The Securities Appellate Tribunal (SAT) has asked capital market regulator Sebi to dispose of the representations made by six "suspected" shell companies and pass orders within the next few weeks.
While Sebi has to dispose of the representations within few weeks, SAT has ruled that the regulator can further investigate the firms and "initiate appropriate proceedings if deemed fit".
As per SAT directive, the companies -- Lotus Eye Hospital and Institute, Edynamics Solutions, IRIS Mediaworks Ltd, Info-Drive Software, Indian Infotech & Software, Cybernate Infotek -- will represent their respective case before the watchdog.
The case relates to Sebi communication on August 7, asking the stock exchanges to restrict trading in shares of 331 "suspected shell companies". Some of them have investments by several well-known domestic and foreign investors.
The move came after the watchdog received a list of such companies from the corporate affairs ministry and many of these 331 firms are under the scanner of the Serious Fraud Investigation Office (SFIO) and the Income-Tax Department.
As per six similar worded orders by SAT, Sebi is required to dispose of representations by Lotus Eye Hospital and Institute, Edynamics Solutions, IRIS Mediaworks, Info- Drive Software within three weeks and has been given a time frame of four weeks to dispose of representations of Indian Infotech & Software and Cybernate Infotek.
"We permit the appellant (company) to withdraw the (SAT) appeal with liberty to pursue the representation pending before Sebi," SAT said in the orders.
"It is made clear that passing of any order on the representation made by the appellant would not preclude Sebi from further investing the matter and initiate appropriate proceedings if deemed fit," the tribunal said.
Recently, SAT stayed trading curbs on as many as 12 such "suspected shell companies", including JKumar Infraprojects and Parsvnath Developers.
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