- SEBI has passed an adjudication order pursuant to several instance of non-compliance in respect of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations").
- It was delivered in the matter of Raymond Limited, a listed company on BSE and NSE.
Summary and Non-compliance observed in the Case:
- The Company had entered into transaction with promoters for sale of certain property at throwaway prices and defaulted in compliance of certain in regulations as mandated under SEBI (Listing Obligations and Disclosure Requirements Regulations, 2015) ("SEBI Listing Regulations"). Following to which, SEBI conducted inquiry to examine the violation of the corporate governance norms prescribed under SEBI Listing Regulations.
- At the same time, it is pertinent to note that article titled ‘IiAS slams Raymond's bid to sell JK House to promoters at throwaway price' was published in Business Standard dated May 25, 2017 by investor Advisory Services Private Limited (liAS) also had raised eyebrows with respect to the governance practices followed by the Company.
- From the inquiry and examination of the case, SEBI observed the following instances:
1. The Company failed to take necessary approval for certain Related Party Transactions that entered into by the Company.
Non-compliance of Provision(s): Regulation 23(2) of Listing Regulations read with Clause 49(VII)(D) of the erstwhile equity listing agreement.
2. The Company failed to disclose litigation filed by Shri Akshaypat Singhania, Smt. Veenadevi Singhania and Anant Singhania in January 2017 along with brief details of litigation and expected financial implications in timely manner to stock exchange(s).
Non-compliance of Provision(s): Regulation 30 read with clause (8) of Para B of Part A of Schedule III of SEBI Listing Regulations and Clause (8) of Para B of Annexure I of SEBI Circular CIR/CFD/CMD/4/2015 dated September 09, 2015 and Regulation 4(1) of the SEBI Listing Regulations.
3. The Company failed to following due process of reclassification of promoter to public shareholder in June 2017, while reclassifying promoter of the Company to public category.
Non-compliance of Provision(s): Regulation 31A of the Listing Regulations.
SEBI Order:
- As a result, SEBI imposes a penalty of INR 7,00,000/- under Section 23-I of the SCRA read with Rule 5 of the Adjudication Rules on the company under the provisions of Section 23E of SCRA for the violation of Clause 49(VIII)(D) of the listing agreement as instructed vide SEBI Circular dated April 17, 2014.
- To read full SEBI order, please click here
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