Nusli Wadia, sons, others settle disclosure lapses case with Sebi

Bombay Burmah Trading Corporation, its promoters including Nusli Wadia, his sons Ness and Jehangir, and others on Friday settled a disclosure lapses case with markets regulator Sebi after paying Rs 2.12 crore towards settlement amount.

In all, a total of 18 entities settled the case pertaining to flouting various provisions of securities market norms.

The order came after the entities proposed to settle the violations "without admitting or denying the findings" by paying settlement amounts.

"It is hereby ordered that any proceedings that may be initiated for the violations ... are settled in respect of the applicants," Sebi said in its settlement order.

As per the order, the entities allegedly failed to make timely disclosures of shareholding changes and related party information; and failed to comply with accounting standards and regulations on related party disclosures as required under SAST (Substantial Acquisitions of Shares and Takeovers) norms and insider trading rules.

Also, the entities did not make disclosure and gave incorrect classification of shareholding under promoter group violating LODR (Listing Obligations and Disclosure Requirements) rules.

Sebi noted that Wallace Brothers Trading & Industrial Ltd, a promoter group entity, of Bombay Burmah Trading Corporation (BBTC) was incorrectly classified as a public shareholder.

The promoters indirectly acquired 8.11 per cent of shares in BBTC in December 2014 without making an open offer, violating SAST regulations.

"Since the promoters indirectly acquired 8.11 per cent shares of BBTC through Wallace on December 2, 2014 in addition to their existing holding of 65.93 per cent shares of BBTC, the indirect acquisition of shares of BBTC beyond the threshold of 5 per cent albeit has triggered the requirement of making an open offer," Sebi noted.

The promoters of BBTC also failed to disclose to the stock exchanges within 2 working days that is by December 4, 2014, the change in the shareholding exceeding 2 per cent of the total stake.

Moreover, there were delays of over 3,000 days in making mandatory disclosures under Sebi regulations.

To settle the case, a total of Rs 2.12 crore was remitted by the 18 entities. This includes Wallace Brothers Trading & Industrial Ltd paying Rs 34.71 lakh, BBTC (Rs 31 lakh) and Nusli Wadia, his sons and others jointly shelling out Rs 1.47 crore to settle the case.

In 2020, Ness and four companies -- Britannia Industries, Bombay Dyeing and Manufacturing Company, National Peroxide, and BBTC -- settled proceedings with Sebi in connection with his alleged failure to make timely disclosure about his arrest and sentencing by a Japanese court.