Market regulator SEBI has asked Osian’s Connoisseurs of Art Pvt Ltd to wind up its art fund and refund the money it raised from its investors within three months. The money has remained unpaid till date.
In a press statement issued on Thursday based on an order dated April 15, 2013, SEBI also said that the company shall also pay the amount of profits/income earned (if any) that is due to the investors as per the terms of its offer or pay interest at the rate of 10 per cent per annum from the date of investment till the date of refund, whichever is higher.
It also barred the company from accessing the capital market and restrained it from buying, selling or otherwise dealing in the securities market till its collective investment scheme is wound up and all the money mobilised through the firm is refunded to the investors.
A total of 656 investors had together invested around Rs 102.4 crore in the scheme, which had a minimum investment floor of Rs 10 lakh and in multiples of Rs 5 lakh thereafter.
The company had sponsored an art fund called Osian Art Fund, which in turn, floated a closed-ended scheme Contemporary-1 that involved pooling of investments from investors with the objective to generate income and capital growth from a portfolio of investment into and management of art works.
The company also acted as an asset management company and Oseta Investments Trustee Company Pvt Ltd was appointed as the trustee for the Osian Art Fund. The company was found to be engaged in mobilising fund from investors by sponsoring/launching ‘Collective Investment Schemes’ as per the SEBI Act.
This was done without obtaining the certificate of registration from SEBI and thereby, contravened the provision of Section 12 (1B) of the SEBI Act and Regulation 3 of the SEBI (CIS) Regulations, 1999.
(Edited by Sanghamitra Mandal)
