Sebi settles case against MD of Sark Systems

Market regulator Sebi has dismissed the matter against the Managing Director of erstwhile Sark Systems after he made a payment of Rs 300000 to settle the case related to non-compliance of disclosure norms The Securities and Exchange Board of India (Sebi) said that case against J Muralikrishna, Managing Director of Sark Systems (now known as VEDAVAAG Systems ) is settled."... for the sole purpose of settling the matter on hand, without admitting or denying the guilt on the part of the noticee to the finding of fact or conclusion of law, the noticee remitted a sum of Rs three00000 ... towards the terms of consent in the matter," Sebi said in its order yesterday.The regulator noted that Muralikrishna had also complied with Sebi's norms relating to insider trading as well as those pertaining to shareholding disclosure regulations.A Sebi probe had found that Muralikrishna was holding 12.94% stake in the company as on March 31, 2010 which reduced to 7.91% as on June quarter 2010.As per the norms, Muralikrishna was under obligation to disclose to the company and the concerned stock exchanges about his shareholding pattern which had changed more than one%.Further, it was also observed that he failed to disclose transfer of share aggregating two% or more of the share capital of the company within two days of the transaction.Sebi had therefore initiated adjudication proceedings. While the proceedings were in progress, Muralikrishna made an offer to settle the case under Sebi's consent order mechanism.In April, last year, he proposed an amount of Rs 300000 as revised consent terms towards settlement charges.The proposed terms were placed before the High Powered Advisory Committee (HPAC) which after deliberation recommended that the case may be settled on the amount "subject to compliance" of the norms which were violated.Thereafter, the recommendations were also approved by whole time members of Sebi which along with the amount of settlement asked Muralikrishna to "furnish the proof of compliance" of the relevant regulations.