The company had collected about Rs 1,000 crore from about 1.5 million investors. (Agencies)
Alchemist Infra Realty was found by the SEBI to be run unauthorised CIS businesses and was asked by the regulator to refund the money collected through such schemes.
After hearing its appeals against SEBI orders, SAT on Tuesday passed an order upholding the regulatory directions against the realty firm, but gave the company 18 months time to refund money in view of the long and tedious process of implementing the scheme of repayment to such large number of investors. However, the company had sought five years for refund process.
After considering facts and circumstances of the case, the Tribunal said, "a period of 18 months would duly suffice, with a rider that the company shall submit a report to SEBI every six months giving accurate details regarding progress made while executing the scheme of repayment in question.”
With regard to another appeal against SEBI's decision to reject a consent plea by Alchemist Infra Realty, SAT observed that the regulator should have given the company more time. Besides, the company and its five directors have also been barred from the securities market till the time all its schemes are wound up and the money is refunded to investors.
SEBI probe also found that the investment application form of the company also mentioned that it was part of 'Alchemist Group', which was engaged in diverse activities such as steel, food and beverages, IT, healthcare, media, aviation, realty, hospitality, education and tea estate, among others, with asset base of over Rs 5,000 crore.
The regulator began its investigations into the affairs of the company in 2011 after receipt of an anonymous complaint about the company mobilising money from the public investors in breach of regulations. Sebi later found that the company was running CIS in the name of real estate business and had garnered Rs 1,087 crore as on March 31, 2011.
The company had collected about Rs 1,000 crore from about 1.5 million investors.