TaxTMI 
TaxTMI 
TaxTMI 
2025 (6) TMI 1888
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....ia, observed in the said Order that the Noticee was one of the directors of GAL during the time when the company offered and issued NCDs to the public. 2. Vide the said Order, inter alia, the following directions were issued qua the Noticee: 15 (a) Greenbang Agro Limited and its directors, namely Paritosh Panda, Dhiman Roy, Nitish Barman, Baidyanath Mondal, Subhra Jyoti Sardar, Satyanendra Nath Maondal, Sreemon Ghosh, Taslim Arif Khan, Nilima Ponda, Lipika Bhaduri, shall jointly and severally refund the money collected through the offer and allotment of NCDs by the GAL to the holders of NCDs, with an interest of 15% per annum (the interest being calculated from the date when the repayments became due in terms of Section 73(2) of the Companies Act, 1956 till the date of actual payment) within a period of 90 days from the date of receipt of this Order; ... ... (d) Till the refund, as directed above, is complete, the company and its above named directors are hereby- (a) restrained from accessing the securities market; (b) prohibited from buying, selling or otherwise dealing in securities in any manner whatsoever, directly or indirectly; and (c) restrained from associati....
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...., submitting the following: 7.1. The Noticee never met the Chairman and Managing Director of the Company. He has no financial stake in the company. 7.2. He has not attended any Board Meeting and has not singed any attendance register. He has not received any sitting fee as a director. 7.3. As a peon, he lost his job on 26th December, 2012 but it appears from the Form 32 that the same date was shown as his cession from the Post of Independent Director. 7.4. He has no knowledge of mobilization of money since he was not engaged in any of the operations of the company. He was fraudulently roped in as Non-Executive director. He had no control over the activities of the company. 7.5. Even otherwise, he was merely included in the Board of Directors of the Company as a non-executive director and was not involved in the day to day affairs of the Company and was not even a shareholder of the Company as is reflected from the records available on the MCA Portal. 7.6. Under the provisions of the Companies Act, 1956 and under the Memorandum of the Company, the Managing Director is the person who takes the final decision for the Company and its management and at no point of time, the Notice....
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....nies Act. 7.14. The Noticee is not an 'Officer in default' under the provisions of 209(5) of the Companies Act and under the provisions of the SEBI Act and SEBI failed to appreciate that the position of Noticee is neither an authoritative position nor a strategic position in the Company. 7.15. The Noticee relied on various Judgments Pritha Bag vs SEBI (Appeal No. 291 of 2017), Sayanti Sen vs SEBI (Appeal No. 163 of 2018), Subhra Jyoti Sardar vs SEBI (470 of 2018), Lipika Bhaduri Vs SEBI (225 of 2024) of the Hon'ble SAT. C. CONSIDERATION OF ISSUES AND FINDINGS : 8. I note that it was, inter alia, observed by SEBI in the Order dated June 15, 2018 that GAL had allotted NCDs to at least 210 individuals/investors during the financial years 2011-12 to 2013-14 and mobilized funds amounting to Rs.36.97 Lakh. Vide the said Order, the Noticee was found to be one of the past directors of GAL and was held liable for the fund mobilization activities undertaken by GAL during the period of his directorship. Therefore, inter alia, directions for refund of monies collected and restraint from dealing in securities were issued in respect of the Noticee and other entities vide the aforesaid Order....
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....Order was passed in respect of GAL and its directors/promoters, for raising money through offer and issue of NCDs to public in contravention of the provisions of Sections 56, 60 read with 2(36), 73, 117B and 117C of the Companies Act, 1956 and relevant provisions of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008. In this context, the relevant extract of Section 73 of the Companies Act, 1956 is reproduced as under: "Allotment of shares and debentures to be dealt in on stock exchange. 73. (1) Every company intending to offer shares or debentures to the public for subscription by the issue of a prospectus shall, before such issue, make an application to one or more recognised stock exchanges for permission for the shares or debentures intending to be so offered to be dealt with in the stock exchange or each such stock exchange. (1A) ... (2) Where the permission has not been applied under subsection (1) or such permission having been applied for, has not been granted as aforesaid, the company shall forthwith repay without interest all moneys received from applicants in pursuance of the prospectus, and, if any such money is not repaid within eight days after t....
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.... of the aforesaid provision indicates that the expression "officer who is in default" would mean the managing director or managing directors, whole time director or whole time directors, the manager, the secretary or any person in accordance with whose directions or instructions the Board of Directors of the company is accustomed to act and would also include any person charged by the Board with the responsibility of complying with the provisions of the Companies Act. Section 5(g) of the Companies Act further stipulates that where the company does not have any of these officers specified in clauses (a) to (c), all the directors would be deemed to be a officers in default. 16. In light of the aforesaid provisions, the Noticee has submitted that Mr. Paritosh Panda was the Managing Director, who was in-charge of the business of the Company and the mastermind behind the issuance of the NCDs and SEBI should consider that the Company was having Managing Director, who shall be responsible in respect of any violation(s) committed by the Company. It is further submitted that the Noticee is not an 'Officer in default' under the provisions of the Companies Act, 1956. 17. It is noted that th....