During 2006-07 SEBI began a probe into art funds being sold as investment schemes. These left investors with losses. SEBI however found Bajaj Capital to be only into an advisory business with regard to art as an investment
After an over seven-year probe into alleged money-pooling through 'art funds', market regulator Securities and Exchange Board of India (SEBI) on Tuesday let off Bajaj Capital and two other entities as they were not found to be running illicit 'collective investment schemes' (CIS).
In an order, SEBI said, Bajaj Capital was found to be only into an advisory business with regard to art as an investment option, while it did not launch any 'art fund' to actually collect money from investors".
At least two other entities, Marwah Fine Art Dealers and RR Investors Capital Services, were also let off by SEBI after its probe concluded that they were not running any art fund schemes in contravention of the CIS (Collective Investment Schemes) regulations, SEBI said in separate orders issued on Tuesday.
SEBI had begun probe into various cases of art funds being sold as investment schemes way back in 2006-07. At that time only, SEBI had issued notices to Bajaj Capital, part of a leading business conglomerate, as also to Marwah and RR Investors among others.
Some other entities are still being probed for allegedly running illicit investment schemes in name of art funds.
So far, only one major entity, Osian's Art Fund, has been found guilty by SEBI of violating its norms with regard to collection of money from investors through art fund schemes. Soon after SEBI passed an order against Osian's in April 2013, the entity approached the Securities Appellate Tribunal (SAT) against the regulator's direction to refund over Rs100 crore and stop running any such schemes.
The case is still being heard by SAT.
Way back in February 2008, SEBI had also issued a public notice warning investors against "investments in art funds, funds/ schemes launched by companies or any entity formed for the purpose" and had said that such activities were in nature of 'collective investment schemes' and need its approval.
Among the three cases disposed by SEBI today, Marwah group had sought guidance from the market regulator in January 2007 to set up an art fund, after SEBI had issued a show-cause notice to them.
The regulator had prima facie observed that the entity was carrying out activities in the nature of a collective investment scheme without registering for the same. Similar prima facie observations were made by SEBI with regard to Bajaj Capital and RR Investors as well.
After detailed probe into these cases, SEBI however concluded later that neither did they launch any art funds, nor they collected money from investors for such schemes limited till date regarding any scheme of 'art fund'.
Consequently, SEBI has found that these are not fit cases to impose any penalty and therefore the proceedings have been disposed off without any regulatory actions.
Only a close below 6,460 for Nifty will mean the start of a short downturn
Unlike most of the Asian indices, the Indian indices closed Tuesday in the red. The market opened almost at the same level at which it had closed on Monday. The indices made attempts to stay in the green in the morning but soon lost strength and started edging lower. Today, the NSE 50-share Nifty made a new high again but could not sustain at that level.
The BSE 30-share Sensex opened at 21,919 and moved to the level of 21,772 after hitting a high of 22,019. It closed at 21,826 (down 108 points or 0.49%). The Nifty opened at 6,537 and hit an all time high of 6,563 after which it edged lower to hit a low of 6,494. The Nifty closed at 6,512 (down 25 points or 0.39%). NSE recorded a volume of 80.99 crore shares.
Except for Realty (up 2.31%); Smallcap (up 0.21%) and IT (up 0.19%) all the other indices on the NSE closed in the red. The top five losers were Metal (3.31%); MNC (1.19%); Nifty Junior (0.86%); Pharma (0.84%) and Commodities (0.79%).
Of the 50 stocks on the Nifty, 21 ended in the green. The top five gainers were DLF (3.88%); Tata Power (3.66%); Grasim (2.68%); IDFC (2.63%) and IndusInd Bank (1.92%). The top five losers were Tata Steel (5.78%); Hindalco (4.02%); Sesa Sterlite (2.91%); Gail (2.91%) and Maruti (2.73%);
Of the 1,547 companies on the NSE, 606 closed in the green, 851 closed in the red while 90 closed flat.
The Indian government unveiled the trade data for February 2014 during trading hours. India's trade deficit narrowed to $8.13 billion in February 2014, from $14.12 billion in February 2013. Total imports declined 17.09% year-on-year at $33.81 billion in February 2014. Merchandise exports fell 3.67% year-on-year at $25.68 billion in February 2014. The trade deficit for the 11-month period April 2013 to February 2014 narrowed to $128.08 billion, from $179.92 billion during the period from April 2012 to February 2013.
US indices closed Monday in the negative. The Federal Reserve will continue to trim its monthly asset purchases at a $10 billion pace, Charles Evans, president of the Chicago Fed and among the most dovish US policymakers said on Monday.
Except for NZSE 50 (down 0.31%) all the other Asian indices closed in the green. Nikkei 225 (0.69%) was the top gainer.
China's central bank governor said on Tuesday that the country's deposit rates are likely to liberalised in one to two years. The central bank is widely expected to introduce a deposit insurance scheme before liberalising deposit rates to protect savers in case a freed-up market leads to major turbulence for smaller banks.
A report yesterday, 10 March 2014, showed aggregate financing in China dropped to 938.7 billion Yuan ($153 billion) last month amid a crackdown on shadow lending, down from January's record 2.58 trillion yuan.
Japan's central bank finishes a two-day meeting today, at which it's projected to keep its bond-buying program unchanged.
European indices had a mixed performance while US Futures were trading marginally lower. German exports increased more than estimated. Data today showed German exports rose 2.2% in January 2014. That was the biggest month-on-month growth since May 2012. Imports jumped 4.1% in the period, also exceeding estimates.
Income tax department conducted searches simultaneously at about 20 locations of Hiranandani group in Mumbai, Bangalore, Chennai and Hyderabad
The Income Tax (I-T) department on Tuesday conducted searches at about 20 locations of Hiranandani group in Mumbai as well as in Bangalore, Chennai and Hyderabad in connection with alleged tax evasion by the realty company.
"We have conducted simultaneous searches at many locations of the group in Mumbai, Bangalore, Chennai and Hyderabad," an Income Tax source said.
Searches were also conducted at the residential premises of top company officials.
The source said some documents of accounts and transactions have been seized in the operation that was underway several hours after it started.
When contacted, a spokesperson of the Mumbai-based Hiranandani Group refused to comment on the matter.
Sources said some alleged mismatch on Tax Deducted at Source (TDS) receipts related to payments made were also being verified during the operations.
Hiranandani group is a major real estate player in Mumbai with its flagship post project located in Powai.
Recently, the group's co-founder Niranjan Hiranandani had filed a suit against his daughter Priya seeking to restrain the usage of name 'Hiranandani' in her business.
Some years back, the Central Bureau of Investigation (CBI) had also raided the offices and other premises of Hiranandani Builders for alleged provident fund evasion of Rs168 crore.