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Alaknanda Agrotech fined Rs. 5 lakh, director sentenced to 6 months in jail

The Delhi court has imposed a penalty of Rs. 2 lakh on convict SP Awashti, who is an advocate, and Rs 5 lakh on his plantation firm

May 16, 2012 5:12 IST | India Infoline News Service
Alaknanda Agrotech Ltd director SP Awashti has been sentenced to six months in jail for raising huge funds from the public and promising high returns without taking prior approval from market regulator SEBI (Securities and Exchange Board of India).  
The Delhi court has imposed a penalty of Rs. 2 lakh on convict SP Awashti, who is an advocate, and Rs 5 lakh on his plantation firm, saying the legislature considered as serious the offences where "ultimate loser is unwary and unorganised investors".
The court sentenced the advocate saying "as already held, the company accused had mobilised funds to the tune of Rs 18.47 lakh and there is nothing on record which may suggest that the said amount was refunded to the investors till date."
The court also allowed SEBI to take necessary steps for realisation of fine amount after finding out the assets of the convict company.
The court rejected Mr Awasthi's plea for leniency, which he sought on the ground of being an advocate and remaining director of the company for a short period.
Alaknanda Agrotech Ltd is one of the hundreds companies, which launched collective investment schemes (CIS) and against whom SEBI had filed complaints between 2003 and 2005, seeking their prosecution for raising huge funds from public without getting prior approval from it as prescribed under the SEBI Act.

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