basis of the material available on record. On the date fixed for personal hearing i.e. October 08, 2015, the directors namely Mr. Goutam Ghosh appeared on behalf of himself, Company and other directors namely Mr. Uttam Ghosh and Mr. Biswajit Sukla Das. Mr. Goutam Ghosh filed the written submissions dated October 08, 2015 along with payment vouchers and the bank statements to show that repayments are being made by the Company to its investors. The written submissions were taken on record.

Mr. Ashim Das remained absent from the personal hearing. The Company vide its letter dated March 17, 2016, has stated that Ms. Ashim Das was given a copy of the interim order and he was also telephonically informed about the hearing letter. Mr. Ashim Das vide e-mail dated March 17, 2016, has submitted that after resigning from the Company, he is not staying at the address mentioned in the record and was not able to receive the letters issued by SEBI. Considering the reasonable opportunities already afforded to him for making submissions in the matter, I am inclined to proceed further with the matter.

5. The Company and its directors namely Mr. Goutam Ghosh, Mr. Uttam Ghosh and Mr. Biswajit Sukla Das vide respective letters dated May 30, 2015, June 08, 2015 and October 08, 2015, submitted as under: a. The Company has always co-operated with all the authorized offices while conducting the business. It had provided each and every information/ document sought for by SEBI. b. Neither the Company nor the directors had any intention to cheat its valuable customers, in any means. Till date no complaint has been lodged by any of its shareholders regarding deficiency of service. If any lacuna has been found, this is nothing but lack of knowledge regarding the procedure. c. An Extra-Ordinary Board of Directors meeting was conducted on May 18, 2015, wherein it was decided that, as per the order of SEBI, the Company will repay all the money collected from the subscribers by RPS. The Company has already started the procedure and repaid about ₹14,23,000. The remaining amount will also be repaid within a reasonable period as early as possible. d. There is no asset in the name of Company either movable or immovable. Rather an amount of ₹1,58,50,064 was invested with its subsidiary company. e. One of its directors namely Mr. Ashim Das had submitted his resignation on September 15, 2014, which was accepted and intimated to the Registrar of Companies. For the said reason, Mr. Ashim Das may be exempted from any kind of liability, in respect of the Company. f. The Company vide its letter dated October 08, 2015, had further submitted that it has repaid about ₹55,46,580 to its customers and requested for reasonable time for repaying all the remaining money (collected in the name of RPS) to its subscribers.

6. I have considered the interim order and the material available on record. The following are the observations from the interim order: “… a. SCSL was incorporated on August 04, 2011 with CIN as U51909TR2011PLC008328 and having its registered office at Joynagar 1 No. Agartala, Tripura 799001. b. The Directors of SCSL are Shri Goutam Ghosh (DIN: 03534885; PAN: AXAPG9340C),Shri Uttam Ghosh (DIN: 05204287; PAN: BBWPG4454J), Shri Biswajit Sukla Das (DIN: 03534899; PAN: AZGPD5682C) and Shri Ashim Das (DIN: 03534849; PAN: ALPPD1324E) c. As per the copy of application form submitted by SCSL, it is observed that SCSL offered Redeemable Preference Shares with the following terms and conditions: Private Placement of Redeemable Preference Shares of Rs.10/- Each Terms & Conditions of the Redeemable Preference Shares Issue Redemption Period 2 Years 3 Years 6 Years Issue Price for 1,000/- 1,000/- 1,000/- Preference Shares (100) Redemption Value 1,200/- 1,350/- 2,000/- d. As per copies of Minutes of Meeting submitted by SCSL, it is observed that SCSL passed the following resolutions at various General Meetings to increase its authorised capital and issue Preference Shares: Date of Resolution passed at Meeting Face Value Amount (₹) Meeting (₹) 31.01.2012 Resolved to increase authorised share capital from ₹5,00,000 to ₹1,00,00,000 by creation of 9,50,000 preference shares of Rs.10 each 20.12.2012 Resolved to issue 310680 Preference Shares 10 31,06,800.00 27.04.2013 Resolved to issue 159700 Preference Shares 10 15,97,000.00 06.11.2013 Resolved to issue 86100 Preference Shares 10 8,61,000.00 e. As per the Statement of Mobilization and Deployment of Fund from August 04, 2011 to October 31, 2013 submitted by SCSL, an amount of ₹55,64,800/- has been mobilized through issue of Redeemable Preference Shares. f. As per submissions made by SCSL vide letter dated September 15, 2014, the details of Redeemable Preference Shares issued by SCSL are as follows: Date of Allotment Total Amount (₹) No. of Allottees 25-12-2012 31,06,800.00 377 02-05-2013 15,97,000.00 132 14-11-2013 8,61,000.00 151 29-04-2014 10,02,500.00 190 Total 65,67,300.00 850 …”

7. Having considered the above, it is now necessary to determine whether the Company had made a public issue as alleged in the interim order and if so, whether the Company had complied with the public issue norms. The liability of the directors of the Company also needs to be determined as they have also been alleged in the interim order.

