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TMI Blog2020 (3) TMI 920X X X X Extracts X X X X X X X X Extracts X X X X ..... directors could not be fastened the liability to refund the amount as they had neither collected the money nor were responsible for disbursement of the money to the investors at that stage. Admittedly the said appellants after their resignations are not involved in the affairs of the company. Consequently, no direction could be issued to them to wind up the investment scheme or to restrain them from selling the assets of the company in which they are not the directors. The impugned order in so far as the appellants in Appeal is concerned cannot be sustained. Appellants in Appeal No. 55 of 2018 and 56 of 2018 no interference is required in the impugned order. The investment made by the investors had matured in 2012 during the period when ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Member Prakash Shah, Adv., Chinmay Paradkar and Meit Shah, Advs. for the Appellant. Anubhav Ghosh, Adv. and Ms. Rashi Dalmia, Adv. for the Respondent. ORDER Tarun Agarwala, 1. Three appeals have been filed against a common order passed by the Whole Time Member (hereinafter referred to as, 'WTM'). Consequently, all the three appeals are being decided together. 2. The facts leading to the filing of the present appeals is that Securities and Exchange Board of India (hereinafter referred to as, 'SEBI') received several investor complaints pertaining to money mobilization by Sanghi Plantations Ltd. (SPL / the Company) and its failure to refund the dues to the said investors. SEBI examined the compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M further found that all the noticees including the appellants were responsible and were held liable to refund the monies and further to wind up the scheme. The WTM accordingly issued the following directions, namely,:- (i) Sanghi Plantations Ltd. and the noticee directors namely, Siddharth Sanghi, Amit Sanghi, Kodhaty Chandrasekhar Rao, Seshadri Upadhyayula, Benda Ram Narayan are jointly and severally liable to wind up the existing collective investment schemes and refund the money collected by it under the schemes with returns which are due to the investors as per the terms of offer within a period of three months from the date of this order. The refund shall be made through 'Bank Demand Draft' or 'Pay Order'. (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Kodhaty Chandrasekhar Rao, Seshadri Upadhyayula, Benda Ram Narayan shall be restrained from holding position as directors or key managerial personnel of any listed company for a period of 4 years from the date of this Order. 5. The appellants being aggrieved by the said order have filed the present appeals. 6. In Appeal No. 378 of 2017, the appellants contended that they were appointed as directors on February 26, 2008 and resigned on June 6, 2009. During this period no money was collected under the scheme nor the investors amount had matured during their period which required repayment to the investors. It was, thus, contended that since the appellants were appointed as directors for a brief period they cannot be held liable to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said noticee to refund the amount with interest jointly and severally with the company to the extent of amount collected during the tenure of director of the company. 8. Having heard the learned counsel for the parties at some length, we find that the appellants in Appeal No. 378 of 2017 were appointed as directors for a limited period between 2008 and 2009. During this period, no amount was collected under the CIS. There is no finding that the amount collected had matured during the period when these appellants were the directors. Consequently, in our opinion, these directors could not be fastened the liability to refund the amount as they had neither collected the money nor were responsible for disbursement of the money to the inves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Board of Directors to show the he did not participate in any meeting. In any case, the amounts had matured during the period they were directors and thus, were responsible for the refund of the money to the investors. The decisions relied upon them that they were only liable to the extent of collection made by them is not applicable to the instant case as they are liable for the refund of the money collected by the company which was liable to be refunded during the period when the said appellants were directors. Consequently, Appeal No. 55 of 2018 and 56 of 2018 lacks merit. 10. In view of the aforesaid, the impugned order in so far as it relates to the appellants in Appeal No. 378 of 2017 cannot be sustained and is quashed. The said ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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