Markets regulator Sebi levied a fine of Rs 1 crore on En Aromatic & Petro Chemicals Ltd for indulging in illegal fund raising and failing to comply with the public issue norms.
The regulator during its investigation found that the company had issued redeemable cumulative preference shares (RCPs) to over 89,000 investors between 2003-2004, and 2010-2011.
The firm had raised nearly Rs 61.5 crore through the RCPS offer.
The firm while supplying certified statement for mobilisation of funds through issuance of RCPs stated that “the issue of preference shares is through private placement and therefore the company does not need to file prospectus/red herring prospectus with the ROC,” Sebi noted in its order dated May 17.
