WTM/PS/87/CIS-NRO/NOV/2015

BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA

CORAM: PRASHANT SARAN, WHOLE TIME MEMBER
ORDER
Under Sections 11(1), 11(4) and 11B of the Securities and Exchange Board of India
Act, 1992 read with Regulation 65 of the SEBI (Collective Investment Schemes)
Regulations, 1999 and Regulation 4(2) (t) of the SEBI (Prohibition of Fraudulent
and Unfair Trade Practices Relating to Securities Market) Regulations, 2003
In the matter of Sunshine Global Agro Limited (earlier known as Sunshine Forestry
Private Limited)
In respect of:
1. Sunshine Global Agro Limited [PAN: AAJCS2508K],
2. Mr. Lekh Narayan Chand [PAN: AALPH6536K],
3. Mr. Mokarram Mohammad [PAN: AJPPM9356A],
4. Mr. Mohammad Ahteshamul Haq [PAN: ACGPH4147P],
5. Mr. Anand Kumar Jha [PAN: AEKPJ8257J],
6. Mr. Wasim Khan [PAN : CENPK6085G] and
7. Mr. Ashif Khan [PAN: BEMPK1322J]
_____________________________________________________________________
1.

Securities and Exchange Board of India (hereinafter referred to as SEBI) had,

conducted a preliminary enquiry in the unit plans of the one Sunshine Global
Agro Limited (hereinafter referred to as the Company or Sunshine) and vide an
interim ex-parte Order dated July 15, 2014 (the interim order), prima facie found that
Sunshine is engaged in fund mobilizing activities from the public, which is in the
nature of a Collective Investment Scheme (hereinafter referred to as 'CIS') as
defined in Section 11AA of the Securities and Exchange Board of India Act, 1992
(hereinafter referred to as the SEBI Act), without obtaining a certificate of
registration from SEBI as required under Section 12(1B) of the SEBI Act and
Regulation 3 of the SEBI (Collective Investment Schemes) Regulations, 1999
(hereinafter referred to as the CIS Regulations). The mobilization of funds from
the public, was also prima facie found to be a fraudulent practice in terms of
Regulation 4(2)(t) of the SEBI (Prohibition of Fraudulent and Unfair Trade
Practice Relating to Securities Market) Regulations, 2003 (hereinafter referred to as
PFUTP Regulations). The interim order was issued in order to protect the interest
of investors, safeguard the assets/ property acquired by the Company by using the
funds collected from the investing public and also to prevent the Company from
further carrying on with its existing fund mobilizing activities through the alleged

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CISs. This Order directed Sunshine and its directors namely Mr. Lekh Narayan
Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq, Mr. Anand
Kumar Jha, Mr. Wasim Khan and Mr. Ashif Khan (hereinafter collectively referred
to as the noticees):
not to collect any fresh money from investors under its existing scheme(s);

not to launch any new schemes or plans;

to immediately submit the full inventory of the assets owned by SGAL;
not to dispose of any of the properties or alienate the assets of the existing scheme(s);
not to divert any funds raised from public at large, kept in bank account(s) and/or in the
custody of the company.
The aforesaid directions came into force with immediate effect and the noticees
were advised to file their reply within a period of twenty one (21) days from the
date of receipt of the interim order and also to indicate whether they wish to avail
an opportunity of personal hearing in the matter.
2.

The Company vide its letter dated August 08, 2014, requested for the copy of the
interim order and requested for a time of three (3) months for complying with the
interim order. The interim order was forwarded to the Company and its directors
vide letters dated August 25, 2014. The letters issued to the noticees namely Mr.
Anand Kumar Jha and Mr. Mohammad Ahteshamul Haq had returned
undelivered. SEBI vide letter dated September 18, 2014, forwarded the copies of
the inteirm order to the Company for onward delivery of these to the noticees
namely Anand Kumar Jha and Mr. Mohammad Ahteshamul Haq. SEBI vide its
letter dated October 08, 2014, issued a reminder to the noticees for replying to the
interim order. As no reply was received, SEBI vide letter datd November 10, 2014,
issued one more reminder to the noticees for replying to the interim order. The
Company vide its letter dated November 24, 2014, replied to the reminder letter
of SEBI and requested for three months time for filing the detailed reply. The
submissions of the Company, in brief are as under:
i.

