SEBI has left Tata Motors with a warning in an old case
New Delhi:
The Securities and Exchange Board of India (SEBI) has warned Tata Motors Ltd to be “more careful” in its future dealings in the securities market, saying that any adverse order passed against the company at this stage serves practically no purpose. cannot fulfill. For events that happened 18 years ago.
Apart from Tata Motors Ltd (TML), the market regulator has cautioned Nishkalp Infrastructure Services, formerly known as Nishkalp Investment and Trading Ltd, to be cautious in its future deals.
The matter pertains to last dated transactions in the shares of Global Telesystems Limited (now known as GTL Limited) and Global E-commerce Services Limited, an unlisted company, which was merged with GTL in 2001.
“For events that occurred more than eighteen years ago, any adverse order passed against TML at this stage shall be legally valid, but may not serve practically any purpose, as TfL (Tata Finance), The rights issue that has been brought has been merged. TML is effective from June 24, 2005, 17 years ago, and is no longer in existence,” Sebi whole-time member SK Mohanty said in its 54-page order.
Further, the regulator noted that the present board of directors of TML is completely separate from all the directors of TfL, who are all senior citizens and have long retired from the boards of TfL and NISHKALP.
“In view of the aforesaid mitigating factors and the fact that adequate and affirmative remedial measures have been taken by TML and NISHKAL against the erring officials and the rights issue subscribers of TfL were given two options to opt out of the said rights issue TfL, if they choose to do so, will be the end of justice if notices No. 1 (TML) and 11 (NISkalp) are issued warning them to be careful in their future transactions in the securities market,” SEBI said.
It was alleged that TfL withheld true and correct facts from investors and made false and misleading statements of facts about the financial position of Nichalp, which was one of TfL’s subsidiaries, in its letter of offer for rights issue. spread.
Further, in order to show inflated and notional gains in the books of Nishalkalp, it was alleged that TfL has intentionally incorporated the transactions of sell-purchase and accounting entries into acts of backdating in respect of scrips of GTL and GECS . In order to induce purchase/subscription to TfL’s rights issue by its shareholders, the ‘Letter of Offer’ of TfL is to be included in the books of accounts of the Optional and consequently in the Offer Document of TfL, to give a better picture of TfL’s accounts.
The order came after SEBI received a complaint from Tata Finance in October 2002 regarding irregular transactions in securities on the basis of past dated and forged contract notes or bills for sale and purchase of shares of Global Telesystems Ltd and Global E-commerce Services Ltd. was accused of. By DS Pendse and AL Shilotri, who executed the trades on behalf of Nishkalp Investment & Trading Limited (now known as Nishkalp Infrastructure Services Limited) and TfL respectively.
Following the complaint, SEBI investigated the alleged retrospective transactions in shares of GTL and GECS to find out possible violation of the provisions of the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.
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