sebi:WTM/KMA/OIAE/323/12/2010
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Facts / Headnote
Company and three directors restrained from accessing the securities market and dealing in securities till pending investor grievances are resolved; proceeding against Dr. Ketanbhai S Mehta abated and disposed of without directions.
Provisions invoked
- s. 19
Parties
- Chicago Software Industries Limited (previously known as Chicago Futures Markets and Financials Limited)
- Mr. Aravindbhai V Shah
- Ms. Manjulaben D Desai
- Mr. Dhirubhai R Desai
- Dr. Ketanbhai S Mehta
Holding
SEBI restrained Chicago Software Industries Limited and its directors Mr. Aravindbhai V Shah, Ms. Manjulaben D Desai and Mr. Dhirubhai R Desai from accessing the securities market and dealing in securities until all pending investor grievances are resolved and confirmed by SEBI. The proceeding against Dr. Ketanbhai S Mehta was disposed of without directions as he had expired in 2001.
Full text
Page 2 of 4 SEBI had not received any response from the Company. 2. In view of the above, a notice dated November 6, 2009 was sent to the Company by SEBI under Sections 11(4)(b) and 11B of the SEBI Act requiring it to show cause as to why it should not be restrained from accessing the securities market and prohibit it from dealing in securities till such time the pending investor grievances are resolved by the Company. Similar notices dated November 16, 2009 were also sent to the directors of the Company, Dr. Ketanbhai S Mehta, Mr. Aravindbhai V Shah, Ms. Manjulaben D Desai and Mr. Dhirubhai R Desai. The notices issued to the Company, Ms. Manjulaben D Desai and Mr. Dhirubhai R Desai returned undelivered. Though, the notice was delivered on Mr. Aravindbhai V Shah, no response was received from him. Subsequently, SEBI received a letter dated December 3, 2009 from Mrs. Malvika K. Mehta, wherein she, while acknowledging the notice dated November 16, 2009, informed that her husband Dr. Ketanbhai S. Mehta had expired on March 17, 2001. She had also enclosed a copy of the death certificate dated March 28, 2001 issued by Surat Municipal Corporation. Thereafter, an opportunity of hearing was granted to the Company, Mr. Aravindbhai V Shah, Ms. Manjulaben D Desai and Mr. Dhirubhai R Desai on August 5, 2010. As the show cause notices issued to the Company, Ms. Manjulaben D Desai and Mr. Dhirubhai R Desai returned undelivered from the last known address, a copy of the same along with the
Page 3 of 4 opportunities have been provided by SEBI to the Company to redress the pending investor grievances. There are various complaints pending against the Company as stated in the letter dated September 25, 2008. However, it failed to redress the investor grievances, as advised by SEBI. No Action Taken Report was submitted by the Company to SEBI, as required. The protection of the investors in the securities market is one of the paramount duties of SEBI and the present case involves a listed company that not only failed to redress the investors’ grievances but also failed to respond to the letters/show cause notice issued by SEBI. Therefore, the Company as well as its directors who were in-charge and responsible for the affairs of the Company, are liable for not redressing the investor grievances. In view of the same, suitable directions needs to be issued against the Company and its directors, Mr. Aravindbhai V Shah, Ms. Manjulaben D Desai and Mr. Dhirubhai R Desai, who are in charge and are responsible for the affairs of the Company, as aforesaid, for the failure of the Company to redress the grievances of the investors. As it has been informed that Dr. Ketanbhai S Mehta had expired in the year 2001, the present proceeding initiated against him vide show cause notice dated November 16, 2009, would abate.
Page 4 of 4 4. The proceeding initiated against Dr. Ketanbhai S Mehta, vide the show cause notice dated November 16, 2009 is disposed of without any directions, for the reasons stated above.
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Source: SecMarx — sebi:WTM/KMA/OIAE/323/12/2010. 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.