The High Court here on Wednesday rejected a writ petition of Rose Valley Real Estate and Construction company against SEBI’s order restraining it from receiving money under its collection scheme, saying it should approach the appellate forum of the capital market regulator.

While observing that the court has no jurisdiction to entertain such petition, Justice Mr Jayanta Biswas gave leave to the company to move the SEBI appelate forum on the issue.

According to Rose Valley’s petition, the capital market regulator on January 3 had passed an order directing Rose Valley not to collect money for its business.

SEBI had barred West Bengal-based Rose Valley from raising money from the public on the grounds that it did not seek the watchdog’s permission for running a scheme.

While Rose Valley claimed it was mobilising funds for real estate business, SEBI held the company was running a Collective Investment Scheme (CIS) and did not seek the market regulator’s permission, which is mandatory for such products.

SEBI directed Rose Valley, “not to collect any money from investors or to launch any scheme, not to dispose of any of the properties or delineate assets of the schemes and not to divert any fund raised from public at large kept in bank account and or at the custody of the company.”

The company challenged the SEBI order before the Calcutta High Court, claiming that it had no authority to decide on the issue as the company was not listed before the regulatory body.

But SEBI stated it had violated its regulations and that collective investment scheme was a type of collection from the public that SEBI has power to regulate.

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