The Bombay Stock Exchange has decided to initiate action against 58 companies for non-payment of listing fees. The exchange will, while taking the matter to the courts through winding up notices, also consult the Securities and Exchange Board of India on the necessary action which may be brought about against the companies and their promoters.
The exchange has already issued show-cause notices against these companies - which include J K Synthetics, the entire Modern group companies, Montari Industries, Skyline NEPC -- seeking their replies and has informed them of the court action which is set to be taken. The fees payable from these companies to the exchange range between Rs 10,00-Rs 90,000 for various years between 1994-95 to 1996-97. According to data compiled by the exchange, there are 21 companies which have agreed to pay the listing fees (totalling to Rs 8.39 lakh), 15 corporates have uncertain addresses (amounting to fees payment of Rs 5.83 lakh still due), 19 companies have not responded (Rs 6.3 lakh ) and three companies have sought more time (Rs 1.52 lakh).
"It is not the case of merely collecting listing fees....the fees are important, but it is more the issue of not adhering to the basic rules/regulations of the exchange and their duties towards shareholders and the investing public," BSE president J C Parekh said.
The exchange will wait for a response from each company but has decided to follow it up with court action.
"We will also have to take Sebi's advice on this issue as delisting these companies may not be the correct solution because the investing public suffers. A policy decision may have to be taken on this issue in the coming months," Parekh said.
The BSE had announced that it would take stern action against 761 companies for non-payment of listing fees. Since then nearly 110 companies have cleared their dues.
The action had been initiated during the tenure of the former BSE president M G Damani and action will be executed now.
"Apart from delisting the defaulting companies, the exchange can do very little as it does not have the necessary powers to prosecute the promoters involved. Now the onus is on the courts, Sebi and the DCA to take necessary action against the corporates," said Damani. The companies in the BSE crosshairs are: Amrut Credit Corporation India Ltd, Amrut Industries Ltd, Arihant Thermoware Ltd, Atash Industries India Ltd, Cauvery Software Engg System Ltd, Chinar Exports Ltd, Glory Chemicals Ltd, Gordon Herbert (India) Ltd, Grapco Mining & Co Ltd, Hilton Intermediates Ltd, J K Synthetics Ltd, Jayanti Business Machines Ltd, Kumar's Metallurgical Corp Ltd, Kusum Ingots & Alloys Ltd, Madhumilan Fincrop Ltd, Modern Denim Ltd, Modern Insulators Ltd, Modern Syntex (India) Ltd, Modern Terry Towels Ltd, Modern Threads (India) Ltd, Montari Industries Ltd, Nova Electro Magnetics Ltd, Orkay Industries Ltd, Orton Synthetics Ltd, Parasrampuria Synthetics Ltd, Prag Bosimi Synthetics Ltd, Rajasthan Breweries Ltd, Rathi Alloys &
Steel Ltd, Rathi India Ltd, Rinki Petrochemicals & Indus Ltd, Sanderson Industries Ltd, Skyline NEPC Ltd, Vijaya Shrimp Farms & Exp Ltd, Vijayshree Capital & Fin Ltd, Vijayshree Chemicals (I) Ltd, Zillion Medicare Exports Ltd, Zellion Pharmachem Ltd.
