Market regulator Sebi on Thursday levied a penalty of Rs 6.5 million on Apollo Tyres for violation of buy-back regulations. The matter pertains to 2003, when Apollo Tyres had allegedly bought back shares belonging to the company and its promoters, in contravention of the regulations.
Sebi had earlier imposed a penalty of Rs 10 million. In December 2016, the Securities Appellate Tribunal (SAT) directed Sebi to issue a fresh order on the matter. "No quantifiable figures are available to assess the disproportionate gain or unfair advantage made as a result of such default by the noticee (Apollo Tyres). Further, from the material available on record, it may not be possible to ascertain the exact monetary loss, if any, on account of the default by the noticee.
However, it cannot be ignored that a listed company like the noticee is required to adhere to the provisions of law. In the present case, the noticee had bought back a controlling block of shares as per the scheme, but did not comply with the provisions of buy-back regulations," read the Sebi order. Jyoti Mehta, legal heir of Harshad Mehta, was among the complainants in the matter.