sebi:Order_in_the_matter_of_Ispat_Industries_Ltd

SEBI · SEBI · 2003-10-22 · D. Sura Reddy, Adjudicating Officer

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Facts / Headnote

Noticee held guilty of non-disclosure; penalty of Rs.1,00,000 imposed under Section 15HB

Provisions invoked

• s. 11
• s. 24
• s. 15
• s. 15H
• s. 15I
• s. 15J
• s. 11a

Regulations

• Reg. 12
• Reg. 14
• Reg. 14(1)
• Reg. 2
• Reg. 12(2)

Parties

• Ispat Industries Limited

Holding

Ispat Industries Limited violated Clause 36 of the Listing Agreement and Regulation 12(2) r/w Schedule II by failing to disclose price sensitive information to stock exchanges before communicating it in a CNBC interview on 26.9.2003, and a monetary penalty of Rs.1,00,000 under Section 15HB was imposed despite a prior warning order under Sections 11 and 11B.

Full text

Page 2 of 10 4 Securities and Exchange Board of India (hereinafter referred to as SEBI) had issued a Show cause notice dated 22.10.2003 to the Managing Director of the Noticee under Reg.14 (1) of said Regulations to submit reply as to why the said information was not disclosed to the stock exchanges and the public as required under Clause 36 of the Listing Agreement and Regulation 12(2) r/w Schedule II of the said Regulations. Thereafter, SEBI having found noticee guilty, passed an order of warning dated 31st March 2004 under Section 11and 11B of the SEBI Act. 5 Appointment of Adjudicating Officer: I was appointed as an Adjudicating Officer under Rule 3 of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995(hereinafter referred to as Adjudication Rules) by SEBI vide order dated November 8, 2004 in place of Shri. J. Ranganayakulu (since proceeded on study leave) to enquire into and adjudge the alleged contraventions of the provisions of law as mentioned in the original order dated January 07, 2004. 6 Show Cause Notice: Shri J. Ranganayakulu, Adjudicating officer had issued a Show Cause Notice dated 15th June 2004 under Rule 4 of Adjudication Rules r/w Section 15HB of SEBI Act, 1992, Clause 36 of Listing Agreement and Regulation 12 (2) read with Schedule II of the said Regulations. Subsequently, another show cause notice dated 20th July 2005 was issued by me giving one more opportunity to the noticee for filing reply. It was alleged i

Page 3 of 10 b. The capacity expansion Programme of Ispat along with cost saving initiatives would result in savings of about Rs.1000 Crores a year.

Page 4 of 10 c. Whether the alleged violations are adjudicatable under Section 15 HB of the SEBI Act, in view of the fact that SEBI has already passed a warning order under Section 11 and 11B of SEBI Act.

Source: SecMarx — sebi:Order_in_the_matter_of_Ispat_Industries_Ltd. 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.