I
(See regulation 3)Part - A FormApplication for settlement(To be filed only after conclusion of investigation, inspection, inquiry or audit, as the case may be)
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(For Office use only)Date of receipt of the application:Application Registration Number:
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| (Instructions:All particulars, including submission regarding details of loss caused to investors, profit made and proposed settlement amountmustbe filled, else application shall be returned. Put 'NA' only where Not Applicable.) |
1. Name/Trade name of the applicant/co-applicants:
(a)Registration no., if applicable :(b)Date of Registration, if applicable :(c)PAN/DIN/CIN number, as available:(d)Paid-up capital of applicant:2. If stock broker, name of the stock exchange:
3. If sub-broker/authorised person, name of stock broker with whom affiliated and name of the stock exchange:
4. Name of the segment (Cash/derivative etc.):
5. Form of organization: corporate body/ sole proprietorship / partnership / LLP/ financial institution (if listed co., details of listing):
6. Names of promoters/directors/proprietors/partners:
7. Key management personnel(s):
8. Address/correspondence address, contact no./fax no. and email (any changes in aforesaid details shall be communicated to the Board promptly):
9. Name and contact details (including e-mail) of the contact person (s):
10. Other registration(s) with the Board, if applicable:
11. Case(s) pending with the Board/SAT/Court (Pl. specify):
12. Case(s) pending under 11B/Adjudication/Enquiry/others (pl. specify):
13. Stage at which pending:
14. Interim order(s) in the pending proceedings (gist of the orders passed), if any:
15. Other actions pending with/concluded by the Board, if any (with their details):
(a)Against the applicant :(b)Against its associates :(c)Against its key management personnel(s) :(d)Against its other promoters/directors:(e)Other details, if any:16. Date of show cause notice/summons/communication indicating probable cause of action, if any, against which the settlement is sought (Please Enclose Copies)*:
17. Full and true disclosure of facts (including the loss caused, profit made, loss avoided, gross fees, brokerage, commissions, etc., in respect of the cause of action, with manner of calculation thereof):
[Applicant To Take Into Account The Guidelines Provided In Schedule-II]18. Specific charges alleged:
19. Submissions in respect of sub-regulations (2), (3) & (4) of Regulation 5:
20. Terms of settlement proposed by the Applicant:-
(a)Monetary terms, with manner of calculation:-(b)Non-monetary terms, including manner of calculation of terms of disgorgement due:-21. Original documents to be enclosed:
(a)Undertakings and waivers (as per Format specified in Part C).(b)Authority letter/Board resolution.22. List of other enclosures:
(a)A copy of the notice to show cause/summons/communication/other notices indicating the probable cause of action, if any, against which the settlement is sought;(b)Complete Annual Reports / other relevant financial details for the last three financial years and the quarterly audited financial results of the current year;(c)A statement showing net worth of the applicant (only for those applicants who are required to comply with the networth requirements as specified by the Board or by the stock exchanges), gross annual income before tax, the amount of gross profit made/loss avoided, including the gross brokerage, fees, management/performance/transaction fee, carried interest, compensation, etc., in respect of the said default;(d)Copy of PAN card/ DIN/CIN details;(e)Complete Income-tax Returns of the applicant for the last three financial years;(f)In case of a foreign body corporate applicant, include details relating to incorporation, place of business, registration details with any non-Indian financial sector regulatory authority.(g)In case of a non-resident applicant, include details relating to passport and national identity document, if any.(h)Any other relevant document (s)/submissions.(Signature of the applicant)(Stamp and Seal of body corporate applicant)VerificationI, ...................................................................................................................................son/daughter/wife of (Name in block letters)Shri ...................................................................being the applicant/authorised representative (in case of body corporate) of ......................................... do hereby verify and affirm on oath that this application and the contents thereof are true to my knowledge and belief and as per the records and that I have not suppressed any material facts and shall keep the Board informed without delay, of any other relevant information that may come to my notice.(Signature of the applicant)Date:Place :Part-BEvery applicant under Chapter II of these regulations shall pay a non-refundable processing fee of fifteen thousand rupees, by way of a demand draft in favour of 'Securities and Exchange Board of India' payable at Mumbai or by way of direct credit in the bank account through NEFT/RTGS/IMPS or any other mode allowed by RBI.Provided that, where the applicant is a body corporate, the non-refundable processing fee shall be Twenty-five thousand rupees.Part-C Undertakings and WaiversFormat|
Undertaking to besubmitted by each applicant, along with the application withstamp duty duly paid and duly notarized at the time of execution.
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II
(See regulation 10)Chapter I
Guidelines for Arriving at Settlement Terms
1. The settlement amount (SA) shall comprise of the Indicative Amount (IA) arrived at in terms of these guidelines and the factors provided in regulation 10, wherever applicable.
