SAT set aside Sebi order in EIIL promoter-director case

The Securities Appellate Tribunal (SAT) today set aside a Sebi order that slapped a fine of Rs 1 crore on the promoter-director of Empower Industries India Ltd (EIIL), and asked the market regulator to hold fresh proceedings in the case.
The Securities and Exchange Board of India (Sebi), in January last year, had imposed a penalty of Rs 1 crore on EIIL's promoter-director Devang D Master for allegedly indulging in fraudulent trading practices and violating disclosure norms related to company's shares.
Master approached SAT challenging Sebi's ruling.
It was alleged that Master made misleading corporate announcement in March 2005 regarding preferential/rights issue. The issue did not materialise and had lured investors, leading to creation of artificial volumes in the scrip of EIIL.

It was also alleged that Master made off market transfers to various entities and receiving shares in off market for which he had not made disclosures and open offer.
The regulator had conducted a probe of EIIL's shares following an unusual rise in price and volume during February 16 - March 11, 2005.

In an order passed today SAT said that the signature appearing on transfer deeds produced by Sebi were forged as Master did not sign the same.
"In the facts and circumstances of the case, keeping all the contentions of the parties open and with their consent, the impugned order dated January 31, 2013 is hereby quashed and set aside and the matter is remanded to the respondent for fresh adjudication," SAT noted.

Besides, SAT directed Sebi to dispose of the matter expeditiously and within a period of six months from today.