SEBI finds 461, 153, 80 persons received shares as public issues in 2010-11, 2012-13, 2013-14

This order addresses a complaint regarding KKP Marketing India Limited's issuance of equity shares to over 600 individuals between 2010 and 2014, which SEBI determined constituted public issues in violation of the Companies Act, 1956, and SEBI regulations.

Who it concerns: KKP Marketing India Limited; Mr. Jayantbhai Karamshibhai Patel; Mr. Damji Hirjibhai Patel; Mr. Prakash Harji Mavani; Mr. Hitesh Gangaram Patel; Mr. Shantilal Kanjibhai Patel; Mr. Shankar Lal Patel; Mr. Kanthilal Premji Patel; Mr. Suresh Ladharam Patel; Mr. Gaurang Khetabhai Patel; Mr. Saurabh Kumar Amrutbhai Patel; Mr. Leeladhar Gunwantbhai Patel

What SEBI found or ordered

• SEBI found that share allotments to 461, 153, and 80 persons in FY 2010-11, 2012-13, and 2013-14 respectively qualified as public issues under the Companies Act, 1956.
• SEBI alleged violations of Sections 2(36), 56, 60, 64, and 73 of the Companies Act, 1956, and multiple regulations under the ICDR Regulations, 2009.
• The directors (Noticees 2-12) were deemed jointly and severally liable to repay the money raised along with interest.
• The total nominal amount of shares allotted across the relevant years was Rs. 6,57,28,625.
• The proceedings were initiated via a Show Cause Notice dated November 26, 2024, seeking directions for debarment, refund, and monetary penalties.

Also in the document

• The complaint alleged that the company defrauded more than 607 shareholders and misappropriated funds for real estate purchases in directors' personal names.
• The company argued that shares were issued only to members of the 'Kutch Kadva Patidar Samaj' and not to the public at large.
• The Noticees requested to avail the settlement mechanism under SEBI (Settlement Proceedings) Regulations, 2018, and the proceedings were kept on hold until May 2025.