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The Securities Appellate Tribunal (SAT) has upheld Sebi's order against Gujarat Filaments in a case related to delay in resolving investor grievances.
However, SAT has reduced the quantum of penalty imposed on Gujarat Filaments from Rs 5 lakh to Rs 1 lakh, citing that the company "is a sick company and its financial condition is extremely poor". It also said that the company had redressed all the pending grievances.
"In this background, we dispose of the present appeal by reducing the penalty to Rs 1 lakh only but upholding the impugned order passed by the Respondent (Sebi)," SAT said in its order on June 17.
"It is also made clear that in case any grievance is still remaining, the Respondent would be at liberty to take appropriate action as per law against the appellant (Gujarat Filaments)," it added.
In December 2011, Sebi had found that several investors' grievances were pending against Gujarat Filaments and were not resolved.
Accordingly Sebi had issued various letters to Gujarat Filaments to redress the said complaints.
After giving Gujarat Filaments an opportunity for personal hearing, Sebi passed an order imposing the penalty in October, 2012.
Following the order, Gujarat Filaments had approached SAT against the regulator's penalty.
The company had submitted to SAT that owing to severe financial crises and various legal cases by the parties and financial institutions, its operations had to be stopped due to the injunctions of Mumbai High Court and Debt Recovery Tribunals of Mumbai & Ahmedabad since June 1999.
