OP Jindal Group's Hexa Tradex Faces SEBI Penalties For Disclosure Violations
The penalties were imposed for violation of delisting norms and other disclosure regulations.
The Securities and Exchange Board of India on Tuesday imposed penalties totaling Rs 35 lakh on Hexa Tradex Ltd, a firm of the OP Jindal Group, along with its promoters and directors, for violating delisting norms and other disclosure regulations. The fines, ranging from Rs 2 lakh to Rs 5 lakh, were levied on Hexa Tradex, its chairperson Raj Kamal Aggarwal, and directors Ravinder Nath Leekha, Vinita Jha, Girish Sharma, and Pravesh Srivastava, who are collectively referred to as the "noticees".
Siddeshwari Tradex Pvt., Innox Global Multiventures, Opelina Sustainable Services, and JSL Ltd. were the promoter entities of Hexa Tradex Ltd. These entities were penalised by the market regulator.
Pursuant to a complaint received by the SEBI in July 2022. The regulator conducted an examination with respect to the delisting of Hexa Tradex Ltd., a BSE and NSE-listed company.
Based on the complaints received, SEBI had initiated the proceedings against the noticees to inquire into and adjudge the alleged violations of the provisions of its delisting rules and other norms.
"...noticees 2-5 had failed to show care/diligence /skill, nor did they conduct their duties in a professional manner by passing an incorrect resolution of HTL and acquirer's related entities viz Prithviraj Jindal and other promoter entities viz Jindal Saw Ltd, JITF lnfralogistics, and Sigmatech Inc of being in compliance with the securities law and also failing to give reasoned recommendations to the board for accepting the delisting proposal," SEBI's adjudicating officer Santosh Kumar Sharma said in the order.
"...the board members of Hexa Tradex Ltd. hadn't insisted for reasoned recommendations," Sharma said.
"Therefore, it stands established that HTL, Raj Kamal Aggarwal, Leekha, Vinita Jha and Girish Sharma have violated delisting regulations LODR (Listing Obligations and Disclosure Requirements) rules," the order said.
Sebi also observed that HTL and its promoter entities were aware of the proceedings initiated against it vide show cause notice dated Feb. 1, 2022, for non-compliance with securities law and yet wrongly informed the stock exchanges that they complied with rules.
Thus, acquirers had allegedly could not hide behind the certificate by Dwivedi & Associates as well as the board of directors of noticee 1, in its meeting held on March 21, 2022, as Detailed Pubic Announcement was issued to the public on behalf of acquirers, the regulator said.
"...the acquirers are trying to absolve themselves of the responsibility of making the disclosure of material information in the DPA as they were promoter group entities of Noticee 1".
"Thus, it is conspicuous that the noticees 9-12 (Siddeshwari Tradex, Innox Global Multiventures, Opelina Sustainable Services, and JSL Ltd.) weren't compliant with respect to the securities law regarding their disclosure in DPA," Sharma said.
Additionally, SEBI noted that Pravesh Srivastava was the compliance officer/ company secretary, who was also responsible for ensuring conformity with the compliance of the violation.
Therefore, the markets watchdog found that Srivastava has violated the LODR rules.
