sebi:EAD-2/AO-131-132/2013

SEBI · SEBI · 2012-03-07 · P K Kuriachen, Adjudicating Officer

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Facts / Headnote

Monetary penalty imposed jointly and severally

Provisions invoked

• s. 15A
• s. 15
• s. 15J

Regulations

• Reg. 7
• Reg. 11
• Reg. 10
• Reg. 11(1)
• Reg. 14(2)
• Reg. 199

Holding

The Noticees violated Regulations 11(1) read with 14(2) and Regulation 7(1A) of the SAST Regulations, 1997 and are liable for monetary penalty under section 15A(b) of the SEBI Act, with a penalty of Rs. 6,00,000 imposed jointly and severally.

Full text

Page 2 of 12 Target Company is listed at Bombay Stock Exchange Limited, Ahmedabad Stock Exchange and Madras Stock Exchange.

Page 3 of 12 Officer) Rules, 1995 (hereinafter referred to as the ‘Rules’) to inquire into and adjudge the aforesaid violations under section 15A (b) of the SEBI Act.

Page 4 of 12  As on April 01, 2011 the promoters held 22,28,828 shares constituting 48% of the total paid up and voting capital of the company.  As on June 26, 2011, out of 52,31,700 warrants allotted, 3,15,000 warrants by the Promoter and Promoter Group and 29,45,700 warrants by Non-Promoters aggregating to 32,60,700 warrants were converted into equity shares and 19,71,000 warrants were pending for conversion.  Upon receipt of the intimation about their intention to convert the warrants into equity shares, the Board of Directors of the Target Company at its meeting held on June 27, 2011 issued and allotted 19,71,000 equity shares to Promoter and Promoter group and the Non-Promoters. The paid-up equity and voting share capital of the Target Company prior to the conversion of warrants ` 7,88,33,000 (‘Pre Issue Capital’) consisting of 78,83,300 equity shares of ` 10/- each. Post conversion of warrants, the paid up equity and voting share capital of the target company and was ` 9,85,43000/- (‘Post Issue Capital’) consisting of 98,54,300 equity shares of ` 10/- each.  The promoters holding therefore went up from 28.15% to 37.13%. However, we were given to understand that the increase in holding in a financial year should not exceed 5% and that was to be reckoned from the balance that they held as on April 01, 2012 (that as on the beginning of the financial year). Since they held 48% as on April 01, 2011and their holding was 37.13% after conversion of warrants they presumed th

Source: SecMarx — sebi:EAD-2/AO-131-132/2013. 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.