Moneycontrol
Jan 11, 2017 04:51 PM IST | Source: PTI

Sebi bars Zenith Highrise, 4 directors from markets

Since the firm had issued shares to over 49 persons, it qualified as a public issue of securities that requires compulsory listing on a recognised stock exchange. It was also required to file a prospectus, among others, which it failed to do.


Regulator Sebi has barred Zenith Highrise Infracon and its four directors from the capital markets and also restrained them from raising funds through issuance of securities till further orders.


It was alleged that the company raised funds illegally by issuing redeemable preference shares (RPS) in 2012-13 to more than 49 investors.


Since the firm had issued shares to over 49 persons, it qualified as a public issue of securities that requires compulsory listing on a recognised stock exchange. It was also required to file a prospectus, among others, which it failed to do.


"There are prima facie grounds to believe that the number of persons to whom preference shares have been offered and allotted exceeded the number of 49," the Securities and Exchange Board of India (Sebi) said in an interim order dated January 10.


The company and its directors have been prohibited from soliciting money from the public for the issue of securities in any manner, directly or indirectly.


Further, the entities have been directed not to dispose of, alienate or encumber any of their assets or not divert any funds raised from public.


They have also been ordered to furnish all information in connection with the offer and allotment of preference shares.

Besides, the regulator has given a time of 21 days to the firm and its directors to file their replies and a time period of 90 days to seek an opportunity of personal hearing.

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