Sebi fines an individual Rs 4cr for violating disclosure norms

Markets watchdog Sebi has slapped a fine of Rs 4 crore on one Vipul Shah for failing to make necessary disclosures with regard to changes in the shareholding of Safal Herbals.
According to an Sebi order today, Shah allegedly offloaded 52.3 lakh shares of Safal Herbals constituting 5.23 per cent stake in the firm during September and December 2012 without making necessary disclosures under relevant regulations.
As per the regulations, Shah was required to make the disclosure with respect to the change in his shareholding when such change exceeded 2 per cent of total shareholding in the company.
Further, any person who is a promoter or part of the promoter group of a listed company is required to disclose to the company and to the stock exchange the change in shareholding if the change exceeds Rs 5 lakh in value or 25,000 shares or 1 per cent of the total shareholding or voting rights, whichever is lower, as per certain norms.

Imposing the penalty Sebi said, "Thus, noticee (Vipul Shah) was required to disclose change in his shareholding to the company i.E. SHL and the stock exchange... Within two days from the date of sale."
The regulator also said Shah did not make disclosures in accordance with various other norms as well.

Accordingly, Sebi imposed a penalty of Rs 4 crore and asked him to pay within 45 days of receipt of the order.
In another case, Sebi slapped a fine of Rs 1 crore on 12 entities for violating shareholding disclosure norms in the matter of Era Infra Engineering Ltd.

According to the order, the entities are inter-connected on the basis of common address, common directorship and common contact numbers and are part of the members of Kiran Group who were disclosed as 'Persons Acting in Concert'(PACs) to stock exchanges.
The shareholding of the entities as PACs increased from 4.97 per cent to 5.08 per cent in the company, as per the order.
According to the norms, any person who acquires shares or voting rights which would entitle him to more than 5 per cent has to disclose at every stage the aggregate of his shareholding or voting rights in that company.

Passing the order Sebi Chief General Manager SV Krishnamohan said the entities failed to comply with statutory obligation by failing to make the necessary disclosures.
The penalties are imposed on Alok Electricals, Antique Texfab, Balaji Texfab, Coronation Builders & Engineers, Durga Fabricators and Engg, Florid Infrastructure, Mahima Developers & Builders, Olive Vinimay, Pensive Agencies, Salasar Texfab, Tanvi Fincap and Vibhut Builders & Engg.
Sebi said that the companies will be jointly and severally liable to pay the penalty.