8. In order to ascertain whether an issue of securities is a ‘public issue’ or done on ‘private placement’, it is necessary to make a reference to Section 67(3) of the Companies Act, 1956, which reads 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).” In terms of Section 67(3), as amended by the Companies (Amendment) Act, 2000, with effect from December 13, 2000, no offer or invitation shall be treated as made to the public by virtue of sub-sections (1) or (2), as the case may be, if the offer or invitation can properly be regarded, in all 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.

In terms of the first proviso to the aforesaid section, the provisions of Section 67(3) shall not apply in a case where the offer or invitation to subscribe for shares or debentures is made to fifty persons or more. Therefore, the number of subscribers becomes relevant to conclude whether an issue of shares are for public or on a private placement basis. In view of the same, if an offer of securities are made to fifty or more persons, it would be deemed to be a public issue.

9. I now place my reliance on the order of Hon'ble Supreme Court of India in the matter of Sahara India Real Estate Corporation Limited & Others Vs. SEBI and another (Civil Appeal Nos. 9813 and 9833 of 2011; decided on August 31, 2012) (‘the Sahara case’) had inter alia held 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. …” 11. In the present case, I note that the Company had offered and allotted RPS to a total of 850 allottees (i.e.

377 allottees as on December 25, 2012; 132 allottees as on May 02, 2013; 151 allottees as on November 14, 2013 and 190 allottees as on April 29, 2014) and had raised ₹65,67,300. The Company has not denied the allotment of RPS. Considering the same, it is held that the Company had made an offer and allotted RPSs to more than 49 persons, thereby making a public issue of RPSs (in terms of the first proviso to Section 67(3) of the Companies Act, 1956) during the financial years 2012- 13, 2013-14 and 2014-15 as alleged in the interim order.

10. By making a public issue of RPS, as discussed above, the Company was mandated to comply with all the legal provisions that govern and regulate public issue of such securities, including the Companies Act, 1956 and the SEBI Act and regulations. In this context, I refer and rely on the below mentioned observation made by the Hon'ble Supreme Court of India in the matter of Sahara case: “... ... 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. …” 11. In view of the above observations, by virtue of Section 55A(a) and (b), SEBI has jurisdiction and would govern the issue of RPS as the same was clearly made to more than 49 persons. As alleged in the interim order, the Company was mandated to comply with the provisions of Sections 56, 60, 67 and 73 of the Companies Act, 1956, in respect of its offer and issue of RPS. In terms of 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 a company, unless the form is accompanied by abridged prospectus, contain disclosures as specified. Section 2(36) of the Companies Act read with Section 60 thereof, mandates a company to register its ‘prospectus’ with the RoC, before making a public offer/ issuing the ‘prospectus’.

12. The interim order further alleged that the Company had failed to comply with Section 73 of the Companies Act, 1956, in respect of its issuance of RPS. By issuing RPSs to more than 49 persons, the Company had to compulsorily list such securities in compliance with Section 73(1) of the Companies Act, 1956. As per Section 73(1) of the Companies Act, 1956, a company is required to make an application to one or more recognized stock exchanges for permission for the shares or debentures to be offered to be dealt with in the stock exchange. There is no material on record to say that the Company has filed an application with a recognised stock exchange to enable the RPS to be dealt with in such exchange. Therefore, the Company has failed to comply with this requirement.

13. Section 73(2) of the Companies Act, 1956 states that "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". As the Company failed to make an application for listing such RPSs, the Company had to forthwith repay such money collected from investors. If such repayments are not made within 8 days after the Company becomes liable to repay, the Company and every director of the Company, who is an officer in default, is jointly and severally liable to repay with interest at such rate. There is no material on record to say that the Company has complied with the provisions of Section 73(3).

