Ban on NGHI Developers to continue: SEBI

The ban on NGHI, its promoters and its directors would continue, till the schemes of the company are wound up and all the monies are refunded to the investors

Mumbai: Jaipur-based NGHI Developers and related entities will remain barred from collecting money from investors and accessing the capital market for their failure to adhere to interim regulatory orders, Securities and Exchange Board of India (SEBI) said, reports PTI.


"The interim order restraining NGHI, its promoters and its directors namely Pipal Singh, Bakshish Singh and Avtar Singh from accessing or dealing in the securities market shall continue, till the schemes are wound up and all the monies are refunded to the investors, to the satisfaction of SEBI," the market regulator said in an order.


The company was collecting funds from the public for developing plots of land through its plans.


SEBI said the restraining order would continue as the company has failed to wind up its scheme --collective investment schemes (CIS)-- and refund the money collected by it with returns to investors within a period of one month from the date of interim order. The interim order was passed on 9th July this year.


The entities also failed to deposit the money collected from the investors under under various schemes in a separate bank account within the stipulated period of three days.


"NGHI has been found operating CIS without obtaining a certificate of registration from SEBI... Therefore, it is necessary that such schemes of NGHI are directed to be wound up and the monies of the investors, which have been invested in the schemes, are refunded to them by NGHI," the regulator said.


SEBI had said it appears that NGHI is related to another company -- Nicer Green Forests Ltd -- which is also under the regulator's radar.


SEBI said it had found that the company was substituting Nicer Green's investment certificates with the NGHI bonds.


It appears that NGHI promoters and directors are using the company as a vehicle to subvert the SEBI order against Nicer Green, SEBI said.


SEBI through an interim order dated 9 July 2012 had prohibited these entities from trading in the securities market and had also restrained from accessing the securities market.


No need to pay deposit for investors seeking arbitration reference

Stock market investors seeking arbitration reference for claims of up to Rs10 lakh would not be required to make any deposits with the stock exchanges and expenses on such applications would be borne by the bourses

Mumbai: Market regulator Securities and Exchange Board of India (SEBI) has said investors seeking arbitration reference for claims up to Rs10 lakh would not be required to make any deposits with the stock exchanges and expenses on such applications would be borne by the bourses, reports PTI.


Arbitration process generally refers to resolving disputes through an out of court settlement.


"A client, who has claim/counter claim up to Rs10 lakh and files arbitration reference, shall be exempt from the deposit. Expenses thus arising with regard to such applications shall be borne by the stock exchanges," SEBI said in a circular.


Prior to this change, investors who were resorting to arbitration reference for claims up to Rs10 lakh were exempted from making any deposit only if they filed the application within six months.


The six-month period was computed from the end of the quarter during which the disputed transaction(s) were executed or settled. The period excludes time taken by the Investors Grievances Redressal Committee of the stock exchange to resolve the dispute as well as the time taken by the member to attempt the resolution, among others.


SEBI has asked stock exchanges to immediately make necessary amendments to the relevant bye-laws, rules and regulations for the implementation of the new guideline.


According to the latest circular, stock exchanges are required to bring the change to the notice of its members and also disseminate the same through their websites.


The market regulator has asked the bourses to communicate to it, "the status of implementation of the provisions of this circular in the Monthly Development Reports".


Modifications have been made to the SEBI circular dated 31st August 2010.


The arbitration committees on the BSE and the NSE help settle disputes between a client and broker, or disputes among brokers.


Suzlon moving CDR cell to give lenders time to sort issues: SBI

Noting that Suzlon case is much different from that of Kingfisher, SBI chairman said the wind-turbine maker's is a much different case as it is a running company and has operations globally

Gurgaon: State Bank of India (SBI), the major lender for debt-laden Suzlon, has said the wind turbine maker's move to approach corporate debt restructuring (CDR) cell would give more time for lenders to sort out the issues, reports PTI.


Loss-making Suzlon Group last month said it has started discussions with lenders for restructuring debt, including a two-year moratorium on repayment of term loans.


"I think reference to the CDR cell gives the bankers more time to iron out these issues and Suzlon's financials are a little more complex," SBI Chairman Pratip Chaudhuri told reporters on the sidelines of the World Economic Forum on India summit.


Suzlon has a debt burden of over Rs13,000 crore including foreign currency convertible bonds (FCCBs) obligations. A few weeks back, bondholders had rejected its proposal seeking four-month extension to repay overseas debt worth about $221 million.


Noting that Suzlon case is much different from that of Kingfisher, Chaudhuri said the former "is a much different case, it is a running company and has operations globally".


"Whatever little I understand is that they (Suzlon) took lot of short term debt...," he added.


SBI is estimated to have an exposure of about Rs3,500 crore to Suzlon.


Talking about Suzlon, he said that its business model is such that "when you build a wind energy farm, the payment would come after a long period of time of 15-20 years, which they financed out of 3-5 years, so it is more a mismatch than I would say an insolvency issue".


According to Chaudhuri, SBI is quite confident about Suzlon's technological capabilities while recognising the challenging global environment.


"So, how the company manages the technological issues with the financing issues, that would need more in depth discussions," he said.


Last month, SBI had suggested merger of Suzlon's German arm REpower with the group to improve profitability.


"They (Suzlon) have global subsidiaries (but) to what extent those global subsidiaries can be brought in together, to what extent you can use the surplus cash lying in one subsidiary to fund the another... so those are some of the issues," he noted.


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