Regulations
Madras HC stays SEBI order barring Polaris' Arun Jain from market

After a probe into the dealings of Polaris Financial Technology shares during August-September 2000, SEBI held Jain, promoter of the company, guilty of flouting norms related to insider trading

 
Chennai: Madras High Court had stayed an order by Securities and Exchange Board of India (SEBI) which had barred Polaris Financial Technology's chairman and managing director Arun Jain from operating in securities market for a period of two years for alleged insider trading in the company's shares, reports PTI.
 
Justice N Paul Vasanthakumar granted the stay on a petition by Jain seeking to quash the 9th October  order of the Securities and Exchange Board of India.
 
When the matter came up for hearing, SEBI counsel sought time to file counter.
 
The counsel for petitioner then submitted that in such circumstances, the implementation of the order may be stayed.
 
The Judge said that in view of the above, there will be an order of interim stay and adjourned the matter to 20th November.
 
In his petition, Jain submitted that the SEBI's impugned order was clearly "unjustified, perverse and completely devoid of substance".
 
He said the order restrained him from accessing the securities market in relation to events that occurred nearly 12 years ago and had subjected him to undue hardship, damage to his reputation, standing and ability to conduct his business.
 
After a probe into the dealings of the company shares during August-September 2000, SEBI held Jain, promoter of the company, guilty of flouting norms related to insider trading.
 
It had charged him with trading in the stock on the basis of 'unpublished price sensitive information' relating to a proposed acquisition by the firm.
 
SEBI had said Jain dealt in 15,080 shares of the company on behalf of Polaris Holding Private Ltd (PHPL) on the basis of 'unpublished price sensitive information' held by him and had made unfair gains to the tune of Rs27.26 lakh.
 

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COMMENTS

Sohrab Ali

4 years ago

The Securities Appellate Tribunal (SAT), through an Order dated 23rd December 2013, has ruled in Arun's favour and has quashed SEBI’s Order. This means that the restriction applied on Arun no longer continues to apply.

SEBI agrees to settle charges against four entities in IPO scam

SEBI probe found that Bahubali Shantilal Shah, Lok Prakashan, Shreyans S Shah and Smruti S Shah provided funds to key operators for cornering shares reserved for retail individual investors in IPOs of IDFC and IL&FS

 
Mumbai: Market regulator Securities and Exchange Board of India (SEBI) has agreed to settle charges against four entities for alleged irregularities in the initial public offering (IPO) scam of 2003-2005, after a payment of about Rs3.3 crore towards settlement charges and disgorgement ill-gotten gains made by them, reports PTI.
 
As per the settlement reached through regulator's consent mechanism, which allows for settling of charges after payment of certain fees and disgorgement of any illegal gains, the four entities -- Bahubali Shantilal Shah, Lok Prakashan Ltd, Shreyans S Shah and Smruti S Shah -- have collectively made the payment without admission or denial of charges, SEBI said.
 
The matter relates to SEBI's investigation into irregularities in IPOs of various companies including IDFC Ltd and IL&FS Limited during 2003-2005.
 
SEBI said the probe had found that the four entities provided funds to key operators for cornering shares reserved for retail individual investors in IDFC and IL&FS IPOs.
 
After its preliminary probe, SEBI had restrained the four entities in January 2006 from dealing in shares of IDFC and other ensuing IPOs till further directions.
 
Pursuant to further investigations, SEBI issued show-cause notices for alleged fraudulent and unfair trading activities by the concerned entities, while proposing a direction to restrain them from securities market for a further period of time and disgorgement of an amount totalling Rs1.92 crore.
 
While the proceedings were in progress against them, the four entities offered a settlement of charges through SEBI's consent mechanism.
 
The settlement proposal was revised further in April this year, after which SEBI's High Powered Advisory Committee recommended the case for settlement on payment of Rs1.35 crore as settlement charges and Rs1.92 crore towards disgorgement of ill-gotten gains made by them, collectively.
 
SEBI said it accepted the recommendations and the four entities have collectively made the payments.
 
Bahubali Shantilal Shah has paid Rs17.60 lakh as settlement charges besides Rs25.14 lakh towards disgorgment money.
 
Lok Prakashan Ltd has shelled little more than Rs 1 crore to settle the charges in addition to Rs1.43 crore as disgorgment money, SEBI said.
 
According to SEBI, Shreyans S Shah has reached settlement by paying Rs8.32 lakh and another Rs11.89 lakh as digorgement money. Further, Smruti S Shah has paid Rs8.40 lakh for settlement and Rs12 lakh as disgorgment money.
 
SEBI said that enforcement actions, including commencing or reopening of the proceedings, could be initiated if any representation made by the entities is found to be untrue.
 
The consent order is effective from 1st November.
 

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'Banks should look at home loans with lower EMI, longer tenure'

The RBI draft report on home loans also suggested that banks should introduce and popularise long-term fixed rate home loan with a provision of re-fixing the interest rate after 7-10 years

Mumbai: The Reserve Bank of India (RBI) has suggested that banks should look at the possibility of introducing home loans with lower equated monthly instalments (EMIs) and higher repayment period of up to 30 years, reports PTI.

 

The RBI draft report on home loans has also suggested that banks should introduce and popularise long-term fixed rate home loan with a provision of re-fixing the interest rate after 7-10 years.

 

These suggestions form a part of a report, 'Feasibility of Introducing More Long-Term Fixed Interest Rate Loan Products by banks. RBI has invited comments from the public on the report by 23rd November.

 

At present, banks give home loans with a maximum tenure of 15-20 years only.

 

The report also suggested that banks should popularise fixed deposit schemes for periods of over five years as it would help them procure long-term funds.

 

The banks, the report added, may also raise funds by floating 30-year bonds on the line of government securities.

 

The report said "transparency in retail loan products should be appropriately addressed and the customers be educated by lending institutions on the possible impact of rate changes on EMIs to enable borrowers to have better planning with regard to their repayments".

 

During 1977-2000, fixed rate loan products were popular.

 

However, post 2000, these products gave place to floating rate loans mainly due to falling interest rates in the early 2000s and significantly higher interest rate on fixed rate loan products in many cases.

 

The encouragement to fixed rate home loan, it added, is necessary as "customers are not able to understand the intricacies of economic cycles, changes in policy rates, transmission of the same and the consequential sudden increase in EMIs therby exposing themselves to interest rate risk".

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