The activities of the Company are not in the nature of CIS and the Company is
engaged in operating a nursery and plantation of Jhatropa plant, a natural
substitute of bio-diesel.

ii.

To achieve economic and commercial viability of extraction of bio-diesel requires

huge plantation on mass scale, the Company took huge efforts to popularize the
large scale plantation of Jhatropa plants in various states.

iii.

The Company had obtained registration from the Government of Bihar on

December 12, 2004, for putting up nursery for forestry/ trading of plant.

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3.

Before proceeding further, SEBI granted an opportunity of personal hearing to the

Company and its directors on April 20, 2015. An intimation regarding the same
was sent to all the noticees vide letter dated March 24, 2015. The hearing notices
sent to the noticees namely Mr. Mokarram Mohammad, Mr. Anand Kumar Jha,
Mr. Wasim Khan and Mr. Ashif Khan had returned undelivered. SEBI vide its
letter dated April 13, 2015, asked the Company to intimate the noticees namely Mr.
Mokarram Mohammad, Mr. Anand Kumar Jha, Mr. Wasim Khan and Mr. Ashif
Khan about the date of hearing. On the date fixed for the personal hearing, none
of the noticees turned up for the personal hearing. In the interest of justice, one
more opportunity of personal hearing was granted to the noticees on May 15, 2015.
An intimation regarding the same was sent to the noticees vide letter dated May
08, 2015. However, none of the noticees turned up for the personal hearing on
such date also.
Considering that reasonable opportunities to the Company and its directors have
already been afforded for making submissions in the matter, I find that the matter
could be proceeded on the basis of the material available on record.

4.

I have considered the interim order issued in the matter and the material available
on record. The main allegation as against Sunshine is that the schemes/ plans
operated by it were in the nature of CIS and that Sunshine was offering these
schemes without obtaining registration from SEBI in contravention of the
provisions of Section 12(1B) of the SEBI Act and Regulation 3 of the CIS
Regulations read with Section 11AA of the SEBI Act. The directors of Sunshine
were also alleged to be responsible for the illegal conduct of the business of the
Company. The issue that now arises for my consideration is: Whether Sunshine
was operating a CIS without obtaining registration from SEBI?

5.

Whether Sunshine was operating a CIS without obtaining registration from

SEBI?
a. I note that the Company was incorporated on June 01, 2004 as Sunshine Forestry
Private Limited. On May 28, 2008, pursuant to the change of name to Sunshine
Global Agro Pvt. Limited, a new certificate of incorporation was issued to it.

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b. As per the details provided by Sunshine vide its letter dated December 31, 2013, it
had two schemes i.e. Sale of Jhatropa Bush group and Sale of plant/ trees. I have
seen the brochure submitted by Sunshine vide letter dated December 31, 2013, the
relevant portions of the same are:
GREEN REVOLUTION FRUIT FOR NATION

Since last five years company is running in profit. valuer has valued 5 to 7
years old trees Rs.1500/- per tree, for which we are offering for sale @ Rs.1,000/- per
Tree.
The grown up trees which we are selling require further maintenance for seven years to
be marketable at the time of delivery, the value of which is expected to be Rs.3,000/-.
These trees are planted & nourished on lease hold land. So, the regular maintenance of
the trees purchased by you will be carried out by the company and in return the company
will aspecting for assured the 14cft. wood contains.

JATROPHA PLANTATION BIO-DIESEL FOR NATION

Since last five years company is running in profit. valuer has valued 5 to 7
years old trees Rs.1500/- per tree, for which we are offering for sale @ Rs.1,000/- or
per J.B.G.
The grown up J.B.G (Jatropha Bush Group) which we are selling require further
maintenance for five years and six months (66 months) to be heavy fruitry at the time
of transfer. The value of which is expected to be Rs.2,000/- to Rs.3,000/- per J.B.G.
These Jatropha B.G. are planted & nourished on lease hold land. So, the regular
maintenance of the J.B.G. purchased by you will be carried out by the company upto the
term as per mutual memorandum of understanding & agreement.
After the completion of terms of maintenance agreement, purchaser is bound to sale such
J.B.G. If he wants to hold such J.B.G.; he will be responsible for transfer the lease
agreement from the company at his own cost. If the purchaser is far from project site
or he is not interested to hold to such J.B.G. company will purchase his J.B.G. as per
existing estimated value including fruit cost of one J.B.G. Rs.200/- and Rs.600/against each plant as per mutual agreement subject to condition that such agreement
must be executed within one year after the terms of M.O.U. expiration including grace
period of time.

