Sebi bans Rainbow Industries, directors from securities market

Regulator Sebi Thursday barred Jharkhand-based Rainbow Industries and Constructions along with its nine former and present directors and promoter from the securities markets till further directions for violation of public issue norms Besides, the regulator asked entities why directions of refunding money along with interest to investors should not be imposed on them and directed them to reply in 21 days from the date of the order. The regulator, in an interim order, said that Rainbow issued redeemable preference shares (RPS) to 5,379 persons amounting to Rs 6 crore during 2011-12. For the period 2012-13, it allotted RPS to 4,673 persons for Rs 5.36 crore. The offer of RPS was made to more than 49 persons, thereby it ‘prima-facie’ qualifies to be a public offer, Sebi said. However, it prima-facie observed that the company has failed to comply with the requirements the Securities and Exchange Board of India (Sebi) noted. Accordingly, Sebi barred Rainbow, its past and present directors — from markets till further directions.

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