Ashutosh Paper Mills matter: Sebi imposes Rs 12L fine on 9 entities

Markets regulator Sebi today imposed a total penalty of Rs 12 lakh on nine entities for disclosure lapses in the matter of Ashutosh Paper Mills.
The nine entities are HSI Infotech, Zayat Construction, Zarf Infra Development, Panafic Industrials, Alps Motor Finance, Surya Medi Tech, Shridhar Financial Services, Archit Hotels & Resorts and Unicon Fincap.
The Securities and Exchange Board of India (Sebi) had conducted an inspection in the scrip of Ashutosh Paper Mills -- now known as Tridev Infraestates -- during the period from November 1, 2011, to July 25, 2012. The firm is listed on BSE.
It was alleged that the entities had failed to make relevant disclosures in respect of their transactions in the shares of Ashutosh Paper Mills during the examination period, as required under the provisions of PIT (Prohibition of Insider Trading) Regulations and SAST (Substantial Acquisition of Shares and Takeovers) Regulations.

"By not making the disclosures on time, the noticees (nine entities) have failed to comply with the mandatory statutory obligation," Sebi said in an order.
"In the instant case, the noticees having acquired more than 5 per cent stake in the company (Ashutosh Paper Mills) or selling a part of their stake, the timely disclosures of the same by the noticees under the relevant provisions of SAST Regulations and PIT Regulations, were of significant importance from the point of view of the investors.

"Further, the purpose of these disclosures is to bring about transparency in the transactions and to assist the Regulator to effectively monitor the transactions in the securities market," Sebi added.

The regulator also observed that BSE vide e-mail dated November 14, 2014 had confirmed that none of the entities had filed any disclosures for the transactions in terms of the PIT and SAST Regulations.
Noting that the entities violated PIT and SAST Regulations, Sebi said "it is a fit case to impose monetary penalty on the noticees".
Accordingly, the regulator has imposed a penalty of Rs 2 lakh each on HSI Infotech, Zayat Construction and Zarf Infra Development, and Rs 1 lakh each on Panafic Industrials, Alps Motor Finance, Surya Medi Tech, Shridhar Financial Services, Archit Hotels & Resorts and Unicon Fincap.