Terms & Condition of Plant Purchase

2. After receiving application duly completed along with cost of each plant @Rs.1000/. The Company will send Plant Title Certificate after sixty days.
3. The saleable Plant will further require maintenance for 7 & more years, hence the
purchaser will give ownership right of the plant to the company for its maintenance.
4. The Purchaser will be bound to sale the said plant on completion of 7 years because
they are grown on leasehold land & Govt. Land.
5. Under the range of insurance risk coverage, purchasing cost is always safe, except
imposition of Govt. enactment, notification, rules & regulation what so ever issued time
to time.

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7. Delivery of plants (14 cft. wood) of such time will be made on project site after 7 years
from the date of sale.

Insurance Schedule

The Company provides one time accidental Insurance Policy an additional facilities to
those purchasers who will be purchasing plant at a time under Trading of Plant as
following schedule withNo. of Units
Insurance Value
10
25,000/25
50,000/50
75,000/100
1,00,000/200
1 Lacs onwards

Terms & Condition of Jatropha B.G. Purchase

2. After receiving application duly completed along with cost of J.B.G. @ Rs.1000/-.
The Company will send J.B.G. Certificate after sixty days.
3. The saleable J.B.G. will further require maintenance for 66 months for developing
the fruit full such & risk from life existing from nature. A Bush Group having Number
of 3 (three) Plant aged about one year of existing Plant hence the purchaser will give
M.O.U. of the plant to the company for its maintenance.
4. The Purchaser will be bound to sale the said J.B.G. on completion of 66 months
because they are grown on leasehold land & Govt. Land. If purchaser hold the J.B.G.
after the terms of M.O.U. the company transfer lease agreement by names of purchaser.
He will be responsible for lease rent and other liabilities. Company will not be liable for
any maintenance to this J.B.G. after completion of terms.
5. Under the range of insurance risk coverage, purchasing cost is always safe, except
imposition of Govt. enactment, notification, rules & regulation what so ever issued time
to time.

Insurance Schedule

The Company provides one time accidental Insurance Policy an additional facilities to
those purchasers who will be purchasing J.B.G. at a time under Trading of Plant as
following schedule withNo. of Units
Insurance Value
25
50,000/50
75,000/100
1,00,000/200
1 Lacs onwards

c. I have seen the sample application form for the schemes/ plans provided by the
Company. These are pre-printed documents asking for the details of the applicant,
address details, contact number, details of payment, nominee details etc. From the
sample application forms as submitted by the Company it is noted that the location
of the plant/ tree was not mentioned.

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d. I have perused the sample Memorandum of Agreement & Understanding for

plan/ scheme of the Company. The relevant clauses thereof are as under:
The first part approached and gave free consent to the company, second part to lookafter
the day to day maintenance of the purchased No. of site.
The following terms & condition were mutually agreed amongst both party & for better
future relations these are enumerated below:

2. Since purchaser living far from the project site, it is felt by him/ her difficult to look
after day to day growth, maintenance to the said & therefore agreed to authorize the
second part to supervise, lookafter the plant for better growth
3. That the total period of such supervision maintenance, taking care for the growth of
the is for at least years.
[4. That the first part agreed to take 14 cft of wood benefit of each grown up plant, rest
of wood benefit will be retained by the second part.]*
5. To cover any kind of adversities the second part draw proper insurance of the at
their cost for the years.
6. That there is no liability/ responsibilities of the second part except the above
mentioned clauses.
* The

clause in is the Memorandum of Agreement & Understanding for Plant/ Tree Sale

e. Another document is certificate, for the schemes/ plans namely Plant and
J.B.G. provided by the Company. It is noted that the same is a pre-printed
document with blanks for the name and address of the investor. The same reads
as under and contains the date of delivery of wood/ plant/ J.B.G. and promising
plant content/ J.B.G. Content/ Fruit:
It is hereby certified that the person/ persons named herein this certificate has purchased
. Grown up Plant paying total cost of Rs. on dated .. the said plant is/ are
bearing distinctive no. . Nature of plant which are situated at .. The certificate
for ownership of Plant is subject to rules & regulations over leaf
The following clauses of the terms and conditions are relevant to be noted:
-

