2020 (2) TMI 1417

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....ay 09, 2016 holding that the scheme floated by the company Assurre Agrowtech Limited was nothing else but a Collective Investment Scheme ("CIS") in terms of Section 11AA of the SEBI Act, 1992 without obtaining certificate of registration as required under section 12(1B) of the SEBI Act and Regulation 3 of the SEBI (Collective Investment Schemes) Regulations, 1999. The WTM accordingly directed the company and its directors including the appellant to abstain from collecting any money from the investors or to carry out any Collective Investment Scheme including the scheme which have been identified as a Collective Investment Scheme and further return the money so collected and further restrained the appellant and others from accessing the secu....

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....ctions of a director and should have taken all the diligent steps and taken care in the affairs of the company". 5. We also find from the impugned order that the appellant has been held responsible only on the ground that part of the mobilization of the fund was also collected during the period when the appellant was appointed as a director and therefore have been held liable. 6. Having heard the learned counsel for the appellant Ms. Shubharanjani Ananth and learned counsel appearing for the respondent Shri Anubhav Ghosh at some length we are of the opinion that the impugned order in so far as it relates to the appellant cannot be sustained. There is no dispute of the fact that the appellant was appointed as an independent director by....

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....here he had not acted diligently." A perusal of the aforesaid provision makes it clear that an independent director shall be held liable only in respect of such acts of omission or commission by a Company which had occurred with his knowledge, attributable through a Board processes, and with his consent or connivance or where he had not acted diligently. In the instance case, there is no finding by the WTM that the acts of the Company in the collection of the funds had occurred with the appellant's knowledge or that the appellant was part of the decision making processes through Board's resolution or that the funds and the activities of the Company was being done with his consent or connivance. Further, we find that there is no f....