14. Further, the ‘non-convertible redeemable preference share’ as defined by SEBI (Issue and Listing of Non-Convertible Redeemable Preference shares) Regulations, 2013, are ‘preference share which is redeemable in accordance with the provisions of the Companies Act, 1956 and does not include a preference share which is convertible into or exchangeable with equity shares of the issuer at a later date, with or without the option of the holder’. In view of the same, the Company was also mandated to comply with the provisions of the SEBI (Issue and Listing of Non-Convertible Redeemable Preference shares) Regulations, 2013. However, the Company has failed to comply with the following provisions of the SEBI (Issue and Listing of Non-Convertible Redeemable Preference shares) Regulations, 2013: i. Regulation 4(2)(a) – Application for listing of securities ii. Regulation 4(2)(b) – In-principle approval for listing of securities iii. Regulation 4(2)(c) – Credit rating has been obtained iv. Regulation 4(2)(d) – Dematerialization of securities v. Regulation 4(2)(e) – Minimum tenure vi. Regulation 4(3) – Capital Redemption Reserve vii. Regulation 4(5) – Appointment of Merchant Banker viii. Regulation 5 – Disclosure in offer document ix. Regulation 6- Filing of draft Offer Document x. Regulation 7 – Mode of disclosure of Offer Document xi. Regulation 8 – Advertisements for Public Issues xii. Regulation 9 – Abridged Prospectus and application forms xiii. Regulation 13 – Minimum subscription xiv. Regulation 15 – Prohibition of mis-statements in the Offer Document xv. Regulation 16 – Mandatory Listing xvi. Regulation 22 – Obligations of the Issuer, etc.

15. From the foregoing, I conclude that the Company has failed to comply with the provisions of Sections 56, 60, 73 of the Companies Act, 1956 read with the Companies Act, 2013 and the SEBI (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations, 2013 in respect of its offer and issuance of RPSs, as discussed in this Order. The Company shall therefore be liable to make refunds as per the mandate under Section 73(2) of the Companies Act, 1956 and also for regulatory action for committing the above violations.

16. Liability of Directors: The interim order was issued against the directors of the Company namely Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das. a. The details of their appointment and resignations are as under: Name Date of Appointment Date of Cession Mr. Goutam Ghosh 04/08/2011 Continuing as director Mr. Uttam Ghosh 15/03/2013 Continuing as director Mr. Biswajit Sukla Das 04/08/2011 Continuing as director Mr. Ashim Das 04/08/2011 22/12/2014 b. I note that the Company had offered and issued RPS in the financial years 2009-10, 2011-12, 2012-13 and 2013-14 (the date of first allotment being December 25, 2012 and the last date available date being April 29, 2014). Section 56 of the Companies Act, 1956 imposes the liability for the compliance, on the company, every director, and persons responsible for the issuance of the prospectus. The liability of the Company to repay under Section 73(2) of the Companies Act, 1956 read with Section 27 of the SEBI Act, is continuing and the same continues till all the repayments are made to the investors/ public. Therefore, the directors who were present during the period when the Company had made the offer and allotted RPS shall be liable for violation of Sections 56, 60 and 73 of the Companies Act, 1956 including the default in making refunds as mandated therein. As the liability to make repayments under Section 73(2) of the Companies Act read with Section 27 of the SEBI Act is a continuing liability, the persons who joined the Company’s Board pursuant to the offer and allotment of RPS shall also be liable if the Company and the concerned directors have failed to make refunds, as mandated under the discussed provisions of law.

c. From the table above, it is noted that Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das were the directors of the Company during the time of impugned issue and allotments of RPSs and were responsible for the affairs of the Company, at the relevant point of time. Mr. Goutam Ghosh, Mr. Uttam Ghosh and Mr. Biswajit Sukla Das continue to be the directors of the Company. Mr. Ashim Das had resigned from the Company on December 22, 2014 i.e. after the last available date of allotment of RPSs.

The Company on behalf of Mr. Ashim Das has submitted that he had resigned on September 15, 2014, due to his personal issues. The Company has also submitted that Mr. Ashim Das may be exempted from any kind of liability. In this regard, I note that the position of a ‘director’ in a public company/ listed company entails responsibilities, which have to be fulfilled by such director and face the consequences for any violation or default thereof. I also place reliance on the order of Hon’ble High Court of Madras in the matter of Madhavan Nambiar Vs. Registrar of Companies [2002 108 Comp Cas 1

Mad] wherein it was observed that “In the matter of proceedings for negligence, default, breach of duty, misfeasance or breach of trust or violation of the statutory provisions of the Act and the rules, there is no difference or distinction between the whole-time or part time director or nominated or co-opted director and the liability for such acts or commission or omission is equal. So also the treatment for such violations as stipulated in the Companies Act, 1956.”.

In view of the same, it can be concluded that Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das are responsible for the violations committed by the Company and liable, jointly and severally, for making refunds along with interest to the investors as mandated under Section 73(2) of the Companies Act, 1956 read with Section 27 of the SEBI Act.

19. I note that the Company and its directors namely Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das were required to provide full inventory of the assets and properties within 21 days from the date of receipt of the interim order. However, the Company and its directors have not submitted full inventory of the assets and properties.

