sebi:WTM/MSS/MIRSD/100/2011
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Direction to applicant to identify promoter(s) and submit audited annual accounts of promoter(s) for last five years with net worth computation by July 15, 2011; SEBI directed to decide by August 15, 2011
Provisions invoked
- s. 19
Regulations
- Reg. 7
- Reg. 7(1)
- Reg. 11(1)
Holding
The Whole Time Member directed the applicant to identify its promoter(s) and submit audited annual accounts of the promoter(s) for the last five years along with net worth computation as per the SEBI prescribed formula by July 15, 2011, failing which the application for registration as a credit rating agency would be deemed rejected.
Full text
Page 2 of 3 application dated June 11, 2009 did not provide the net worth / the audited annual accounts from where the net worth of all the promoters could be ascertained. In view of the details in the application regarding promoters, shareholding pattern and the board composition of the applicant, SEBI sought clarity as to who was the promoter(s) and if they met the eligibility requirements under the Regulations. The applicant changed its stance given in the application and stated that Coment (Mauritius) Limited (Coment) was its promoter. It provided, vide its letter dated November 26, 2009, a statement indicating the net worth for five years of Coment. In view of the regulatory requirement of net worth as per audited annual accounts, SEBI called for the audited annual accounts of Coment for five years under regulation 7 (1) of the Regulations. The applicant did not provide the same despite several reminders from SEBI.
Page 3 of 3 such, and (b) submit audited annual accounts of the promoter(s) for the last five years alongwith the computation of net worth as per the SEBI prescribed formula, at the latest by July 15, 2011 failing which the application would be deemed to be rejected. SEBI is directed to take a decision on basis of the details provided by the applicant in pursuance to this Order, at the latest by August 15, 2011 in accordance with the law.
3. In view of the above, SEBI formed a prima-facie opinion that the applicant did not fulfill the requirement of registration as a credit rating agency. It accordingly issued a show cause notice dated March 01, 2011 asking the applicant as to why its application for registration as a credit rating agency should not be rejected in terms of Regulation 11(1) of the Regulations. In reply, the applicant, vide letter dated March 18, 2011, enclosed audited annual accounts of Coment for 2003, 2004, 2005, 2006 and 2007. It submitted annual accounts of Coment for 2008 vide its letter dated May 31, 2011. It appeared for a personal hearing in the matter before me on June 10, 2011.
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Source: SecMarx — sebi:WTM/MSS/MIRSD/100/2011. 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.