sebi:WTM/AB/IVD/ID19/13689/2021-22
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Facts / Headnote
PFUTP fraud charges not established; SSL held liable for LODR violations and directors (Noticee nos. 2-6) held liable for board-function and certification violations
Provisions invoked
- s. 11
- s. 19
- s. 11(1)
- s. 11B
- s. 12A
- s. 15H
- s. 27
- s. 15J
- s. 15F
- s. 21
- s. 23E
- s. 23H
- s. 40A(3)
- s. 269S
- s. 12A(1)
- s. 40
Regulations
- Reg. 3
- Reg. 4(1)
- Reg. 4(2)
- Reg. 4(2)(f)
- Reg. 200
- Reg. 3(b)
- Reg. 2(1)
- Reg. 23
- Reg. 30
- Reg. 4
- Reg. 4(1)(a)
- Reg. 33
- Reg. 48
- Reg. 17(8)
- Reg. 33(2)(a)
- Reg. 34(3)
- Reg. 25(5)
- Reg. 30(6)
- Reg. 4(1)(g)
- Reg. 33(1)(c)
Parties
- Svam Software Ltd.
- Virender Gupta (Noticee no. 2)
- Harshwardhan Koshal (Noticee no. 4)
- Rajeev Garg (Noticee no. 5)
Holding
SSL was held liable for violation of Regulations 30(6), 33(1)(c) and 48 of LODR Regulations and Section 21 of SCRA, 1956 for disclosure and accounting failures including non-disclosure of related-party transactions. Noticee nos. 2 to 6, being directors, were held directly liable for violation of Regulations 4(2)(f)(ii)(6) & (7), 4(2)(f)(iii)(1), (3), (6) & (12), 17(8) read with Schedule II and 33(2)(a) of LODR Regulations, while fraud/manipulation charges under Section 12A of SEBI Act and PFUTP Regulations were not established.
Full text
Final Order in the matter of Svam Software Ltd. Page 1 of 48 WTM/AB/IVD/ID19/13689/2021-22 SECURITIES AND EXCHANGE BOARD OF INDIA FINAL ORDER
Final Order in the matter of Svam Software Ltd. Page 2 of 48 Section 15HA and 15HB of SEBI Act, 1992 and Section 12A, 23E and 23H of Securities Contracts (Regulation) Act, 1956 (hereinafter referred to as “SCRA, 1956”), against them for violations of Sections 12A(a), (b) & (c) of the SEBI Act, 1992 and Regulations 3(b), (c) and (d), 4(1), 4(2) (f) & (r) of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (hereinafter referred to as "PFUTP Regulation, 2003"). Svam Software Ltd. (hereinafter referred to as ‘SSL’/ ’the Company’) is also called upon to show cause as to why it should not be held liable for violation of Regulations 4(1) (c), (e) and (g), 4(2)(f)(i)(2), 4(2)(f)(ii)(6) & (7), 4(2)(f)(iii)(1), (3), (6) & (12), Clause B(2) of Schedule III read with Regulation 30, Regulation 33(2)(a) and Regulation 48 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “LODR Regulations”), and Section 21 of SCRA Act, 1956. Noticee no. 2 to 6 are also called upon to show cause as to why they should not be held liable for violation of Reg. 4(1)(a),(b),(c), (e) and (g), 4(2)(f)(i)(2), 4(2)(f)(ii)(6) & (7), 4(2)(f)(iii)(1), (3), (6) & (12), Regulation 17(8) read with Schedule II and Regulation 33(2)(a) of LODR Regulations and Section 21 of SCRA Act, 1956.
Final Order in the matter of Svam Software Ltd. Page 3 of 48 2.2. The forensic audit report (hereinafter referred to as ‘FAR’) was submitted to SEBI by the stock exchange and the findings of the FAR from the period April 01, 2015 till December 31, 2017 were examined.
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Source: SecMarx — sebi:WTM/AB/IVD/ID19/13689/2021-22. 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.