Disposed

In the matter of Parasrampuria Plantations Ltd.

SAT28 Sept 2006

Case brief

AI extract

What is this about?

The Securities Appellate Tribunal allowed an appeal against a SEBI order requiring the appellant to refund investor money within one month. The Tribunal granted the appellant until August 2007 to repay Rs. 24.16 crores to investors, refusing further extensions. It modified the impugned order to include this new timeline while reserving the right for SEBI to proceed legally if the deadline was miss

What did the court decide?

Extension of time granted until end of August 2007 for refunding Rs. 24.16 crores to investors; no further extension permitted.

In the matter of Parasrampuria Plantations Ltd. — Securities and Capital Markets | SAT (2006)

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IN THE SECURITIES APPELLATE TRIBUNAL MUMBAI

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Appeal No. 137 of 2003

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Date of Decision 28.9.2006

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Parasrampuria Plantations Ltd.

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…… Appellant

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Versus

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Securities & Exchange Board of India

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…… Respondent

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Present : Mr. Joby Mathew, Advocate for the appellant Mr. Chirag Balsara & Ms. Daya Gupta, Advocates for the respondent

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Coram:

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Justice N.K. Sodhi, Presiding Officer C. Bhattacharya, Member R. N. Bhardwaj, Member

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Per: Justice N.K. Sodhi, Presiding Officer (oral)

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This appeal is directed against the order dated 8.10.2003 passed by the then Chairman of the Securities and Exchange Board of India (for short the Board) directing the appellant company to refund the money collected by it under its collective investment schemes as per the terms of the offer within a period of one month failing which the Board was to initiate proceedings including prosecution against the appellant. It is not in dispute that the appellant had been running 22 collective investment schemes on the date of the coming into force of the Securities and Exchange Board of India (Collective Investment Schemes) Regulations, 1999 (for short the Regulations). It is thus clear that the schemes were existing schemes within the meaning of Chapter IX of the Regulations. The appellant was required to obtain provisional registration which it did but it failed to comply with the provisions of Regulations 71 and 73 thereafter. Hence the impugned order.

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The learned counsel for the appellant at the outset submits that without going into the merits of the order the appellant be allowed some reasonable time to refund the amounts due to the investors. He has informed us that a sum of Rs. 24.16 crores is due to different investors. He requests for time up to the end of August 2007 and undertakes that by that time all the investors would be refunded the amounts due to them. Keeping in view the large amounts due to the investors we grant extension of time. Another reason that weighs with us is that if the appellant is not granted time and the Board is allowed to carry on further proceedings including prosecution of the Directors of the appellant company, the investors may not get their money back. Since sufficient time is being allowed for the repayment of the amounts, we make it clear that no further extension shall be granted and in case the appellant fails to satisfy each and every investor by the aforesaid date, the Board shall take steps in accordance with law and proceed against the appellant. The impugned order is modified accordingly and the appeal stands disposed of as above with no order as to costs.

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Justice N.K. Sodhi Presiding Officer

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C. Bhattacharya Member

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R.N. Bhardwaj Member

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28.9.2006

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// SR26/12/07 10:27

In the matter of Parasrampuria Plantations Ltd.

Case brief

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In the matter of Parasrampuria Plantations Ltd.

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