Regulations
Polaris Agro Industries barred from collecting funds from investors
The company was engaged in fund mobilising activity through issue of Redeemable Preference Shares to more than 49 persons without complying with the provisions of the Companies Act, 1956, according to a SEBI Order on Polaris Agro Industries
 
SEBI passed an Order with respect to Polaris Agro Industries Limited directing that the company shall not mobilise funds from investors and that the company and its directors are prohibited from issuing prospectus or any offer document or issue advertisement for soliciting money from the public for the issue of securities, till further orders. The company and its directors shall not dispose off any of the properties of the company and shall not divert any funds raised from the public. 
 
The company was engaged in fund mobilising activity through issue of Redeemable Preference Shares to more than 49 persons without complying with the provisions of the Companies Act, 1956.
 
SEBI had received several complaints in October 2014, against Polaris Agro Industries Limited (PAIL) relating to illegal mobilisation of funds. Immediately, SEBI wrote to the company and started an investigation. Letters sent to PAIL and its directors i.e. Jafar Ali Molla and Arindam Dutta, were returned as undelivered with the remarks 'Addressee Not available/Addressee Moved'. However, the letter to Kartick Chandar Das was delivered. Subsequently, letters dated 12 January 2015 were sent by SEBI to PAIL and its directors. While the letters sent to PAIL and its Directors i.e. Jafar Ali Molla and Arindam Dutta, were again returned as undelivered with the remarks 'Refused – Return to Sender & Addressee Moved', the letter to Kartick Chandar Das was delivered. However, till date, no information has been received from PAIL or its directors.
 
SEBI investigated on its own and found that the Offer of Redeemable Preference Shares by PAIL, would prima facie qualify as a public issue under the first proviso to Section 67(3) of the Companies Act, 1956. In this regard, it is pertinent to note that by virtue of Section 55A of the Companies Act, 1956, Section 67 of that Act, so far as it relates to issue and transfer of securities, shall also be administered by SEBI.
 
The SEBI Member continues by saying, “it will follow that since the Offer of Redeemable Preference Shares is a public issue of securities, such securities shall also have to be listed on a recognised stock exchange, as mandated under Section 73 of the Companies Act, 1956. In this regard, reference is made to Sections 73 of the Companies Act, 1956, of which sub-Sections (1), (2) and (3) are relevant.”
 
Hence, the SEBI Order infers, “In the facts of the instant case, it prima facie appears that PAIL has violated the provisions of Section 73 of the Companies Act, 1956, in respect of the Offer of Redeemable Preference Shares.”
 
Hence, the SEBI Order goes on to bar the company from mobilising funds from investors as indicated in the earlier paragraphs.
 
The SEBI Order concludes by saying, “The prima facie observations contained in this Order are made on the basis of the material available on record i.e. the abovementioned complaints received by SEBI and information obtained from the Ministry of Corporate Affairs' website i.e. MCA 21 Portal. In this context, PAIL and its abovementioned Directors are advised to show cause as to why suitable directions/prohibitions under Sections 11(1), 11(4), 11A and 11B of the SEBI Act including the following, should not be taken/imposed against them: 
 
i.  Directing them jointly and severally to refund money collected through the Offer of Redeemable Preference Shares along with interest, if any, promised to investors therein; 
 
ii.  Directing them to not issue prospectus or any offer document or issue advertisement for soliciting money from the public for the issue of securities, in any manner whatsoever, either directly or indirectly, for an appropriate period; 
 
iii.  Directing them to refrain from accessing the securities market and prohibiting them from buying, selling or otherwise dealing in securities for an appropriate period.”

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COMMENTS

Jiarul shaikh

1 year ago

Polaris agro indastris ltd chted the company please arist or diracter thanku

Only 41% of BSE 100 companies fully comply with mandatory disclosures
A first time study of 100 companies by FTI Consulting shows that corporate India has a long way to go in complying with disclosure requirements mandated by the regulator
 
FTI Consulting, a global business advisory firm, in the first study of its kind, has found that most Indian companies score low on mandatory and voluntary disclosures.
 
Infosys, ICICI Bank and Bharti Airtel were the only three companies that were fully compliant on mandatory disclosures and voluntary disclosures. The companies with the lowest disclosures included United Spirits, Unitech, Indian Oil Corporation, HPCL, Hindustan Zinc, Divi’s Laboratories, Canara bank and Coal India. These companies scored 3.5 out of a maximum score of 10.
 
The India Disclosure Index, developed and maintained by FTI Consulting revealed that only 41% of the constituent companies of the BSE 100 index were fully compliant on mandatory disclosures parameters. Not surprisingly then, voluntary disclosures by the same set of companies are also low, with a median score of 3.5 out of a maximum of six. Most companies provided inadequate information relating to business strategy and debt.
 
