Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Companies / News/  SAT upholds Sebi's order against Gautam Thapar, other ex officials of CG Power
BackBack

SAT upholds Sebi's order against Gautam Thapar, other ex officials of CG Power

The order comes on an appeal filed by ex officials of CG Power
  • While restraining the officials from accessing the securities markets, Sebi directed BSE to appoint an independent auditor
  • Gautam Thapar. (HT)Premium
    Gautam Thapar. (HT)

    NEW DELHI : The Securities Appellate Tribunal (SAT) on Tuesday upheld regulator Sebi's order that barred CG Power ex-chairman Gautam Thapar and three other former officials from capital markets for misstatement of accounts as well as funds diversion.

    Besides, the tribunal ruled that the appellants are entitled for supply of documents from the company so that they may file an appropriate reply before Sebi and that denial of such documents by the company or by Sebi would be in violation of principles of natural justice as embodied in Article 14 of the Constitution of India.

    In a statement, Thapar said, "We note that this morning's order of the Securities Appellate Tribunal (SAT) gives clear directions to SEBI and CG Power to give us access to the documents which CG Power has denied and have been unwilling to provide till date."

    "We continue to maintain the fact that we had no opportunity to participate in the so-called 'investigation' nor in the resulting 'report' (Vaish). This Vaish Associates report is inconclusive and highly disclaimed as only selective information and data was shared with them."

    The order comes on an appeal filed by ex officials of CG Power - Gautam Thapar, V R Venkatesh, Madhav Acharya, B Hariharan and Avantha Holdings Ltd - against an "ex-parte ad interim order" passed by Sebi on September 17, 2019.

    V R Venkatesh is the former Chief Financial Officer, while Madhav Acharya and B Hariharan are ex-directors of CG Power and Industrial Solutions.

    While restraining the officials from accessing the securities markets, Sebi directed BSE to appoint an independent auditor for conducting a detailed forensic audit of the books of accounts of CG Power from 2015-16 onwards till date to verify wrongful diversion of the company’s funds, misrepresentation of financials and manipulation of books of accounts.

    The former officials of the company contended before the tribunal that Sebi, by passing the ex-parte ad-interim order has already placed the appellant guilty without trial.

    They also contended that an ex-parte ad-interim order can only be passed in "extreme urgent cases" and that there was no urgency in the present case and that if an opportunity of hearing was given, they would have proved that all the alleged transactions were duly authorised and approved by the risk audit committee as well as the board of directors.

    Further, they said that "while passing the impugned order, (Sebi) has not conducted any independent investigation and has not applied its mind and has not made any self assessment after taking independent evidence but has mechanically relied upon the Preliminary Investigation Report of the Company".

    Besides, the officials contended that to file an appropriate reply to the ex-parte ad-interim order cum show cause notice, the appellants have to rely upon certain documents which are in the custody of the company and have been denied to the appellants.

    While upholding Sebi's order, SAT said, "We are of the opinion that, in the instant case, there was ample evidence to show urgency and, considering the material that has been brought on record, the matter being serious, warranted an inference by the regulator".

    The tribunal also noted that "the contention of the appellants that no case was made out for grant of an ad-interim ex-parte order is misconceived and cannot be accepted".

    Thus, the tribunal has asked the appellants to file a reply before the whole time member of Sebi on or before October 15, 2019 and said that "in the event any document is required by the appellants either from Company or from Sebi a formal request to that effect shall be made by the appellants which document(s) shall be supplied in accordance with law within three working days".

    Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

    Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
    More Less
    Published: 01 Oct 2019, 09:48 PM IST
    Next Story footLogo
    Recommended For You
    Switch to the Mint app for fast and personalized news - Get App

    Chat with MintGenie