Sebi fines Arihant Threads for violating DP regulation

The Securities and Exchange Board of India (Sebi) has imposed a penalty of Rs 75,000 on Arihant Threads Limited for failure to appoint a common agency for demat and physical shares under Sebi’s Depositories and Participants (DP) regulations. The capital market regulator ordered an enquiry and adjudicated proceedings into the alleged contravention of DP regulations and served a show-cause notice on Arihant Threads in September. The Sebi order said, “The company may not have enjoyed any gain or unfair advantage as a result of the default. But the default was bound to have caused an unquantifiable loss to the investor class. The default is continuing till date. Although the penalty need not be imposed in terms of the provision in Section 15HB of the Act, the imposition of penalty is very much necessitated.” Sebi said despite granting sufficient opportunities to appear in person and present the case, Arihant Threads did not avail of the given opportunities to submit any proof of their compliance of section 53A of the DP regulations. Till date, no document has been furnished by them, evidencing compliance of the Regulations and it is not even known as to whether they have started functioning as a common share registrar for both physical and demat securities in terms of regulations, it said. As per the websites of the Central Depository Services Limited (CDSL) and the National Securities Depositories Limited (NSDL), Arihant Threads is registered with both the depositories. It also shows that the company has not appointed a common agency to handle the share registry work relating to physical and demat shares. In the absence of Arihant Threads providing any documentary evidence to substantiate that they had appointed a common share agency, it is reasonable to presume that it was unable to provide any evidence since they had not complied with the regulatory provisions which requires all listed companies to engage a common share agency. The company has kept away from the hearing proceedings, it added. Regulator cancels registration of 12 brokers MUMBAI Sebi has cancelled the registration certificate of 12 stock brokers with various stock exchanges for failing to meet regulatory norms. The stock brokers were declared as defaulters and expelled by the stock exchanges and ceased to be members of the exchanges as they failed to fulfill the pre-requisite condition of registration as stock broker, Sebi said in a release. The brokers declared defaulters by Sebi were Anil Kumar Nanda (Uttar Pradesh Stock Exchange), Ashsih Bamba, Sonali Securities (OTC Exchange), Naval Kishore V Sharma, PV Kaimal, PT Joseph, Sukesh Bhaskaran, Thomas Mathew, Surinderpal Singh (Cochin Stock Exchange), Chandra Kanta Jain, JK Jain and Company and Praveen Ramawat (Jaipur Stock Exchange), it added.