Mumbai, May 16: Capital market watchdog Sebi today ordered the promoters of another suspected Ponzi scheme operating in Bengal — apparently run by Delhi-based Basil International Ltd — to show cause why action should not be taken against them for failing to provide information about the deposits they have raised from the public since 2009.
The 12 promoters and directors of Basil International have been asked to file their replies with 15 days.
They are: Satya Narayan Karmakar, Sourindra Nath Mukherjee, Biplab Talukdar, Manindra Kumar Basu, Susanto Chatterjee, Jayanta Kumar Basu, Monami Basu, Sadhan Kumar Nandi, Sarmistha Sengupta Saikia, Korobi Sengupta, Kaushik Chattopadhyay and Promothesh Banerjee.
Basil International has been charged with raising deposits under the garb of redeemable preference shares from rural people after promising them returns ranging between 11 per cent and 14 per cent.
They utilised these proceeds to pay huge commission to the company’s agents, invested in business assets, fixed deposits and siphoned off the funds as cash.
“The company was … running a Ponzi scheme where the liability was being met through deposits,” Sebi said in its order issued today.
The market regulator had sent out its first letter to Basil International Ltd’s registered office at Satya Niketan in Delhi Moti Bagh area on July 18, 2011, after receiving a complaint from the income tax authorities in Calcutta. But the letter came back with the remark that the company had left the premises.
The company’s corporate office is located at Suren Tagore Road in Calcutta.
Sebi investigators then visited Basil’s offices in Delhi and other places but found no one there.
The regulator then drilled through documents that the company had submitted to the Registrar of Companies (RoC) and found links to 30 entities to whom letters were then sent. Nine of these letters were returned undelivered.
In July and September 2012, Basil International replied through letters to Sebi that “investments in different projects were a continuous process it was not possible to identify funds collected for each individual project/scheme”.
The investigations reveal that the company was offering redeemable preference shares on a private placement basis and had raised about Rs 95 crore till March 31, 2011.
Under section 67 of the companies act, no company can offer shares or debentures to more than 50 persons.
In the Sahara case, the Supreme Court had ruled that any offer to more than 50 persons automatically became a public issue and must be listed on an exchange under section 73 of the companies act.
The regulator said that while details of the amount that Basil raised were available from the documents submitted to the RoC, there is no information available about the number and identity of the subscribers to the issue.
Sebi has directed Basil not to collect any money from investors, refrain from disposing of properties or assets of the company and diverting any funds.