MUMBAI, Feb 14: Market regulator, the Securities and Exchange Board of India (SEBI) has restrained Shah Group Builders Ltd. and its directors from mobilising funds from public through the issuance of securities.
It was alleged that Shah Group Builders raised over Rs 22 crore
through issue of shares to more than 1,500 people with a promise to list the shares through IPO.
The company had allegedly defaulted in payment of the agreed interest and has not refunded the principal amount. SEBI found that the company had issued equity shares to 50 or more persons as so was under a legal obligation to get listed on a
stock exchange.
Among others, it was also mandatory for the company to bring out a prospectus with respect to the public issue. However, it failed to comply with these norms.
In an order issued yesterday SEBI said, “the company and its directors or promoters – Nalin V Shah, Nirav N Shah and Neelam N Shah were involved in the mobilisation of public funds through the
issue of equity shares without complying with the applicable law.”
(UNI)
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