2. The IA shall not be less than Rupees 3 lakh for first time applicants or Rupees 7 lakh for others, as the case may be:
Provided that in case of individual applicants who submit to the satisfaction of the IC or HPAC or Panel of WTMs that, without knowledge of the illegal activity, they had lent the use of their securities account to the key operator or intermediary or securities market infrastructure institution involved in such activity, the SA may not exceed the minimum penalty for that violation under securities laws.Explanation. - A 'first time applicant' is a person against whom no order has been passed by the adjudicating officer or by the Board or who has never obtained a settlement order from the Board as on the date of the present application.3. Based on the stage at which the proceeding(s), for which the application is made, is/are pending, the proceeding conversion factor (PCF) shall be applied when calculating the IA.
4. In cases, where an existing business or activity of a person is either corporatized or converted into an LLP or partnership or merged or taken over by a new management, the existing record of the erstwhile entity shall be deemed to be the record of the new entity. Considerations including insolvency, change of name or management or ownership, etc., shall be considered in accordance with the guidelines issued by the Board, if any, from time to time.
5. PCF for Applications made voluntary or seeking settlement with confidentiality: Where an entity desires to obtain the benefit of a lower PCF, it may, suo motto, before the receipt of any notice to show cause, intimate the Board of such default hereinafter referred to as 'intimation defaults' and co-operate with the Board in the investigation, inquiry, inspection or audit. Such an application shall be deemed to have been made 'Pre- issue of notice to show cause' for the purpose of calculating the PCF.
6. The IA shall be calculated per count of default, jointly or separately as per the facts and circumstances of the case, in accordance with these guidelines.
7. While considering the application, the alleged default(s) detailed in the Inspection Report or the Investigation Report or the Report of the Designated Authority (DA) or the notice to show cause, including any supplementary notice to show cause issued by any authority in a pending proceeding, or the facts/findings detailed in the order of the Designated Member (DM) or the Whole Time Member (WTM) or the Adjudicating Officer (AO) or the Securities Appellate Tribunal (SAT), as applicable, may be the basis for calculating the IA.
In case, the Internal Committee (IC) or the High Powered Advisory Committee (HPAC) or the Panel of Whole Time Members (WTMs) are of the opinion that the facts disclose a different default, the modification of the charge(s) may be sought.8. The alleged defaults shall, wherever applicable, be categorised based on the facts and circumstances by the IC or HPAC or the Panel of WTMs.
9. Notwithstanding anything contained in these guidelines, the IC or HPAC or Panel of WTMs shall have the discretion to recommend acceptance or rejection or accept or reject an application, to recommend an amount, lower or higher than the amounts arrived at in terms of these guidelines, for reasons to be recorded, in accordance with the provisions of securities laws, considering the facts and circumstances of the case and the gravity of the charges.
10. In case the applicant is body corporate, the IC or HPAC or Panel of WTMs may require that the SA payable by a body corporate is to be paid by the officers in default including the persons in charge of the body corporate to avoid burdening investors holding securities issued by the body corporate:
Explanation. - The principle in clause 10 may be applied mutatis mutandis to the sponsor, manager, or trustee (by whatever name called) of a trust, the karta of a Hindu Undivided Family, the office bearers of an association of persons, as the case may be.11. In cases where the formula for calculating the IA are inapplicable or cannot be adapted due to the peculiar nature of the default or the facts and circumstances of the case or where the defaults detailed in the Tables in these guidelines are not covered, the IC or HPAC or Panel of WTMs may arrive at the SA, as they deem fit.
12. In case of an amendment(s) or repeal of the securities laws, these guidelines shall continue to apply to similar provisions under the amended or new laws, mutatis mutandis.
Chapter II
Indicative Amount and The Settlement Amount
Indicative amount (IA) shall be calculated as follows:
#Legal costs of the Board may be applicable to an application made at the stages mentioned in points "b", "d" and "e" as provided in Table I.Where:'A' = PCF + RAFA: Multiplying Factor.PCF: Proceeding Conversion Factor.RAF: Regulatory Action Factor.'B' = BV x BAB: Applicable Benchmark Amount, is the amount attributable to every count of the alleged default in accordance with these guidelines;'BV': Aggregate of the base values given to the relevant factors including the aggravating and mitigating factors in respect of a particular charge.'BA': Base amount attributable to every count of the alleged default in accordance with these guidelines.1. The IA shall not exceed the maximum penalty under securities laws that may be levied for each count of violation multiplied by the counts of alleged default in accordance with these guidelines.
2. (a) Where an order of penalty has been passed prior to making an application, then 'B' shall not be less than the penalty so awarded;
(b)In case more than one proceeding arising from the same cause of action has been initiated against the applicant, the IA shall be increased by 20%;3. In case of grant of confidentiality, the IA arrived in accordance with this Schedule shall, be further reduced as follows, -
i. those marked first in priority status may be granted reduction of up to or equal to ninety percent of the IA;ii. those marked second in priority status may be granted reduction of upto or equal to fifty percent of the IA; andiii. those marked third or subsequent in the priority status may be granted reduction upto or equal to twenty five percent of the IA.4. The amount which is finally approved by the Panel of Whole Time Members is the SA.
