sebi:EAD-5/SVKM/AO/49-57/2017-18

SEBI · SEBI · 2015-06-30 · S. V. Krishnamohan, Chief General Manager & Adjudicating Officer

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Facts / Headnote

Penalties imposed under Section 23E of SCRA, Section 15HA and Section 15A(b) of SEBI Act

Provisions invoked

Regulations

Parties

Holding

Sungold Capital Limited violated Section 21 of SCRA read with Clause 35 of Listing Agreement by classifying promoter-group holdings as public and misreporting Ravi Rajiv Kotia's holding; all noticees violated Regulation 3(d) of PFUTP Regulations and Shri Rajiv R Kotia violated Regulation 13(4) read with 13(5) of PIT Regulations, attracting monetary penalties.

Full text

Adjudication Order in the matter of Sungold Capital Limited Page 2 of 20 Capital Limited (hereinafter referred to as “The Company/Noticee 1”). It was alleged that, the Company had filed false and misleading disclosures regarding shareholding pattern of promoter group to the stock exchange. The shareholding of the ‘promoter group’ was wrongly shown as ‘public holding’ from the quarter ending March 2008 onwards. It was also alleged that the Company had filed wrong shareholding of Shri Ravi Rajiv Kotia Son of Rajiv R Kotia, Promoter, Chairman & Managing Director (CMD) of Sungold Capital Limited, (noticee no. 2) for quarter ending June, 2009. All the aforesaid acts are in alleged violation of provisions of Section 21 of Securities Contracts (Regulation) Act, 1956 (hereinafter referred to as ‘SCRA’) read with Clause 35 of Listing Agreement and Regulation 3 (a) to (d), 4 (1), 4 (2) (f) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating Securities Market) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’) by Sungold Capital Limited and its executive Directors namely Shri Rajiv R Kotia, Shri Ashok Modi and Shri Sharad Gandhi (hereinafter referred to individually as ‘Noticee no. 1 to 4’ and collectively as "Noticees").

Adjudication Order in the matter of Sungold Capital Limited Page 3 of 20 SHOW CAUSE NOTICE, REPLY AND PERSONAL HEARING 4. Show Cause Notice dated September 30, 2015 (hereinafter referred to as “SCN”) was issued to the noticees in terms of Rule 4 of Securities Contracts (Regulation) (Procedure for holding inquiry and imposing penalties by Adjudicating Officer) Rules, 2005 (hereinafter referred to as ‘SCR Adjudication Rules’) read with Section 23I of SCRA, 1956 and under Rule 4 of SEBI (Procedure for holding inquiry and imposing penalties by Adjudicating Officer) Rules, 1995 (hereinafter referred to as ‘SEBI Adjudication Rules’) read with Section 15I of SEBI Act, 1992, to show cause as to why an inquiry should not be initiated and penalty be not imposed under Section 23E of SCRA, 1956 and Section 15HA of SEBI Act, 1992, for the aforesaid alleged contravention of the provisions of Section 21 of SCRA read with Clause 35 of Listing Agreement and Regulation 3 (a) to (d), 4 (1), 4 (2) (f) of SEBI (PFUTP) Regulations, 2003 by Sungold Capital Limited and its executive Directors namely Shri Rajiv R Kotia, Shri Ashok Modi and Shri Sharad Gandhi. Further under Section 15A (b) of SEBI Act, 1992, for contravention of the provisions of Regulation 13 (4) read with Regulation 13 (5) of SEBI (PIT) Regulations, 1992 by Shri Rajiv R Kotia noticee no. 2 herein.

Adjudication Order in the matter of Sungold Capital Limited Page 4 of 20 6. Noticees were granted opportunity of personal hearing. Shri Rajiv R Kotia, CMD of Sungold Capital Limited appeared in person for himself on February 17, 2016 and also on behalf of Shri Sharad Gandhi & Sungold Capital Limited on February 18, 2016 & March 08, 2016 respectively and made the following submissions:-

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Source: SecMarx — sebi:EAD-5/SVKM/AO/49-57/2017-18. 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.