Kalyani Investment pays Sebi Rs 1.12 cr to settle disclosure violation case

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Kalyani Investment Company, one of the promoter group entity of Bharat Forge, has settled a case with Sebi about the alleged violation of disclosure norms after paying Rs 1.12 crore towards the settlement fee.

Kalyani Investment Company Ltd (KICL), a listed entity, is part of the over $2.5 billion Kalyani Group.

The order came after the applicant (Kalyani Investment Company) proposed to settle the instant proceedings initiated against it, without "admitting or denying the facts and conclusions of law", under the Sebi's settlement regulations.

"In view of the acceptance of the settlement terms and the receipt of the settlement amount, the adjudication proceedings initiated against the applicant (Kalyani Investment Company) vide show cause notice (SCN) dated March 19, 2024, is disposed of," Sebi's adjudicating officer Amit Kapoor said in the settlement order on Friday.

The Securities and Exchange Board of India (Sebi) initiated adjudication proceedings against the applicant for the alleged violation of Securities Contracts (Regulation) Act (SCRA) rules and disclosure norms.

Thereafter, Sebi issued a show cause notice on March 19, 2024, to KICL.

The SCN alleged that the applicant failed to place the summary of the related party transaction entered between the KICL and Kalyani Steels Ltd (KSL) on March 27, 2014, before its audit committee concerning purchase of Non-Cumulative Optionally Convertible Preference Shares (NCOCPS) of Lord Ganesha Minerals Pvt Ltd (LGMPL).

Further, it alleged that the applicant failed to take prior approval of its audit committee for the related-party transaction entered between applicant and KSL on September 16, 2015, with respect to purchase of NCOCPS of LGMPL.

Sebi also found that the applicant had allegedly failed to place the summary of the related party transaction entered between KICL and KSL, before its audit committee concerning the Inter Corporate Deposits, advanced by applicant to KSL, during the period December 27, 2013, to March 19, 2014.

Pursuant to the receipt of the settlement application, Kalyani Investment Company filed revised settlement terms, wherein it will pay Rs 1.12 crore towards settlement charges.

The revised settlement terms proposed by KICL were cleared by Sebi's High Powered Advisory Committee (HPAC), which recommended the matter be settled.