Securities and Exchange Board of India (Sebi) said that stock exchanges will impose fines in case of non-compliance with certain provisions of Issue of Capital and Disclosure (ICDR) Regulations.
The fine will be applicable if the bonus issue is delayed beyond 15 days from the date of approval of the issue by the board of directors in cases where shareholders’ approval for making the bonus issue is not required.
While in the cases where issuer is required to seek shareholders'' approval for making the bonus issue, the fine will be applicable if bonus is not issued within two months from the date of the meeting of board of directors, Sebi said.
With respect to delay in bonus issue, Sebi clarified that "the approvals for the listing and trading of promoters’ bonus shares may be granted by the stock exchange, only after payment of the requisite fine by the listed entity.
"However, the approvals for the listing and trading of bonus shares allotted to persons other than the promoter(s) may be granted in the interest of the investors, subject to compliance with other requirements," Sebi said in a circular.
The fine will also be levied on entities that do not complete the conversion of convertible securities and allot the shares within 18 months from the date of allotment of such securities.
Besides, the entities that fail to approach the bourses for listing of equity shares within 20 days from allotment and fail to make application for trading approval to the stock exchange within seven days from the date of grant of listing approval are also liable for paying the penalty.
The fine would be credited to the "Investor Protection Fund" of the concerned exchange, the regulator said.
The exchanges would issue notice to the non-compliant listed entity to pay fine within 15 days from the date of the notice.
In case the non-compliant entity fails to pay the fine, the stock exchange may initiate appropriate enforcement action, including prosecution, Sebi said. PTI SRS VHP BAL
Disclaimer :- This story has not been edited by Outlook staff and is auto-generated from news agency feeds. Source: PTI