Capital markets regulator SEBI (Securities & Exchange Board of India) on Wednesday imposed ₹6 crore penalty on as many as 15 entities, including former promoters of Deewan Housing Finance Corp Ltd, Kapil Wadhawan and Dheeraj Wadhawan, over the violations of norms in the case of DHFL.
The SEBI probe pertained to a complaint that Kapil Wadhawan (noticee number 1 in the case), along with other promoters of DHFL, was "misrepresenting and misleading" the shareholders by claiming that promoter holding in DHFL is 39.23%.
However, in reality, the complainant says they suppressed the names of three companies, which held around 10% shareholding in DHFL as they were directly or indirectly controlled by the DHFL promoters. These three companies were shown as part of “public shareholders” instead of part of the “promoter and promoter group” of DHFL.
The regulator via its 82-page order says these noticees will have to pay the amounts of penalties in 45 days of the order. The SEBI order says the noticees were in violation of the “open offer and disclosure norms”.
As per the SEBI order, the DHFL promoters Kapil Wadhawan and Dheeraj Wadhawan suppressed the names of three companies, Hemisphere Infrastructure India, Galaxy Infraprojects and Developers, and Silicon First Realtors, even though they controlled them.
These companies were allegedly formed only for the purpose of substantial acquisition of additional shares of DHFL.
The SEBI findings show certain employees of DHFL allegedly were acting as directors in these three companies during incorporation and they also subscribed to the initial shares of these companies and acted as witnesses.
The funds for subscribing to the initial shares were also allegedly provided by promoter-controlled entities of DHFL.
The noticees had failed to make a public announcement of an open offer on 14 occasions when the obligation got triggered and thus, they have violated the provision on 14 occasions, says the order.
Despite several notices, the noticee no. 1 neither filed any reply (i.e. neither after inspecting the documents nor after cross-examination of entities) nor appeared before SEBI for the personal hearing provided. "Noticee No.1 was authorised signatory for the noticee companies i.e. the PACs. The constant requests for inspection of documents and cross-examination at the end of Noticee No. 1, without submitting any reply on merits constrains me to believe that these were all delaying tactics adopted by the Noticee No. 1 to prolong and procrastinate the proceedings."
Apart from him, many other noticees also did not file any replies to the show-cause notice. They demonstrated a "casual approach" towards the enforcement proceedings initiated by SEBI by not replying to the show-cause notices. "Therefore, I find that imposition of monetary penalties on the noticees, to be paid jointly and severally, for the said violations of law would meet the ends of justice in the present case."
