SEBI said this in a decision order, where it imposed a fine of Rs 1 lakh on Williamson Magor & Company Limited (WMCL).
“It should be noted that the SEBI Act, 1992 and the rules thereunder have got a larger public objective as protection of investors and regulation and development of securities market. "These objectives will be defeated if violators are given immunity due to delay in initiating action against them," Sebi said.
"In view of the above facts, I find that the noticee has not suffered any prejudice nor has he been able to make out a clear case of prejudice on account of the alleged delay in initiating the proceedings," the order said.
In the complaint it was alleged that WMCL entered into a related partial transaction with its associate company Babcock Borsig Limited, acquiring 1,13,360 shares of Woodlands Multispeciality Hospital Limited (the 'Transaction') without corporate approval and without making proper disclosures. ) included sales of.Under th accounting standards.
In this regard, it was noted in the SCN that as per clause 49 (VII (d) of the erstwhile equity listing agreement, prior approval of the Audi Committee was required for the RPT undertaken by the noticee with effect from October 1, 2014.
However, the noticee in its reply to SEBI said that board approval was taken and the transaction did not require audit committee approval, hence prior approval of the audit committee was not taken for the transaction with Babcock Borsig Limited.
“Based on the findings of the investigation in the present case, it has been established that the noticee has not complied with the requirements of the erstwhile equity listing agreement. The Noticee was under a statutory obligation to comply with the provisions of the foregoing equity listing agreement, which I failed to do in respect of the said related party transaction.
“Monetary penalty is imposed on the said violations by the notice recipient.Therefore, it seems appropriate to impose penalty commensurate with the nature of the violation, which acts as a deterrent factor to the notice recipient and others and protects the interests of the investor. Securities market,” SEBI said.
“It should be noted that the SEBI Act, 1992 and the rules thereunder have got a larger public objective as protection of investors and regulation and development of securities market. "These objectives will be defeated if violators are given immunity due to delay in initiating action against them," Sebi said.
"In view of the above facts, I find that the noticee has not suffered any prejudice nor has he been able to make out a clear case of prejudice on account of the alleged delay in initiating the proceedings," the order said.
In the complaint it was alleged that WMCL entered into a related partial transaction with its associate company Babcock Borsig Limited, acquiring 1,13,360 shares of Woodlands Multispeciality Hospital Limited (the 'Transaction') without corporate approval and without making proper disclosures. ) included sales of.Under th accounting standards.
In this regard, it was noted in the SCN that as per clause 49 (VII (d) of the erstwhile equity listing agreement, prior approval of the Audi Committee was required for the RPT undertaken by the noticee with effect from October 1, 2014.
However, the noticee in its reply to SEBI said that board approval was taken and the transaction did not require audit committee approval, hence prior approval of the audit committee was not taken for the transaction with Babcock Borsig Limited.
“Based on the findings of the investigation in the present case, it has been established that the noticee has not complied with the requirements of the erstwhile equity listing agreement. The Noticee was under a statutory obligation to comply with the provisions of the foregoing equity listing agreement, which I failed to do in respect of the said related party transaction.
“Monetary penalty is imposed on the said violations by the notice recipient.Therefore, it seems appropriate to impose penalty commensurate with the nature of the violation, which acts as a deterrent factor to the notice recipient and others and protects the interests of the investor. Securities market,” SEBI said.
