sebi:WTM/SKM/EFD1-DRAI/11/2018-19
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Facts / Headnote
Directions restraining Noticees from accessing the securities market: Commex Technology Ltd. for five years, Mr. Adi Cooper for two years, Mr. Kishore Hegde for two years; no direction against Mr. Hemant Sonawala (deceased).
Provisions invoked
- s. 19
- s. 12A
- s. 376
Regulations
- Reg. 3
- Reg. 4(1)
- Reg. 3(a)
Parties
- M/s. Commex Technology Ltd. (Noticee no. 1)
- Mr. Adi Cooper (Noticee no. 2)
- Mr. Hemant Sonawala (Noticee no. 3)
- Mr. Kishore Hegde (Noticee no. 4)
Holding
The Company (Commex Technology Ltd.) and directors Mr. Adi Cooper and Mr. Kishore Hegde were held liable for violating Section 12A(a),(b),(c) of the SEBI Act read with Regulations 3(a),(b),(c),(d) and 4(1) (and 4(2)(f),(k),(r) for the Company) of the PFUTP Regulations, for concealing a fraudulent Loan and Pledge arrangement behind a GDR issue. The Company was restrained from accessing the securities market for five years, and Mr. Cooper and Mr. Hegde for two years each; no direction was passed against Mr. Hemant Sonawala as he had expired.
Full text
Order in the matter of M/s. Commex Technology Ltd. Page 2 of 33 People (India) Limited (hereinafter referred to as “Commex/Company/Noticee no. 1”) for the period May 01, 2009 to June 30, 2009.
Order in the matter of M/s. Commex Technology Ltd. Page 3 of 33 4. The investigation revealed that European American Investment Bank AG (hereinafter referred to as “EURAM Bank”) granted loan to Vintage FZE (hereinafter referred to as “Vintage”) by way of a Loan Agreement dated May 5, 2009 (hereinafter referred to as the “Loan Agreement”) for payment of USD 9.99 million towards subscription to GDR of Commex. The loan amount was the same as the gross value of GDR issue i.e., USD 9.99 million. It was observed that the entire 1.91 million GDR (amounting to US$9.99 million) were subscribed by only one entity, i.e. Vintage, and that Commex had not submitted correct list of GDR subscribers to SEBI.
Order in the matter of M/s. Commex Technology Ltd. Page 4 of 33 (Commex’s) UAE subsidiary a/c. It was therefore observed that the release of GDR proceeds from Commex’s EURAM Bank account was dependent on the repayment of the loan by Vintage to EURAM.
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Source: SecMarx — sebi:WTM/SKM/EFD1-DRAI/11/2018-19. 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.