Siddharth Sanghi and Amit Sanghi are the former directors of the firm against against whom the order is quashed.
While setting aside Sebi's order, the tribunal noted that "we find that the appellants ... were appointed as directors for a limited period between 2008 and 2009. During this period, no amount was collected under the CIS. There is no finding that the amount collected had matured during the period when these appellants were the directors."
It further said that "in our opinion, these directors could not be fastened the liability to refund the amount as they had neither collected the money nor were responsible for disbursement of the money to the investors at that stage."
The order comes on an appeal filed against the markets regulator's October 2017 order that barred Sanghi Plantations and its five directors from the capital markets for four years for illegally mobilising funds from the public in the name of teak plantation scheme.
Sanghi Plantations had collected money to the tune of Rs 4.17 crore from over 27,000 investors for a teak plantation scheme, Sebi had noted in its order.
These funds were raised without obtaining necessary registration from the regulator.
Besides, these entities were directed to refund investors' money that the firm had raised through illegal collective investment schemes (CIS).
Sebi had asked Sanghi Plantations and its directors -- Siddharth Sanghi, Amit Sanghi, Kodhaty Chandrasekhar Rao, Seshadri Upadhyayula, Benda Ram Narayan -- to wind up the existing CIS and refund the money collected by it with returns which were due to investors.
Additionally, they were also restrained from holding position as director or key managerial personnel of any listed company for a period of four years.
The tribunal, while quashing the order against Siddharth Sanghi and Amit Sanghi said, Sebi's order against them "cannot be sustained and is quashed."
For Seshadri Upadhyayula and Kodhaty Chandrsekhar Rao, SAT said their appeal "lacks merit and are dismissed." SRS RVK