Securities and Exchange Board of India (SEBI): G. Mahalingam, (Whole Time Member) has granted limited relaxations to the noticee, namely N. Ravichandran, Anita Ravichandran and Hemant Patel, for inter alia availing benefits of corporate actions during the restraint period, dematerializing physical shares and extension of timeline for selling shares lying in the Demat accounts for paying the disgorgement amount to SEBI.
SEBI had passed an order on 05-11-2019, bearing reference number WTM/GM/EFD/DRA-I/43/2019-20 in the matter of KLG Capital Services Limited. Subsequently, another order dated 09-12-2020, bearing reference number WTM/GM/EFD/DRA1/ISD/9769/2020-21 was also passed by SEBI in the said matter.
The Noticees concerned had requested for certain relaxations during the period of restraint from the directions contained in the abovementioned orders. Noticee, Anita Ravichandran, while requesting for extension of timeline further submitted that selling of shares lying in her Demat account to pay the disgorgement amount to SEBI, which was permitted by SEBI to be completed by 12-09-2020, could not be done within the prescribed timeframe due to the delay on part of her broker (HDFC Securities Ltd.) and DP (HDFC Bank Ltd.).
SEBI, while granting certain limited relaxations during the period of restraint to the noticees permitted them to avail the benefits of any corporate action like bonus issues, rights issue etc., that may arise in respect of securities held by them and to dematerialize the securities held by them in physical form and get them credited into their Demat account(s). The noticees were also permitted to dematerialize and receive a credit of those securities in their Demat account(s) which they were entitled to inherit/receive upon transmission. Further, the time limit provided to, Anita Ravichandran and Priyanka Singhvi for completion of sale or liquidation of securities and remitting the proceeds thereof to SEBI under para 2(b) of the Addendum dated 13-08-2020 (WTM/GM/EFD-I/DRA-I/43D/2020-21) was extended to 31-01-2021. Regarding the noticees, Hemant Patel and Hemant Patel HUF, permission to square off any open position held by them in the derivative segment was granted, also these noticees were made free to access and utilize the funds deposited in the bank account (Axis Bank A/c No. 909010042957248) in terms of orders of Securities Appellate Tribunal, issued on 10-11-2009 with a further condition that the funds lying therein should first be utilized for payment of the disgorgement amount and the applicable interest as directed in the SEBI order dated 09-12-2020. [KLG Capital Services Ltd., In Re., 2020 SCC OnLine SEBI 199, decided on 22-12-2020]