sebi:WTM/KMA/CFD/109/07/2009
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Facts / Headnote
Representation dated June 04, 2009 disposed of without granting the prohibitions sought
Provisions invoked
- s. 11
- s. 81
- s. 173
- s. 55A
- s. 87
Regulations
- Reg. 4
- Reg. 3
- Reg. 10
- Reg. 29A
Holding
The representation alleging misuse of preferential warrants by promoters is disposed of; mere non-exercise of warrants and consequent fresh issuance to promoters is not a violation of the SEBI (Disclosure and Investor Protection) Guidelines, 2000, and the requests to mandate full upfront payment, prohibit re-issue to non-exercising allottees, and bar interested promoter voting are not granted.
Full text
Page 2 of 23 Rajkot Saher/Jilla Grahak Suraksha Mandal (hereinafter referred to as the petitioner) on July 14, 2009. On the said date, Mr. Mohammad Shaffiq, advocate represented the petitioner and made submissions. Mr. Murari Madekar (M/s Madekar & Co), Mr. Ramjibhai B. Mavani, and Mrs. Ramaben Mavani (office bearers of the petitioner) were also present during the hearing.
Page 3 of 23 failed to subscribe), causing grave prejudice to the company and the investors; d. That the guidelines for preferential shares had been issued by SEBI in exercise of its powers under Section 11 of the SEBI Act and that the issue of further capital (preferential shares) is made by a company in terms of Section 81 of the Act. That Section 55A of the Act empowers SEBI to administer various provisions of the Act including Section 81 in so far as they relate to issue and transfer of securities. That the Guidelines made in exercise of the powers under Section 11 of the SEBI Act read with Section 81 and 55 A of the Act ought to be exercised in a manner which attains the following objectives:
Page 4 of 23 g. That the directors of the companies have not discharged their fiduciary obligations to the shareholders and the company and that they had acted only for the interest of the promoters;
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Source: SecMarx — sebi:WTM/KMA/CFD/109/07/2009. 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.