sebi:EAD-8/KS/AA/AO/202/2018-19
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Facts / Headnote
Penalty of Rs. 1,50,000 imposed on Arms Paper Limited under Section 15HB of the SEBI Act
Provisions invoked
- s. 15
- s. 15H
- s. 15J
- s. 15F
Parties
- Arms Paper Limited
Holding
The Noticee, Arms Paper Limited, failed to comply with the Whole Time Member's directions dated March 22, 2016 by not conducting an audit of Sharepro's records and systems and not submitting an audit report to SEBI, and a monetary penalty of Rs. 1,50,000 under Section 15HB of the SEBI Act was imposed.
Full text
Page 2 of 9 cases where violations are observed, in accordance with the provisions of law and inform SEBI accordingly. 12. Companies who are clients of Sharepro are also advised to carry out / switchover their activities related to a registrar to an issue and share transfer agent, either in- house or through another registrar to an issue or share transfer agent registered with SEBI. Sharepro shall provide the requisite cooperation to these companies for the purpose.….”
Page 3 of 9 5. It was observed in the SCN that the Noticee was one of the clients of Sharepro. In terms of above referred directions of Whole Time Member of SEBI, the Noticee was required to conduct a thorough audit of the records and systems of Sharepro within a period of three months from the date of the above referred
Page 4 of 9 on other requirement of conducting forensic audit by qualified agencies as fee was far too high and also we had no dividend declaration and hardly few shares changed hands. (v) The company observes regular practice of in house secretarial audit. (vi) There is no shareholders complaint for share transfers. (vii) We have complied with all legal and secretarial laws governing transfer of shares. You will appreciate that we had these bonafide reasons for non adherence as cost was too high in comparison to the benefits that would have augured to us. We sincerely request you to drop penalty proceeding against us.
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Source: SecMarx — sebi:EAD-8/KS/AA/AO/202/2018-19. 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.