Rose Valley Real Estate and Construction Company today moved the Calcutta High Court against market regulator SEBI’s order that prevents it from collecting money from investors or launch any scheme. A SEBI order dated 3 January had asked the company to not to collect money from investors or launch any scheme to dispose of any of its properties as part of its collective investment scheme.
Praying for an injunction on the SEBI order, Rose Valley counsels P C Sen and S Pal submitted before Justice Jayanta Biswas that as the company is not listed in any stock exchanges of the country, SEBI has no jurisdiction to interfere with its affairs. According to their petition, affairs of the company are regulated and administered by the Ministry of Corporate Affairs of the Government of India as provided under the Companies Act, 1956.
The petitioner stated that the method of receiving money for allotting a plot of land to prospective buyers could not be equated to collection of deposit from the public or trading in the securities market.The principal business of the company was real estate promotion and development, they submitted. The petitioner prayed for an injunction on SEBI directing it to quash its January 3 order and not to interfere with the business of the company.
Appearing for SEBI, counsel Hirak Mitra submitted that the company had violated its regulations and that collective investment scheme was a type of collection from the public which SEBI had power to regulate.
