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TMI Blog2017 (2) TMI 414X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent reads, inter-alia, as under:- "......... On, the basis of our verification, we certify that the Company had already received Rs. 8,52,50,000/- Share money in respect of Preferential issue of 2,00,00,000 new Equity Shares of Rs. 10/- per share aggregating Rs. 20,00,00,000/-, as per details given below: Number of shares Amount (Rs.)- per share Total Amount Rs. 47,00,000 10.00 4,70,00,000/- 1,53,00,000 2.50 3,82,50,000/- 3. The second certificate of even date, being a due diligence certificate, issued by the respondent reads as under:- "DUE DILIGENCE CERTIFICATE Re: Padmini Polymers Limited Preferential Allotment of 2,00,00,000/- Equity Shares of Rs. 10/- each aggregating to Rs. 20,00,00,000/- i) We have examined various documents and materials facts/papers in connection with the Preferential Allotment. ii) On the basis of such examination and discussion with the Company, its Directors and other Officers, Other Agencies, independent verification of the statements concerning the objects of the Preferential Allotment, Price justification and the contents of other Documents and papers furnished by the Company. We confirm that: (a) The Preferential Allotmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India 445867 25.05.99 UTI Bank Ltd. 2000,00,000.00 Total 8,62,60,000.00 5. Being relevant for the purposes of the fate of the respondent, we need to highlight that in the third certificate the respondent mentioned the name of the allottee, the cheque number issued by the allottee, the date of the cheque, the bank on which the cheque was drawn. The date of encashment of the cheque has consciously not being recorded in the certificate. We shall deal with this aspect while reasoning. 6. It came to the notice of the SEBI that the share price of the company unduly increased from December 13, 1999 to March 09, 2000. From Rs. 60.95 it rose to Rs. 266/-. Thereafter the price of the shares declined and by May 15, 2000 it fell to Rs. 47/-. Subsequently the price increased to Rs. 118.10 on July 06, 2000 and fell to Rs. 55.65 on August 08, 2000. 7. In view of the unusual price movement, SEBI conducted an investigation in which it was revealed that 2,00,00,000/- equity shares for cash at par were allotted as under:- Sl. No. Allotment Date Name of Allottees Shares Allotted Paid up value (Rs./share) 1. 31.5.1998 Unit Trust of India 200000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0,000 22.50 lacs 1.6.99 14.1.00 Cross Country Exports 15.7.99 6.1.00 Pramod Kumar Kishorepuria 9,00,000 22.50 lacs 22.5.99 18.1.00 Cross Country Exports 15.9.00 7.1.00 Alok Khetan 9,00,000 22.50 lacs 28.5.99 19.1.00 Shivesh Computers 15.7.99 12.1.00 Royal Bengal Exports 9,00,000 22.50 lacs 3.8.99 18.1.00 DKG Buildocn 25.6.99 12.1.00 Savera Tie-up 9,00,000 22.50 lacs 3.8.99 18.3.00 JP Promoters 25.6.99 9.3.00 Sanjeev Beriwal 9,00,000 22.50 lacs 28.5.99 18.1.00 RN Dyachem 25.8.99 17.1.00 Prakash Kumar Damani 9,00,000 22.50 lacs 25.6.99 14.3.00 Mudra Capital 25.8.99 9.3.00 Prakash Kumar Damani (HUF) 9,00,000 22.50 lacs 25.6.99 14.3.00 Mudra Capital 25.8.99 9.3.00 11. SEBI also noted that the cheque issued by Blumenfeld Ltd. dated May 17, 1999 was revalidated on January 04, 2000. 12. Qua Delhi based entities similar exercise revealed to SEBI as under:- b) Delhi Based entities: Name of Allottees Shares Allotted on 20.6.99 Amount due to Padmini (Rs.) Cheque Date Clearing Date Entities to whom preferential shares were sold by the respective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2000 after the receipt of sale proceeds of the said shares by the original allottees. Similarly, cheque dated August 01, 1999 issued by Cherry Marketing P. Ltd. Rs. 22.50 lacs was in fact cleared only on December 27,1999. Similarly, I find that there are numerous instances as detailed in Annexure I to the show cause notice which established beyond doubt that Padmini had not received share application money by June 30, 1999 or by November 30, 1999, as stated and certified by Shri Kailash Chandra Agrawal in his certificates dated June 30, 1999 and November 30,1999. 4.9 I note from the bank statements of Padmini (maintained with Vijaya Bank Ansari Road Branch, New Delhi) that the cheques (towards the application/allotment money) of Cama Enterprises (cheques no. 43565) Hermonite Consultants Pvt Ltd (cheques no. 42454), Zinga Chemicals Pvt Ltd. (22985), Cherry Marketing Pvt Ltd. (Cheques no. 43226) Hermonite Surgicals Pvt. Ltd (cheques no. 19878) and HT Ferro Pvt. Ltd. (cheques no. 596160) were cleared and credited to the account of Padmini only on December 27,1999 except the cheques of H T Ferro Pvt. Ltd. which was credited on December4 28,1999. Similarly, from the bank statement ofr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent. 22. Unfortunately we do not have any assistance from the respondent who has chosen not to appear today and would therefore highlight that in the certificate dated November 13, 1999 the respondent has consciously omitted to add the column of the date when the cheques were encashed for the reason he knew that no cheque had been encashed by the date he gave the certificate. We would also highlight that before the Disciplinary Committee that the respondent relied upon Form 2 which had been submitted by the Company to the Registrar of Companies, and suffice it to record that said form could not form the basis on which the respondent issued the certificates because the date of issue of said form under signatures of the Company Secretary of the Company, is much after the date when the three certificates were issued by the respondent. 23. Accepting the report of the Disciplinary Committee, the Council at its meeting recommended penalty of removal of the name of the respondent from the Register of Members of the Institute for a period of five years. 24. We concur. 25. The reference is disposed of levying penalty of removal of the name of the respondent from the Register ..... X X X X Extracts X X X X X X X X Extracts X X X X
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