Case Law Details
In re New Delhi Television limited (SEBI)
Disclosure requirements have their root in the continuous listing requirements laid down in the listing agreement which prescribed that the information must be disclosed at the time of occurrence of the event in order to enable the shareholders and the public to appraise the position of the company, so as to enable them to take an informed investment or disinvestment decision in the securities of the listed entity and to avoid the establishment of a false market in its securities. The timelines for making disclosures of such information is of much significance as the delay or complete failure would defeat the very purpose of the regulatory requirements. While holding so, I have due regard to the preamble of the SEBI Act and the primary functions of the Board as defined under the SEBI Act. The same includes protection of interest of investors in securities and to promote the development of and to regulate the securities market and prohibiting fraudulent and unfair trade practices related to the securities market. I have also perused the Hon’ble Supreme Court judgment in the matter of SEBI v. Rakhi Trading (P) Ltd. (2018) 13 SCC 753 and Hon’ble SAT judgment in the case of Piramal Enterprises Ltd (Supra) on role of SEBI based on fairness, integrity and transparency while imposing penalty.
Any act of concealing the material and price sensitive information from the public shareholders of the Noticee in particular and from the investors in securities market in general, cannot be considered as good for the securities market and for the interest of investors. I also observe that the importance of non-disclosure of such a material event by the Noticee can be gauged from the fact that for similar non-disclosures by the Promoters of the Noticee were found to be in violation of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market)) Regulations, 2003 (hereinafter referred to as PFUTP Regulations’) as per Ld. WTM order dated June 14, 2018 and SEBI Adjudicating Officer order dated December 24, 2020. Considering the role and responsibility of the Noticee in these regards and important obligations cast upon it under the Listing Agreements and SCRA, in my view, the default by the Noticee is grave and the seriousness of this matter cannot be ignored. Therefore, no lenient view should be taken in this matter and the case deserves imposition of deterrent monetary penalty to deal with the deliberate defiance, as found in this case.
Considering all the facts and circumstances of the case and exercising the powers conferred upon me under section 231 of the SCRA read with rule 5 of the SCR Adjudication Rules, I hereby impose a penalty of Rs 5,00,00,000/- (Rupees Five Crore only) on the Noticee New Delhi Television Limited under section 23E of the SCRA. In my view, the said penalty is commensurate with the violation committed by the Noticee in this case.”
FULL TEXT OF THE ORDER OF SEBI
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