Markets regulator Sebi has ordered Suvidha Farming and Allied Ltd and its directors to complete by March the repayment of investors' money that the firm had collected through illegal investment schemes.
The company had raised Rs 28.22 crore from 2,69,905 investors through Collective Investment Schemes (CIS) from 2010 to 2014 without obtaining the regulator's approval.
"I direct that Suvidha and its directors - Vinod Kumar Shankhwar, Rajendra Karn Rajpoot, Pardeshi Ram and Rajneesh Dutta - shall complete all refunds by March 31, 2018 and shall furnish evidences to establish that refunds have been made to all investors," Sebi Whole Time Member G Mahalingam said in an order dated December 22.
The latest directive comes after Securities and Exchange Board of India (Sebi), in January last year, had given three months to the company to repay investors' money.
Following this, the firm had moved Securities Appellate Tribunal against Sebi's order. The Tribunal in September this year had directed Suvidha to file a representation before Sebi within three weeks wherein the details of money refunded and mode and manner of repayment of balance amount should be stated.
In its submission to Sebi, the firm claimed to have refunded over Rs 4.35 crore to 11,892 investors out of Rs 28.22 crore mobilised by it from 2.7 lakh investors.
However, no proof in support of this repayment has been submitted to Sebi, the order noted.
"Further, Suvidha has sought minimum one year to sell the land and make repayment...it has been nearly two years since the order has been passed and in these two years, as per the company's submission, only 15.4 per cent money has been repaid," Sebi noted.
It is also noted from the final order that from 2,69,905 investors, money was mobilised from 2010 to 2014 and the company could repay only 11,892 investors, which is less than 10 per cent investors in nearly two years, it added.
"Considering the paltry number of investors refunded, meagre amount of repayment claimed to be made and the lack of efforts of the company to monetise its liquid assets, I am of the opinion that the company is just engaging itself in correspondence with Sebi with the idea of delaying and protracting compliance with the final order.
"This is also to avoid other actions being taken against it for the failure or delay in compliance of the final order. The proposal is not genuine and does not merit any consideration," Mahalingam said.
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