sebi:HAPL/AO/DRK/AS/EAD-3/67/2009
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Facts / Headnote
Violation of Regulation 7(3) not established; violation of Regulation 8(3) established for 18 days delay; penalty of Rs. 15,000 imposed under Section 15A(b)
Provisions invoked
- s. 15A
- s. 15
- s. 15J
Regulations
- Reg. 7
- Reg. 7(1)
- Reg. 6
- Reg. 11
- Reg. 8
- Reg. 8(3)
- Reg. 11(1)
- Reg. 7(3)
Parties
- Hatsun Agro Product Ltd.
Holding
The noticee did not violate Regulation 7(3) of the SEBI Takeover Regulations, but violated Regulation 8(3) by an 18-day delay in dividend-related disclosure, warranting a penalty of Rs. 15,000 under Section 15A(b).
Full text
Page 2 of 10 Officer) Rules, 1995 (hereinafter referred to as ‘Rules’) to inquire into and adjudge under Section 15A(b) of the SEBI Act, 1992 the violations of the provisions of Regulation 7(3) and 8(3) of the SEBI Takeover Regulations.
Page 3 of 10 Hence, to understand the disclosure requirement under Regulation 7(3), one needs to go back to Regulation 7(1). (b) As per Regulation 7(1) as existed for the period 20.02.1997 to 23.10.2001, any acquirer who acquires shares or voting rights which (taken together with shares or voting rights, if any held by him) would entitle him to more than five percent shares or voting rights in a company, in any manner whatsoever, shall disclose the aggregate of his shareholding or voting rights in that company, to the company. The provision has no applicability in the case of the Company. It is an accepted position that the holding of the Acquirer along with persons acting in concert was much in excess of five percentage (it was actually 62.85%) as on the date on which the Takeover Regulation was made operative i.e. 20.02.1997. This fact is very much available in the Letter of Offer referred to in the SEBI notice. (c) Hence, there is no necessity for the Acquirer to make any disclosure under Regulation 7(1) to the Company and consequently, there is no obligation by the Company for any disclosure under Regulation 7(3) for the period 20.02.1997 to 23.10.2001.
Page 4 of 10 percentage (it was actually 62.85%) as on the date the Takeover Regulation was made operative i.e. 20.02.1997. This fact is very much available in the Letter of Offer referred to in the SEBI notice. Hence, there is no necessity for the Acquirer to make any disclosure under Regulation 7(1) to the Company. (f) Similarly, as per Regulation 7(1A) as existed for the period 24.10.2001 to 06.04.2002, any acquirer who has acquired shares or voting rights of a company, under sub regulation (1) of regulation 11, shall make disclosure of such acquisition as well as aggregate of his pre and post acquisition of shareholding and voting rights to the company when such acquisition aggregates to 5% and 10% of the voting rights. Hence, to understand the disclosure obligation of the acquirer under this regulation, one has to look into the Regulation 11(1) as existed during this period. (g) As per Regulation 11(1) as existed for the period 24.10.2001 to 06.04.2002, the acquirer, who has acquired, in accordance with the provisions of this Regulation, 15% or more but less than 75% of shares or voting rights in a company, shall acquire more than 10% of the voting rights in any period of 12 months unless such acquirer makes a public announcement. As already mentioned, the holding of the Acquirer was much in excess of 15% before the introduction of the Takeover Guidelines. Hence, this Regulation has no applicability in the case of the Acquirer. Even further, the Acquirer had not acquired
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Source: SecMarx — sebi:HAPL/AO/DRK/AS/EAD-3/67/2009. 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.