Mumbai: , owner of the Cafe Coffee Day chain, has settled a securities law violation case with the Securities and Exchange Board of India(Sebi) by paying Rs 69.06 lakh.
On January 21, 2021, Sebi issued a show-cause notice to the company alleging various disclosure-related violations.
The regulator alleged that the company didn’t place a limited review report before its board of directors at its meetings dated November 13, 2019 and January 29, 2020 wherein the financial results for the quarters ending June 30, 2019 and September 30, 2019 were approved, respectively.
The company submitted unaudited financial results for the quarters ended June 30, 2019 and September 30, 2019, but they were not subjected to limited review by its statutory auditors, Sebi said.
The regulator in its notice also alleged that, on November 11, 2019, Sanjay Nayar resigned as non-executive director from the company’s board. However, the information regarding the change in director was disclosed on November 13, 2019. Thus, the company exceeded the 24-hour timeline provided under Sebi rules.
There was also a delay of two days in making the disclosure dated January 9, 2020 regarding default on payment of interest on loans for the quarter ended December 31, 2019, Sebi said in its notice.
The regulator said on January 23, 2020, the company had disclosed to the stock exchanges that they entered into an agreement to sell Way2Wealth Securities, including its certain subsidiaries to Shriram Ownership Trust. However, the details of the sale transaction were not disclosed by the company.
Sebi also alleged that after the company’s auditor BSR & Co. resigned, it disclosed the reason for the resignation as commercial considerations. However, the auditor’s resignation letter was not disclosed by the company.
Although, the auditor’s letter contained detailed reasons of resignation, which were required to be disclosed as per rules, Sebi said.
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