5. Notwithstanding anything in this Schedule, -
i. where a compounding application has been filed in respect of an offence under securities laws for nonpayment of penalty, the proposal agreeing to the composition of the offence may be made to the court in lieu of such penalty and interest as deemed appropriate along with legal charges as determined by the Board;ii. where a compounding application has been filed in respect of an offence under securities laws other than for non-payment of penalty, the proposal agreeing to the composition of the offence may be made to the court in lieu of terms as may be approved by the Panel of Whole Time Members; andiii. where a compounding application is filed after framing of the charges by the court, the proposal agreeing to the composition may be made after increasing the amount calculated under this Schedule by atleast twenty-five per-cent along with legal charges and along with any other terms as may be approved by the Panel of Whole Time Members.Chapter III
Proceeding Conversion Factor
The values assigned on the basis of the stage of the proceedings, as on the date of the application, shall be the PCF as per Table I:Provided that where multiple proceedings arising out of the same cause of action are sought to be settled, the value of the proceeding which is at the most advanced stage, irrespective of the stage of progress of the other proceedings, shall be taken as the PCF.Table - IPCF
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Stage of The Proceeding(S) When The SettlementApplication is Made
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Value of PCF |
| a. |
Voluntary or for seeking settlement withconfidentiality
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0.65 |
| b. |
Pre- issue of thenotice to show cause (including applications filed on receipt ofthe settlement notice/summary settlement notice)[OrCompounding application filed pre-summoning]
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0.75 |
| c. |
Post-issue of thefirst notice to show cause pertaining to any pending proceedingin the same cause of action (including applications filed afterperiod provided in settlement notice[OrCompounding application filed before the framingof charge]
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0.85 |
| d. |
Proceeding pendingafter the submission of the report by the Designated Authority[OrCompounding application filed after framing ofcharge]
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0.9 |
| e. |
Proceedings pending after passing of a finalorder imposing penalty or issuing civil and administrativedirections, as the case may be
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1.10 |
| f. |
Proceedings pending after the passing of theorder by the Securities Appellate Tribunal or Court
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1.20 |
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Orders and Regulatory Directions Issued To TheApplicant
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XPer Order
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Exonerated cases (i.e.cases where applicant was exonerated in an order or appeal orreview)and any settlement order involvingconfidentiality
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0 |
| Any other Settlement Order |
0.01 |
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All Other Orders (Except For Which TheApplication Is Filed)
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| Cease and desist order |
0.02 |
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Final order issued against other personsassociated with the securities markets
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0.05 |
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Final order issued against an intermediary orsecurities market infrastructure institutions* or listedcompanies, and their principal officers
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0.075 |
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Final Order Against Intermediary OrSecuritiesMarket Infrastructure Institution,For Which Applied
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Final Order Against Any Person Other ThanIntermediary Or Securities Market InfrastructureInstitution, ForWhich Applied
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'Y'Per Order
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| Warning issued |
0.05 |
| Suspension/Debarment upto 1 month |
Debarment upto 6 calendar months |
0.1 |
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Suspension/Debarment for 1 month or more, butlessthan 6 months
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Debarment for 6 calendar months or more, but lessthan 1 year |
0.15 |
| Suspension/Debarment for 6 month or more but lessthan 1 year |
Debarment for 1 year or more but lessthan 2years
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0.2 |
| Suspension/Debarment for 1 year or more but lessthan 2 years |
Debarment for 2 years or more but lessthan 3years
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0.25 |
| Suspension/Debarment for 2 years or more |
Debarment for 3 years or more |
0.3 |
Chapter V
Applicable Base Values and Factors
| BV= 1+ Sum of Applicable Base Values |
1. The quantum of IA would affect the ability of the applicant to make restitution to investors:
Explanation. - In such cases higher IA may be sought from the officer who is in default.2. The applicant had minimal participation in the alleged default;
3. Proactive and exceptional cooperation, including:
a. Prompt and detailed self-identification of suspected or uncovered misconduct;b. Early self-identification of contraventions followed by thorough internal reviews and sharing of discovered facts;c. Substantial assistance to an investigation or inquiry by obtaining and providing evidence.4. Acceptance of responsibility and acknowledgement of misconduct to the Board prior to detection and intervention by truthfully admitting the conduct;
5. Voluntarily employing subsequent substantial corrective measures to avoid recurrence of misconduct;
6. Where the delay in complying with the reporting requirement was less than 7 days and non-reporting did not result in undue gain or loss to any person;
7. Voluntary acts of compensation, disgorgement of commission, profits and payment of restitution to investors;
8. Disclosure made in the incorrect format;
9. Applicant is a unit of governmental authority including a public-sector unit.
II. While assessing the relevant factors, the IC or HPAC or Panel of WTMs may take into account the following general aggravating factors with a base value of '0.2' applied once for all or any of them:1. Efforts to frustrate or prolong an investigation, inquiry or a civil and administrative proceeding, including settlement proceedings:
2. Providing inaccurate or misleading testimony or information or wilfully failing to provide information that he was bound to provide;
3. Misconduct over an extended period of time which is not less than 30 days;
4. Significant monetary loss to the clients which exceeds in aggregate of Rs 5 crores;
5. Applicant had failed to heed prior regulatory guidance and prior warnings;
6. Evidence of planning, pre-meditation or sophisticated means:
Explanation. - Conducting default across different jurisdictions, hiding assets or transactions, or both, through the use of fictitious entities, corporate shells or offshore financial accounts ordinarily indicates sophisticated means.7. A listed intermediary or securities market infrastructure institution was substantially jeopardized:
Explanation. - A listed intermediary or securities market infrastructure institution shall be deemed to have been substantially jeopardized if as a result of the alleged default:a. it has become insolvent or an application under the Insolvency and Bankruptcy Code, 2016 was admitted;b. it was unable on demand to refund fully any public deposit, payment or investment; orc. it is so depleted of assets that it is forced to merge with another institution in order to continue active operations.8. The liquidity of the securities of a publicly traded company was substantially endangered i.e. it was delisted or trading of the company's securities was halted for more than one full trading day;
9. The applicant abused a position of trust or used a special skill, in a manner such that significantly facilitated the commission or concealment of the alleged default:
Explanation 1. - This factor applies if the applicant occupied and abused a position of trust. It does not apply to an ordinary tippee.Explanation 2. - This factor applies if the applicant's position involved regular participation or professional assistance in creating, issuing, buying, selling, or trading securities or products was used to facilitate significantly the commission or concealment of the default. It does not apply to clerical staff in an organisation; as such position ordinarily does not involve special skill.Explanation 3. - 'Special skill' refers to a skill not possessed by members of the general public and requires professional education, training or licensing, e.g. chartered accountant, advocate, auditor, compliance officer, etc.Explanation 4. - This factor also applies where the applicant has represented himself to hold a position of trust when, in fact, he does not.10. The applicant was the key-operator, whether or not he himself traded:
Explanation 1. - A person is a key-operator if he was an organizer or leader of an illegal activity or the main beneficiary of the default:Provided that, if a person is merely a manager or supervisor (but not an organizer or leader or the main beneficiary) then he is not a key-operator.Explanation 2. - The IC or HPAC or Panel of WTMs may take into account factors such as share of profits, the recruitment of accomplices, the degree of control and authority exercised over others.11. Exercising management control by use of fraudulent or forged securities or securities issued without appropriate approvals;
12. Reporting of false information.
III. While assessing the relevant factors, the IC or HPAC or Panel of WTMs may take into account the following factors tending to show the alleged default was deliberate with a base value of '0.25' applied once for all or any of them:1. The actions were not in accordance with the applicable internal procedures;
2. The individual knowingly took decisions relating to the violation beyond his field of competence;
3. The individual intended to benefit financially from the violation, either directly or indirectly;
4. The alleged default was repetitive.
IV. While assessing the relevant factors, the IC or HPAC or Panel of WTMs may take into account the following factor tending to show the alleged default was reckless with a base value of '0.3':1. The body corporate or the responsible person, appreciated there was a risk that their actions or inaction could result in a violation of securities laws and failed adequately to mitigate that risk:
Explanation. - The following shall be deemed to be reckless, -a. failure to appoint competent officials for discharge of their duties, including a compliance officer;b. failure to put in place adequate systemic safeguards; orc. failure to put in place a code of conduct.V. While considering the various factors and the aggregate base values, the following specific base values shall also be taken into account, -Table IV- General Base Values, Applicable In All Cases
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Nature of Violation |
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Base Value |
| a. |
Fraudulent and unfairtrade practice (FUTP); orInsider trading, including tipping (IT); orviolation of code of conduct noted in an investigation or inquiryrelated to FUTP or IT
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|
0.25 |
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Or |
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FUTP or IT in combination with the violation ofcode of conduct or any other regulation
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0.3 |
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Or |
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FUTP in combination IT or in combination with aviolation ofrequirement relating to anti-money laundering andknow your client.
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0.35 |
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Or |
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Failure by a market infrastructure institution orits principal officers to conduct its business in a fair manner.
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0.50 |
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Or |
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|
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Failure by a market infrastructure institution orits principal officers to conduct its business in a fair mannerin combination with FUTP or IT or the violation of code ofconduct or any other regulation
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0.75 |
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|
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[In case multiple are applicable, only thehighest value shall be applied.]
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| b. |
Factors for volume traded and/or price change forthe default
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Sum of'V', 'P'and'Q',wherever applicable, to be applied to each memberof group or the applicant when he acts alone, only if the volumetraded or price change, quantity traded in respect of the group ,of which the applicant is a part of or the applicant when he actsalone, as the case may be, can be calculated from the findingsbrought out in the investigation report or inquiry or notice toshow cause or order, as the case may be.In case multiple trading periods are involved,the hightest change has to be considered.
|
| c. |
Time value of ill-gotten gains* |
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0.09 × multiple of calendar years from thedate of commission of the default
|
| d. |
Reputation risk applicable in all settlementswithout admitting violation of securities laws
|
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All applicants: 0.25 |
| e. |
Violation in illiquid scrip |
|
0.3 |
| f. |
Persons who are indigent or undergoingliquidation or bankruptcy process or whose resolution/repaymentplan has been submitted to the adjudicating authority forapproval
|
|
- 0.3 |
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In case ofmore than one scrip, the scrip with the highest volume traded isto be considered
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Table IVA-Special Base Values, In AdditionTo General Base Values
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| % Volume Traded |
'V' |
% Volume Traded |
| (Illiquid Scrip) |
|
(Liquid Scrip) |
| Upto 50% |
0.1 |
Upto 2% |
| 50 -60% |
0.15 |
2-5% |
| 60-75% |
0.2 |
5-10% |
| 75% or more |
0.25 |
10% or more |
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|
|
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'P' = Value For Highest % of Price Change During The EntirePeriod of Violation
|
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In case multiple trading periods are involved, the highestchange has to be considered.
|
| |
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Table IVB-Special Base Values, In AdditionTo General Base Values
|
| % Price Change |
'P' |
% Price Change |
| (Illiquid Scrip) |
|
(Liquid Scrip) |
| Upto 50% |
0.1 |
Upto 5% |
| 50-100% |
0.15 |
5-10% |
| 100-200% |
0.2 |
10-20% |
| 200% or more |
0.25 |
20% or more |
|
'Q' = Value For Highest % of Price Change, During The Periodof Default For F&O & Leveraged Products
|
|
In case of more than one product, the contract with thehighest price change is to be considered
|
| |
|
Table IVC-Special Base Values, In AdditionTo General Base Values
|
| % Price Change |
'Q' |
| Upto 0.5% |
0.1 |
| 0.5-1% |
0.15 |
| 1-5% |
0.2 |
| 5% or more |
0.25 |
| |
Nature of Violation |
|
Base Value |
| a. |
In Non-disclosure (including incorrect orincomplete disclosure) charge under any regulation relating totakeover, insider trading or issue or listing of securities incombination with any other charge
|
|
0.20 |
| b. |
In Non-Disclosure (including incorrect orincomplete disclosure) matters: Applicant has made relateddisclosure under any other regulation or is a body corporate withpaid-up equity share capital (including reserves) below RupeesTen crores (not applicable to companies which are exclusivelyholding companies)
|
|
- 0.5 |
| c. |
In open offer violations: acquirer not incontrol of target company, prior to triggering the takeover
|
|
0.25 |
Chapter VI
Applicable Base Amount
|
Applicable BA = 'The illegal profits' + 'loss caused to investors' [quantified as per the guidelines, if any, issued by the Board]OrThe BA as per the Tables in this Chapter,whichever is higher.
|
|
BA For Alleged Default Relating To OpenOffer
|
|
|
Natureof Violation
|
BA For Acquirer and Persons Acting In Concert |
|
DelayedOpen Offer
|
|
| |
|
Rupees 25 LakhOr0.25% of The Open Offer Size, I.E. Max Number ofShares For Which Open Offer Must Be Given X Applicable Open OfferPrice, Whichever Is Higher
|
|
Delayed Open Offer(After Direction From The Board)
|
|
Rupees 50 LakhOr0.5% of The Open Offer Size, Whichever Is Higher
|
| |
|
|
Where The Making of The Open OfferIsInfructuous I.E. When Company HasBeen Delisted, When Open OfferIs NotBeneficial To Shareholders, Etc
|
Infructuous By An Act of TheCompany RequiredTo Make AnOpen Offer
|
Infructuous Due To Other Reason, IncludingWhen Open Offer Is Not Beneficial To Shareholders
|
| |
Rupees 1 Crore Or OpenOffer Size, Whichever IsHigher
|
Any Amount Between The Minimum Penalty ToProbable Cost of Open Offer As Recommended By The CorporateFinance Department of The Board
|
|
Percentage ofShareholding or Voting Rights Acquired or Disposed But NotDisclosed or Percentage of Encumbered Shares But Not Disclosed,Etc.
|
|
BA For Violation of |
|
| |
Regulation 7 of 1997Regulations |
Regulation 8 of 1997Regulations |
Regulation 8A of 1997Regulation |
| |
Or |
Or |
Or |
| |
Regulation 29 of2011 Regulations(I)
|
Regulation 30 of2011 Regulations(II)
|
Regulation 31 of2011 Regulations(III)
|
| Less than 2% |
Rupees 2 lakh+
|
| |
Rupees 5,000/- For every three months delay orpart thereof
|
| 2% to less than 5% |
Rupees 5 lakh+
|
| |
Rupees 10,000/- For every three months delay orpart thereof
|
| 5% to less than 10% |
Rupees 10 lakh+
|
| |
Rupees 15,000/- For every three months delay orpart thereof
|
| 10 % to less than 15% |
Rupees 15 lakh + 0.1 %of the value of the holding not disclosed, etc.+
|
| |
Rupees 20,000/- For every three months delay orpart thereof
|
| 15% and above |
Rupees 20 lakh + 0.1 %of the value of the holding not disclosed, etc.+
|
| |
Rupees 25,000/- For every three months delay orpart thereof
|
2. The BA for violation at (II) shall only be as per the lowest slab, irrespective of change in shareholding over the reporting period. In case of violations related to disclosures that are required to be made annually\ the amount for delay for every three months or part thereof shall be computed only for the first disclosure violation. In case the noticee complies with the annual reporting requirements for a few years, such compliance will not result in a higher amount than would have otherwise be calculated for continuous violations.
3. The period of delay is to be calculated from the last day, when the disclosure ought to have been made, as required by the regulations.
Table VIIIBA - Alleged Default Relating To Transaction Specific Disclosures Under Regulations 13(3), 13(4), 13(4a) and Corresponding 13 (6) of 1992 Pit Regulations [Includes, Corresponding Transaction Specific Disclosures Under Regulations of 2015 PIT Regulations]
|
Percentage of Shareholding or Voting RightsAcquired or Disposed But Not Disclosed or Percentage ofEncumbered Shares But Not Disclosed, Etc.
|
BA |
| Less than 2% |
Rupees 2.5 lakh+
|
| |
Rupees 7,500/- For every three months delay orpart thereof
|
| 2% to less than 5% |
Rupees 6 lakh+
|
| |
Rupees 12,500/- For every three months delay orpart thereof
|
| 5% to less than 10% |
Rupees 12 lakh+
|
| |
Rupees 17,500/- For every three months delay orpart thereof
|
| 10 % to less than 15% |
Rupees 18 lakh + 0.1 %of the value of the holding not disclosed, etc.+Rupees 22,500/- For every three months delay orpart thereof
|
| 15% and above |
Rupees 25 lakh + 0.1 %of the value of the holding not disclosed, etc.+
|
| |
Rupees 25,000/- For every three months delay orpart thereof
|
2. Table VIII is not applicable in cases where the disclosure related violation is in combination with FUTP or IT.
Explanation: - Dealing while in possession of material financial or shareholding information may be treated as IT.Table IXBA - Disclosures Related Violations Not Covered In Tables VII and VIII
| Nature of Alleged Default |
|
Base Amount |
| Type of Disclosure Related Violation |
|
|
| Pit Regulations |
| Periodical and other disclosures |
|
Rupees 5 lakh+Rupees 5,000/- for every three months delay orpart thereof, if applicable
|
| Open Offer Regulations |
|
Reporting requirementsor disclosures for which exemptions are available, except casesof non-compliance of a condition precedent for availing exemptionwould result in triggering of an open offer obligation(The Regulation 6 of 1997 Regulations are datedand no amount may be imposed for its violation, except in case ofstandalone violations of Regulation 6 the minimum SA may beapplicable)
|
|
Rupees 5 lakh+Rupees 10,000/- for every three months delay orpart thereof, if applicable
|
|
Violations Under Regulations Related To ForeignInstitutional Investors
|
| Failure to provide information |
|
Rupees 20 lakh per default |
| Intimation of material changes |
|
Rupees 10.0 lakh per default |
| Residuary |
|
Code of conductreporting requirementsor
|
|
|
|
Disclosures onappointment of directoror
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Rupees 5 lakh+Rupees 10,000/- for every three months delay orpart thereof, if applicable
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Any other disclosure related violations that arenot detailed in this Chapter, if deemed appropriate
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2. Table IX is not applicable in cases where the disclosure related violation is in combination with FUTP or IT.
Explanation: Dealing while in possession of material financial or shareholding information may be treated as IT.Table-XResiduary BA, For Each Unit of Alleged Default For Each Applicant or On Joint Liability Basis (As Per The Sum of Applicable Amounts In Case of Joint Applicants)
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Individual(PrincipalOfficers NotIncluded)(I)
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BodyCorporate &Firm(And PrincipalOfficersIn CasesRelatingTo JointLiabilityWith TheBodyCorporate/firm)(II)
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PrincipalOfficers&ComplianceOfficers[When NotIn II,IV-VII](III)
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Section 15bAnd 15fof SebiAct&SimilarDefaults(AndPrincipalOfficers InCasesRelatingTo JointLiability WithTheIntermedia Ry)(IV)
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Failure InRedressingInvestorGrievances(andPrincipalOfficers InCasesRelatingTo JointLiabilityWithThe IntermediaRy/ Issuer)(V)(For DelayReduceTo 1/4)
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MarketInfrastructUreInstitutions(AndPrincipalOfficers InCasesRelatingToJointLiabilityWithTheInstitution)(VI)
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Fund RelatedDefaults(andPrincipalOfficersIn CasesRelatingTo JointLiabilityWithThe Fund)(VII)
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| BA Where:DefaultRelateTo FutpOr It, |
Rupees 15Lakhs |
Rupees 1Crores |
Rupees 45Lakhs |
Rupees 15Lakhs |
Rupees 30Lakhs |
Rupees 5Crores |
Rupees 33LakhsOr
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False/ Misleading/ Incorrect/in CompleteDisclosures In Offer Documents,
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0.01% of The Average Asset Under Management, AtTime of Violation Or
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Failure By Market Infrastruct Ure InstitutionsTo Conduct Business In The Required Manner,
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0.5% of The Average Net Worth, At Time ofViolation, Whichever Is Higher
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A RecklessViolation,Or
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A Disgorgemen T/refund In Excess Of Rupees 1Crore (M)
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Benchmark Where Violation Involved At (M) And,-Such Violation Directly Or Indirectly -
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Rupees 60Lakhs |
Rupees 3Crores |
Rupees 2Crores |
Rupees 60Lakhs |
Rupees 80Lakhs |
Rupees 10Crores |
Rupees 60LakhsOr0.05% of The AverageAsset Under Management, At Time of Violation
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(I) Resulted In Substantial Losses To OtherPersons,
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Or0.075% of The Average Net Worth, At Time ofViolation, Whichever Is Higher
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(II) Created A Significant Risk of SubstantialLosses To Other Persons, Or
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(III) Affected The Integrity of The SecuritiesMarkets (N) Residuary (O)
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| Rupees 3Lakhs |
Rupees 15Lakhs |
Rupees 10Lakhs |
Rupees 3Lakhs |
Rupees 6Lakhs |
Rupees 3Crores |
Rupees 15Lakhs Or0.001% of The Average Asset Under Management, AtTime of ViolationOr0.01% of The Average Net Worth, At Time ofViolation,Whichever Is Higher
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2. In this Schedule, 'Principal Officer' means a person that may be covered under Section 27 of the SEBI Act, as amended by the Finance Act, 2018.
3. 'Fund' means an AIF, MF, CIS, and any other pooling arrangement required to be registered with the Board.
4. 'Body corporate' in (II) of this Table includes, any applicant not covered in (I) and (III) to (VII).
Chapter VII
Repetitive Nature of Default
I. The counts of defaults may be selected using one or more or a combination of the methods indicated in this Chapter.Explanation. - Different methods may be used in respect of different persons in the same cause of action as may be required for arriving at a reasonable IA.II. In general, the unit of alleged default may be selected from either of, or a combination of, the following, -i. the (approx.) number of purchase or sale transaction,ii. the (approx.) number of individual deceptions attempted,iii. the (approx.) number of investors involved, oriv. 'Course of conduct' standard- whereby each counts amounts to a complete violation. Discretion may be used to apply a different standard that is less prejudicial to a person after taking into account the interest of the investors in securities:Provided that, where a large number of counts of a default are noted, for arriving at a reasonable IA a less prejudicial standard of selecting the unit of default may be applied.Explanation. - In respect of a default relating to a report or statement, -i. each person to whom a misleading report was sent or statement made may involve a separate "act";ii. each distinct misleading report or statement made may be a separate "act";iii. each distinct misleading statement within a report may be a separate "act";iv. the course of conduct standard in respect of all or any such reports or statements; orv. a combination of i, ii, iii and iv above.III. Course of Conduct standard: - Depending on the facts and circumstances of a case, for the purpose of arriving at a reasonable IA, "course of conduct" standard in which multiple counts of a violation are aggregated and counted as a single violation for purposes of calculating IA may be applied.Explanation 1. - It may be reasonable to aggregate multiple counts of a default if, -(a)the conduct did not involve manipulative, fraudulent or deceptive intent or insider trading, except where the recommended IA would otherwise be extremely disproportionate to the conduct;Explanation. - "disproportionate" and "reasonable" refer to the appropriateness vis-à-vis the deterrence sought to be achieved and not appropriateness vis-à-vis the illegal profit made by the applicant or loss caused to investors.(b)the conduct did not result in substantial injury to the rights of public investors, or if restitution was made in such cases; and(c)the violations resulted from a systemic problem or cause that has been corrected.Explanation 2. - Depending on the facts and circumstances, the units of violation may be based on how long the violations continued, however no uniformity of the period of time (daily, weekly, fortnightly, monthly, yearly) is required. The multiple counts of violation acts may be combined into one or more than one course of conduct.
III
Part-A (See regulation 16)FormatToDateAddressSub: Notice of summary settlement in the matter of .....................................During the course of investigation/ inspection/ inquiry/ audit in the matter of................................................................... the Securities and Exchange Board of India (SEBI) has prima facie observed that you have violated the following provisions of the securities laws:(i)......................(ii)......................(iii)......................(iv)......................Extracts of the findings are enclosed.2. In view of the aforesaid, probable proceedings against you under......(relevant provisions under which the proceedings may be initiated or continued) may be initiated or continued .
3. Notwithstanding anything contained in this notice, the Board reserves the right to modify the proceedings and charges to be brought against you and this notice shall not confer any right to seek settlement or avoid any action initiated by the Board.
4. Subject to Regulation 5 of the SEBI (Settlement Proceedings) Regulations, 2018 the aforesaid proceedings to be initiated may be settled and disposed of upon filing of a settlement application under Chapter-II of the SEBI (Settlement Proceedings) Regulations, 2018 upon remittance of a settlement amount of Rs. ......................to SEBI in terms of ....... ................................... (provision) of SEBI (Settlement Proceedings) Regulations, 2018 within 30 calendar days from the date of receipt of this notice and upon complying with the following non-monetary terms (if applicable):
(i). ...................................(ii)................................ (please specify any other terms)5. In case the settlement application is not filed or the settlement amount is not remitted and/or undertaking in respect of other non-monetary terms is not furnished or other non-monetary terms are not complied with to the satisfaction of the Board or the settlement application is withdrawn, the specified proceedings may be initiated or continued, as the case may be and you shall be permitted to file a settlement application only at the next stage in respect of proceedings pending before a Court or a tribunal, after conclusion of proceedings before the Adjudicating Officer or the Board, as the case may be.
Name, designation and signatureEncl: As abovePart-B (See regulation 18)FormatToDateAddressSub: Notice of settlement in the matter of .....................................During the course of investigation/ inspection/ inquiry/ audit in the matter of.................................................................. the Securities and Exchange Board of India (SEBI) has prima facie observed that you have violated the following provisions of the securities laws:(i)......................(ii)......................(iii)......................(iv)......................Extracts of the findings are enclosed.2. In view of the aforesaid, probable proceedings against you under......(relevant provisions under which the proceedings may be initiated or continued) may be initiated or continued.
3. Notwithstanding anything contained in this notice, the Board reserves the right to modify the proceedings and charges to be brought against you and this notice shall not confer any right to seek settlement or avoid any action initiated by the Board.
4. Subject to regulation 5 of the SEBI (Settlement Proceedings) Regulations, 2018, the aforesaid proceedings to be initiated may, be settled and disposed of upon filing of a settlement application under Chapter-II of the SEBI (Settlement Proceedings) Regulations, 2018 within 15 calendar days from the date of receipt of this notice.
5. If the settlement application is not filed, the Board may initiate any proceedings against you in accordance with law and you shall be permitted to file a settlement application only at the next stage in respect of proceedings pending before a Court or a tribunal, after conclusion of proceedings before the Adjudicating Officer or the Board, as the case may be.
Name, designation and signatureEncl: As above
IV
(see Regulation 19)Application for confidentiality1. The application for confidentiality shall be in the format convenient to the applicant and shall inter-alia, include the following, -
i. name and address of the applicant or its authorized representative as well as of all other known participants involved in the alleged default;ii. the address of the applicant for communication including the telephone numbers and the e- mail address, etc.;iii. a detailed description of the alleged arrangement, including its aims and objectives and the details of activities and functions carried out for securing such aims and objectives;iv. the commencement and duration of the default;v. the names, positions, office locations and, wherever necessary, home addresses of all persons who, in the knowledge of the applicant, are or have been associated with the alleged defaulters, including those persons who have been involved on behalf of the applicant;vi. the details of other authorities, forums or courts, if any, that have been approached or are intended to be approached in relation to the alleged violation;vii. a descriptive list of evidence regarding the nature and content of evidence provided in support of the application for confidentiality; and viii. any other material information as may be directed by the Board.(Signature of the applicant)(Stamp and Seal of body corporate applicant)VerificationI, ..........................................................................................son/daughter/wife of (Name in block letters)Shri ...................................................................being the applicant/authorised representative (in case of body corporate) of ......................................... do hereby verify and affirm on oath that this application and the contents thereof are true to my knowledge and belief and as per the records and that I have not suppressed any material facts and shall keep the Board informed without delay, of any other relevant information that may come to my notice.(Signature of the applicant)Date:Place :2. The undertaking and waiver as specified in Part C of Schedule-I shall be annexed to the application for confidentiality.
