sebi:EAD/AO/BJD/VS/217/2018

SEBI · SEBI · 2010-04-15 · BJ Dilip, Adjudicating Officer

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Facts / Headnote

Consolidated penalty imposed on Noticee

Provisions invoked

Regulations

Parties

Holding

The Adjudicating Officer held Cardinal Capital Partners liable for violating Regulation 7A and Regulation 13A of the FII Regulations and SEBI Circular dated April 15, 2010, and repealed Regulation 10(c) corresponding to Regulation 23(1)(c) of FPI Regulations, and imposed a consolidated penalty of Rs 3,00,000.

Full text

Adjudication Order in respect of Cardinal Capital Partners Page 2 of 18 FII holding a certificate shall, at all times, abide by the Code of Conduct, including the following clauses, as specified in third schedule of the FII Regulations, 1995. Therefore it was alleged that the Noticee being a FII had violated Regulation 7A and Regulation 13A of FII Regulations and SEBI Circular CIR/IMD/FIIC/1/2010 dated April 15, 2010. Further it was also alleged that the Noticee failed to inform SEBI about the change, which is material change, in the information previously furnished by them, which has resulted in alleged violation of repealed Regulation 10(c) of FII Regulations corresponding to Regulation 23(1)(c) of FPI Regulations.

Adjudication Order in respect of Cardinal Capital Partners Page 3 of 18 Partners, Mauritius. Therefore, as the SCN was served upon the TIL with which Mr. Pawan Reddy, the Director and Investment Officer of the Noticee was associated with, I note that the SCN has been deemed to be served on the Noticee. However, no reply was received on behalf of the Noticee even after one and half years from the date of issuance of the SCN. In view of the same, pursuant to the appointment of the undersigned as the Adjudicating officer, vide email dated September 06, 2018 addressed to Mr. Pawan Reddy and officials of TIL, an opportunity of hearing was granted on September 14, 2018 along with an advise to submit reply to the SCN. The said email was sent digitally signed and delivered as per rule 7(b) of the AO Rules. However, no reply was received and no appearance was made for the hearing on behalf of the Noticee. In the aforesaid facts and circumstances whereby the opportunity of hearing has been duly granted and the Noticee inspite of the knowledge of the show cause notice being issued to them and an opportunity being provided has failed to reply or avail the opportunity of hearing, I am of the opinion that sufficient opportunity to submit reply and hearing has been granted in the instant case and noting that, as per Rule 4(7) of AO Rules, if any person fails, neglects or refuses to appear as required by Rule 4(3) before the AO, he may proceed with the inquiry in the absence of such person a

Adjudication Order in respect of Cardinal Capital Partners Page 4 of 18 FINDINGS 5. On perusal of the material available on record and giving regard to the facts and circumstances of the case and submissions of the Noticee, I record my findings hereunder. ISSUE I. Whether Noticee has violated the provisions of Regulation 7A and Regulation 13A of FII Regulations and SEBI Circular CIR/IMD/FIIC/1/2010 dated April 15, 2010?

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Source: SecMarx — sebi:EAD/AO/BJD/VS/217/2018. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.