Companies & Sectors
SEBI cracks whip on Gillette promoters, directors

SEBI also prohibited the promoters and directors of the company, from dealings in the shares of Gillette India, except for meeting the minimum 25% public shareholding limit, till the time of their compliance to this requirement

Taking action against promoters of Gillette India for non-compliance to minimum public holding norms, the Securities and Exchange Board of India (SEBI) on Friday ordered freezing all corporate benefits arising out of their stake in the company.


Besides, SEBI also prohibited the promoters and directors of the company, which is part of global consumer goods giant P&G, from dealings in the shares of Gillette India, except for meeting the minimum 25% public shareholding limit, till the time of their compliance to this requirement.


In addition to these interim orders, SEBI also warned the company, its promoters and directors of further penal actions including monetary penalties, prosecution proceedings and restriction in its trading, in the event of continued non- compliance. The company has been asked to present its case before SEBI within 21 days.


The order follows the disposal of Gillette’s appeal by the Securities Appellate Tribunal (SAT) on 3rd July against a previous decision by SEBI, wherein a proposed scheme of shareholding arrangement to meet the norms was rejected.


Gillette had offered to classify a senior Indian executive as a public shareholder, from a promoter entity previously to meet the norms, but SEBI rejected it.


As per minimum public holding norms, all private sector listed companies were required to achieve at least 25% public shareholding by 3 June 2013. A day after this deadline passed, SEBI on 4th June passed similar orders against 105 companies, but Gillette was not part of those actions, as the company had at that time got an interim relief from SAT.


While dismissing Gillette’s appeal, SAT also vacated that interim stay in its 3rd July order and paved way for SEBI to take necessary actions against the company.


As per SEBI’s order, Gillette India’s promoters and directors have also been restrained from taking up any new position as a director of any listed company till the time the company meets the minimum public holding norms.


SEBI has ordered “direct freezing of voting rights and corporate benefits like dividend, rights, bonus, shares, split, etc. with respect to the excess of proportionate promoter/promoter group shareholding of Gillette till such time these companies comply with the minimum public shareholding requirement”.


With regard to progress made in meeting the norms, the regulator also directed Gillette’s board/audit committee to submit compliance report every quarter to the stock exchanges where its shares are listed.


“... in the interest of all investors and the orderly development of the securities market, it is necessary to pass directions against the promoter/promoter group and directors of Gillette while not adversely affecting the interests of the public shareholders,” it added.


Gillette India is jointly promoted by the Procter and Gamble Co and Poddar Group. The promoters hold 88.76% in Gillette.


In 2012, the company had proposed a three-stage plan to bring down the promoter holding to 75%, which was turned down by SEBI as it involved reclassification of a top company executive as non-promoter entity.


Following SEBI’s refusal, Gillette had filed an appeal with SAT, which had then directed the market regulator “to pass a speaking order” the company’s proposal, in February, this year.


Accordingly SEBI had issued a letter to the company rejecting its proposal and advising Gillette to comply with the minimum public shareholding norms within the stipulated timeline.


On 3rd July, responding to Gillette’s plea SAT upheld SEBI’s decision that rejected the company's proposal and also vacated an interim stay given on 30th May.


SEBI had directed all listed private companies to have at least 25% public shareholding by 3 June 2013.


In its order, SEBI noted that promoters and directors of were “mainly responsible” for the non-compliance of companies with the minimum public shareholding norms.


According to the market regulator, the promoters of non-compliant companies “would have an advantage on account of their disproportionate stake compared to the public in their respective companies and also place them in more advantageous position as compared to the promoters of the compliant companies on account of violating the regulatory requirement”.


SEBI said that the disproportionate advantage arising out of non-compliance of the norms should not be permitted to be vested with the promoter/promoter group.


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Moneylife Foundation event on “How to write your own Will”

In an interactive two-hour session, advocate Bapoo Malcolm explained to a packed house the practical aspects of preparing a will

At Moneylife Foundation’s 171st event, Bapoo Malcolm, an experienced advocate practising civil and criminal law, spoke on the basic requirements of making a Will. Many delay in making a Will for many reasons. One of the reasons could be that there are many misconceptions. “A Will does not need to be registered, for that matter, even a handwritten Will written on a simple piece of paper will suffice,” explained Mr Malcolm. However, the Will should be legible and clear to understand, he emphasised. Not waiting for the last moment, one should start by preparing a simple Will, which can be updated any time. “At any point of time you should have a valid Will,” he said.


“A Will needs to be simple. You just have to give specific instructions about what has to be done with what you own. Just specify the property and the person,” explained Mr Malcolm. In order to create a clear Will you could even have a lawyer draft it, but ask him the meaning of every word, he said. “This may be your first Will but a lawyer would be going through over a dozen wills every month and would know the specifics,” he mentioned.


On clarifying whether a Will needs to be registered or not, he said “Registration is a grey area, mainly because if you then wish to make a second Will, you may not have the time to register it. If you realise the day you die that a relative is useless, you may not be able register this second Will. Then does the unregistered Will have more value than the registered one? Registration takes care of the safety issue. An unregistered Will could easily be lost. At least if it is registered you know that it is always in some government ward”


“A Will has to be interpreted. So it will all be interpreted according to the word of the law, which may not assign the same meaning as you intended.” Therefore, one should specify everything in the Will that would be subject to interpretation. For example, while mentioning names it is important to specify the relationship along with the date of birth of the person as there could be common names. Also if you wish to intentionally leave someone out of your Will, especially if it is a close family member, it is better to mention the name in the Will, if not, the person may contest the Will by saying you have forgotten their name, he explained.


Participants were also unclear about whom to appoint as an executor. “Without the executor, who will execute the Will? If this is not done, the court will appoint someone and there is no need for this,” he said. It is advised to take a written confirmatory note from your executor that he would execute the Will. But an executor can back out any time. Therefore, choosing a beneficiary as your executor could ensure timely execution of your Will. On a query to how many executors can one have, Mr Malcolm replied, “One can pick any number of executors, the law does not specify any limit. Ideally, three to four executors are advisable.” Also one could put a clause in the Will, that an executor can appoint another executor if he/she would be unable to execute the Will.


During the course of the session, Mr Malcolm spoke of the basic components of a Will as well as terms such as testator, executor, codicil, testamentary guardian and a detailed discussion on probate of a Will. He covered issues related to Wills, like registration, litigation possibilities, witnesses, executors, intestate problems. He also answered the queries of Moneylife Foundation members who raised their doubts.




3 years ago

I just read your post in Money-Life.
Nothing has been said about following aspects
1. Need for witnesses, how many and what details about them are to be put in the will
2. Doctor's certificate for mental fitness
3. On what paper should it be recorded( legal, plain paper)
4. In case of childless couples with no trustworthy relatives, who should be appointed as executor in case of an eventuality such as accidental death of both.
With regards,


Sucheta Dalal

In Reply to sunilotiv 3 years ago

All this and more has been covered in this session on Wills and others. Do sign up for moneylife foundation's FREE membership. You can listen to the full video when it is uploaded this week.


3 years ago


Every time I read about such an useful Lecture conducted by Money Life, I invariably wish that I were in Mumbai. Mumbaiites are very lucky.

Malcom Sir has said that “Registration is a grey area, mainly because if you then wish to make a second Will, you may not have the time to register it".

Recently I checked with the Registrar here in Bangalore. She categorically said that registration of any will is optional and in case a first will is registered subsequent wills need not necessarily be registered as long as it is specified clearly in those wills that it supersedes the original registered will [giving full particulars and reference details of the registered will].

Your valued comments on this Sir?

I found the information you gave about executors very useful and educative. One does not get such interesting information so easily and so lucidly. I was under the impression that executor cannot be a beneficiary as there will be conflict of interest. That is what someone told me.


Mohan Raj


Harish Kohli

In Reply to crmohanraj 3 years ago

CRMohanraj has raised a good question about registration of Wills. If the registration is beneficial but not necessary, then a Will written subsequent to the registered one should be binding. Perhaps a clause stating this could be inserted in the Will itself.
There is always a possibility of the wordings in the Will having some ambiguity. For greater clarity is it acceptable to have a preamble in the Will to state the spirit,the intention and the purpose of distributing the assessts. This may help if any of the beneficiaries is given more than the others.

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