For purchase of Grown-up Tree Plants and their Further Maintenance

1. The Company will do maintenance of grown-up Plants purchased by you for further
7 years as agreed by you.
2. Purchaser will be bound to delivering the said Plants after completion of 7 years.
3. Purchaser will be free from maintenance of Tree Plant or estimated future cost of
Rs.2,500/-. Company may consider to 14 cft. wood on each unit against Tree Plant.
4. As the plants laying on mostly lease hold land. Plants purchaser must take delivery
of plants at project site.
5. The purchaser must submit their Plant title certificate on completion of due date with
the option to sale to his plants himself or by the Company.

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For purchase of Grown-up Jatropha Bust Group (J.B.G.) and their

Further Maintenance
1. The Company will do maintenance of grown-up J.B.G. purchased by you for further
51/2 years as agreed by you.
2. Purchaser will be bound to sell or lease transfer the said J.B.G. after completion of
term (51/2 years).
3. Purchaser will be free from maintenance of such J.B.G. up to the maintenance period
(51/2 years).
4. As J.B.G. are laying on mostly lease hold land. Purchaser must take delivery of fruits
with his bush group as per M.O.U. at project site.
5. The purchaser must submit their J.B.G. title certificate on completion of due date
with the option to sale to the company.
6. If the purchaser not hold J.B.G. on self the company will purchase his J.B.G. as per
existing estimated value including full term fruit cost of one J.B.G. Rs.200/- and
Rs.600/- against each standing plant as per mutual agreement subject to condition that
such agreement must be executed within one year after the terms of M.O.U.
7. If the purchase dont want to sale their J.B.G. (Jatropha Bush Group) after term,
then lease agreement will be transfer to purchaser minimum period up to 25 years only.
After transfer he will bear lease rent with maintenance cost on self.

f. From the discussion above, it is observed that Sunshine was inviting applications
from the customers/ investors for sale of plants and J.B.G. I also note the
following:
i. The plant/ tree are said to be allotted by the Company after 60 days of receiving
the application and the ownership rights of plant/ tree are retained by the
Company.
ii. Sunshine guarantees assured returns as more specifically mentioned in the
brochure as expected value. The application form for the scheme namely sale
of Plant/ Tree assured the benefit of 14 cft. of wood for each grown up plant
and the rest of the wood benefit is retained by the Company.
iii. Till the issuance of certificate, the Company did not provide the details of the
location of the plants.
iv. The possession of the plants rests in the hands of the Company for the purpose
of maintenance. The Company takes consent of the customer/ investor to
lookafter the day to day maintenance of the plant purchased.
v. The Company has proposed to purchase/ buyback the plant/ trees after
completion of the term. The plan/ scheme of the Company are in the nature
that at the end of the term, the customer/ investor has no option but to sell the
plants as it may not be practical for him/ her to look after the plants from their
residence and to bear the cost of continuing lease.

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vi. The customer/ investor is compulsorily required to submit the J.B.G. title
certificate/ plant title certificate on completion of due date with the option to
sale to the Company.
vii. The Company provides the accidental insurance cover to its customers/
investors.
From the observations as noted above, it can be inferred that the transactions of
the Company were not mere sale of plants/ trees rather these can be said to be an
investment scheme.
g. Having considered the above, now I proceed to deal with the charges levelled
against Sunshine. According to the definition, CIS means any scheme or
arrangement which satisfies the conditions specified in Section 11 AA of the SEBI
Act, which provides as under:
"(1) Any scheme or arrangement which satisfies the conditions referred to in subsection (2) or subsection (2A) shall be a collective investment scheme:
Provided that any pooling of funds under any scheme or arrangement, which is not registered with the
Board or is not covered under sub-section (3), involving a corpus amount of one hundred crore rupees
or more shall be deemed to be a collective investment scheme.
(2) Any scheme or arrangement made or offered by any person under which,
(i) the contributions, or payments made by the investors, by whatever name called, are pooled and
utilized solely for the purposes of the scheme or arrangement;
(ii) the contributions or payments are made to such scheme or arrangement by the investors with a
view to receive profits, income, produce or property, whether movable or immovable from such scheme
or arrangement;
(iii) the property, contribution or investment forming part of scheme or arrangement, whether
identifiable or not, is managed on behalf of the investors;
(iv) the investors do not have day to day control over the management and operation of the scheme or
arrangement.
(2A) Any scheme or arrangement made or offered by any person satisfying the conditions as may be
specified in accordance with the regulations made under this Act.
(3) Notwithstanding anything contained in sub-section (2) [or sub-section (2A)], any scheme or
Arrangement:

i. made or offered by a co-operative society

ii. under which deposits are accepted by non-banking financial companies
iii. being a contract of insurance
iv. providing for any scheme, Pension Scheme or the Insurance Scheme framed under the
Employees Provident Fund
v. under which deposits are accepted under section 58A of the Companies Act, 1956
vi. under which deposits are accepted by a company declared as a Nidhi or a mutual benefit
society
vii. falling within the meaning of Chit business as defined in clause (d) of section 2 of the
Chit Fund Act, 1982(40 of 1982);
viii. under which contributions made are in the nature of subscription to a mutual fund;

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ix. such other scheme or arrangement which the Central Government may, in consultation
with the Board, notify,
shall not be a collective investment scheme."
The term securities in section 2(h) of the Securities Contracts (Regulation) Act, 1956
was amended vide the Securities Laws (Amendment) Act, 1999, w.e.f. February 22,
2000, to include units or any other instrument issued by any collective investment
scheme to the investors in such schemes.
h. Let me now, proceed to test the characteristics of the impugned schemes/ plans
floated and carried on by the Company against the four conditions under Section
11AA(2) of the SEBI Act.
i.

The first condition is that the contributions, or payments made by the investors, by whatever
name called, are pooled and utilized for the purposes of the scheme or arrangement. The
Company had invited its customers to subscribe to one of the plans offered by it
for the purchase of J.B.G./ plants/ trees. Sunshine had taken the contribution/
investments of the investors/ customers in accordance with its plans/ schemes
as detailed above. As per the discussion above, the J.B.G./ plants/ trees always
remained in the possession of the Company and as per the maintenance clause,
the J.B.G./ plants/ trees are maintained from the funds received from the
customers, under the contract agreement. It is also important to note that even
on payment of full amount for J.B.G./ plants/ trees the customer/ investor had
to wait for 60 days for mere allocation of the plants (the quality/ age of the plant
is never disclosed). From the above observations, it can be said that the payments
made by the investors were pooled and utilized by the Company for the purposes
of its schemes. Thus, satisfying the first condition as stipulated in Section
11AA(2)(i) of the SEBI Act.

ii.

The second condition is that the contributions or payments are made to such scheme or
arrangement by the investors with a view to receive profits, income, produce or property, whether
movable or immovable from such scheme or arrangement. As discussed above, the investors
had made payments towards the plans/ schemes promoted by Sunshine. In the
brochure, Sunshine had stated that the grown up trees offered for sale, require
further maintenance for 7 years to be marketable at the time of delivery, and the
value of which is expected to be 3000. It was also said that the regular

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maintenance of the trees will be carried out by the Company and in return the
Company had assured 14 cft wood benefit.
Likewise, in J.B.G. plan, the Company had stated that if the customer/ investor
is not interested to hold to J.B.G., the Company will purchase it as per existing
estimated value including fruit cost of one J.B.G at 200 to 600 against each
plant.
In view of the above, it can be concluded that the brochure itself assured the
customers/ investors of expected value which meant nothing but profits. Further,
the Company also provides one time accidental insurance as an additional facility
to its customers/ investors. The same makes it clear that the investors made
contribution/ payment with a view to receive the profits/ income/ property/
return on their investments that may accrue to them as applicable, thus attracting
the second condition as stipulated in Section 11AA(2)(ii) of the SEBI Act.

iii.