20. In view of the discussion above, appropriate action in accordance with law needs to be initiated against the Company and the directors/ promoters in charge of the affairs of the Company, during the relevant period.

21. Therefore, I, in exercise of the powers conferred upon me under section 19 of the Securities and Exchange Board of India Act, 1992 read with sections 11 and 11B thereof hereby issue the following directions:

a. The Company, Subha Commercial Services Limited [PAN: AAQCS2617C], its directors namely Mr. Goutam Ghosh [PAN: AXAPG9340C], Mr. Uttam Ghosh [PAN: BBWPG4454J], Mr. Biswajit Sukla Das [PAN: AZGPD5682C] and Mr. Ashim Das [PAN: ALPPD1324E] jointly and severally, shall forthwith refund the money collected by the Company through the issuance of Redeemable Preference Shares (which have been found to be issued in contravention of the public issue norms stipulated under the Companies Act, 1956), to the investors including the money collected from investors, till date, pending allotment of RPS, if any, with an interest of 15% per annum compounded at half yearly intervals, from the date when the repayments became due (in terms of Section 73(2) of the Companies Act, 1956) to the investors till the date of actual payment.

b. The repayments to investors shall be effected only in cash through Bank Demand Draft or Pay Order.

c. The Company and/ or its present management are permitted to sell the assets of the Company only for the sole purpose of making the refunds as directed above and deposit the proceeds in an Escrow Account opened with a nationalised Bank.

d. The Company and its present management shall issue public notice, in all editions of two National Dailies (one English and one Hindi) and in one local daily with wide circulation, detailing the modalities for refund, including details on contact persons including names, addresses and contact details, within fifteen days of this Order coming into effect.

e. If the Company, Subha Commercial Services Limited and/ or the directors have repaid the investors as claimed by it, the Company may include such repayment in the report to be submitted under para 21(f), provided the Company has met with the criteria laid down under para 21(b) and it pays interest of 15% per annum compounded at half yearly intervals, from the date when the repayments became due (in terms of Section 73(2) of the Companies Act, 1956) to the investors till the date of actual payment.

f. After completing the aforesaid repayments, the Company shall file a certificate of such completion with SEBI, within a period of three months from the date of this Order, from two independent peer reviewed Chartered Accountants who are in the panel of any public authority or public institution. 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 (‘ICAI’).

g. In case of failure of the Company, Subha Commercial Services Limited, its directors including Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das in complying with the aforesaid directions, SEBI, on expiry of three months from the date of this Order,- i. shall recover such amounts in accordance with section 28A of the SEBI Act including such other provisions contained in securities laws. ii. may initiate appropriate action against the Company, its promoters/ directors and the persons/ officers who are in default, including adjudication proceedings against them, in accordance with law. iii. would make a reference to the State Government/ Local Police to register a civil/ criminal case against the Company, its promoters, directors and its managers/ persons in-charge of the business and its schemes, for offences of fraud, cheating, criminal breach of trust and misappropriation of public funds; and iv. would also make a reference to the Ministry of Corporate Affairs, to initiate appropriate action as deemed fit. v. would also make a reference to the Ministry of Corporate Affairs to flag the names of notice directors in its database so that information may be perused by RoC or any other regulatory authority.

h. The Company namely Subha Commercial Services Limited is directed not to, directly or indirectly, access the capital market by issuing prospectus, offer document or advertisement soliciting money from the public and is further restrained and prohibited from buying, selling or otherwise dealing in the securities market, directly or indirectly in whatsoever manner, from the date of this Order till the expiry of four (4) years from the date of completion of refunds to investors, made to the satisfaction of SEBI, as directed above.

i. The directors of the Company namely Mr. Goutam Ghosh, Mr. Uttam Ghosh, Mr. Biswajit Sukla Das and Mr. Ashim Das are restrained from accessing the securities market and are further prohibited from buying, selling or otherwise dealing in securities, directly or indirectly, with immediate effect. They are also restrained from associating themselves with any listed public company and any public company which intends to raise money from the public, with immediate effect. This restraint shall continue to be in force for a further period of four (4) years on completion of the repayments, as directed above.

j. The above directions shall come into force with immediate effect.

22. This Order is without prejudice to any action, including adjudication and prosecution proceedings, that might be taken by SEBI in respect of the above violations committed by the Company, its promoters, directors and other key persons.

23. Copy of this Order shall be forwarded to the recognised stock exchanges and depositories for information and necessary action.

24. A copy of this Order shall also be forwarded to the Ministry of Corporate Affairs/ concerned Registrar of Companies, for their information and necessary action with respect to the directions/ restraint imposed above against the Company and the individuals.

DATE : March 22nd, 2016 PRASHANT SARAN PLACE : Mumbai WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA