SEBI imposes Rs 25 lakh fine on Beryl Securities’ promoters

Markets regulator SEBI has imposed a penalty of Rs 25 lakh on 10 promoters of Beryl Securities for failing to make an open offer to acquire shares of the firm.

The promoters are Sangita Sethi, Sanjay B Sethi HUF, Soniya Sethi, Sudhir B Sethi HUF, Sudhir Sethi, Sohil Sethi, Babulal Sethi, Tara Sethi (Tara HUF), Babulal Sethi HUF and Sanjay Sethi.

The Securities and Exchange Board of India (SEBI) had conducted an inspection for the period from June 1 to September 30, 2013 in respect of dealings in the shares of Beryl Securities.

As per a SEBI order dated February 28, the shareholding of the promoter group, comprising 10 promoters, for the quarter ending June 2013 was 11,77,500 shares representing 23.24 percent of the share capital of Beryl Securities and it increased to 12,71,100 shares representing 25.09 percent for the quarter ending September 2013.

The increase of 1.85 percent in shareholding of the promoter group was on account of acquisition of 93,600 shares of BSL by few promoters on May 17, 2013.

Prior to placing purchase orders to acquire 93,600 shares, the promoters were under an obligation in terms of SAST (Substantial Acquisition of Shares and Takeovers) Regulations to make a public announcement of an open offer for acquiring the shares as the shareholding of the promoter group exceeded the threshold limit of 25 percent.

However, it was alleged that the promoters failed to do so. “… open offer should have been given by the noticees (promoters) before placing buy orders for 93,600 shares of the target company (Beryl Securities),” SEBI said in its order.

It added that by not giving open offer at the time when required, the promoters have violated the provisions of SAST Regulations. Noting that the violation of the SAST Regulations by the promoters “attracts the imposition of monetary penalty”, SEBI imposed a fine of Rs 25 lakh on them.

In a separate order dated February 28, SEBI imposed a total penalty of Rs 18 lakh on one Naresh Shah for violating Securities Contracts (Regulation) Act, among others, in the matter of GFL Financials.