The third condition is that the property, contribution or investment forming part of scheme
or arrangement, whether identifiable or not, is managed on behalf of the investors. The fourth
condition is that the investors do not have day to day control over the management and
operation of the scheme or arrangement. In this regard, I note that the Company takes
the consent of the customer/ investor to look after the day to day maintenance
of the plants/ trees. Further, as per the terms and conditions on the reverse side
of the certificate, the purchaser will be free from maintenance of J.B.G./plants/
trees. I also note that Sunshine on completion of the term, asks for submission
of the certificate with the option for sale to the Company. From the same, it can
be said that the customer/ investor does not manage his investments in the
scheme rather his investments are managed and utilized by the Company as per
its own discretion and the investor does not have day to day control over the plot
of land/ property as the same remained with Sunshine.
Further, the statement that the J.B.G./ plant are mostly lying on the lease hold
land and in case the customer/ investor do not want to sell the J.B.G./ plants
after the lease agreement, then the lease agreement will be transferred to the
customer/ investor, shows that the plan/ scheme always remains in the control
of the Company. Further, the provision regarding non transferability of the
certificate indicates the total authority of the Company over the subject

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J.B.G./plant. The above discussion makes it clear that the contribution,

investment and property, if any, pertaining to the schemes/ plans were managed
by the Company. In view of the same, the investor does not have any day to day
control over the management and operation on the land. Such day to day control
over management and operations of such schemes were also looked after by the
Company and its directors.
i. From the above, it is noted that all the four conditions specified under Section
11AA(2) of the SEBI Act are satisfied in this case, the schemes/ plans promoted,
launched, carried on and operated by the Company are in the nature of CIS in
terms of Section 11AA(1). While proceeding further, I also place my reliance on
the observations of the Hon'ble Supreme Court, made in the matter of PGF Limited
& Ors. Vs. Union of India & Anrs. (Civil Appeal No. 6572 of 2004):
42.
... .. as per the agreement between the customer and the PGF Limited, it is the responsibility of
the PGF Limited to carry out the developmental activity in the land and thereby the PGF Limited
undertook to manage the scheme/arrangement on behalf of the customers. Having regard to the
location of the lands sold in units to the customers, which are located in different states while the
customers are stated to be from different parts of the country it is well-neigh possible for the
customers to have day to day control over the management and operation of the
scheme/arrangement. In these circumstances, the conclusion of the Division Bench in holding that
the nature of activity of the PGF Limited under the guise of sale and development of agricultural
land did fall under the definition of collective investment scheme under Section 2(ba) read along
with Section 11AA of the SEBI Act was perfectly justified and hence, we do not find any flaw
in the said conclusion.
... ....
53. therefore, hold that Section 11AA of the SEBI Act is constitutionally valid. We also
hold that the activity of the sale and development of agricultural land squarely falls within the
definition of collective investment scheme under Section 2(ba) read along with Section 11AA (ii)
of the SEBI Act ...

6.

The Company has clearly failed to comply with the Section 12(1B) of the SEBI Act
which mandates that no person, shall sponsor or cause to be sponsored or carry on or
caused to be carried on any CIS unless it obtains a certificate of registration from SEBI
in accordance with the CIS Regulations. Regulation 3 of the CIS Regulations provides
that no person other than a Collective Investment Management Company which has
obtained a certificate under the said regulations shall carry on or sponsor or launch a
'CIS'. A person can launch or sponsor or cause to sponsor a CIS only if it is registered
with SEBI as a Collective Investment Management Company. Therefore, the
launching/ floating/ sponsoring/ causing to sponsor any 'collective investment
scheme' by any 'person' without obtaining the certificate of registration in terms of the
provisions of the CIS Regulations is in contravention of Section 12(1B) of the SEBI

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Act and Regulation 3 of the CIS Regulations. I note that Sunshine launched CIS
without obtaining certificate of registration from SEBI, it contravened the provisions
of Section 12(1B) of the SEBI Act and Regulation 3 of the CIS Regulations.
7.

