Sebi slaps Rs 7,269-cr penalty on PACL

One of the highest penalty ever imposed by Sebi

The Securities and Exchange Board of India (Sebi) has slapped a penalty of Rs 7,269 crore on PACL. This is the first time that the regulator has imposed such a high penalty.

The adjudicating order, issued on Tuesday, follows an order passed last year directing PACL to refund Rs 49,100 crore it had collected through illicit schemes over 15 years staring September 2013. “Keeping in view the entire facts and circumstances of the case… there cannot be a better case than this which deserves the maximum penalty,” stated the order.

Under Sebi norms, the regulator can impose a penalty of Rs 25 crore or three times of the profit made by indulging in fraudulent and unfair trade practices and in the present case the regulator has imposed a fine equivalent to three times of the illicit gains.

According to the Sebi order, the entities, including PACL and its four directors — Tarlochan Singh, Sukhdev Singh, Gurmeet Singh and Subrata Bhattacharya -- had made illicit gains to the tune of Rs 2,423 crore.

Sebi said, “In the recent past, the country has suffered a lot at the hands of entities who indulge in such illegal money mobilisation under various schemes, wherein hard earned money of the common man has been duped... Thus, imposition of deterrent penalty is the need of the hour.”

The entities had mobilised funds from the general public through illicit collective investment schemes, without the Sebi registration, in the name of purchase and development of agriculture land.