SEBI Slaps Penalties Totalling Rs 36 Crore On PNB Finance And Industries, CCCL, Other Entities

SEBI on Tuesday imposed penalties totalling Rs 35.67 crore on PNB Finance and Industries Ltd, Camac Commercial Company Ltd and various other entities, including promoters Samir Jain and Meera Jain who have also been barred from the securities market. Apart from the market ban, Samir Jain and Meera Jain have been restrained from holding any key managerial position or associating with any listed public company. These restrictions will be in place till the two companies comply with the minimum public shareholding requirement under SEBI norms, according to two separate orders.

Listed companies are required to have at least 25 per cent public shareholding. As per SEBI, the two companies did not make adequate disclosures about their promoter entities. The companies, listed on Calcutta Stock Exchange, have also been directed to disclose details about their promoters.

Samir Jain was the Vice Chairman and Managing Director of Bennett Coleman and Co. Limited (BCCL) at the relevant point of time and Meera Jain was a Whole Time Director at BCCL. In the matter of PNB Finance and Industries Ltd (PNBFIL), six entities have been prohibited from the securities market. They are Samir Jain, Meera Jain, Ashoka Viniyoga Ltd, Artee Viniyoga Ltd, Camac Commercial Company Ltd and Combine Holding Ltd, as per a 96-page order.

A fine of Rs 12 crore has been imposed on PNBFIL as well as Rs 1.41 crore each on Samir Jain, Meera Jain, Ashoka Viniyoga Ltd, Artee Viniyoga Ltd, Camac Commercial Company Ltd and Combine Holding Ltd. Further, a penalty of Rs 39 lakh has been slapped on Trishla Jain.

Besides, Samir Jain and Meera Jain have been "restrained from holding the post of director, or any key managerial position or associating themselves in any capacity with any listed public company and any public company which intends to raise money from the public, or any intermediary registered with SEBI" till the company complies with the minimum public shareholding norms.

In the case of Camac Commercial Company Limited (CCCL), the regulator has barred eight entities from the securities market. They are Samir Jain, Meera Jain, Ashoka Viniyoga Ltd, Artee Viniyoga Ltd, PNB Finance and Industries Ltd, Combine Holding Ltd and Punjab Mercantile and Traders Ltd.

A penalty of Rs 11 crore has been slapped on CCCL and Rs 1.41 crore fine each on Samir Jain and Meera Jain. Besides, a fine of Rs 20 lakh each has been imposed on  Ashoka Viniyoga Ltd, Artee Viniyoga Ltd, PNB Finance and Industries Ltd, Combine Holding Ltd and Punjab Mercantile and Traders Ltd.

Similar to the directions in the PNBFIL case, the two individuals have been restrained from holding any key managerial position or associating themselves in any capacity with any listed public company till compliance with the minimum public shareholding norms. SEBI, in the order against PNBFIL said the entities "have jointly and maliciously misrepresented the company to be a professionally run company having no promoter".

This was despite clearly knowing that the Jain family was the actual promoter of the company practically through their holding 91.51 per cent of its total shareholding of the company, directly as well as indirectly, it added. In its order against CCCL, SEBI said the company, Samir Jain and Meera Jain "have jointly and maliciously misrepresented the company to have no individual promoter and to be run by a group of seemingly unconnected corporate entities in such a manner that none of them was in a dominant position".

The orders came after SEBI received complaints alleging non-compliance of various provisions of securities laws including non-compliance with minimum public shareholding norms as well as wrong disclosure of promoter shareholdings by certain companies such as Arth Udyog Ltd, Ashoka Viniyoga Ltd, Ashoka Marketing Ltd, PNB Finance and Investments Ltd and Camac Commercial Company Ltd.