April 17, 1998
PR No. 79/1998

Investigations, Enforcement and Surveillance Dept.

M/s. Gangotri Cements Ltd having its registered office at Kharora district Raipur, Madhya Pradesh came out with a public issue of 25,50,000 equity shares of Rs. 10/- each for cash at par aggregating to Rs.255 lacs. The public issue opened for subscription on January 3, 1994 and closed on January 6, 1994. 
 
SEBI received a complaint in January 1997 alleging inter-alia about fictitious nature of applications at the time of public issue, diversion of issue proceeds, change in management, delay in transfer of shares by Company etc. The complainant also filed a petition in the Hon'ble High Court, Mumbai. The Hon'ble High Court vide its order dated September 23, 1997 directed SEBI to investigate the petitioner's complaint. Despite vigorous follow-up the following entities namely M/s. Gangotri Cements Ltd and its Directors, M/s. New Look Shares & Stocks Pvt. Ltd and its Directors ; and Shri G. P Surekha failed to co-operate in investigation by SEBI and have also failed to furnish information as required from time to time. The said Act of the aforesaid entities is in violation of Section 11 (2)(i) of SEBI Act, 1992 which empowers SEBI of calling for information from, undertaking inspection conducting inquiries and audit of persons associated with the securities market, intermediaries etc. For this act of non co-operation Chairman SEBI has ordered initiating prosecution proceedings against the said persons under section 24 of SEBI Act 1992 for violation of Section 11 (2)(i) of the SEBI Act, 1992.