ArchiveMarch 2013

Yet another CIS scam? Further loss of 100s of crores of rupees by investors?

Yet another CIS scheme is unearthed, by income-tax authorities who intimates the details to SEBI. SEBI investigates and passes an Order asking the Company to repay investors or face prosecution. However, it is almost certain that investors will lose significant part of their monies, considering the huge amounts collected and the low assets the company has. The liabilities in this case are at...

Amendments to Takeover Regulations

SEBI has recently made certain amendments to the Takeover Regulations 2011 which are as follows:- Public announcement in case of preferential allotment In case an open offer is triggered by a preferential announcement, it is now provided that the public announcement shall be made on the date when the Board of Directors authorizes such resolution. The erstwhile requirement was that public...

FSLRC Report

The report of the Financial Sector Legislative Reforms Commission, which
has recommended elaborate reforms in the financial sector, is now available.

1 contains the findings and recommendations of the Commission, while Volume 2 contains a
draft of the proposed Indian Financial Code, 2013.

Zenith SEBI Order – disturbing findings and curious SEBI Order

SEBI’s recent interim Order and findings in Zenith’s case again present many disturbing things, as appears from SEBI’s allegations in the orders. How Promoters can easily divert to related parties monies belonging to creditors and shareholders. How existing laws cannot prevent them and even their enforcement and recovery of lost monies could be a prolonged process. Thus creditors have to...

Are consent orders under Section 11 of the Arbitration and Conciliation Act, 1996 valid?

(In the following post, Ms Renu Gupta, Advocate, considers whether the Chief Justice or his designate is entitled to appoint an arbitrator under section 11 without considering whether there is a valid arbitration agreement) Can the Chief Justice (or his designate), appoint an arbitrator, under Section 11 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”), without deciding the...

Rights Offering: Kerala High Court Judgment Stayed by Supreme Court

Last month, we had discussed a decision of the Kerala High Court in Securities and Exchange Board of India v. Kunnamkulam Paper Mills Ltd, where it was held that in certain circumstances a rights offering by an unlisted company may amount to a public offering thereby conferring jurisdiction on SEBI. The company preferred an appeal to the Supreme Court, which has issued notice, and ordered that in...

Acquisitions Beyond 75% Shares in a Company: SEBI’s No-Action Letter

[The following is a guest post from Yogesh Chande. Yogesh is a Consultant with Economic Laws Practice, Advocates & Solicitors. The views expressed by the author are personal.] Recently, the Corporation Finance Department of SEBI issued a “no-action letter” in terms of SEBI (Informal Guidance) Scheme, 2003 for proposed acquisition by the promoters/promoter group of the target company up...

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