SEBI rejects 149 consent pleas; 16 from Reliance group
MDT/PTI 04 January 2013

These include applications of RIL itself, as also various group companies and that of RIL Chairman Mukesh Ambani's close aide Manoj Modi, India Infoline and HSBC Investdirect Securities

Mumbai: Indian Market regulator Securities and Exchange Board of India (SEBI) has rejected as many as 149 consent applications, finding them unsuitable for settlement through payment of charges, including 16 from various entities related to Reliance Industries group, reports PTI.

 

These include applications of Reliance Industries Ltd (RIL) itself, as also various group companies and that of RIL Chairman Mukesh Ambani's close aide Manoj Modi.

 

The other applications include those from brokerage firms India Infoline and HSBC Investdirect Securities and from entities in a case involving Bank of Rajasthan.

 

Under SEBI's consent mechanism, companies can seek to settle cases with the market regulator after payment of certain charges and disgorgement of any ill-gotten gains.

 

However, in May 2012 SEBI tightened the regulations for settlement through consent framework. Following that, many cases including some of those related to insider trading, can't be settled through this mechanism.

 

In a status report, SEBI has said that 149 consent applications have been rejected as they are not found to be in consonance with the revised guidelines and the proceedings in these cases will continue in accordance with law.

 

These include 13 applications from various entities in a case involving alleged violation of SEBI regulations for 'Prohibition of fraudulent and unfair trade practices' in a matter of RIL's erstwhile subsidiary Reliance Petroleum Ltd.

 

Besides, there are three applications related to alleged violation of 'Prohibition of Insider Trading Regulations' in the matter of another erstwhile RIL group company - Indian Petrochemicals Corp Ltd (IPCL) - which used to be a government-owned company and was later acquired by Mukesh Ambani-led group as part of a disinvestment exercise.

 

Both the companies, Reliance Petroleum and IPCL, used to be separately listed entities, but were later acquired by RIL and got delisted from the stock exchanges.

 

SEBI has also rejected consent applications of entities such as GMR Holdings Pvt Ltd, Edserve Softsystems Ltd, PMJ Properties, Garuda Plant Products Ltd and EPC Industries Ltd.

Others included Splash Media & Infra Ltd, Transglobal Securities, JMD Telefilms Industries Ltd, Chemo Pharma & Laboratories Ltd and Shree Consultations & Services Pvt Ltd, Chemo Pharma & Laboratories Ltd.

The market regulator said these rejected applications are related to alleged violations of 'Prohibition of Insider Trading Regulations', 'Substantial Acquisition of Shares and Takeovers' and 'Stock brokers and Sub-brokers' norms.

SEBI said HSBC Investdirect Securities's application is related to alleged violation of 'Prohibition of Insider Trading Regulations' in the matter of Adani Exports Ltd, while that of GMR Holdings is related to alleged violation of 'Substantial Acquisition of Shares and Takeovers'.

Besides, it has rejected consent application of India Infoline Ltd for alleged violation of clauses related to 'Stock Brokers and Sub-Brokers' in the matter of Pyramid Saimira Theatre Ltd.

SEBI has also rejected consent pleas of Saurabh Tayal, Sanjay Kumar Tayal, Navin Kumar Tayal, Pravin Kumar Tayal and Sovotex Textiles for alleged violation of 'Prohibition of Fraudulent and Unfair Trade Practices' in the matter of erstwhile Bank of Rajasthan.

The regulator said pending proceedings in these cases will continue in accordance with law.

"The rejection of consent application, however, shall not prejudice the pending proceedings in any manner," SEBI noted.

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