The Securities Court of Appeal (SAT) has overturned the Rs 1 crore penalty imposed by the Securities and Exchange Board of India (SEBI) on the ratings of the construction work. The court reduced the penalty to 10,000 rupees and concluded that some of the findings in Sebi’s order could not be sustained.
Sebi, in an order dated September 29, 2020, highlighted the many shortcomings and loopholes of Brickwork. These included the lack of a monitoring mechanism (A), the delay in recognizing the default of Diamond Power Infrastructure (NCDs) non-convertible bonds (B); failure to review the classification and withdraw the classification of non-communicable diseases for Great Eastern Energy; Failure to recognize the failure to classify non-communicable diseases for Essel (D) group entities; Violations of Regulated Compliance (e).
“Under the circumstances, a penalty of Rs 1 crore also cannot continue to be imposed. In view of the fact that we supported the conclusion of the Beneficiary Chapter Officer (AO) in respect of B fully and in relation to C only partially, the intervention of The amount of penalty is also required,” the SAT said in an order, adding that A, D and E scores also could not be maintained.