Sebi relaxes restrictions on 54 entities

Markets regulator Sebi today eased restrictions on 54 entities against whom the regulator had taken action in a case of alleged misuse of stock market platform for tax evasion and suspected money laundering activities.

The entities, which were barred from the securities market in Kailash Auto Finance case, have now been allowed certain relaxations including permission, to deal in government securities and invest in ETFs (exchange-traded funds).

Besides, they can enter delivery-based transactions in the cash segment in NSE Nifty 500 index as well as S&P BSE 500 shares and subscribe to mutual funds.

Among others, these entities can tender shares lying in their demat accounts in any open offer/delisting offer under the relevant Sebi regulations.
 

Through an interim order passed in March this year, Sebi had barred Kailash Auto Finance and 245 other entities from the securities market till further directions.

In an order passed today, Sebi has confirmed "the directions issued vide the ad interim ex-parte order dated March 29, 2016 as against the 54 noticees."

However, the markets regulator has given certain relaxtions to these entities.

The markets regulator said that majority of 54 entities have raised concern over challenges in running their activities on account of ban and consequent freezing of their demat accounts.

Considering the facts and circumstances of the case, "I deem it appropriate to provide relaxations so as to address the issues of the personal and business exigencies or other liquidity problems," Sebi Whole Time Member Rajeev Agarwal said.

As per the latest order, the entities for whom relaxations have been extended can sell the securities lying in their demat accounts as on the date of interim orders. This will exclude shares of the companies which are suspended from trading by stock exchanges concerned.

Besides, sale proceeds lying in the escrow account can be used for certain purposes.

Sebi said that up to 25 per cent of the value of the portfolio as on the date of the interim order or the amount in excess of the profit made/loss incurred or value of shares purchased to give exit, whichever is higher, may be utilised for business purposes and/or for meeting any other exigencies or addressing liquidity problems, etc.