Description

SEBI order against Weird Infrastructure Corporation Limited and its directors for violations related to public issue of NCDs and appointment of unregistered debenture trustee.

Summary

SEBI has issued an order under Sections 11(1), 11(4) and 11B(1) of the SEBI Act against Weird Infrastructure Corporation Limited (WICL) and its directors for violations related to the public issue of Non-Convertible Debentures (NCDs) and appointment of an unregistered debenture trustee. This follows up on a previous July 24, 2015 Final Order regarding the company’s fund mobilization activities.

Key Points

  • WICL issued 1,62,794 Secured Non-Convertible Redeemable Debentures aggregating ₹16.28 crore as of March 31, 2012
  • Company continued issuing NCDs in 2012 and 2013 without proper filings with Registrar of Companies
  • Directors Avijit Chatterjee and Jadunath Jena served from August 27, 2010 to January 13, 2015 and May 26, 2015 respectively
  • Masrur Ahmed Basheer was appointed as debenture trustee without holding required SEBI registration
  • Violations of Companies Act, 1956 and SEBI (Issue and Listing of Debt Securities) Regulations, 2008

Regulatory Changes

This order reinforces existing requirements for debenture trustees to hold proper SEBI registration under the SEBI (Debenture Trustees) Regulations, 1993 for public issues of debt securities.

Compliance Requirements

  • Companies issuing NCDs to public must comply with applicable provisions of Companies Act and SEBI regulations
  • Debenture trustees must hold valid SEBI registration before appointment
  • Proper filings with ROC required for continued issuance of debt securities

Important Dates

  • July 24, 2015: Original Final Order issued
  • August 22, 2024: Show Cause Notice issued to all noticees
  • March 31, 2012: Cut-off date for NCD aggregation of ₹16.28 crore

Impact Assessment

This enforcement action serves as a reminder to companies and market participants about compliance requirements for debt securities issuance and trustee appointments. The order specifically targets historical violations and may result in market access restrictions for the named entities.

Impact Justification

Enforcement action against specific company for historical violations, limited broader market impact