Further, in terms of the Regulation 4(2)(t) of the PFUTP Regulations, dealing in

securities shall be deemed to be a fraudulent or an unfair trade practice if it involves
fraud and includes illegal mobilization of funds by sponsoring or causing to be
sponsored or carrying on or causing to be carried on any collective investment scheme
by any person. Accordingly, it could be held that by mobilizing public funds through
CIS without obtaining registration from SEBI as required under Section 12(1B) of the
SEBI Act read with Regulation 3 of the CIS Regulations, the Company has
contravened Regulation 4(2)(t) of the PFUTP Regulations and is liable for action.

8.

I note that the interim order was issued against the Company and its directors namely
Mr. Lekh Narayan Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul
Haq, Mr. Anand Kumar Jha, Mr. Wasim Khan and Mr. Ashif Khan. As per details
available at 'MCA 21' portal of Ministry of Corporate Affairs (accessed on August 31,
2015), following are the present directors of the Company:
DIN/DPIN Full Name

Designation Date of Appointment

00640432

LEKH NARAYAN CHAND

Director

01/06/2004

01040835

MOHAMMAD MOKARRAM

Director

01/06/2004

03103199

MOHAMMAD AHTESHAMUL HAQ Director

15/07/2011

06995817

MOHAMMAD FAISAL

Director

02/12/2014

06995819

BIBEKA NAND MANDAL

Director

02/12/2014

From the above, it is noted that Mr. Lekh Narayan Chand and Mr. Mokarram
Mohammad are directors of the Company from June 01, 2004 and Mr. Mohammad
Ahteshamul Haq from July 15, 2011 and they continue to be the directors and are
responsible for carrying on unregistered CIS activities. Further, it is also noted that Mr.
Mohammad Faisal and Mr. Bibeka Nand Mandal have become the director of the
Company on December 02, 2014 (i.e. after the passing of the interim order) and these
persons continue to be the directors of the Company.
The details submitted by the Company vide its December 31, 2013, shows that the
noticee namely Mr. Anand Kumar Jha was appointed as director of the Company on
October 15, 2005 and had resigned on July 16, 2011. Further, the noticees namely Mr.
Wasim Khan and Mr. Ashif Khan had joined the Company on June 22, 2013 and
had resigned on December 02, 2014.

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I note that the resignation by Mr. Anand Kumar Jha, Mr. Wasim Khan and Mr. Ashif
Khan do not absolve these from the charges levied in the interim order as the Company
was incorporated on June 01, 2004 and since then it had mobilised funds from the
investors. Therefore, I have no hesitation in holding that Sunshine and its directors
namely Mr. Lekh Narayan Chand, Mr. Mokarram Mohammad, Mr. Mohammad
Ahteshamul Haq, Mr. Anand Kumar Jha, Mr. Wasim Khan and Mr. Ashif Khanwere
engaged in the illegal fund mobilising activity by floating/ sponsoring/ launching,
unregistered/ unauthorised CIS, as defined in the Section 11AA of the SEBI Act.
9.

In view of the observations made in this Order, I, in exercise of the powers conferred
upon me under Section 19 of the Securities and Exchange Board of India Act, 1992
and Sections 11(1), 11B and 11(4) thereof and Regulation 65 of the SEBI (Collective
Investment Schemes) Regulations, 1999, hereby issue the following directions:
a. Sunshine Global Agro Limited [PAN: AAJCS2508K] and its directors, namley
Mr. Lekh Narayan Chand [PAN: AALPH6536K], Mr. Mokarram Mohammad
[PAN:

AJPPM9356A],

Mr.

Mohammad

Ahteshamul

Haq

[PAN:

ACGPH4147P], Mr. Anand Kumar Jha [PAN: AEKPJ8257J], Mr. Wasim Khan
[PAN: CENPK6085G], Mr. Ashif Khan [PAN: BEMPK1322J], Mr. Mohammad
Faisal

[PAN: AAWPF1464H] and Mr. Bibeka Nand Mandal [PAN:

CNVPM6593E] shall abstain from collecting any money from the investors or
launch or carry out any Collective Investment Schemes including the scheme which
have been identified as a Collective Investment Scheme in this Order.
b. Sunshine Global Agro Limited and its directors, namley Mr. Lekh Narayan
Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq, Mr.
Mohammad Faisal and Mr. Bibeka Nand Mandal shall wind up the existing
Collective Investment Schemes and refund the money collected by the said company
under the schemes with returns which are due to its investors as per the terms of
offer within a period of three months from the date of this Order and thereafter
within a period of fifteen days, submit a winding up and repayment report to SEBI
in accordance with the SEBI (Collective Investment Schemes) Regulations, 1999,
including the trail of funds claimed to be refunded, bank account statements
indicating refund to the investors and receipt from the investors acknowledging such
refunds.