The research report reveals that the BSE 100 index constituents have a median ‘Mandatory Disclosure’ score of 2.5/4 when reviewed against the six basic mandatory disclosure parameters. The six parameters include quarterly financial information, annual report, shareholding, board and management team, investor contact and analyst transcripts; covering financial and non-financial parameters.
 
Over half of all BSE 100 index constituent companies have Mandatory Disclosure scores less than 2.5, reflecting a poor level of disclosure for basic mandated information. Only 41 of the 100 companies in the BSE 100 Index had a full 4/4 score for Mandatory Disclosure, with the remaining 59 falling short on either one or some of the mandatory disclosure parameters. “This is a glaring gap and a telling statistic indicating the unavailability of basic information that is required by law in the Indian capital markets.”
 
The companies which scored the lowest include United Phosphorus, Union Bank, Punjab National Bank, JSW Steel, Bank of India and ACC. These companies had a mandatory disclosure score of 2/4.
 
“Unavailability of updated analyst transcripts and sufficient public information regarding analyst engagements was the single largest reason for low Mandatory Disclosure scores,” the researchers explain. “This goes against the principle of Fair Disclosure to all investors and majority and minority shareholders irrespective of class.”
 
The voluntary disclosure scores rates companies on disclosures of profit and margin improvement narrative, operating metrics, business strategy articulation, updated debt information and key corporate developments. A third of all BSE 100 index constituent companies have Voluntary Disclosure scores of 3 or less, and 14% have the lowest Voluntary Disclosure score of 1/6. Six of the lowest scorers were government-owned enterprises.
 
Only eight of the 100 companies in the BSE 100 Index had a full 6/6 score for Voluntary Disclosure. These include companies like Infosys, Indusind Bank, IDBI bank, ICICI Bank, Federal Bank, Bharti Airtel, Bank of India and Axis Bank. As can be seen, banks account for six of these eight companies.
 
Lack of updated debt-related information was the single largest reason for low Voluntary Disclosure scores, with 68% of Indian companies not providing adequate information on their corporate websites.
 
FTI Consulting reviewed publicly available information disclosed by leading publicly-listed companies in India to ascertain current practice and identify trends. This finding reveals a strong non compliance to Securities and Exchange Board of India’s (SEBI) regulations. SEBI’s recently enacted Amended Clause 49 of the Listing Agreement, places responsibility for ‘adequate disclosure and communications’ with the board of directors of India’s listed companies.
 
FTI Consulting created a weighted, Composite Disclosure scoring system, with six Mandatory Disclosure parameters and five Voluntary Disclosure parameters; and applied it to the BSE 100 index constituents.

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COMMENTS

KAVIRAJ B PATIL

2 years ago

It is time SEBI gave a one time warning to the erring companies and start cracking down on the truant companies if there is no change in their attitude. The article does not say whether the findings have been sent to SEBI and if SEBI has received it, the reaction of SEBI officials to this blatant disregard of SEBI regulations.

Sensex trades 104 points down; healthcare stocks hit
The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading in the negative territory during the late afternoon session. It was down by 37.75 points or 0.45 percent at 8,410.35 points
 
A day after a 556-point decline, a benchmark index of the Indian equities markets, the 30-scrip BSE Sensitive Index (Sensex), was on Tuesday trading in the red during the late afternoon session.
 
The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading in the negative territory during the late afternoon session. It was down by 37.75 points or 0.45 percent at 8,410.35 points.
 
The Sensex of the S&P Bombay Stock Exchange (BSE), which opened at 27,860.51 points, was trading at 27,782.61 points (at 2.30 p.m.), down 103.60 points or 0.37 percent from the previous day's close at 27,886.21 points.
 
The Sensex had touched a high of 27,976.93 points and a low of 27,687.07 points in the intra-day trade so far.
 
In Tuesday's trade so far healthy buying was observed in metal and consumer durables sectors.
 
However, stocks of healthcare, automobile, oil and gas, fast moving consumer goods (FMCG) and capital goods came under heavy selling pressure.
 
The BSE S&P healthcare index plunged by 441.84 points, followed by automobile index which declined by 112.22 points, oil and gas index fell 53.00 points, FMCG index receded by 52.12 points and TECK index was down by 13.00 points.
 
However, the S&P BSE metal index was up by 59.45 points and consumer durables index was marginally higher by 2.95 points.
 
On Monday, the BSE Sensitive Index closed 556 points or nearly 2 percent down, due to below-expected quarterly results coupled with negative global cues.
 
The Sensex had plunged by 620 points in the intra-day trade on Monday as interest rate-sensitive stocks like capital goods, automobile and banks fell. 
 
Fears of more retrospective tax cases impacted foreign investors' sentiments -- which also dented the rupee's value.

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