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c. Sunshine Global Agro Limited and its directors, namley Mr. Lekh Narayan
Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq, Mr.
Mohammad Faisal and Mr. Bibeka Nand Mandal shall not alienate or dispose
off or sell any of the assets of Sunshine Global Agro Limited except for the
purpose of making refunds to its investors as directed above.
d. Sunshine Global Agro Limited and its directors, namley Mr. Lekh Narayan
Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq, Mr.
Mohammad Faisal and Mr. Bibeka Nand Mandal and past directors, Anand
Kumar Jha, Mr. Wasim Khan and Mr. Ashif Khan and are also directed to provide
a full inventory of all their assets and properties and details of all their bank accounts,
demat accounts and holdings of shares/ securities, if held in physical form.
e. Sunshine Global Agro Limited and its directors, namley Mr. Lekh Narayan
Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq, Mr.
Anand Kumar Jha, Mr. Wasim Khan and Mr. Ashif Khan are restrained from
accessing the securities market and are prohibited from buying, selling or otherwise
dealing in securities market for a period of 4 years.
f. In the event of failure by Sunshine Global Agro Limited and its directors,
namley Mr. Lekh Narayan Chand, Mr. Mokarram Mohammad, Mr.
Mohammad Ahteshamul Haq, Mr. Anand Kumar Jha, Mr. Wasim Khan, Mr.
Ashif Khan, Mr. Mohammad Faisal and Mr. Bibeka Nand Mandal to comply
with the above directions, the following actions shall follow:
- Sunshine Global Agro Limited and its directors, namley Mr. Lekh Narayan
Chand, Mr. Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq,
Mr. Anand Kumar Jha, Mr. Wasim Khan and Mr. Ashif Khan shall remain
restrained from accessing the securities market and would further be prohibited
from buying, selling or otherwise dealing in securities, even after the period of 4
years of restraint imposed in paragraph 9(e) above, till all the Collective
Investment Schemes of Sunshine Global Agro Limited are wound up and all
the monies mobilized through such schemes are refunded to its investors with
returns which are due to them.
- SEBI would initiate appropriate proceedings as against Mr. Mohammad Faisal
and Mr. Bibeka Nand Mandal for appropriate directions including directions

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restraining them from accessing the securities market and prohibiting them from
dealing in securities.
- SEBI would make a reference to the State Government/ Local Police to register
a civil/ criminal case against Sunshine Global Agro Limited, its promoters,
directors and its managers/ persons in-charge of the business and its schemes,
for offences of fraud, cheating, criminal breach of trust and misappropriation of
public funds; and
- SEBI would make a reference to the Ministry of Corporate Affairs, to initiate the
process of winding up of the company, Sunshine Global Agro Limited.
- SEBI shall initiate attachment and recovery proceedings under the SEBI Act and
rules and regulations framed thereunder.
10.

This Order shall be without prejudice to the right of SEBI to initiate prosecution
proceedings under Section 24 and adjudication proceedings under Chapter VIA of
the Securities and Exchange Board of India Act, 1992 against Sunshine Global
Agro Limited and its directors, namley Mr. Lekh Narayan Chand, Mr.
Mokarram Mohammad, Mr. Mohammad Ahteshamul Haq, Mr. Anand
Kumar Jha, Mr. Wasim Khan, Mr. Ashif Khan, Mr. Mohammad Faisal and
Mr. Bibeka Nand Mandal, including other persons who are in default, for the
violations as found in this Order.

11.

This order shall come into force with immediate effect.

12.

Copy of this Order shall be forwarded to the stock exchanges and depositories for
necessary action.

Date: November 09, 2015

PRASHANT SARAN
Place: Mumbai
WHOLE TIME MEMBER
SECURITIES AND EXCHANGE BOARD OF INDIA

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